Toyota Makes Inroads Among Hispanics

LOS ANGELES Toyota Motors is increasing its sales lead among Hispanics, besting Ford Motors for the first time this spring, according to R.L. Polk.

Toyota overtook Ford in May. Through June, Toyota maintains a 15.7 percent to 14.8 percent market-share lead, with nearly 5,000 more Hispanic sales, per R.L. Polk, Detroit, which derives its figures from new vehicle registrations.

“We are thrilled,” said Karen Treydte, executive media director at Toyota’s Hispanic shop, Publicis Groupe’s Conill Advertising, Torrance, Calif. “Although they’ve always been very complimentary of our advertising, Toyota sees it as the result of a collective, collaborative effort to address the Hispanic market. They are consistently refining the message and investing in research.”

Leading the pack for the Torrance-based automaker is the Tacoma, now the No. 1 compact truck among Hispanics, and the Corolla, the top-selling passenger car. Treydte said that though Toyota’s position has traditionally been higher in the Hispanic than the general market, its position was third or fourth only a few years ago. Though she declined to be specific, Toyota’s ad spending has increased every year.

Treydte said the agency’s next move would be to advance the Camry: Though it is the No. 1 car in the general market, it has recently placed behind the Honda Accord and, from month to month, the Nissan Altima. During this spring of repositioning, the Nissan brand has moved into a virtual dead heat with Honda, per R.L. Polk

Even Victor Ornelas, president and CEO of Nissan’s Hispanic agency, independent Ornelas & Associates, Dallas and Santa Monica, Calif., acknowledges that Toyota is one of the “very few automakers spending close to what the Association of Hispanic Advertising Agencies says they should be spending.”

Manny Machado, president of AHAA, as well as CEO of Machado/Garcia-Serra/Publicidad, Coral Gables, Fla., which does roster work for Toyota’s Scion, pegged the appropriate spend at 9 percent of the total marketing budget, twice what the industry is laying out, he said. “Nissan did post the biggest spending increase of anyone in the automotive category,” Machado said. “But none of them are spending what they should be. The auto industry was the first to go into the Hispanic market, but now they are lagging behind other marketers. We don’t understand what is happening. Perhaps corporate priorities are shifting as the industry tries to retain its core business.” Machado said the auto industry now invests $1 billion annually in Hispanic ads.

“If you look at all the marketers and what is being spent, we are still behind,” said Treydte, “But what that spend should be is still open to discussion. It is more complicated than simply saying Hispanics purchase x percent, so we should be spending x percent on advertising.”

Even if Nissan does step up spending to $50 million to match Toyota [Adweek Online, June 20], its ripple effect may not be immediately apparent. “We’ve definitely seen greater interest in the Hispanic consumer by Honda,” said Margarita Fitzpatrick, group account supervisor for La Agencia de Orci & Asociados, Los Angeles. “It now represents about 8 percent of Honda’s overall sales. But our plans are long term. We’re looking for steady growth over time, rather than a big splash.”

Ford, Toyota and Chevrolet still dominate the domestic Hispanic market, according to Polk. The company reports that Hispanics now represent 6 percent of the auto market, up from 4.8 percent in 1999, a five-year volume increase of nearly 26 percent.

“The biggest change in the Hispanic market is that the automotive manufacturers have awakened to the community,” said Ornelas, whose shop pushed Nissan’s Titan as well as Sentra, Altima, Frontier and Exterra last year.