HP targets the Hispanic small business owner

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NEW YORK -- A thoughtful approach to targeting Hispanic small and medium-sized business owners will bring great results.

This was a key takeaway from Denise Marcilio, the marketing director for small and medium business in the personal systems group for the Americas at Hewlett-Packard Co., who was also the keynote speaker at the 14th annual DMA Directo Days conference.

"If you are going to do something in the Hispanic market, understand that it has to be a long-term commitment," she said. "Once you start showing the numbers and providing ideas, and [proving] that you can bring results to the table, then you start getting trust and confidence from your stakeholders."

Ms. Marcilio manages HP's diversity initiatives for the SMB segment focusing on the Hispanic market and women-owned businesses.

Ms. Marcilio explained that there are about 2 million Hispanic-owned small and medium-sized businesses in the United States today, which generate $270 billion in sales per year. In 10 years, that number will increase to 8 million, Ms. Marcilio.

"Basically this growth had been driven by Hispanic women," she said.

A concern for companies is how to communicate with these owners. Ms. Marcilio said that when HP has surveyed Hispanic business owners, in general, they said they prefer doing business in English.

While some HP sales reps work on a deal with Hispanic small and medium-sized businesses using both languages, closing a deal is done in Spanish.

HP has done several campaigns to target Hispanic small and medium-sized businesses, and many are focused on the Web. For example, it has launched a U.S. Hispanic small business Web site, presented in Spanish, and built to highlight the full portfolio of the company's products and services for Hispanic-owned small and medium-size businesses.

It also has created several successful interactive campaigns using direct mail, including one launched that won several awards called "Recipe for your Business."

"The campaign was dropped to high- and low-potential customers, and drove people to the Web," she said. "It was done in both languages, and it was successful both internally and externally."

It also has experimented with Spanish-language catalogs, along with a "Hispanic page" in a general market catalog.

While both worked just fine, Ms. Marcilio said the company has seen the best results from the U.S. catalog with one Hispanic insert.

"It worked much better then when we did everything to the Hispanic market only,"she said. "When you blend both things, that's when it works better for us."

The median age for the general Hispanic market is 27 (for the general population, the median age is 41); the average household size is 3.5 (2.4 for the general population); and half of all Hispanics are white-collar workers, middle class or higher, own their own homes and are married.

"We tend to think that Hispanics are low-income, that they had to cross the border, or that they are suffering because they have a family of 15 to support," Ms. Marcilio said. "Please don't stereotype Hispanics. Hispanics are no longer what they used to be when they were back in their countries. They stop at red lights, come to meetings on time and watch American Idol."

In terms of marketing to Hispanics, Ms. Marcilio said direct mail should always drive traffic to the Web.

"Direct mail is just the tip of the iceberg," she said. "At HP, the direct mail pieces have to drive people to the Web. The mail pieces have be so strong, so compelling and so perfect that it drives the person to the Web. The Web is where you can tell your entire story. Call volume and lead generation is most likely to happen through the Web."

Ms. Marcilio said Hispanic consumers have a story of their own that marketers should know.

"When we talk about Hispanics, we are talking about somebody in a family who left something in their country of origin," she said. "That is the starting point of an entire story that builds the cultural insight of the Hispanic market. There is this little piece of pain...of leaving the family...because they wanted something better. They wanted to try something new. That's how everything started."

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Home Depot retools and focuses on Hispanics

By Melissa Campanelli

NEW YORK - Despite some early missteps, The Home Depot Inc. is seeing success targeting Hispanics.

The Atlanta-based home improvement retailer has bilingual signs in more than 800 stores; a paint color product line called Colores Origenes; "how-to" clinics taught in Spanish and English; targeted direct and interactive campaigns; and the MiCash Home Depot card. However, it took Home Depot, the second-largest retailer in the United States, awhile to master the market. MiCash is in a test right now in two markets, Atlanta and Washington.

"We have been targeting the Hispanic market for five years now," said Pat Wilkinson, senior director of CRM and multicultural marketing at Atlanta-based Home Depot, who offered the keynote presentation on April 11 at the 14th Annual DMA Directo Days conference. "Early in the process, we had to build awareness and explain to the company why it was important to market to the multicultural customer. It's been a tough ride, but we did it."

After building internal as well as external teams that focus on Hispanics, Home Depot began producing some television commercials in Spanish - translated directly from the original English.

"While I don't think the ads were terrible, I don't think it really put the Home Depot brand in the mindset of Hispanics," Ms. Wilkinson said.

After this experience, the company started to create a greater level of awareness about the Hispanic market. It also increased its budget. Home Depot, for example, began getting involved in sponsorships that would appeal to Hispanics as well as special events and workshops.

The company also began creating Spanish-language television commercials that featured Colores Origenes and focused on paint colors, textured paints and painting techniques.

"Hispanic customers really embrace color, and these commercials highlighted that," Ms. Wilkinson said. "In fact, Hispanics are the leading purchasers of the textures paint line at The Home Depot."

The company also added some direct mail marketing programs to the Hispanic marketing mix, as well as e-mail campaigns and microsites targeting Hispanics.

Ms. Wilkinson said the Hispanic market is now featured as part of a large market push called Home Depot-True Stories. The program features television commercials in English and Spanish that show real people and their experiences with the company. It also includes a Web site which features the commercials and offers the opportunity for consumers to sign up.

"This is a small signal to the general market that The Home Depot recognizes different customers," Ms. Wilkinson said. "This is an important cue for all of our customers -that The Home Depot values all of our customers, no matter who they are."

Ms. Wilkinson was asked what advice she would give to DMers to sell the idea of targeting the Hispanic market into a company that may perceive it as not budget-worthy.

"Very early benchmarking is critical," she said. "We did have some success and we did have some failures. But iteratively, over time, we could actually track our customer spend in those stores we considered Hispanic ones and what their brand preferences. As we see those number consistently going up...it really has allowed us to keep that momentum going."

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