Tag Archives: In 2011

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Latin America: The World’s Fastest-Growing Ad Market

Recently we noted the positive growth that both eMarketer and MagnaGlobal projected for ad spend in Latin America. Zenith Optimedia has joined these two sources with its own strong projections for the region.

Zenith Optimedia predicts that in 2013, Latin America will grow by 10.1% in ad spend, which is more than any other region in the world and nearly three times the rate of growth of the United States (3.6%) and double the rate of growth of the entire world (4.6%).

In terms of specific figures, Zenith Optimedia forecasts that 2013 ad spend in Latin America will reach nearly US$42 billion and then grow another 8.7% in 2014 to total US$45.6 billion.

Of course, these are projections. To get a sense of how accurate these projections may be, we researched actual ad spend figures for Latin American markets for 2012. Here’s a look at what we found.

Argentina
According to the Cámara Argentina de Agencias de Medios, ad spend value seems to have increased in Argentina during the first half of 2012. Overall, the ad spend value is up by nearly 20% compared to 2011, with the biggest increases in Internet ad spend (56%), radio (47%), newspapers (35%), pay TV (29%) and newspapers in the capital (22%)

Brazil
According to Projeto Inter-Meios, in Brazil ad spend in the first half of 2012 increased by 11% compared to the first half of 2011 to reach 14 billion reais (US$6.8 billion). Free TV continues to dominate the Brazilian ad market, commanding nearly 65% of the ad spend and growing by 13% compared to the first 6 months of 2011. However, the two forms of media that grew the most in the first half of 2012 in Brazil were Internet and pay TV, each of which registered growth of 18% in this period. It’s also interesting to note that Brazilian newspapers grew by 4% in ad spend during the first half of 2012.

Colombia
Overall ad spend grew by 5% in Colombia during the first half of 2012, according to figures from Asomedios, Andiarios and IAB Colombia. The total reported by these organizations —which reflects ad spend in regional and local TV, magazines, newspapers, national TV, radio and Internet— is one trillion Colombian pesos, which is about US$555 million. During the first half of 2012 Internet grew the most of all Colombian media in ad spend: 12%. However, national TV still commanded the largest share of ad spend, with 45.8%, followed by newspapers (21%), radio (20%) and magazines (4.5%).

More Markets
While we could not find 2012 ad spend numbers for other Latin American markets, the figures from last year suggest that Zenith Optimedia’s positive projections make sense. For example, in 2011 ad spend grew by 11.9% in Mexico, by 10% in Chile, by 16% in Peru, by 6.5% in Ecuador, by 7.% in Uruguay and by 7.8% in Venezuela.
As such, it’s likely that we’ll be reporting strong 2012 ad spend figures for all of these markets during the first quarter of 2013.

To explore how we can help you reach Latin America’s growing consumer market through a campaign in any type of media, please contact us.

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The Hottest Growth Markets in Latin America

As Latin America’s economies continue to grow and more and more consumers emerge—particularly those from the middle class—the region has produced a number of growth markets. After reviewing dozens of studies, we’ve identified 8 different product categories that have posted impressive growth in recent years and seem to poised to grow even further in the near future. For marketing and media professionals, these growth trends may offer some hints as to where advertising dollars may be headed.

Appliances
While there aren’t figures available for the entire region, many of Latin America’s markets are seeing spiking sales of appliances. For example, in 2011 appliance sales went up by 25% in Argentina, by 20% in Colombia, by 16.6% in Brazil and by 16% in Peru. While sales figures for Mexico have not been published, research firm Global Insight has projected that appliance consumption in Mexico should increase by 11.6% through 2015.

Coffee Shops
Over the past few years Latin America has been growing as a market for specialty coffee shops. According to research firm Euromonitor International, by 2016 Latin America will contribute 13% of the world’s total value of specialty coffee shops. In Mexico, the specialty coffee shop segment has more than doubled since 2006 and Colombia is expected to contribute US$212 million in new value to this market. Given the growth, it’s not surprising that Starbucks has announced plans to open hundreds of shops in Brazil, Mexico and Argentina over the next few years. The strategy for brands like Starbucks seems to be to focus on the premium quality of its products and the ambience of its stores.

Cosmetics
According to Euromonitor, the Latin American cosmetics market grew by 20% in 2010 to reach US$64 billion—it’s the fourth-largest cosmetics market in the world. This regional growth is fueled by key individual markets, starting with Brazil. In 2011, Brazil’s cosmetics market posted US$43 billion in sales, an increase of 18.9% compared to 2010. Also in 2011, cosmetics consumption in Peru grew by 13% to reach US$290 per person. In fact, Peru now ranks #5 in cosmetics consumption per person in Latin America, behind Venezuela (US$390), Brazil (US$380), Mexico (US$330) y Colombia (US$320). It’s estimated that Peru’s cosmetics consumption per capita will grow by 9% in 2012 to reach US$318 per person.
In Mexico, the country’s US$9.1 billion-dollar cosmetics market grew by 7.6% in 2010 and by 8% in 2011. It’s projected to grow by another 5% in 2012, a greater rate than the country’s GDP.  In Chile, the cosmetics market grew by 11% between April 2011 and April 2012, with overall growth for 2012 projected to be 7%. Argentina’s cosmetics market posted 40% growth in value and 12% in volume in 2011 to reach US$200 million.

Pet Care
According to research firm Euromonitor International, spending on pet care products in Latin America has risen by 44% during the past 5 years to reach $11 billion. Brazil is the largest pet care market in Latin America, registering sales of US$5.2 billion in 2010, followed by Mexico (US$1 billion in sales) and Argentina (US$645 million). Despite being a smaller market in terms of pet care, Chile has the highest rates of both dog ownership (60% of households owned a dog in 2011) and cat ownership (31% of households). As such, it’s not surprising that that the pet care market in Chile has grown by 20% over the past 5 years. Peru is another growing market in pet care, posting 25% growth in 2011.

Pharmaceuticals
According to the market research report Emerging Pharmaceutical Markets in Latin America, Argentina, Chile, Colombia Peru and Venezuela should see their pharmaceutical markets grow significantly between 2012 and 2016. The report projects 8% annual growth for Colombia’s pharmaceuticals market until 2016 and 20.8% annual growth in this sector for Venezuela.
Overall, the Latin American pharmaceutical market is worth more than US$60 billion per year, equivalent to 7% of global pharmaceutical sales.
Brazil, not surprisingly, has the largest pharmaceutical market in Latin America and in fact its market ranks 7th in the world. Mexico’s pharmaceutical market ranks #14 in the world but is #2 in Latin America—it was worth US$11.4 billion in 2010, up significantly from its US$7 billion worth in 2004. IMS predicts that Mexico’s pharmaceutical market will grow by 6% per year to reach US$13 billion by 2014. For its part, Argentina’s pharmaceutical market grew by 26% in 2011 to reach 17 billion pesos (US$3.6 billion).

Soft Drinks
Between 2004 and 2010, Latin America was the region that grew the most in the consumption of energy drinks: 31%. In addition, by 2016 the per capita volume of soft drink consumption in Latin America will equal that of Western Europe. Households in Latin America spend a greater proportion of their income on soft drinks than on any other region: 4%. A study from Yale University’s Rudd Center indicates that Mexico is the world’s biggest consumer of soft drinks, with a per capita consumption that’s 40% higher than that of the United States.

Sun Care Products
In 2011 Latin America posted US$1.7 billion in sales of sun care products, up significantly from the US$1.4 billion in sales in 2010. Global sales of sun care products was US$9.3 billion, which means that Latin America accounted for 18% of sales, just behind North America. In addition, Euromonitor projects that Brazil’s growth could propel Latin America into the #2 spot in sun care product sales by 2016.

Toys
In 2011 Latin America accounted for about 9.2% of the worldwide toy market. While the region’s share isn’t as large as that of Europe or Asia, it’s important to note that Latin America is the world’s fastest-growing toy region in the world: its annual retail sales growth is between 6-8%. The combination of the region’s growth in both per capita income and population of children are helping drive Latin America’s toy market. Top categories in terms of sales include dolls, building sets and infant/preschool products. Latin America was responsible for 14.4% of Mattel’s worldwide sales in 2011 and for 7.8% of Hasbro’s worldwide sales.

To explore how we can help you reach Latin America’s growth markets through a campaign in any type of media, please contact us.

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