April 21st, 2008
Cinco de Money
By Richard Guzmán
Los Angeles Downtown News
As Fiesta Broadway Arrives, so Do the Corporate Sponsors
It’s billed as the nation’s largest “family friendly cultural festival.” This Sunday, April 27, an estimated 500,000 people are expected to throng Downtown Los Angeles for the 19th annual installment of the Fiesta Broadway celebration.
It’s a major event for the community, with a 36-square-block area expected to fill with spectators and several concert stages with performers such as AB Quintanilla and bilingual pop singer Kat deLun. The free celebration, which runs from 11 a.m. to 6 p.m., will also feature community nonprofit groups handing out voter registration information to coincide with this year’s theme: “Vote for Your Future” ("Vota por Tu Futuro").
At the same time, Fiesta Broadway is about much more than entertainment: It’s a prime opportunity for the more than 75 companies who are participating as sponsors and hope to tap into a captive Latino audience whose spending power is estimated to reach about $1 trillion nationally within the next few years.
That effect is felt in the very name of the gathering, as a telecommunications giant and an insurance provider paid undisclosed sums to have the event officially titled AT&T Fiesta Broadway Presented by State Farm Insurance. In the same way that office supply chain Staples spent $100 million for 20 years of naming rights to the home of the Lakers, Clippers and Kings, the companies hopes the sponsorship will help them target a young, urban audience.
“The Hispanic demographic and also the youth is what we consider our priority, and so it’s something that we strategically do,” said Luz Varela, a spokeswoman for AT&T. “These sponsorships are so important to us because the Hispanic community is certainly something we’ve always been very interested in reaching out to.”
AT&T and State Farm are not alone. Burger King, Albertsons and MTV, and energy drinks such as Red Bull, Rockstar and Monster all paid to be sponsors (All Access would not reveal specific prices) of the cultural event as they attempt to woo new customers. Each company will set up booths, pass out free samples and help bankroll the stages and entertainment during the celebration.
Hey Big Spenders
Recent reports point to the growing strength of the Hispanic demographic.
A study by HispanTelligence, the research division of Hispanic Business Inc., stated that from 1994 to 2004 Hispanic purchasing power posted an annual growth rate of 7.7%, nearly three times higher than the national rate. This translates into a purchasing power of more than $700 billion this year, and that figure is expected to reach $1 trillion by 2010, according to the report. Those figures are mirrored by a 2006 report by the Magazine Publishers of America, which estimates Latino purchasing power will top $1.2 trillion by 2011.
“It’s a wonderful, grassroots way of getting their product exposed to a very large audience, very quickly,” said Augustine Martinez, president and CEO of the United States Hispanic Chamber of Commerce. “And because it is at Fiesta Broadway, which has been around for [years], they’re able to draw the Latino consumers, which like to feel a comfort level.”
Mitchell Liday, vice president of operations for All Access Entertainment, the organizers of the event, said they look for companies that are familiar with the Latino audience. However, he noted, some businesses are still not aware of the purchasing power of the demographic.
“Surprisingly enough, there are still companies every day where it’s almost like they wake up and they realize that there’s a lot of Latinos here. So we first and foremost are looking for companies that appreciate and that are active in the Hispanic market,” he said.
Peter Bellas, senior vice president of sales and marketing for All Access, added that sometimes the sponsors get more than they bargained for. He said companies that were skeptical at first have wound up surprised.
“When you get, say, 6,000 leads in one day, we certainly have made a lot of doubting Thomases into believers,” he said.
Fiesta Broadway is an early celebration of Cinco de Mayo, the day in 1862 that Mexican troops defeated the French army in the battle at Puebla, Mexico. Regardless of ethnicity, or the background of the event, having half a million people within arm’s reach is an opportunity many companies can’t pass up.
“There’s a lot of consumers up there at this event,” said Fred Waterfall, vice president of shows and promotions for Simple Green, a cleaning product which, as a sponsor at the 2007 Fiesta Broadway, handed out more than 100,000 free samples. “There’s a tremendous volume of people there and ethnicity is irrelevant. Where there’s a lot of people is where we focus spending our dollars.”
Simple Green is again a sponsor this year, and Waterfall plans to distribute a similar number of free samples in the effort to gain new customers.
“For us word of mouth is very important,” he said.