It has become painfully clear that the U.S. economy has not rebounded as expected, and the dollar is not performing well. Across the sea in Europe, things don’t look a heck of a lot better. Growth has quite frankly stagnated. And it seems that Japan has yet to wake up from a period of dormancy that began back in 1998. The buzz around the IT industry has now turned to China—the place to see and be seen.

IDC is forecasting Latin America's growth rate to average a sizzling 16% annually.

But as usual, the most obvious hot spot is right under our own noses—the sleeping giant known as Latin America.

While the U.S. and other western markets are expected to grow about 6% annually, International Data Corporation (IDC) is currently forecasting Latin America's growth rate to average a sizzling 16% annually. It’s anticipated that some of the countries in the region may even grow as much as 20% per year.

How is this possible? Growth rates for most Latin American countries are more dynamic given the low saturation point for PC and PDA (personal digital assistant) products, for example. Businesses are more conscious of the benefits derived from an implementation of specialized applications, and local firms are taking advantage of this trend. International software publishers like IBM, Sun, Oracle and Microsoft understand the opportunities that await them in the southern American market and have jumped on them.

The best way to market vertical software is through industry, not IT consultants.

Yet there are some key differences between Latin America and other countries that most likely account for their ability to grow quickly. Project sizes tend to be smaller, and the intense scrutiny from U.S. headquarters that requires a quantifiable ROI (return on investment) argument as part of the sales process is not always given the same degree of attention in this region. However, providing an ROI argument can provide significant advantages to software publishers who go to the trouble to provide one. Most companies buying software in the region will tend to look to industry-specific solutions, and thus ROI becomes a very important factor. They seem to have a “sink or swim” attitude towards doing business. In many cases, the best way to market vertical software in the region is through industry, as opposed to using IT consultants.

The most attractive markets today are Brazil, Mexico and, to a lesser degree, Argentina and Columbia. For the software industry, there is a serious need for companies that offer complimentary services that can help them grow. Services like—yes, you guessed it—localization.

Take Brazil for instance: the biggest population, the greatest area, and the largest and most diverse industrial base in Latin America. Brazil is not only an attractive market; it is also an excellent launching pad for products and for exporting from Latin America.

Latin Americans in the U.S.

The U.S. Hispanic market is the 5th largest in the world, with USD 428 billion a year in purchasing power.

Interestingly enough, few companies are distributing the Spanish version of their localized products in the U.S. Although the U.S. Hispanic market is the fifth largest in the world, with USD 428 billion a year in purchasing power, most companies prefer to sell their products only in English. Many of these same companies create a localized product for the Latin American market, but don’t include U.S. Hispanics. This may be because there are few talented Hispanic advertising agencies or localization companies headquartered in the U.S.

For those interested in targeting the U.S. Hispanic market, there are some general marketing strategies to consider. You’re selling to a culture, not selling a language, and this culture thinks differently than the general market. The U.S. is constituted by Hispanics who speak only Spanish, Hispanics who speak only English but talk, walk and think like Hispanics, and the bilingual (but English-dominant) Hispanics.

A successful Hispanic marketing strategy will cross-pollinate its message in both English and Spanish. The U.S. Hispanic market is more open to using English terms in the Spanish, such as “voicemail.” The reason is because they hear these words in English with greater frequency. Another reason is that the longer Hispanic Spanish-dominant speakers stay in the U.S., the more comfortable they become using English words.

Basic Cultural Differences Among Hispanics

Women are making the majority of buying decisions in this region.

Contrary to the reputation that precedes Hispanic males via macho stereotyping, the husband is not, and I repeat not, the final decision-maker in the family (I hope my wife is not reading this). Hispanic families are matriarchal, that is, the wife has the final say while the man pounds his chest, stomps his feet, and says, “I’m in charge.” He is for all intents and purposes, a “paper tiger.” My point is this: the women are making the majority of the buying decisions.

Another cultural difference can be found in religion. In the U.S., it is not always politically correct to send Christmas cards stating “Merry Christmas.” We create generic, made-up terms, such as “Happy Holidays.” For most Hispanics, the meaning of December 25 is highly religious. Our firm once worked on an advertising piece for MBE (MailBoxes, Etc.), which was going to be used in the U.S. and all Spanish-speaking countries in Latin America. We had to fight to be able to use the word “Christmas” in Spanish, since the campaign was going to be used in the U.S. as well.

The client wanted to increase packaging and shipping sales. The problem was that most Hispanics don’t trust the mail (sorry, United States Postal Service) because the mail in their country is basically distributed sporadically, i.e., when the mail carriers get around to doing it. Hispanics, unlike Americans, consider that much of the thought behind a gift is in its packaging. Our Hispanic campaign focused on providing a sense of security that their precious gifts would be delivered safely and on time, and that it would be handled as if it were packaged and sent from home. This particular project was a great example of how important it is to weave cultural differences into a strategy for this particular market.

Language Differences

What the heck is “generic” about Spanish?

The localization industry in Latin America is cause for concern, however. I have been in this business for eighteen years, and I have seen words creep into our vocabulary like "vanilla Spanish," "generic Spanish," a “one-for-all Spanish.” Do Haagen Das and Nestle vanilla flavor taste the same just because they’re both vanilla? How about generic Spanish? What the heck is “generic” about Spanish?

Aren't schools in the U.S. teaching anything anymore? A little lesson on the Spanish language and geography is in order, at least for some companies. Spanish is the language of Mexico, El Salvador, Ecuador, Guatemala, Honduras, Panama, Costa Rica, Argentina, Chile, Peru, Colombia, Belize, Paraguay, Uruguay, Nicaragua, Bolivia, and Venezuela. Portuguese is spoken in Brazil.

In the Spanish language, there is one set of grammatical rules, whether you are in Argentina, Mexico or Peru. A noun is a noun and a verb is a verb, no matter what country you're in. What may, and I do mean MAY, change is the use of terminology. For instance, a tortilla in Spain is made out of egg and potatoes, while a tortilla in Mexico is not only thinner, but also made out of flour or corn meal. Another example is that we all know Hispanics love soccer, yet the basic terms used by aficionados differ from country to country. For example, a “goalkeeper” is a “portero” in Spain, an “arquero” in Argentina and a “golero” in Mexico, and a “guardameta” or “guardavalla” in other Latin American countries…But a “portero” is a very important person in Argentina: a “doorman.”

Clients frequently want to know if you can ship a Spanish version of a product to all Spanish-speaking countries. The short answer is yes, at least most of the time. You need to make sure that you create a mandatory terminology list (I like this term better than glossary, because it suggests that you have no choice but to follow it). This list should include product-specific terminology, industry-specific terminology, as well as client-specific terms. Linguists and terminologists from as many countries as possible should create this list. Once this list has been approved by the client and its in-country specialist, the chance of choosing terms that are not regionally correct are minimized. The localization team should include a mix of translators from as many Spanish-speaking countries as possible.

When creating multimedia or voiceover projects, use either Peruvian or Columbian talent.

Here are a couple hints: when creating multimedia or voiceover projects, use either Peruvian or Columbian talent, since they do not have much of an accent (compared to Spaniards and Argentines). This way, the end user will not associate the project with the place of birth and country of the talent. The more technical the project, the less variance in the dialect or word choice.

If your product is aimed at cool, young snowboarders or skateboarders, then the project might need special handling. The reason for this is because “cool” words vary country-by-country, state-by-state, and even city-by-city. If you have the money to spend and want to create twenty versions of Spanish, please call my office (or call me at home for that matter!) because we would love to handle your project.

Don’t include Spaniards on a Latin American project that is not technical in nature.

If your Spanish reviewers are based in the U.S., make sure you have a screening procedure that prevents a friend of a friend who happened to go to Mexico once on a high school trip back in 1984 from becoming a reviewer. The major problem Spanish localization has to deal with are client reviewers in the U.S. who can’t speak Spanish and are asked to review our work. Although Spanish is similar between Latin American countries, no one in Latin America likes Spanish from “Spain.” In fact, many actually dislike it. Call it regional pride. So my advice is not to include Spaniards on a Latin American project that is not technical in nature.

Finally, the importance of currency exchange should not be minimized. When you buy Spanish localization, you need to find sources of quality translators (of course); however, you should also take into account the issue of currency fluctuation. Assuming you are purchasing localization in Spain, and your provider has not changed their rates within the last three years, you could be paying up to 25% more today. Why? Because the dollar has gone south by 25%.

Go to countries where the currency is weak, and the economy stinks.

So, if you are looking to purchase Spanish translation services, go to countries where the currency is weak, and the economy stinks. Why should you consider economy? Because a translator can make more than a doctor or a lawyer in some Spanish-speaking countries, and thus you will be able to engage excellent translators with excellent subject matter expertise.

Take advantage of the sleeping giant before someone else does, and start counting your beans today.

Hopefully, I’ve made a convincing case for looking south to Latin America to enhance your profit margin. And before you cross the border, don’t forget to consider the U.S. Hispanic market as well. Take advantage of the sleeping giant before someone else does, and start counting your beans today.

Michael Cárdenas is Founder & President of Multilingual Translations in San Diego, California. Born in Madrid, Spain, and raised in Spain and the United States, Cárdenas has nurtured Multilingual Translations from a small translation service to a full-range, multi-language communications service. You can reach Cárdenas at mcardenas@Multitrans.com.