The News Room

Hispanics More Active on Social Media than Other Ethnicities

US Hispanics are more active on social media than the average US internet user, and are logging in more frequently to a wider variety of social sites.

The February 2012 “American Pulse Survey” fromBIGinsight of US adult internet usage found that, while greater percentages of black internet users spent larger blocks of time online than the other groups studied, Hispanic internet users spent more of their online time on social media sites.

On an average day, 26.8% of Hispanic internet users spent six hours or more on social media sites, while 20.4% of black internet users and only 8.5% of total internet users spent that much time on social sites.

Looking specifically at which sites social-savvy Hispanics were using, the survey found US Hispanics were willing to participate in some newer and smaller social sites, logging in more often to networks like Pinterest, foursquare and LinkedIn, for example, than the average US internet user.

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Is McDonald's Losing That Lovin' Feeling?

It's the world's largest fast feeder by sales. Global same-store sales rose 5.6% last year over 2010 -- its eighth consecutive year of positive same-store sales. It's rated the world's No. 6 brand by Interbrand, with a value of $35.6 billion. It's the 26th-largest advertiser in the country, with a budget of nearly $888 million for U.S. measured media, according to Kantar Media. Indeed, the GoldenArches are a global beacon of success, and the company's 33,000-plus locations in 119 countries serve 68 million people a day.

But something strange is happening on McDonald's soaring arches: Its brand perception isn't keeping pace with sales. According to people close to the company, its internal tracking system finds that McDonald's consistently ranks near the bottom in quality perception when compared with rivals.

The company is working to close the gap, these people said, by addressing issues related to perceptions about its food's quality, sourcing and nutritional value; sustainability practices, including suppliers' treatment of animals; service; and condition of stores.

"The future is going to be so transparent that major corporations should wear underwear that fits," said Scott Bedbury, CEO at Brandstream, who praised McDonald's move. "For any company to ignore what consumers are saying and instead take comfort in their revenue numbers is ill-advised."

Heather Oldani, McDonald's director-U.S. communications, said that though concerned is too strong a word, the company recognizes that "there is an opportunity for us to answer some of the questions that customers may have, that influencers may have, about our menu, our commitments to the community and in the areas of sustainability -- things that frankly we haven't been as vocal about ... in the past.

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PepsiCo Plans 35% Marketing Boost for Snacks Division

PepsiCo will boost advertising and marketing on its North American snack business this year by 35%, while investing in the fast-growing value category with products such as Cracker Jack line extensions, executives said today. The company also pledged to double down on its "Power of One" effort to market snacks and beverages together, a strategy that analysts have criticized in the past.

Executives, speaking at the Consumer Analyst Group of New York conference, focused almost exclusively on its snacks business after rolling out plans earlier this month to revive its beverage division. PepsiCo said it will increase company-wide marketing by up to $600 million in 2012, focusing on a dozen key brands.

As opposed to beverages, where PepsiCo trails Coca-Cola, the company's snacks business is thriving by most measures. With brands such as Lay's, Doritos and Cheetos, PepsiCo dominates the global savory-snacks category. In 2010 it had sales of $29.9 billion, far ahead of No. 2 Kraft at $5.3 billion. PepsiCo's snack revenue grew 9% and volume was up 4% last year, the company reported. Snacks are forecast to overtake beverages by 2016, growing to 52% of overall revenue from 48%, the company said today.

Yet the company sees opportunity for more gains.

"Clearly we lead from a position of strength," said John Compton, CEO of PepsiCo Americas Foods and Global Snacks Group. But "what matters most is growth."

PepsiCo will devote more marketing resources to the Frito-Lay North America business, focusing the 35% spending increase on mainstream megabrands Lay's, Tostitos and Cheetos. Those three were supported with nearly $71 million in media spending in 2010, according to the Ad Age DataCenter. New products this year will include Doritos "Jacked," billed as a "bigger, bolder, thicker" chip in smoky chipotle barbeque flavor, and Doritos "Dinamita," a chile-lemon-flavored chip in rolled form.

Frito-Lay will also make moves in the premium- and value-snacking segments. "The American macro snack consumer is truly bifurcating," said Tom Greco, president of Frito-Lay North America. "As a result, there's rapid growth in both the premium and value segments within macro snacks." (The "bifurcation" theme has been repeated all week by marketers at this week's CAGNY conference, perhaps a reflection of the shrinking middle class.)

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Disney, Univision Talk About Starting a Cable News Channel

Walt Disney Co., owner of the ABC broadcast network, is in talks with Univision Communications to create an English-language, 24-hour cable-news channel, according to two people with knowledge of the situation, confirming a report today in The Wall Street Journal.

Walt Disney Co. would oversee advertising sales and distribution for the venture, said the pair, who sought anonymity because an agreement hasn't been reached. The channel would draw newsgathering resources from ABC News and Univision, the largest U.S. Spanish-language broadcaster, they said.

The discussions have been under way for at least six months and are ongoing, said the people. They added that the channel would be based in Miami and start service before the November presidential election.

A venture would provide Disney , which reports first-quarter results today after markets close, with a cable-news presence, and advance Univision CEO Randy Falco's goal of building new channels.

Until now Univision has ventured tentatively and with little fanfare into English-language efforts, not wanting to undercut its core message that Hispanics speak Spanish and so advertisers need to buy Univision to reach them. The company has a year-old Tumblr website in English, and sees other opportunities in an English-language news website, expected next month. And closed caption English-language subtitles for the network's popular telenovelas began this month.

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