From: The San Antonio Express News
Hispanic radio is boosting Clear Channel
Clear Channel Radio began changing some of its long-standing rock 'n' roll stations to Spanish-language music a year ago to serve the fast-growing Hispanic market.
It has converted 23 radio stations of 25 originally planned, but it may do even more, said Alfredo Alonso, Clear Channel's senior vice president of Hispanic radio.
"The driver is the population continues to grow — with more than 40 million Hispanics," Alonso said. "As a broadcaster, Clear Channel made a decision this was a definite growth opportunity."
In November, KLOL Radio in Houston became Clear Channel's first station to adopt a format dubbed "Hurban," with a slogan of "Latino and Proud."
The station's disc jockeys broadcast in Spanglish and feature Spanish-language hip-hop, reggaetón, pop and dance music.
Since then, the Houston station has seen its ratings rise dramatically — from 17th place to seventh, according to Arbitron, a research firm that tracks radio listeners.
Early on, Clear Channel saw the importance of Hispanic radio when it bought a 26 percent stake in Hispanic Broadcasting Corp. in Dallas in 1995. But Univision Radio bought HBC for $3.2 billion in 2003 and Clear Channel sold its stake to repay debt.
Alonso declined to talk about Clear Channel's past involvement in Hispanic radio, saying he wasn't with the company then. Today, Clear Channel is aggressively catering to the lucrative Spanish-language music consumer in the United States, particularly first-and second-generation Hispanics ages 18 to 34.
Clear Channel, the nation's largest radio station owner, has seen flat radio revenue for the past few years as it faces increasing competition from other entertainment formats such as digital music players, the Internet and podcasting. It has faced a difficult advertising market overall, but Hispanic radio is a growth area.
Still, Clear Channel faces competition from Viacom-owned Infinity Broadcasting, Univision and other radio stations owners that are aggressively pursuing the young Hispanic radio listener.
This year, Infinity converted WHFS Radio in Washington, a rock station for more than three decades, to El Zol, a rhythmic Spanish-language music format.
The move sent "shock waves" through the radio industry, said Paul Heine, director of news, music and programming at Billboard Radio Monitor in New York.
"This was just a beacon for rock music," Heine said. "What we are seeing is that the Latin rhythm format is one of the fastest-growing radio formats in years."
The reason behind all the changes is that companies specializing in Hispanic radio have seen their revenue grow more quickly than general market radio companies, Heine said.
"The reason for that is the Hispanic radio market was underserved," Heine said. "The population is obviously growing at a faster rate than other groups. Radio is now catching up with the population, and that is why you're seeing these flips to reggaetón formats."
In the past three months, Univision Radio has flipped seven stations to a "reggaetón y mas" format known as "La Kalle," a twist on "the street" in Spanish. In late July, Univision converted KCOR Radio in San Antonio from contemporary Spanish-language music to La Kalle.
Reggaetón, which originated in Panama and developed in Puerto Rice before spreading to Miami, is an up-tempo rhythmic new form of music featuring artists such as Daddy Yankee, Zion y Lennox, Don Omar and Diego Calderón.
On Aug. 15, Billboard launched a chart devoted to the Latino rhythm format. It has other charts that track Latino pop, Latino tropical and Latino regional Mexican.
Spanish-language radio ratings also have reached record levels. Hispanic, as a category, captured 10 percent of the market, meaning that in any given quarter-hour, 10 percent of people listening to radio were tuned to a Spanish-language radio station. The United States now has a record 750 Spanish-language radio stations, according to Arbitron.
"What's important to the Latino culture is the music — it's an important part of any Latino culture — family, food, music and dance," said Christina Pieraccini, communications professor at the State University of New York at Oswego.
Another main driver is the enormous purchasing power of the Hispanic market, estimated at $700 billion and projected to top $1 trillion by 2010, according to new estimates by HispanTelligence, the research division of Hispanic Business magazine.
"It's a very young population, and music and radio is very important to young people," Pieraccini said. "It makes economic sense that the radio stations are trying to target and get that niche."
In addition, reggaetón music — which combines Jamaican reggae, dance hall, hip-hop and salsa — appeals to a wide variety of young Latino listeners, said J.D. Gonzalez, vice president of programming for Univision Radio in Houston.
Savvy advertisers are jumping on this trend, Gonzalez said.
Overall, advertisers in 2004 spent $473.2 million for local radio ads and $191.2 million for national ads targeting the Hispanic audience, up 6 percent from a year ago, according to the Association of Hispanic Advertising Agencies.
In the nation's largest cities, some of the top radio stations are Spanish-language, and not just among Hispanics, Gonzalez said.
In addition to Houston, Clear Channel has Hurban stations in San Diego, Miami, Denver and Albuquerque, N.M. It also has two Spanish contemporary, two Tejano, one tropical and 13 Mexican stations.
"I like to come up with new formats that are tailor-made for each market," Alonso said. "In Houston, we saw there was an opportunity to go after Latinos that were bilingual regardless of generation."
Before Clear Channel debuted its Hurban station, the Houston market was saturated with 16 Spanish-only radio stations but had none that catered to 18-to 34-year-old Latinos, Alonso said. More than 40 percent of the market is bilingual or speaks primarily Spanish, and a lot of advertisers wanted to go after that market, he said.
"Reggaetón is the first Spanish-language genre that Mexicans like, Caribbeans like it and South Americans like it," Alonso said.
In addition to the traditional radio station owners, Clear Channel also faces competition from satellite radio and podcasters — people who post digital broadcasts on the Internet for anyone to download. XM also recently launched a Latin rhythm station on its satellite radio network.
Alonso says competition is good for everyone and the one thing that radio offers listeners is a free medium.
"You don't have to pay a monthly subscription," Alonso said.
One of the biggest challenges Clear Channel faces is deciding which of its 1,200 radio stations to change to a Spanish-language music format, Alonso said. With the stations it's changed so far, the company has increased audience share and done very well with Hispanic listeners, he said.
Clear Channel's "less-is-more" initiative to cut back on commercial clutter is helping gain audience share and has helped with its Spanish-language stations, Alonso said.
The company's Spanish-language competitors run as much as 18 minutes of commercials per hour, but Clear Channel plays 12 minutes of commercials during the morning drive time and 10 minutes the rest of the day, he said.
"Hispanics tend to use radio very frequently," Alonso said. "They spend longer listening to radio. The Hispanic population is very brand-loyal, and once they identify with a radio station, they tend to stick with that station."
The Hispanic market will fragment even more as it evolves, but people will start paying more attention to the older demographic and start creating formats to target it, Alonso predicted.
"We are a Spanish radio station company that goes after Hispanics that are bilingual," Alonso said. Their consumption of media is bilingual, he said. "They really live in two cultures."
Hispanic radio is boosting Clear Channel
Clear Channel Radio began changing some of its long-standing rock 'n' roll stations to Spanish-language music a year ago to serve the fast-growing Hispanic market.
It has converted 23 radio stations of 25 originally planned, but it may do even more, said Alfredo Alonso, Clear Channel's senior vice president of Hispanic radio.
"The driver is the population continues to grow — with more than 40 million Hispanics," Alonso said. "As a broadcaster, Clear Channel made a decision this was a definite growth opportunity."
In November, KLOL Radio in Houston became Clear Channel's first station to adopt a format dubbed "Hurban," with a slogan of "Latino and Proud."
The station's disc jockeys broadcast in Spanglish and feature Spanish-language hip-hop, reggaetón, pop and dance music.
Since then, the Houston station has seen its ratings rise dramatically — from 17th place to seventh, according to Arbitron, a research firm that tracks radio listeners.
Early on, Clear Channel saw the importance of Hispanic radio when it bought a 26 percent stake in Hispanic Broadcasting Corp. in Dallas in 1995. But Univision Radio bought HBC for $3.2 billion in 2003 and Clear Channel sold its stake to repay debt.
Alonso declined to talk about Clear Channel's past involvement in Hispanic radio, saying he wasn't with the company then. Today, Clear Channel is aggressively catering to the lucrative Spanish-language music consumer in the United States, particularly first-and second-generation Hispanics ages 18 to 34.
Clear Channel, the nation's largest radio station owner, has seen flat radio revenue for the past few years as it faces increasing competition from other entertainment formats such as digital music players, the Internet and podcasting. It has faced a difficult advertising market overall, but Hispanic radio is a growth area.
Still, Clear Channel faces competition from Viacom-owned Infinity Broadcasting, Univision and other radio stations owners that are aggressively pursuing the young Hispanic radio listener.
This year, Infinity converted WHFS Radio in Washington, a rock station for more than three decades, to El Zol, a rhythmic Spanish-language music format.
The move sent "shock waves" through the radio industry, said Paul Heine, director of news, music and programming at Billboard Radio Monitor in New York.
"This was just a beacon for rock music," Heine said. "What we are seeing is that the Latin rhythm format is one of the fastest-growing radio formats in years."
The reason behind all the changes is that companies specializing in Hispanic radio have seen their revenue grow more quickly than general market radio companies, Heine said.
"The reason for that is the Hispanic radio market was underserved," Heine said. "The population is obviously growing at a faster rate than other groups. Radio is now catching up with the population, and that is why you're seeing these flips to reggaetón formats."
In the past three months, Univision Radio has flipped seven stations to a "reggaetón y mas" format known as "La Kalle," a twist on "the street" in Spanish. In late July, Univision converted KCOR Radio in San Antonio from contemporary Spanish-language music to La Kalle.
Reggaetón, which originated in Panama and developed in Puerto Rice before spreading to Miami, is an up-tempo rhythmic new form of music featuring artists such as Daddy Yankee, Zion y Lennox, Don Omar and Diego Calderón.
On Aug. 15, Billboard launched a chart devoted to the Latino rhythm format. It has other charts that track Latino pop, Latino tropical and Latino regional Mexican.
Spanish-language radio ratings also have reached record levels. Hispanic, as a category, captured 10 percent of the market, meaning that in any given quarter-hour, 10 percent of people listening to radio were tuned to a Spanish-language radio station. The United States now has a record 750 Spanish-language radio stations, according to Arbitron.
"What's important to the Latino culture is the music — it's an important part of any Latino culture — family, food, music and dance," said Christina Pieraccini, communications professor at the State University of New York at Oswego.
Another main driver is the enormous purchasing power of the Hispanic market, estimated at $700 billion and projected to top $1 trillion by 2010, according to new estimates by HispanTelligence, the research division of Hispanic Business magazine.
"It's a very young population, and music and radio is very important to young people," Pieraccini said. "It makes economic sense that the radio stations are trying to target and get that niche."
In addition, reggaetón music — which combines Jamaican reggae, dance hall, hip-hop and salsa — appeals to a wide variety of young Latino listeners, said J.D. Gonzalez, vice president of programming for Univision Radio in Houston.
Savvy advertisers are jumping on this trend, Gonzalez said.
Overall, advertisers in 2004 spent $473.2 million for local radio ads and $191.2 million for national ads targeting the Hispanic audience, up 6 percent from a year ago, according to the Association of Hispanic Advertising Agencies.
In the nation's largest cities, some of the top radio stations are Spanish-language, and not just among Hispanics, Gonzalez said.
In addition to Houston, Clear Channel has Hurban stations in San Diego, Miami, Denver and Albuquerque, N.M. It also has two Spanish contemporary, two Tejano, one tropical and 13 Mexican stations.
"I like to come up with new formats that are tailor-made for each market," Alonso said. "In Houston, we saw there was an opportunity to go after Latinos that were bilingual regardless of generation."
Before Clear Channel debuted its Hurban station, the Houston market was saturated with 16 Spanish-only radio stations but had none that catered to 18-to 34-year-old Latinos, Alonso said. More than 40 percent of the market is bilingual or speaks primarily Spanish, and a lot of advertisers wanted to go after that market, he said.
"Reggaetón is the first Spanish-language genre that Mexicans like, Caribbeans like it and South Americans like it," Alonso said.
In addition to the traditional radio station owners, Clear Channel also faces competition from satellite radio and podcasters — people who post digital broadcasts on the Internet for anyone to download. XM also recently launched a Latin rhythm station on its satellite radio network.
Alonso says competition is good for everyone and the one thing that radio offers listeners is a free medium.
"You don't have to pay a monthly subscription," Alonso said.
One of the biggest challenges Clear Channel faces is deciding which of its 1,200 radio stations to change to a Spanish-language music format, Alonso said. With the stations it's changed so far, the company has increased audience share and done very well with Hispanic listeners, he said.
Clear Channel's "less-is-more" initiative to cut back on commercial clutter is helping gain audience share and has helped with its Spanish-language stations, Alonso said.
The company's Spanish-language competitors run as much as 18 minutes of commercials per hour, but Clear Channel plays 12 minutes of commercials during the morning drive time and 10 minutes the rest of the day, he said.
"Hispanics tend to use radio very frequently," Alonso said. "They spend longer listening to radio. The Hispanic population is very brand-loyal, and once they identify with a radio station, they tend to stick with that station."
The Hispanic market will fragment even more as it evolves, but people will start paying more attention to the older demographic and start creating formats to target it, Alonso predicted.
"We are a Spanish radio station company that goes after Hispanics that are bilingual," Alonso said. Their consumption of media is bilingual, he said. "They really live in two cultures."