Mariachi music to the ears: the Hispanic market is emitting sweet sounds these days. Hispanic numbers are growing rapidly. So is their buying power. But be careful. To win their hearts, you have to romance them a little differently.

Most of us have seen the numbers. Latino households are one of the fastest-growing demographic segments in the United States, projected to increase from 9.3 million to 11.9 million by the year 2010, according to the latest U.S. Census statistics. Impressive enough, especially when you add the projections on purchasing power. Celent Research reports that buying power of Latinos is expected to expand from the current $581 billion to over $900 billion by 2007.

That's an enormous amount of money in the hands of a market largely underserved by U.S. financial services institutions.

"The biggest opportunity banks have is in the Hispanic community," says Jorge Reynardus, president and founder of Reynardus & Maya Advertising, New York. "They are going to be an incredible number in the population in five to 10 years, and if you're not targeting them, you're missing out."

Given their reputation for loyalty, the Hispanic community could also prove to be a bank marketer's dream.

"They tend to view financial services institutions ha the same way a Catholic sees a priest, very respectful," claims Reynardus, the former head of marketing for Puerto Rico-based Banco de Ponce "Once they choose a bank, they're unlikely to change channels, so you can develop a very loyal franchise with Hispanic clients."

A bank that reaches out and addresses the Hispanic community's needs could tap into a significant source of fee income. For example, the U.S. Census reports that Mexican-Americans send $16 billion annually to Mexico. Those wire transfers are currently going through entities like Western Union.

"We're also seeing a lot of prepaid cards and I think we'll see more," says Reynardus, "It's something that a Mexican, Cuban or Columbian can send back home to make sure family has a secure way of availing themselves of funds."

A client of Reynardus and Mayo, Mexico City-based Prestaciones Universales, is the second largest provider of these cards in Mexico. They have a product named "Si Vale," or" "It's Worth It," that he feels will soon migrate to the United States and allow Mexican-Americans to wire money directly to the card in Mexico.

He also claims that Hispanics are drastically underserved when it comes to mortgages and credit cards. He cites two reasons for this situation: "lack of identification documents and lack of understanding by credit managers.

Many banks are cautious about the documentations required to open an account, especially after the events of 9/11. There has been controversy over using consular ID's (matricula consular), but the rewards are too good to ignore," he says. "Citibank is now accepting them for account openings."

The other reason can be traced to what he calls the skeptical nature of credit managers.

"The Biggest hurdle is the inability of these banks' credit departments to really understand the low credit-risk this group represents," claims Reynardus.

Getting started

Interested in this market? Reynardus recommends calculating the percentage of Hispanic residents in a one- to five-mile radius of the branch location.

Then do a fair share analysis of what the opportunities are and invest to the business," he suggests. "You will see a lift of 15 to 20 percent on business coming from all sorts of line items."

Reynardus & Moya Advertising is the Hispanic agency of record for LaSalle Bank in Chicago, an institution with $61.3 billion in assets. Just over two years ago, the company helped LaSalle kick off a branding campaign following an overall office expansion. The expansion included opening branches in areas with high Hispanic populations.

"While Hispanics had a very good image of LaSalle, they" didn't see it as their bank because Lasalle had never really extended the welcome or talked to their heart," says Reynardus.

The initial strategy used a TV campaign entitled "Dreams" that showed Hispanic dreams, such as a vacation, new home or car. The results:

* Customer traffic into LaSalle's Hispanic branches in, eased by 17 percent.

* Inquiries about banking services into LaSalle's Spanish customer service area increased 15 percent.

* From in-branch customer service interviews, Hispanics expressed the feeling that they felt more "welcome" to do banking with LaSalle.

Efforts since then have been primarily on a local level, with outdoor billboards and signage within the communities. (See sidebar page 20.) LaSalle is hoping to relate to the community even more closely by sponsoring business seminars for commercial customers, and offering community sponsorships such as parades and Hispanic film festivals.

According to Emil Zbella Sr., vice president and advertising manager at LaSalle Bank, having the advice of a Hispanic agency was worth the investment.

"We felt we needed extra help in understanding how to market due to the cultural differences," says Zbella. "Them are just too many horror stories out them with literal translations."

Using experts in the field helped them avoid mistakes when adapting their mass-market campaigns, too. For example, one radio series for the summer of 2003 was designed to promote awareness of convenience banking services like ATMs and Internet. LaSalle wanted to do a Hispanic version of that theme that focused on "Summer in the City ... Summer is short, bank faster."

"Reyardus came back and said, 'In the Hispanic community, speed isn't a critical issue, nor is being in a "large group or standing in line thought to be much of an effort,'" explains Zbella.

Instead of a literal translation of the original campaign, Reynardus tweaked it to focus on the advantages convenience banking has for creating more family time.

"It took a different twist, but fit in well," claims Zbella. "That little insight was invaluable."

A Sample Hispanic Marketing Campaign

The following is a marketing plan targeting Hispanics in the vicinity of the Little village branch of LaSalle Bank, Chicago. The campaign was initiated in September 2003.

Goal

Develop a marketing communications program that positions the Little Village branch as a true partner to the local Hispanic community. Position LaSalle as the neighborhood bank of choice for Hispanic consumers, a place where they can find all the financial services they need every day

Target Audience

The two primary audiences for this communications effort included:

* Consumers. Hispanics in the local community who use banking services.

* Community. Leaders of local community organizations, business owners and politicians.

Program Summary

* In-branch brochure that showcased the full range of banking services and skills of branch staff to meet the needs of the local Hispanic community.

* Pocket folder included information on branch services, biographies of branch staff and details of community outreach programs being done by LaSalle that meet the needs of the local Hispanic Community.

* Outdoor/phone Booths Twenty-nine posted locations in the Little village. Up-close and on-the-street impact, at the same level of our audience.

Spanish or English

Should in-language offerings be a part of targeted ethnic marketing efforts? Absolutely.

"The Spanish language is the language of the heart," says Jorge Reynardus, president and founder of Reynardus & Moya Advertising Inc., New York. "It's where our emotions are based, and when you do a creative that leverages that motion, it's much more effective and that means your dollars go farther."

Its power has also been documented. In 1994, a "Spanish vs. English Ad Effectiveness" study conducted by the Roslow Research Group revealed that among bilingual Hispanics, Spanish-language ads were found to be four times more persuasive than English-language ads.

The same study conducted in 2000 confirmed the 1994 results.

Findings revealed that among Hispanics:

* Commercial in Spanish are 61 percent more effective at increasing ad awareness levels than are commercial in English.

* Commercials in Spanish are 57 percent more effective than commercial in English when it comes to message communication.

* Ads received in Spanish are four-and-a-half times more persuasive than ads received in English.

Source: Roslow Reach Group's "Spanish vs. English Ad Effectiveness."

Race to Serve the Unbanked

New initiatives designed for the Hispanic market are cropping up almost daily. Here are just a few examples.

ATM Cards that You Don't Have to Apply for

In March 2004, the e-Viva Group Inc. (serf-described as a company that has heart), launched the eViva Card into the Latino market. No bank account or forms are required to obtain this ATM card that allows holders to withdraw cash from ATM machines worldwide. It allows high maximum cash balances without an ATM daily withdrawal limit. It can be used for purchases, as well as for a long-distance, international phone card. The company says it will distribute 5-10 million eViva debit cards to U.S. Latinos in the next 18 months.

Online Services

New online services in Spanish at Wells Fargo & Ct. include educational centers for Latino homebuyers, small businesses and consumers. These centers are part of a bilingual online financial literacy program called "El Futuro en Tus Manos" in Spanish or "Hands-on Banking."

Wells Fargo also recently announced its acceptance of the matricula consular as valid identification for opening both bank and wire transfer accounts. The matricula consular is issued by the Mexican and Guatemalan consulates in the United States to prove citizenship with the respective countries.

Mile High United Way is collaborating with Wells Fargo to provide low- and no-cost bank products, including Individual Development Accounts and financial management and economic literacy training. The project will reach out to the unbanked population through employers and community-based organizations.

Audio Tapes

In February, 2004, the Winston-Salem, N.C.-based BB&T Corp. launched the fourth in a series of 60-minute educational audio tapes as part of their ongoing marketing effort aimed at the 1.9 million Hispanics in its footprint, a group estimated to have $40 billion in buying power. The "BiBi" (named for one of the characters and pronounced "Bee-Bee") tapes follow the "novella style" storytelling approach popular on Spanish TV and aim to bridge the learning gap many Hispanics say exists when it comes to living in America. One side covers general consumer issues, and side two covers financial and banking information.

Janet Bigham Bernstel specializes in writing about marketing and financial services industry issues. She works in Jupiter, Fla.