Tag Archives: andres sandoval

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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.

 

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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The Hottest Social Media Sites in Latin America

Recent research from comScore shows some major changes on the social media landscape in Latin America. Between November 2011 and November 2012, the increase in unique visitors to social media sites was relatively small, just 2%. However, there were crucial shifts in terms of the popularity of sites. Here’s a look at the hottest social media sites in Latin America.

#1 Ask.fm
Why did we rank it #1? It’s not the site with the most users: Facebook still rules social media in Latin America, without question. That said, this site, in which users interact with each other by asking and answering questions, has grown massively in Latin America, more than any other social site—by 5,000%. The site had 247,000 uniques in November 2011 in Latin America, and one year later reached nearly 13 million monthly uniques.

#2 Pinterest
While this site does not rank among the top 10 social sites in large Latam markets like Brazil, Argentina and Mexico, overall Pinterest has grown by 2,500% in Latin America: from 77,000 unique users in November 2011 to 2 million unique visitors in November 2012.

#3 Scribd
The document-sharing site has grown by 97% in Latin America since November 2011, boasting 6.6 million unique monthly visitors one year later.

#4 Tumblr
This blog social site ranks among the top 10 social media sites in many Latam countries and overall has grown by 86% in the past year to reach nearly 12 million unique visitors a month.

#5 Weheartit
This site is similar to Pinterest that allows users to store and share images that they like with other users. It’s grown by 43% in Latin America in the past year or so to reach nearly 3 million unique monthly visitors.

Other Significant Data Points about Social Sites in Latam

  • Facebook grew by 7% in Latin America between November 2011 and November 2012
  • As we indicated, Facebook is by far the biggest social media site in Latam, with 125 million unique visitors in November 2012—LinkedIn was #2, with 35 million
  • Orkut has dropped by 62% in Latin America and had 12.9 million unique users in November 2012
  • Deviantart.com, which is among the top 10 social sites in many individual markets in Latin America, grew by 12% in the region between November 2011 and November 2012
  • Twitter posted 24 million unique visitors in Latin America in November 2012 (#3 in the region) but posted a drop of 12% in uniques since November 2011
  • Despite ranking among the top 10 social sites in Argentina, Brazil and Colombia in November 2012, overall Badoo has dropped by 46% in unique monthly visitors since November 2011
  • Two sites whose November 2011 numbers were listed as N/A by comScore now have 2.5 million unique monthly users each in Latin America: Ning and MeetMe Media
  • A number of formerly popular social media sites in the region posted significant drops in the period cited by comScore, including Vostu (down by 68%), Sonico (down by 63%), Hi5 (down by 49%) and Myspace (down by 26%)

To find out how we can help you reach Latin America via social media or any other type of media, please contact us.

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