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When it comes to connecting with the massive U.S. Hispanic market, most advertisers don’t know which side the iguana chews on.

And if you don’t know what that means, you may be part of the problem.

It’s a Mexican idiom — “saben de que lado masca la iguana” — that basically translates as “knowing the territory” or “knowing your stuff.” And it’s not a claim many marketing campaigns can make in regard to the almost 45 million Hispanic consumers now in the U.S.

Even in these ethnically sensitive days, many campaigns aimed at Latino audiences in the United States rely on outmoded stereotypes and stock misconceptions to touch Hispanic audiences. They reach too easily for the usual cultural clichés: music, futbol, the beaming “abuelita” (grandmother) offering platters of food to her family.

Brands, or their agencies, often point proudly to Cinco de Mayo campaigns and promotions without realizing that (a) the holiday means nothing to the 35% of U.S. Hispanics with origins other than Mexico, and (b) it’s not the Mexican equivalent of Independence Day. (That comes on Sept. 16.)

“Many agencies still take a formulaic approach to addressing the Hispanic market,” says Manuel Wernicky, founder and principal of Adrenalina, which last November was named agency of record for the Tecate brand owned by Heineken, and which just produced the brand’s first dual-language TV campaign. “They see it as a black-or-white decision: Telemundo or Univision? The truth is, the market is morphing tremendously and is becoming a moving target.”

GEN-2 SEGMENTS OFF

Two particular drivers are putting that target audience in motion: its organic growth within the U.S. population and its equally swift increase as a share of the online audience.

On the first count, the U.S. Hispanic population is quickly hyphenating into American-Hispanics. About 60% of Hispanics in this country today were born here; by 2020, that proportion will rise to 70%. Hispanic births now make up one-quarter of the 4 million babies born annually in the U.S.

These home-grown Hispanic consumers have implications for marketers, because they will acculturate faster than their first-generation parents. They’ll grow up bilingual, switching from one language to the other depending on social context, consuming media in both, and moving regularly from home environments that may be more or less Hispanic to conventionally Anglo workplaces.

Research produced in January by McCann Relationship Marketing Worldwide and MSN Latino finds these second-gen Hispanics hold a lot of potential value for brand marketers. “Second-generation American Hispanics are not only a bigger market than their first-gen parents, but they are more lucrative, better educated and have more household income,” says Maria Lopez-Knowles, senior vice president and group account director for MRM.

That value is amplified by the fact that they are often the brand influencers within multi-generational families, passing on product information and buying advice to other family members.

HYPERCONNECTED HISPANICS

MRM’s research also suggests that these American-born Hispanics are much less engaged in traditional Spanish-language media than their Spanish-dominant forebears. What grabs their attention rather than TV or radio? The Internet.

Researcher comScore Media Metrix says the online U.S. Hispanic audience grew 11% in 2007, to 18.5 million visitors, compared to only a 5% increase in the overall Web audience. That came on the heels of a 13% jump in the online Hispanic presence in 2006.

Of course, those growth figures include both English-dominant Hispanics and their Spanish-dominant predecessors. But the former group is as likely as non-Hispanic whites to have broadband access and/or WiFi at home, while the latter rely mostly on dial-up access, according to a 2007 survey by Florida State university’s Center for Hispanic Marketing Communication.

Even with that dial-up handicap, U.S. Hispanics make up 10% of the online population in the U.S. And they use the Internet intensively; 50% watch video online, more than twice the video rate among the general Web audience. Seventy percent of U.S. Hispanic women are online.

And then there’s mobile ownership. A May 2007 comScore study found 26 million U.S. Hispanic mobile phone users. Admittedly, that’s a small segment of the country’s more than 250 million mobile subscribers; but they out-index on almost every usage measurement.

Hispanics are more likely to own full-featured mobile phones than the U.S. average. They’re also more likely to use them to consume mobile media: Almost 71% do so, compared to the market average of about 48%. Be it watching video, playing games, sharing photos, buying ringtones or sideloading music from their PCs, the Hispanic audience in the U.S. is more prone to do it than the average consumer.

NO EASY ANSWERS

But even marketers who want to reach that English-dominant customer segment may need to add Spanish to their online content.

A 2007 survey from Forrester found that while only 23% of online Hispanic shoppers said they needed Spanish, more than 50% said they preferred Web sites that spoke to them in Spanish, and 28% expressed greater trust in brands with Spanish Web sites.

So some brands have opted to go all the way and offer up sites specifically for Spanish-speaking U.S. consumers. The all-out approach seems to be a choice for brands that offer complicated products or services with which a sizable proportion of first-generation Hispanics may be unfamiliar.

Last month MasterCard re-launched its Spanish consumer site, www.MasterCardenespanol.com, as part of a market initiative that also produced the first Hispanic-centered entry in its “Priceless” TV advertising. In light of research showing that 75% of Hispanic consumers are most comfortable paying cash for purchases, the updated Web site spends more time than before laying out the value and convenience of its debit card product, while instructing visitors in the basics of building a credit history.

“We want to give them instruction in managing their finances using the ways that they may already be thinking about to build a genuine connection with the market,” says Chris Jogis, vice president of U.S. brand development for MasterCard Worldwide.

The site also incorporates money-management content from video partner Univision.

And aversion to using credit cards online — at least among first-generation Hispanics — has kept down the number of e-commerce merchants running Spanish-language sites, according to Jose Villa, president of digital marketing agency Sensis.

“They’re online researching products, they’re comparing prices and looking for locations, but they’re not shopping the Web the way the more acculturated Hispanics do,” he says. “That’s why only a handful of Internet retailers, like Best Buy and Office Depot, offer full e-commerce functionality for Spanish speakers.”

Instead, many follow the example of JCPenney and simply translate the customer relations portions of their sites.

Some brands have launched parallel English and Spanish versions of microsites to give Hispanic visitors the linguistic option.

Villa’s agency designed and launched a bilingual consumer-information site for health insurance provider United Healthcare last month.

“UHC has a significant number of Hispanic members and a lot of Spanish speakers among those,” he says. “They wanted to make sure they felt comfortable enough to stay with their service when open enrollment comes around. So we added a tutorial about how health insurance works and wellness content geared to Hispanics.”

Sensis also worked with UHC to enable searches for providers in their system who offered services in Spanish.

In March Johnson & Johnson rolled out the parenting portals www.TouchingBond.com and www.TouchingBond.com/espanol, mixing parent-child play tips, short Web animations, and expert advice with light pitches for its baby lotion line.

The sites link easily to one another in the expectation that many Latina mothers might prefer to watch the cartoons in English but absorb the written content in Spanish.