Can Latin Grammys Give the Music A Lift?

Latin Grammys

Latin Grammys

In a year when Latinos were the most talked-about demographic in U.S. politics, the Latin Recording Academy has high hopes that its 13th annual awards show will be a turning point for the industry.

The Latin Grammy Awards show, which will be broadcast live Thursday night from the Mandalay Bay Events Center in Las Vegas, comes amid a continuing slump for Latin music. Its U.S. album sales, as measured in units, have dropped nearly 69% since 2006, according to Nielsen SoundScan, far worse than the 44% decline in overall album sales in the same period.

Yet amid those faltering figures, the popularity of the Latin Grammys broadcast on the Spanish-language Univision network has remained strong. According to Univision, more than 11 million U.S. viewers tuned in for all or part of last year’s broadcast. In both 2010 and 2011, the event was the night’s most-watched TV show among 18-to-34-year-olds.

Univision Networks President Cesar Conde says the ratings “exploded” when the Latin Grammys moved to the Spanish-language network from CBS, where it was broadcast in English from 2000 to 2004, mirroring broader growth in Spanish-language media. “We have a tremendous, growing demographic,” he said.

Among most Hispanic adult viewers, last year’s Latin Grammys were more popular than the Academy Awards, the Golden Globe awards and the Primetime Emmy awards. The Latin Recording Academy says the show drew nearly 80 million viewers in more than 100 countries.

Along with viewership, the event’s corporate sponsorship has grown steadily. This year’s sponsors include Heineken, 7UP, Gucci’s watch-and-jewelry division, Delta Air Lines,DAL +2.36% McDonald’sMCD +1.09% Jack Daniel’s, MetroPCS PCS +2.23% and Allstate.

Whether the awards show’s growing popularity will boost album sales remains to be seen. Digital-album sales in the genre are growing, but from a minuscule starting place. According to SoundScan, Latin digital-album sales barely surpassed one million in 2011, while overall digital-album sales in the U.S. were 103 million. Only about 9.5% of Latin album sales in the U.S. last year were digital, compared with 31% of all album sales.

Live tours, on the other hand, are growing. Since 2010, New York’s Madison Square Garden has sold out multiple nights for such Latin performers as bachata artist Romeo Santos, ranchera singer Vicente Fernandez and tropical-pop performer Marc Anthony. In Los Angeles earlier this year, Mexican rockers Maná sold out a record 11th show at AEG’s Staples Center.

Rebecca Leon, who books major Latin artists for AEG venues, including the 20,000-seat Staples Center, called the live Latin music market “a sleeping giant.” Six years ago, a major Latin artist touring the U.S. would put on 10 to 12 shows, she said. “All these places that before were probably not considered Latin markets, now they’re part of the route,” she added. “That demonstrates the kind of growth we’ve seen.”

Last year, nine Latin artists were among the 100 top-grossing North American tours, according to trade magazine Pollstar.

But many of those touring artists established themselves in the years before the music industry took a dive. Now the question remains: Who will develop new Latin artists? Major labels have downsized their Latin divisions, and as record stores close around the country, it is getting harder for fans to discover new music.

Ms. Leon of AEG, who transitioned to the live-concert business after working with record labels for many years, says there is demand for new music and a population with buying power, but the promotional machine has dried up. Aside from sending young artists on tour to open for established acts, she adds, it isn’t clear what will bring the industry back. “That’s a nut I’d love to crack,” she adds.

Gabriel Abaroa, president and CEO of the Latin Academy of Recording Arts and Sciences, believes social media and mobile technology will play a role in the success of the next generation of Latin artists.

A Nielsen report earlier this year showed that Hispanic Americans download more full music tracks to their mobile devices than any other demographic. They were also the fastest growing ethnic group on Facebook FB -2.72% from February 2011 to February 2012, and adults in the demographic were more likely to follow brands and celebrities online than the general population.

The diverse tastes of young-adult Hispanics, as exhibited in the brands and artists they follow online, are driving “the birth of a new musical generation,” Mr. Abaroa says. “It’s Latin, but it pertains to the U.S. influences of jazz and pop, all blending in a new way.”

–Courtesy of The Wall Street Journal

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