Author Archives: Andrés Sandoval@usmediaconsulting.com

About Andrés Sandoval@usmediaconsulting.com

Andrés Sandoval is the Digital Ad Sales Director for US Media Consulting.

01 e-commerce

The Hottest E-Commerce Products in Latin America

Ok, so we know that digital ad spend is set to grow by 114% in Argentina between 2015 and 2018. Digital ad spend will spike by 73% in Mexico between now and 2018 and go up by 49% in Brazil by 2018.

In fact, 75% of the ad spend growth in Latin America between 2015 and 2017 will come from digital advertising on desktop and mobile.

We also know that B2C e-commerce sales in Latin America went up by 22% in 2014 and will grow by nearly 14% in 2015.

So digital marketers and agencies should be well attuned to what Latin Americans are buying online. Of course, data that covers the whole region is tricky to compile since e-commerce development varies greatly from country to country in Latam. But we were able to discover which products are flying off e-commerce shelves in most of the larger Latin American markets.


Argentina flag
ARGENTINA

The Cámara Argentina de Comercio Electrónico (Argentine Chamber of E-Commerce) indicates that e-commerce sales in Argentina reached a total of 40.1 billion Argentine pesos (US$4.5 billion) in 2014.

What Argentines bought the most online in 2014 were travel products like tickets and hotel reservations: they spent more than US$1 billion on these and travel products made up more than 27% of total e-commerce sales.

Other top e-commerce products purchased in Argentina in 2014 include:

  • Electronic equipment and accessories (12.5% of total sales)
  • Food, drink and cleaning supplies (6.9%)
  • Appliances (5.3%)
  • Clothes (4.2%)
  • Tickets to shows and events (3.7%)
  • Home furnishings (3%)
  • Office supplies (2.3%)
  • Sporting goods (2.2%)
  • Auto and motorcycle accessories (2.1%)
  • Toys and games (1.6%)
  • Clothes and accessories for babies (1.5%)
  • Other (includes properties and vehicles) 27%

brazilflag1968
BRAZIL

The 2015 Webshoppers report from ebit indicates that Brazil posted R$35.8 billion (US$11.4 billion) in e-commerce sales in 2014. As such, e-commerce sales in Brazil went up 24% in 2014. More than 51 Brazilians made an online purchase in 2014 and generated a total of more than 103 million orders. Nearly 10% of e-commerce sales in 2014 in Brazil were made with mobile devices, mostly through smartphones. In 2014 6 of every 10 m-commerce shoppers in Brazil were classes A or B.

Top products sold via e-commerce in Brazil in 2014 include:

  1. Fashion and accessories (17% of total sales)
  2. Cosmetics, perfume and personal care (15%)
  3. Appliances (12%)
  4. Mobile phones and phone products (8%)
  5. Books and magazine subscriptions (8%)
  6. Computer products (7%)
  7. Home furnishings (7%)
  8. Electronics (6%)
  9. Sporting goods (4%)
  10. Toys and Games (3%)


chile 3
CHILE

The Cámara de Comercio de Santiago (Santiago Chamber of Commerce) estimates that e-commerce sales in Chile would exceed US$2 billion in 2014, an increase of around 20% compared to 2013, in which total e-commerce sales in Chile were nearly US$1.6 billion. The most recent data we could find about the products that Chileans buy most online comes from a GfK study that covered e-commerce purchases in Chile during the first half of 2014. According to GfK’s results, the top products purchased by Chileans via e-commerce were:

  1. Cell phones
  2. Television sets
  3. Tablets
  4. Washing machines
  5. Notebooks
  6. Refrigerators
  7. Stoves
  8. Netbooks

 

Colombia flag
COLOMBIA

A report from the firm PayU indicates that e-commerce grew by more than 41% in Colombia in 2014 to reach total sales of more than US$3.5 billion. It’s important to note that these are estimates from a private firm that reportedly reaches more than 80% of the market, as opposed to an independent study such as the one by e-bit or the CACE in Argentina. That said, PayU’s results are in line with projections from the Cámara Colombiana de Comercio Electrónico (Colombian Chamber of E-Commerce), which has yet to issue a report for 2014 e-commerce activity for the country. According to PayU’s results, the products that Colombians bought the most via e-commerce in 2014 were:

  1. Airline tickets and hotel reservations
  2. Coupons
  3. Electronic products
  4. Clothes and shoes

A 2013 study from The Cocktail Analysis identified differences in products between 3 groups they designated: sophisticated shoppers, advanced shoppers and entry point shoppers. However, when The Cocktail Analysis aggregated the results to show which products registered the most purchases relative to the total of all online shoppers in Colombia, the following products stood out:

  1. Electronics and computer products
  2. Travel products
  3. Clothes
  4. Telecommunications
  5. Leisure

As can be observed, these are similar results to those from PayU.

 

mexico flag
MEXICO

According to the Asociación Mexicana de Internet (The Mexican Internet Association or AMIPCI) e-commerce sales in Mexico totaled more than 150 billion pesos ($US9.6 billion) and increased by 24% compared to 2013. AMIPCI has not yet released its 2014 Mexico e-commerce report, so the list of hot e-commerce products for Mexico comes from the 2013 report:

  1. Plane or bus tickets
  2. Music and movies
  3. Computers
  4. Clothes
  5. Tickets to shows
  6. Hotel reservations
  7. Software

These results are fairly consistent with previous AMIPCI results on e-commerce in Mexico, suggesting that the hot e-commerce products in 2014 should not be that different.

Uruguay_Flag
URUGUAY

While data for e-commerce sales in Uruguay doesn’t seem to be readily available, a small 2014 study by Agencia de Gobierno Electrónico y Sociedad de la Information (Electronic Government Agency and Information Society or AGESIC) surveyed more than 1,000 e-commerce shoppers in Uruguay to find out what they most bought online:

  1. Clothes
  2. Electronics
  3. Hotel/restaurant reservations
  4. Cell phones and accessories
  5. Home furnishing
  6. Appliances
  7. Service payments
  8. PC accessories
  9. Tools
  10. Books

Contact us if you need help reaching Latin Americans in general or in specific markets with an online display campaign or a programmatic buying campaign.

Human hand with a bag of US Dollars, coming out from computer sc

Digital to Dominate Surging Ad Spend in Latin America

A recent report from ZenithOptimedia and eMarketer offers encouraging projections for Latin America and suggest a much larger role for digital, especially in certain markets.

Overall Ad Spend
While Zenith Optimedia predicts 4.9% global growth in ad spend in 2015, eMarketer has a rosier forecast of 6.8%. Both organizations predict increased ad spend growth around the globe in the coming years, between 5 and 6% per year in 2016 and 2017.

Latin America’s Ad Spend Share to Grow
In 2014 eMarketer indicated that Latin America accounted for 7.3% of global spend, compared to 35.6% for North America, 27.9% for Asia-Pacific, 21% for Western Europe, 4.5% for Central and Eastern Euripe and 3.8% for Middle East and Africa. However, by 2018 eMarketer forecasts that Latin America’s share of global ad spend will rise to 8.4%.  (Click on the image below to enlarge.)

Ad spend 2018 Eng

In fact, eMarketer projects that between 2014 and 2017 Latin America’s ad spend will grow by 10% a year: only countries in a group called Fast-Track Asia (China, Indonesia, Malaysia, India, Pakistan, Philippines, Taiwan, Thailand and Vietnam) will grow more, with 10.3% annual growth.

Digital Driving Growth
According to Zenith Optimedia, mobile advertising will account for 51% of total ad spend growth around the world between 2014 and 2017. Desktop digital will also be an important part of global ad spend growth: it will account for 25% of it between 2014 and 2017. In fact, by 2017 desktop advertising will account for nearly 20% of global ad spend while TV will remain #1 with 37.4%. Mobile advertising will be close behind newspapers, accounting for 11.5% of global ad spend compared to 12.2% for newspapers. (Click on the image below to enlarge.)

Ad spend 2017 by medium Eng

Digital to Play a Key Role in Latam Markets
Historically, it’s obvious that traditional media have dominated ad spend in Latin America, particularly television. But eMarketer’s projections suggest a significant shift will happen in certain markets this year. For example, eMarketer forecasts that digital will command as much as 50% of the ad spend in the United Kingdom in 2015, while accounting for anywhere from 42% to 45% in countries like China, Denmark, Australia and Norway.
While digital won’t be as dominant in Latam countries, it’s significant to note that eMarketer projects that digital will account for 24% of the total 2015 ad spend in Mexico, not far behind the percentage projected for digital in the United States (31%). In fact, Mexico’s projected digital ad spend percentage is the same as that of Germany, Finland and Japan. In Brazil in 2015 digital will account for 15% of total ad spend. In Argentina, digital will account for 9% of total ad spend in 2015. While neither Brazil nor Argentina will have digital dominance in their 2015 ad spend, those familiar with ad spend in these countries will note that these percentages represent a significant increase for digital compared to years past.

Massive Mobile and Digital Ad Spend Growth for Argentina, Brazil and Mexico
According to eMarketer’s projections, in 2015 digital ad spend will grow by 30% in Argentina. Digital ad spend in Mexico will grow by 28% in 2015. And in Brazil, digital ad spend will grow by 15% in 2015.

Here’s a quick look at 2015 ad spend in these countries as per eMarketer (click on the image below to enlarge):

Ad spend ARG BR MX 2015 eng

Mobile advertising is set to grow in all 3 countries, according to eMarketer. Here’s the breakdown:

  • In 2015 mobile advertising spend will grow by 201% in Argentina
  • In 2015 mobile advertising spend will grow by 120% in Brazil
  • In 2015 mobile advertising spend will grow by 81% in Mexico

Over the next few years, between 2015 and 2018, digital ad spend should grow strongly in these countries, as per eMarketer projections. For example, digital ad spend will grow by 49% in Brazil between 2015 and 2018 to reach nearly US$5 billion. Mexico will post 73% growth in digital ad spend between 2015 and 2018, with more than US$2 billion invested in digital advertising in 2018. However, Argentina will have the most dramatic growth: 114% growth in digital ad spend between 2015 and 2018 and a total of nearly US$1 billion invested that year.

Leveraging This Data
As the digital money flow gushes in the coming years, we’ll see a parallel growth in programmatic ad spend in Latin America: a 600% increase just in 2015 and a nearly 9,000% increase by 2018. See more on that here. These projections suggest that brands will be putting more of their digital spend into programmatic, which makes sense when you consider the improved targeting offered by programmatic and the ability to buy by audience. An additional factor in this could be the ability to buy mobile programmatic impressions, which allows brands to reach the 194 million Latin Americans who use mobile Internet.

Contact us to find out how you can use programmatic to reach Latam’s 307 million Internet users via desktop, mobile or video, or if you just need help with a digital desktop campaign.

Latam digital music

Digital Music Cranks Up in Latin America

Both online music downloads and digital music subscriptions are on the rise in Latin America.

According to the most recent digital music report from the International Federation of the Phonographic Industry or IFPI—released in November 2014—Latin America posted 27% digital music revenue growth in 2013. Overall, revenues from digital music grew by 124% in Latin America between 2010 and 2013.

According to the Federation’s report, a number of Latam countries had powerful individual growth, including Peru (149%), Colombia (85%) and Argentina (69%).

But IFPI is not the only source that points to digital music growth in Latin American countries.

Colombia
Ipsos-Napoleón Franco’s Technology Tracker study, released in 2014, indicated that 37% of Colombian internet users stream music, compared to the 49% that buy CDs.

Mexico
The Mexican Association of Phonographic Producers (Amprofon) reported a 130% increase in revenues from streaming music services in Mexico during the first half of 2014. Streaming revenues totaled 175 million Mexican pesos in the first half of 2014, while digital music sales went up by 14% to reach 428 million Mexican pesos in the same period. Overall, 59% of the revenues generated by the Mexican music industry in the first half of 2014 came from digital sources, either streaming or purchases.

Brazil
A recent study from Opinion Box indicated that 28% of Brazilians stream music, though 76% still prefer to listen to music via traditional radio. However, another study from Opinion Box—done in June 2014—surveyed 1,484 Brazilian Internet users and found that 76% listened to music on their cell phones. Of these, 84% listen to MP3 files, 65% listen to the FM radio embedded in the device and nearly 31% use streaming music apps. In addition, while 2014 numbers aren’t available yet, the Associação Brasileira de Produtores de Discos, (Brazilian Association of Record Producers or ABPD) reported that digital music sales in Brazil went up by 22% in 2013 and that digital sales accounted for 36% of total music sales.

What to Do with This Data
While it’s tricky to find large scale spikes in digital music consumption for every Latin American country, there’s enough data for the larger markets to suggest a significant change is taking place. For advertisers and agencies, this means that looking into ad solutions from sites like Deezer may deliver some strong results with campaigns, especially with the younger age groups (15 to 24, 25 to 35) that make up the majority of Latam’s Internet users.

Please contact us to find out more how we can increase efficiencies for Latin American agencies through media services like planning or buying or via advertising technology solutions like programmatic buying.

Flying dollars banknotes isolated on white

Where Ad Investment in Latin America Should Go in 2015

The challenge that every marketer faces is how to develop a media budget that delivers the best results. Making changes to your approach is hard, not only because of the risk but also because of the need to sell other people in the company on those changes. But as the media landscape changes, it’s actually a bigger risk to make no changes, since you can easily fall out of step with your customers. In reviewing the data, here are some areas that both brands and media agencies need to look more closely at in executing their 2015 campaigns.

#1: Mobile Programmatic
Mexico clearly leads Latin America when it comes to mobile ad investment and is set to reach US$287 million by next year, while Brazil mobile ad investment will reach US$245 million and Argentine mobile ad spend will be a surprisingly small US$14.5 million.

But this modest level of investment doesn’t seem to jibe with the mobile boom happening in Latam. For instance:

And if those numbers aren’t enough to get the point across, see how smartphone penetration, tablet ownership and mobile Internet user are growing in other Latam markets, including Chile, Peru, Colombia, Ecuador and Venezuela.

Now to programmatic. We know that programmatic ad spend is set to spike dramatically in Latin America, so definitely the industry knows this works. The advantages of the tight targeting of programmatic are becoming clearer, in addition to the fact that it may deliver a more efficient spend than manual online ad buying.

Given this, it seems logical that brands need to deepen their mobile spend. And if the concern is that mobile may be a risk, why not look at some trials with mobile programmatic? Sharper targeting could lead to even better results with mobile and allow brands to fully take advantage of an audience that’s using smartphones more and more in the purchase process.

As such, it seems clear that brands need to run programmatic mobile trials and increase their conventional mobile ad spend in 2015. We can help with this: find out more here.

#2: Social
The numbers on social make things pretty clear:

Ok, so we know we have a good audience. Then why is social network ad spending in all of Latin America only estimated to be US$481 million in 2014 and only to increase by 23% in 2015?

Per user, advertisers will spend US$2.52 on social network advertising in Latin America, compared to $46 per user spent in North America and $27 per user in Western Europe.

How does this make sense when comScore reports that the average social media user in Latam spends 8.67 hours a month on social media versus 8.07 hours spent by Europeans and 6 hours a month spent by North Americans?

>>>The Approach with Social
There are several ways brands should leverage this Latam love of social in 2015:

Facebook retargeting. On one hand, we have 200 million Facebook users. On the other, in 2014 we have e-commerce growing by 40% in Argentina, by 23% in Brazil, by 20% in Mexico and by 45% in Colombia. So obviously it makes sense to retarget people who visit e-commerce sites with ads on Facebook. You can find out more on how that works here or just contact us directly since we’re experts in this area and partners with Triggit, a leading company in Facebook Exchange retargeting around the world.

Native advertising and content marketing. Do any of you know how much Latin American marketers are spending on native advertising or content marketing? Many of us don’t know yet, and the reason is because no surveys that report tactical spend by Latam marketers has been released. But it doesn’t seem to be much, if at all.

And what a missed opportunity. Mobile Internet is expanding hugely in Latin America and part of that entails people checking social networks on their cell phones: 30% of Mexicans, 37% of Chileans, 32% of Argentines and 19% of Brazilians, according to one study. But other studies confirm this trend: see here, here and here.

This means that people are checking their Facebook feeds, scrolling down: this makes it the perfect place for you to include a sponsored post that’s part of your content marketing. A recent survey of American marketers showed that 23% are devoting more than half of their 2015 budget to content production. Why? Because posts on topics and videos, for example, are good ways to engage people and sell. A post can lead back to a mini-site where your content lives—along with banners to convert people. Or you can set up a content channel on a portal—something we helped a client do with iG a few years ago and which worked very well. And you can leverage content even further with mobile: 55% of Brazilians recently said that video was their preferred format for mobile ads.

Sponsored social. This trend has taken off in the U.S. and it makes sense: use social media users with strong followings to promote brands. A recent study showed that 52% of American marketers had used this tactic in 2014, nearly as many as those who used online display advertising (58%). This could be a trickier tactic to deploy but it definitely merits some trials considering the potential it has.

Bottom Line
As an industry, we’re skipping around the surface of the potential of digital in Latam with light investments. It’s not about jumping on the bandwagon to be cool. It’s about adjusting our business practices to our audience habits. And that’s just good business.

Contact us to learn more about how we can spike your response in 2015 via mobile, programmatic, mobile programmatic, Facebook retargeting, social and a deeper dive into digital campaigns.

 

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Using Behavior to Reach Latin American Internet Users

In targeting the Latam online audience, understanding their behavior and activities is crucial to initiate and later optimize campaigns. A recent study from JWT polled thousands of Latin American Internet users in countries like Argentina, Brazil, Chile, Colombia, Ecuador, Mexico, Peru, Puerto Rico and Venezuela. The JWT study includes some behavioral data that could be helpful for agencies and advertisers. Here are some of the key takeaways:

# social tv
#1 Consider a Social TV Campaign

Nearly 6 out of 10 (58%) of Latin American Internet users say that they watch TV while online. And since we know that mobile Internet is growing hugely in Latam (along with tablet and smartphone acquisition), it stands to reason that these internautas are going online with mobile devices while watching TV.  In fact, significant percentages of Latin Americans in the JWT study report that they go online with mobile devices:

  • 58% of Brazilians
  • 66% of Chileans
  • 61% of Venezuelans
  • 62% of Puerto Ricans
  • 57% of Mexicans
  • 54% of Colombians
  • 54% of Ecuadorians
  • 49% of Argentines
  • 44% of Peruvians

Further supporting this is a study from Ericsson that revealed that 62% of Argentines, Brazilians and Mexicans go online with mobile devices and another on Chileans doing the same.
As such, agencies and advertisers may want to explore the possibilities with the Shazam mobile app and other solutions that combine TV advertising with mobile components.

deezer
#2 Up Investment in Online Video & Music Sites

Nearly 7 in 10 (67%) of Latin American Internet users say they watch or download online videos, while 58% download music and 30% stream radio. Also, more than half (53%) say that they listen to music online. Besides exploring programmatic buying of ads on video sites to improve efficiency and overall investment in online video advertising, brands and agencies can also evaluate the opportunities offered by sites like Deezer, the world’s leading legal music streaming service.

mobile money
#3 Put Money in Mobile

While 89% of Latin American Internet users access the Internet from a PC at home, the #2 device they use is a smartphone: 56% go online with these. And 24% go online with tablets, compared to 32% going online from a PC at work and 17% connecting via a PC at school and 13% using a PC at an Internet café. A recent study from PriceWaterhouseCoopers offers some ideas for crafting mobile campaigns that appeal to Brazilians and it may have applicability for the rest of Latam. Regardless, device adoption suggests that our online campaigns need a significant mobile component just to continue reaching Latam Internet users that rely more and more on these devices to connect.

# social money
#4 Be Smart about Social

Not surprisingly, the JWT study shows that 76% of Latin American Internet users engage in social networking every day. The tricky part for agencies and advertisers is that there’s pressure to stay current with all the new networks that are popping up. While many of these social networks can offer some interesting opportunities to connect with certain niche groups, the key metric to factor in is time spent. A 2014 report from comScore indicates that more than 95% of the time that Latin Americans spend on social media sites is spent on Facebook, so this suggests that we should weigh our investments accordingly. Otherwise, despite the growth of Twitter and LinkedIn, brands may not see good results with campaigns, simply because people aren’t on these long enough to see ads. With Facebook, retargeting through Facebook Exchange may be a way to maximize reach because of its basis in proven behavior, as opposed to sponsored posts or other types of ads.

Contact us to learn more about how we can help with a variety of these tactics, media and platform, including programmatic buying of display or online video ads, campaigns on Shazam or Deezer, mobile advertising and retargeting via Facebook Exchange.

internet

The 7 Hottest Trends Among Latin American Internet Users

To deliver the best possible results for clients that seek to reach Latin American consumers via online and offline campaigns, we constantly review the latest research. In doing so, we noticed a number of trends in different Latin American markets.

#1 Internet Use Spikes Dramatically
As brands score strong responses to their campaigns in Latam, it can be easy to overlook how far the market has progressed in Internet use—and how it keeps growing every day. For example, according to Pew Research Center, in 2007 35% of Argentines reported using the Internet but in 2013 more than 6 in 10 (65%) of Argentines reported using the Internet. In 2007 33% of Chileans used the Internet. But in 2013 62% of Chileans reported using the Internet. Mexico also showed a significant surge in Internet use, going from 31% in 2007 to 43%. In 2010 around 4 in 10 Brazilians (43%) reported going online but by 2013 nearly half (47%) of Brazilians reported that they were Internet users.  Of course, given that IBOPE has reported that Brazil has 105 million Internet users out of a population of 202 million, it’s possible that Pew’s numbers are a bit low. The same can be said for Mexico’s numbers given that World Internet Project recently reported that there are 59 million Internet users in Mexico (out of a population of 118 million). Projections from several organizations suggest that massive growth is on the way in many of Latin America’s markets:

  • Brazil should have 168 million Internet users by the end of 2014*
  • Chile should have 16.4 million Internet users by 2015**
  • Ecuador should have 7.5 million Internet users by 2015***
  • Mexico should have 65 million Internet users by 2015***

Sources: *Comite Gestor da Internet, **Pyramid Group, ***Latin America & Caribbean Network Information Centre

#2 Chile Leads Latam in Smartphone Penetration
According to the Pew Research Center, in 2013 more than 91% of Chileans reported owning a mobile phone and 39% have a smartphone. This means that smartphone penetration in Chile is at 39%. That seems quite huge until you consider that more than 6.6 million smartphones were sold in Chile in 2013 and that the population is at around 17.5 million. So just in 2013, 37% of the population bought smartphones in Chile.

#3 Colombia Leads Latin America in Internet Penetration
This data comes from the 2013 IBOPE Media Book. According to IBOPE, Internet penetration in Colombia is at 72% and is the highest in Latin America. IBOPE further reports that more than 80% of Colombian Internet users connect from home. Chile is #2 in Internet penetration in Latin America with 68% of the population going online.

#4 Costa Rica Is the Fastest-Growing Internet Market in Latin America
According to IBOPE, Internet penetration in Costa Rica jumped from 50% in 2012 to 67% in 2013, the biggest leap in all of Latin American markets.

#5 Accessing Social Networks Via Smartphones Increases
Nearly 4 out of 10 Chileans (37%) access social networks through cell phones and the same amount (37%) of Venezuelans also access social media via cell phones. Nearly one-third of Argentines (32%) and Mexicans 30% use mobile phones to access social networks. Significantly lower percentages of Brazilians (19%), Salvadorans (18%) and Bolivians (17%) report using their phones to check social media.

#6 90% of Argentines are on Facebook
Recently Alejandro Zuzenberg and Alberto Arébalos of Facebook Argentina released some figures about the social network’s reach in the country. While overall 90% of Argentines have an account on Facebook, there are 23 million active Facebook users in Argentina and 15 million of them connect to Facebook using mobile phones. Other important facts:

  • Slightly more women (52%) than men (48%) are Facebook users in Argentina
  • Facebook users in Argentina tend to be younger: 72% are between 13 and 34 years old,  with 22% aged 35-54 and 5% over 55
  • In March 2014 Facebook users in Argentina notched 2.4 billion likes, 1.1 billion comments, 615 million messages, 360 million photo uploads, 168 million status updates and 265 million publications on user walls

#7 LinkedIn Surges in Latam
Currently LinkedIn reports that it has more than 40 million Internet users in Latin America. LinkedIn has its deepest penetration in Chile in which more than 13% of the population (2.2 million people) use the social network. Overall, Brazil has the largest amount of LinkedIn users in Latin America (more than 15 million). Brazil is actually the #3 market in the world for LinkedIn, surpassed only by the United States (more than 100 million users) and India (more than 24 million users).
Mexico is the #2 market in Latin America for LinkedIn and has more than 5 million users. The majority (58%) of Mexican LinkedIn users are women and 57% are under 35 years of age
There are 3.3 million LinkedIn users in Argentina, 3 million LinkedIn users in Colombia and nearly 2 million LinkedIn users in Peru. In the case of Peru, LinkedIn users are mostly under age 35 (79%) and men make up 59% of the user base.

To find out more about how we can help you reach Latin American Internet users with a targeted campaign, please contact us.

An Overview of Latin America’s Mobile Market for 2014

When it comes to Latin America’s mobile market, the growth has been fast and furious, with new trends emerging in terms of behavior and usage. It’s a challenge to sort through the data just to make sense of it, let alone take advantage of it. So we decided to offer a statistical overview to help highlight the important facts that may influence mobile ad campaigns in Latin America in 2014 and beyond.

Mobile Phone Users
According to GSMA, there are 328 million individual mobile users in Latin America. By the end of 2014 there will be 341 million mobile phone users in Latin America and by 2017, there will be 374 million.

Biggest Markets
Brazil has 112 million mobile users, while Mexico has 97.6 million active mobile lines and Argentina has 53 million mobile lines.

Mobile Internet Growth
A report from Guialocal.com called Invasión Mobile Latinoamerica 2013 looks at the Latin American mobile market from several angles. One of them is in terms of growth of users connecting to the Internet via a smartphone or tablet. Costa Rica led Latin America in this area in 2013, with a 332% increase. Brazil was #2 in the growth of mobile Internet users with a 244% increase, followed by Argentina (221% increase), Colombia (216%), Mexico (213%), Chile (185%), Peru (166%), El Salvador (161%) and Venezuela (161%).

Mobile Broadband Connections
According to GSMA’s report—Mobile Economy Latin America 2013—in 2014 there will be 275 million mobile broadband connections in Latin America and 500 million by 2017.

Smartphones
At the end of 2013 there were 114 million smartphone owners in Latin America and by the end of 2014 there will be 146 million. By 2017 there will be 243 million smartphone owners in Latin America with 44% overall smartphone penetration. A look at key markets shows the following:

  • Argentina will have 12.7 million smartphone users in 2014
  • Brazil will have 41.2 million smartphone users in 2014
  • Mexico will have 33 million smartphone users in 2014 and overall sales of smartphones in 2014 (including new and current users) are projected to reach more than 37 million units

With other markets, precise amounts of smartphone users is harder to ascertain. That said, we do know the following:

Tablets

  • Tablet sales in Mexico in 2013 reached 4.3 million according to IDC and in 2014 6.2 million tablets will be sold in Mexico
  • More than 900,000 tablets were sold in Argentina in 2013, compared to 400,000 sold in 2012 and 233,000 sold in 2011
  • Tablet sales in Brazil went up by 119% in 2013 to reach nearly 8 million and in 2014 will reach 10.7 million; currently it’s estimated that there are more than 11 million tablets in use in Brazil
  • It’s projected that more than 1.6 million tablets will be sold in 2014 in Peru: 2013 sales were 828,000, a 132% increase compared to 2012
  • Tablet sales tripled in Chile in 2013 to exceed 1.5 million units and are projected to reach more than 2 million units sold in 2014

Mobile Applications
According to the Competitive Intelligence Unit, mobile app penetration in Latin America was at 28% in November 2013. Most Latin American favor free as opposed to paid apps. Apps from Google Play had the largest market share at 41.5%.

Popular Apps
According to a 2013 study from Softonic, the most downloaded apps in Spanish are WhatsApp, Facebook’s mobile app and Opera Mini’s app. A survey by Qualcomm showed that WhatsApp was the most popular app among Brazilians, followed by WeChat and Facebook’s mobile app. Another study by OnDevice showed that WhatsApp is on 72% of the smartphones of Brazil, while Facebook Messenger is on 49% of them, and Skype is in third place with 30%.

Mobile Ad Investment
According to eMarketer, Mexico leads the rest of Latin America in mobile ad spend and projects an 87% increase in mobile ad spend in Mexico during 2014 to reach a total of US$173 million. In comparison, Brazil’s mobile ad spend is projected to reach US$132 million in 2014. That said, eMarketer projects that Brazil’s mobile ad spend will soar upward until reaching US$731 million in 2017. While other countries in Latam do not have the same level of mobile ad spend increase, recently Leonardo Hilario—advertising planning manager for Telefónica Digital in Latin America—projected that mobile advertising will grow by 70% annually through 2017.

To find out how we can help you reach Latin American mobile users with a targeted mobile ad campaign, please contact us.

media buying

7 Common Media Buying Mistakes in Latin America

As we work to plan and implement more than 2,000 campaigns a year in Latin America, we often see certain strategic stumbling blocks pop up on a regular basis. To help media and marketing professionals avoid these media buying mistakes in Latin America, we decided to highlight the most common ones.



#1 One Size Fits All

Often campaigns aimed at Latin America tend to treat it as a monolithic area. However, despite the broad commonalities, adjustments for certain markets are crucial. First, media consumption is different in different countries, so the budgets need to be weighted accordingly.


#2 Not Customizing Creative

As incredible as it may sound, some clients will run English-language creative in Latin American campaigns. Obviously, language is crucial for creative to connect. We also see clients running creative that doesn’t connect culturally. For example, Mexicans may not respond well to creative developed for the Southern Cone, and vice versa. Brands need to factor in the differences in both regional accents and terminology, because a radio spot that works well in Uruguay may not do well in Puerto Rico, for example. An additional investment in development will pay off in response, whereas not customizing creative can lead to low response or embarrassing copy. Finally, brands need to keep in mind that mistakes that ended up under the radar 20 years can get around a lot faster via social media.


#3 Low Investment in Internet Ad Spend

There is a tendency among some brands to think that TV is the medium with the best reach in Latin America and the highest consumption. While there’s no doubt that free TV has a penetration rate above 90% in many Latin American markets, there are now 300 million Internet users in Latin America, which is 50% penetration (the region’s total population is 598 million). By 2017 there will be nearly 400 million Internet users in Latin America.
In addition, the Internet is rivaling free TV in media consumption in several Latam markets. For example, more than half of Mexicans watch TV between 2 and 4 hours a day, 60 to 120 hours per month. But Mexican Internet users spend 5 hours a day online—150 hours per month. Peruvian Internet users spend 2 hours and 40 minutes a day online, while Peruvians in general watch 3 hours and 20 minutes of free TV every day. A study of Colombian TV consumption showed an average of 4 hours per day for those between 5 and 17, 120 hours per month, compared to a Google study that showed that Colombians spend 4 hours a day on the Internet—also 120 hours per month.


#4 Running a Social Media Campaign without a Clear Plan

While there’s no doubt that social media can deliver strong and tangible results, clients often request social media campaigns without clear objectives or even expectations. Or they set objectives that social media is not designed to deliver. This happens because brands are naturally looking for new ways to drive sales and social media certainly has that potential, especially when you consider that 5 of the top 10 countries in social media use are in Latin America. However, without establishing goals, having a clear expectation, and having a clear action plan, it’s likely that brands won’t get the results they’re after.
In addition, social media is a conversation, yet we sometimes see that brands are not prepared to handle the interaction between them and their clients. Before any social media effort, advertisers must truly understand the value of a like or a follower as an engaged consumer, or even a social advocate; this will change the way they perceive social media as a vehicle to drive brand loyalty —and consequently—sales. It is somewhat easy to generate likes or followers, but without a clear strategy on what to do with them, including using the right metrics to evaluate results, the benefits of social media are limited.


#5 Buying Cheap Instead of Buying Smart

Sometimes clients will choose a particular media vehicle because it’s cheaper, thinking it will be more efficient. While it’s always good to spend wisely, the cheapest medium isn’t always the most effective. As such, clients can end up saving money on the buy on a cost per unit basis, but still not achieving their goals, because they are not reaching the audience they want, or because the target’s consumption of that medium is low compared to other media types, or simply because that placement is simply not within the best context to generate interaction or engagement. Advertisers must always keep in mind that they are buying audiences and not media. It’s amazing that still to this day a lot of marketers remain obsessed with cost-based metrics (CPM, CPC, CTR, CPV). We need to start looking at metrics that help us understand where consumers are in the sales funnel. Cheap does not mean valuable.


#6 No Benchmarks or the Wrong Benchmarks
While it may be hard to believe, sometimes we are told that the goal of an online campaign is to “increase traffic”, but what’s not explained is what current traffic is and how much of an increase the client wants. In fact, we’ve even had instances in which even the client doesn’t know what their current traffic is. This same thing can also happen with “awareness”, where many clients set goals based on increasing awareness, however, sometimes they don’t even know what their current awareness is, or have a plan in place to measure it before and after the campaign.
So do your homework and establish real and measurable KPIs. That way, you won’t set yourself up for failure.


 

 

 


#7 Bigger is Not Always Better

For online campaigns, we’ve had instances in which clients look at comScore rankings in the area they want and tell us to buy the top 5, period. However, these big sites with the deep reach don’t always produce the best results. Why? It could be that the sites’ content doesn’t connect with enough of the target audience or that the ad space is crowded because of the sites’ size and popularity, meaning that the client’s ads get lost in the shuffle. Or maybe the target audience that visits the big sites aren’t necessarily all that engaged.
On the other hand, you could run ads on an aggregate of smaller sites with highly engaged users and deliver both the volume and response a client wants. Obviously, this varies, but the point is to consider the best solution to reach the target audience based on available data and not equate reach with response.

To find out more about how we can help you avoid media buying mistakes in Latin America and optimize your results with a campaign in any form of media, please contact us.

5 New Mobile Trends among Hispanics

As part of our tracking of mobile trends in Brazil and Latin America, we also focus on mobile data for U.S. Hispanics, another key market we reach for our clients. After reviewing a number of recent studies, here are 5 trends in the Hispanic mobile market that we have observed.

#1 Hispanics Are More Likely to Own Smartphones than the General Market
A May 2013 report from the Pew Research Center noted that 56% of American adults are now smartphone owners. However, 60% of Hispanics report owning smartphones. When breaking down smartphone ownership by ethnic group, Pew noted that smartphone ownership stands at 53% among white non-Hispanics and at 64% among African Americans.

#2 Hispanics Are More Likely to Own Tablets as the General Market
Another Pew Research Center report from June 2013 indicated that 34% of Hispanics report owning a tablet computer, compared to 33% of white non-Hispanics and 32% of African Americans.

#3 Hispanics are More Likely to Go Online with a Mobile Device Than the General Market
More data from Pew indicates that 76% of Hispanics report going online with a mobile device, compared to 60% of white non-Hispanics and 73% of African Americans.

#4 Hispanics Are More Responsive to Mobile Ads
A 2012 study from Terra reported that 46% of Hispanics believe they are more likely to remember brands advertised on their tablets—compared to just 37% of non-Hispanics. In addition, in a survey from ThinkNow Research published in June 2013, more than 60% of Hispanics felt that mobile phone ads provided them with useful information about bargains or products and the same percentage would be willing to accept mobile phone ads in return for additional services or lower monthly charges.

#5 More and More Hispanics Are Shopping with Their Mobile Phones
Research from the Integer group indicates that 16% of Hispanic shoppers use mobile phones to make a purchase, compared to 12% of the general market. This use often involves product research, although 15% of Hispanics also report using either a QR or UPC code.

To find out how we can help you reach Hispanics via mobile or another form of media, please contact us.

reaching rich 2

Reaching the Rich in Latam

While the impressive growth of the middle class in Latin America (50% in the past decade) has been well-covered in the media, another segment in the region has also grown significantly: the affluent. We recently looked at this segment and have some interesting figures that marketers, advertisers and media professionals should be aware of.

The Growth in Latin America’s Affluent Market

  • According to the 2012 World Wealth Report, the amount of high net worth individuals (HNWI) in Latin America grew by 5.4% in 2011
  • In 2012, Latin America’s population of ultra high net worth individuals (UHNW)—those with a net worth of 30 million or above—went up by 3.5%
  • In fact, right now there are 14,750 UHNW individuals in Latin America and they have a combined net worth of US$2.2 trillion
  • Brazil has the largest amount of UHNW individuals (4,640), followed by Mexico (3,240), Argentina (1,040), Colombia (690), Peru (595), Chile (550), Venezuela (420), Dominican Republic (240) and Guatemala (235)
  • Brazil ranks 11th in the world in high net worth individuals and leads Latin America in this category
  • In 2011 Brazil had 155,400 millionaires, with one-third of them aged 35 or younger

How Latin America’s Affluent Shop
Not surprisingly, the growth of the amount of affluent individuals in the region has clearly driven the growth of the luxury market in Latin America. Here’s a look at some recent figures:

  • In 2012, Brazil’s luxury market grew by 8% to reach R$ 20 billion (US$10 billion) and it’s expected to grow by 15-25% for the next 5 years
  • Sales of luxury watches went up 30% in Brazil in 2012
  • Mexico’s 2012 luxury sales are expected to total US$14 billion and it’s estimated that 7.2 million Mexicans (5.2% of the population) can afford luxury goods
  • Luxury auto sales in Mexico in 2012 went up by 70%
  • A number of luxury brands posted sales increases in Mexico in 2012, including Porsche (20%), Audemars Piguet (25%) and Zegna (10%)
  • In Chile sales of luxury goods rose 10% in 2012 to reach US$472 million

The Media Consumption of Latam’s Affluent
Data on the types of media consumed by this segment is harder to come by, especially when it comes to the entire region. However, there are numbers that offer some hints regarding media consumption by Latin America’s affluent:

  • 37% of class AB Brazilians plan on buying a car in 2013 and the media that they say will most impact their purchase decisions are magazines (74%), Internet (70%), radio (57%), newspapers (56%) and out of home advertising (56%)
  • 85% of Chile’s highest socioeconomic class uses the internet 3-7 days a week, compared to 14% of the lower socioeconomic classes
  • 90% of the higher socioeconomic classes in Argentina have pay TV
  • 94.3% of the higher socioeconomic classes in Colombia have pay TV
  • 32% of Brazilians who listen to the radio in their cars belong to classes AB
  • Internet penetration is 81% among Chileans who belong to classes ABC1
  • Magazines have increased their penetration with classes AB in Brazil, going from 52% in 2011 to 62% in 2012

To find out how we can help you reach affluent people or any other type of market segment in Latin America via any type of media, please contact us.

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