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New Player Univision Shakes Up Local Television Industry…

Local Advertising Industry Fares Better Than Expected In 2002; Deportes 13 brings sports programming to prime time; events put spotlight on local film industry

New Player Univision Shakes Up Local Television Industry…


December 26, 2002
Copyright © 2002 CARIBBEAN BUSINESS. All Rights Reserved.

Univision Communications’ takeover of the now-defunct TeleOnce dominated the media headlines in Puerto Rico throughout 2002. The main Spanish-language communications company in the U.S., Univision announced its goals upon entering the local market in February: to strengthen its news coverage and to limit media clutter to no more than 10 minutes per hour.

Later in the year, Vice President & General Manager Larry Sands revealed that according to Mediafax ratings, 19 of the 50 highest-rated shows on local television were aired by Univision, among them soap operas "Gata Salvaje" and "Salome" and game shows "Sabado Gigante" and "Que Suerte."

In 2003, Univision will continue to air Latin American soap operas, which have been the cornerstone of its success with Puerto Rico viewers. The station’s news team will keep airing three daily shows plus a weekend edition.

Another newcomer to the island’s TV dial was Deportes 13, a sports programming slot on Teleoro (Ch. 13) developed by Empresas Angelo Medina. Deportes 13 has a five-year deal with Teleoro to transmit Major League Baseball (MLB) games, National Basketball Association (NBA) games, Professional Winter Baseball League games, and other major sporting events during prime time.

Research company Research & Research unveiled a comprehensive media consumption study which indicated that Puerto Ricans spend a daily average of 3 hours and 11 minutes watching TV, 3 hours and 43 minutes listening to the radio, 29 minutes reading newspapers, 1 hour and 54 minutes surfing the Internet, and 2 hours and 12 minutes on the road.

The study also determined that some 825,000 people listen to morning radio shows every day, with the number almost evenly split between men and women. The study yielded other specific information, such as that 55% of middle-class women who live in the San Juan metro area watch soap operas, 45% of which are on Channel 2 and 25% on Channel 11.

The local film industry was host to a couple of major events, including the third Movie Goals symposium, the first Puerto Rico Sun Fest film festival, and the 14th San Juan Cinemafest.

Jorge Rojas, partner at Muvi Films and producer of the Sun Fest, said the event had three important goals: to develop the local film industry by generating interest in productions and increasing the number of locally made movies, to explore ways to make profitable films in Puerto Rico, and to help local filmmakers produce and find distributors for their films.

The San Juan Cinemafest included galas and special activities, cocktail parties attended by local and international film personalities, and the showing of more than 50 local, Caribbean, and international films. Movie lovers were also able to enjoy conferences and panels addressing such subjects as international film distribution.

In an effort to further strengthen the local film industry, a group of local film and sound production companies formed an alliance called Productoras Asociadas de Imagen y Sonido (PAIS, or Associated Producers of Image & Sound) to promote the local production industry as one of the best and most competitive in Latin America.

Film production companies Paradiso Films, Viguie Films, Guede Films, X Films, DVI Films, and Kamikase Films joined sound production companies Mantek Productions, Mezzaluna Studios, Alfa Recording, and Digitec to form the organization.

In the radio arena, Onda 94 began airing Top 40 hits on Spanish Broadcasting System’s (SBS) 94.7 FM radio frequency in San Juan and on 94.1 elsewhere on the island. The new format replaces the Spanish rock programming previously featured on Cosmos 94.

They Said It This Year

"Since its inception, the San Juan Cinemafest has had great resonance on the local cultural scene. The festival has built a bridge between the best that international cinema has to offer and the island’s movie lovers, who are increasingly demanding quality movies."--Ramon Almodovar, San Juan Cinemafest board chairman

"You wouldn’t pay the same price for a store-bought, mass-produced dress as you would for a designer dress, would you? Thus advertising in a less cluttered environment will be more expensive."--Luis Roldan, president & general manager of Telemundo in Puerto Rico

"There is always movement in this active radio market; the rankings change frequently. It is interesting to follow stations as they employ new strategies to attract listeners and to see how they impact the ratings."--Thom Mocarsky, vice president of communications at Arbitron

Local Advertising Industry Fares Better Than Expected In 2002

Univision Starts A Revolution; Agencies Receive International Accolades


December 26, 2002
Copyright © 2002 CARIBBEAN BUSINESS. All Rights Reserved.

Disaster in the local advertising industry was averted this year as agencies were forced to turn out their best work to help clients weather the harsh economic climate.

According to Juan Arteaga, president of the Association of Advertising Agencies of Puerto Rico (AAPPR by its Spanish acronym), the local industry can be said to have experienced heavy rain when a major hurricane had been expected. He believes year-end results will be better than anyone thought they would be.

The arrival of television network Univision in Puerto Rico shook things up at the beginning of the year. Armed with its parent company’s deep pockets, Univision Puerto Rico established a new way of doing business with advertising agencies. "Univision’s entrance marked the beginning of drastic changes in the way we buy media," said Ramiro Millan, general manger of BBDO Puerto Rico. FCB’s Carmen Cedre agreed, saying that local media companies will start operating the way they do on the mainland, imposing strict rate standards. "There will be no more ay bendito," she said.

Compensation systems will follow suit, evolving from a system reliant on commissions and volume discounts to one based on fees for services rendered, said many executives.

Creative departments got to show off their talents this year, challenged by the pressing need for advertising investments to yield bottom-line results. The industry saw an improvement in creativity across the board, confirmed by such honors as a Gold Lion at the Cannes Advertising Festival for McCann-Erickson and a flurry of awards at El Ojo de Iberoamerica for Badillo Nazca Saatchi & Saatchi, Young & Rubicam, and McCann-Erickson. Some local agencies were given the opportunity to develop strategies and creative work for the U.S. Hispanic market, further validating the quality of local talent.

The slow economy and the urgent need for results helped many agencies consolidate relationships with clients. "Clients placed great value on their agencies’ experience and knowledge of their brands," said Arteaga. Although a few coveted accounts went through agency reviews this year, activity in that area was generally slow. "Everyone seemed to be concentrating a lot more on serving their existing clients well, and much less on trying to land new accounts," said Edgardo Rivera, president of EJE Sociedad Publicitaria.

While no mergers or acquisitions took place in the local advertising industry, multinational agency Ogilvy & Mather did ink a strategic agreement to share resources and talent with local agency De la Cruz Group. There was no equity involved in the agreement, but speculation abounded that the move was a sure sign of Ogilvy’s interest in acquiring De la Cruz. That hadn’t happened as of mid-December 2002.

Many agencies stepped up promotional efforts for their clients, looking for ways to maximize their investments. "We were forced to be creative in all areas in order to meet our clients’ goals," said Rivera.

In retrospect, 2002 proved that those who advertise during hard economic times are better positioned for growth when the economy recuperates, as the AAPPR claimed in its campaign. "Whoever survived the year will be in a great position to become a leader when the economy fully recovers," said Rivera.

They Said It This Year

"We don't have the million-dollar budget that Wal-Mart has, so we have used our limited resources to call attention to our message in a creative way,"--Marchand ICS Group’s Jorge Marchand of ads developed for the Coalition of Puerto Rican Associations.

"The new design was created to reflect our position as a growing, leading creative communications company."--BBDO Puerto Rico President Ramiro Millan of the company’s new vertical, black-and-red logo, which took a whole year to design.

"When you cut prices you create a commodity, but if you invest in a brand you create value. To break even at full capacity can’t make economic sense."--Sir Martin Sorrell, CEO of WPP Group, parent company of advertising agencies Ogilvy & Mather, J. Walter Thompson, and Young & Rubicam.

This Caribbean Business article appears courtesy of Casiano Communications.
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