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CEO Predicts 15-20% Upfront Ad Spending Hike for Hispanic Broadcast Nets

Joe Zubi is CEO of Miami-based Zubi Advertising, one of the
largest Hispanic advertising agencies in the country, with annual billings of
about $200 million a year. The agency was founded in 1976 by Zubi's late mother
Tere Zubizarreta, who on March 27 became the first Hispanic woman to be
inducted into the AAF Advertising Hall of Fame. Zubi agency clients include
Ford, JP Morgan Chase, American Airlines and Walgreens, among others. He was in
New York to attend the AAF induction dinner on behalf of his mother and took
some time to talk with MBPT about this year's Hispanic upfront.

What type of ad spending do you think will take place in the Hispanic
TV upfront this year?

I believe this is going to be one of the best upfronts in the Hispanic ad marketplace.
In 2000, great numbers came out of the census regarding the Hispanic
population, but then in 2001 we had the tragedy of the September 11 attacks,
and for a couple of years, there were ad cutbacks. Then the 2010 census numbers
came out, again reflecting huge growth in the Hispanic population in the U.S.,
but we were still in a tough economic marketplace that was still recovering
from 2008-09. But finally this year, marketers seem more positive about
spending again. Most have positive cash flows and are showing sales growth.
This Hispanic upfront will be one of the most aggressive in years.

How does that translate in dollars?
I wouldn't be surprised to see an overall ad dollar volume increase of
15-20% in the Hispanic upfront.

Where will that increase come from?
I think most of it will come from current clients on Hispanic
television that will be spending more.

What impact do you think the new network being formed by News Corp. and
RCN, MundoFox, will have on upfront spending and ad dollars?
It's hard to tell. We are going to have to rely on ratings promises
since the network has no track record. So we will have to be cautious since
they may not achieve the ratings they project. They will have plenty of content
and they will have solid distribution. But we haven't seen their business plan
so it's hard to tell. Right now they seem to be concentrating on growing their
station base. It's not likely they will be releasing any programming
information until their upfront presentation. I have to believe right now that
their take in the upfront will be relatively low and that a lot of advertisers
will buy them in scatter as they start to see what kind of ratings the
programming gets.

What ad categories do you believe will bring in more ad dollars in the
Hispanic upfront?
I believe automotive will be stronger with companies like Hyundai, Kia
and Volkswagen spending more. I also think the financial category will pick up.

What are some ad categories where you see room for growth?
I think electronics is not spending what it should be, considering
Hispanics' passion for that category. And packaged goods still has a lot of
room for growth, not so much with new companies coming in but with the
companies that are advertising now. There are so many more brands they should
be promoting.

When do you expect selling to begin in the Hispanic upfront?
Over the last couple of years, media agencies have been buying Hispanic
TV at the same time they were buying English-language television, so I see that
continuing. I expect buying on English-language and Hispanic TV to be going on

Do you believe Telemundo will continue to make some inroads in picking
up more upfront dollars?
While Univision will continue to get the bulk of the dollars, Telemundo
is getting more dollars. It introduced some strong novelas this season and
programming-wise it is moving in the right direction. I believe that Telemundo
will grow its share of advertising a bit again this year.