Essay 1024

AdAge.com states the obvious regarding Taco Bell’s inability to connect with Hispanics. The ad above certainly tells the story — would anyone be attracted to food that looks like that?

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Taco Bell Grapples With Its Hispanic Conundrum
Chain Struggles to Attract Latino Demographic; Analysts Claim the Problem is the Product

By Kate MacArthur


CHICAGO (AdAge.com) -- Taco Bell’s fast-food version of Mexican food isn’t playing very well with Hispanics, who contributed just a half-percent to the company’s same-store-sales gain of 7% in 2005, despite making up 20% of Taco Bell’s core 18-to-34-year-old target market. Now, as the definition of the average American increasingly includes Spanish-speaking consumers, the Yum Brands chain plans to boost its Spanish-language marketing.

Ads or product?
But experts aren’t sure whether Taco Bell’s problem is the advertising -- or the product.

With same-store sales declining for two consecutive months after a 43-month streak of gains, the fast-feeder shared with analysts its plans to prevent a full-out sales swoon. Among them, Taco Bell is considering adding carnitas, a braised pork dish, to the menu and doing more Spanish-language advertising. Management said Taco Bell’s English-language TV ads tended to underdeliver to Hispanic consumers, according to John Ivankoe, a JPMorgan Chase restaurant analyst who attended the chain's investor meeting.

‘Not really Mexican’
“It’s not really Mexican food or food that unacculturated Hispanics know from their home country,” said Everett Hernandez, senior VP-general manager, diversity for market-research firm Synovate. “It’s a new offering to them.”

Taco Bell tends to rely on food-oriented advertising and uses the same positioning regardless of language.

“Food looks like food whether you’re Spanish-dominant or Anglo-Saxon,” said Debbie Myers, VP-media services for Taco Bell. Because its tagline “Think Outside the Bun,” designed to lure consumers from their burger routines, doesn’t translate well into Spanish, the chain uses “No solo de pan vive el hombre” (“man does not live by bread alone”) in Spanish-language ads.

Taco Bell Hispanic ads
Taco Bell does ads for 10 different marketing periods throughout the year, with a Hispanic version for each, Ms. Myers said. The “food-heavy” spots are adapted from general-market footage, and the company also did two live-action original Hispanic spots last year with its Hispanic agency, Dieste Harmel & Partners, Dallas, a Taco Bell spokesman said.

A Dieste executive declined to comment, saying it is too early to discuss the work.

Sonya Suarez-Hammond, director-multicultural marketing insights at Yankelovich, recommends using both Spanish and English to reach Hispanics. “If you think about extended family where you have grandparents, uncles, in-laws and cousins living in one home, there are varying levels of acculturation and language proficiencies,” she said. “Oftentimes marketers have to get past the question of: Is it English or Spanish? It’s really both. We’re seeing the important thing is marketers have to reach out to Hispanic consumers in a culturally relevant way.”

For instance, mealtime is more important to Hispanic families and creates a different opportunity from general-market consumers hooked on dashboard dining.

That opens up a host of operational issues, from point-of-sale materials to dining-room cleanliness.

‘Their issue is authenticity’
“If they want to broaden their Hispanic market … their issue is authenticity, and they have a lot of years of not being perceived as authentic to break through,” said Carl Kravetz, chairman-chief strategic officer of Cruz/Kravetz: Ideas, Los Angeles, which handles advertising for fast-casual chain El Pollo Loco.

He also questioned whether adding more traditional Mexican food would help the situation.

“If they say they deliver good Mexican food to [Hispanics] they won’t be believed. If they say they have good, filling, cheap American food, they may have a chance.”