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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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Fast Facts for Latin American Media

Keeping up with what’s happening in Latam media is tough—even for a media representation and placement company like ours. We realize that this is even harder for professionals in the media, advertising and marketing industries who specialize in Latin America.

That’s why we put together some newer developments in Latin American media for you in short sections below. With a quick scrolldown, you can get updated on a variety of media in several important markets and access more information if you need it with a quick click.  We start off regionally:

LATIN AMERICA
>Digital Advertising Will Grow 15% in 2012 in Latam
This is according to a recent survey done by Portada. Read more here.

>Latin American Newspapers Keep Growing in Circulation
According to the World Association of Newspapers and News Publishers, circulation of Latin American newspapers went up by 2% in 2010 and by 4.5% over the past 5 years.

>Social Gaming Surges in Latam
At IAB Now in Argentina in fall 2011, Daniel Kafie, founder and CEO of Vostu, predicted that the social gaming market will hit US$1.6 billion in 2012. In Latin America social gaming is already a $330 million market. Read more here.

>E-commerce Booms In the Region
German research firm Ystats reports that the number of online shoppers in Latin America will grow by 20% a year over the next few years. More stats available here.

>3 Latin American Countries Among Top Facebook Markets
As of January 2012, Colombia was the fastest-growing Facebook market in the world, followed by Brazil and Mexico.

>Latin America is Growing Fastest in Ad Spend for Social Media
A survey by Grant Thornton LLP indicated that 78% of Latin American advertisers plan to increase their social media spend in 2012, more than advertisers in North America, Europe or Asia.

>Pay TV Revenues in Latin America to Reach $25 billion by 2016
This is according to a new report from Informa Telecoms and Media.

>Latin Americans Among the World’s Biggest Moviegoers
IBOPE AGB Mexico’s newest report offers these and other interesting facts about Latin American media.

Being More Specific
Here are some more fast facts about major media types  in specific markets of Latin America.

ARGENTINA
>Pay TV Penetration reaches 81%
This is according to a new study from the Latin American Multiadvertising Council (LAMAC).

>66% of Argentine Internautas Watch TV Online
A study from Mindshare Argentina recently reported these results, along with the fact that a lesser amount of Argentine Internet users—47%—watch free TV.

BRAZIL
>6% of Shopping Searches in Brazil Come From Mobile Devices
This is according to Peter Fernandez, head of Mobile Marketing for Google in Latam, during the Mobile Marketing Association Forum in São Paulo in fall 2011. More info here.

>Brazilians A Huge Online Gaming Market
According to Juan Franco, founder and CEO of Mentez, 35 million Brazilians play online games on social media. In total, Brazilians spend US$2 billion a year on online gaming overall, which includes gaming on social media and mobile devices as well as massively multiplayer online (MMO) games.

CHILE
>Online ad spend grew by 35% in 2011 in Chile
IAB Chile projects that online ad spend will make up 7% of the country’s overall ad spend in 2012, which is comparable to the 10% that online has reached in Brazil.

>88% of Chilean Internet Users Have Made An Online Purchase
A new study from Universal McCann Chile suggests that e-commerce is strong in Chile and breaks down the top products that Chilean Internet users buy.

MEXICO
>Mexico has 46 million Internet Users
According to E-Marketer, the country now has 40.5% Internet penetration.

>19% of Mexican Internet Users Watch TV on a Mobile Device Every Day
This is from Motorola Mobility’s Global Media Engagement study. See more here.

>Games Spending in Mexico Hits US$1.2 billion in 2011
Mexico’s gaming market continued to grow in 2011 and players spend 60% of their time on online or mobile gaming.

>E-Commerce in Mexico Grew 28% in 2011
This is one of many fascinating numbers from a recent study done by Asociación Mexicana de Internet and Visa.

URUGUAY
>Online ad spend went up 50% in 2011
Uruguay joined other countries in Latam with spiking online spend—Internet now makes up 4% of the overall ad spend in the country. Read more here.

>Overall ad spend in Uruguay reached $249 million in 2011
This is a 7% increase compared to 2010, according to a report issued by the Asociación Uruguaya de Agencias de Publicidad—the Uruguayan Ad Agency Association.

To find out how we can help you reach Argentina, Brazil, Chile, Mexico or all of Latin America with an innovative media campaign, please contact us at info@usmediaconsulting.com.

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US Media Consulting Merges with Jumba

This month we officially completed our merger with Jumba Media Group, one of the top online ad networks in Latin America. “While we have worked closely with Jumba since its launch in 2007, we’re proud to make it officially part of the US Media Consulting family,” says Bruno Almeida, Chief Commercial Officer for US Media Consulting.

New Name, New Products
The “Jumba” name won’t go away, but it will no longer refer to the company. From now on, US Media Consulting is the company name but the Jumba brand name will continue to exist in the form of specific products. As such, Jumba’s offices in Buenos Aires, Argentina, will become an additional Latin American satellite office for US Media Consulting, joining the ones in Bogotá, Guatemala City, Caracas, Mexico City and the upcoming office in Brazil
One of the key products with the Jumba name is the online ad network, which features 1,700+ sites concentrated in 15 key subject areas. Adding this network—which will be called Jumba Display Network—to US Media Consulting’s roster of represented media and 2,200 media partners will give our clients even more Web options for their campaigns. Besides top premium sites, Jumba Display Network offers vertical site clusters and long-tail sites—both of which make for maximum reach and significant cost-effectiveness.
 
Beyond Web into Mobile, Social and More
Of course, merging with Jumba offers more than just proprietary web solutions. With the Jumba Mobile Network, US Media Consulting can help clients tap into Latin America’s surging mobile ad market via more than 150 mobile sites.
But the new solutions don’t stop there. “Our team has developed a wide range of solutions for clients, including online video advertising, email marketing and social media marketing,” says Ignacio Roizman, former head of Jumba Media Group and now Chief Operations Officer at US Media Consulting. “We’ve already launched campaigns for clients in those areas but we’re also developing a number of other web-based solutions that should roll out in 2012,” explains Roizman.

A Fresh Site…and Maybe More Mergers
Clients, media partners and industry colleagues will get a very direct sense of the offerings of the new, improved US Media Consulting this spring. “We’re re-doing our company Web site from top to bottom,” says Almeida. “The new site should be ready in a couple of months and will showcase the expanded offerings that the merger has made possible. In addition, we’re also considering other firms that we may acquire. We’re seeing a lot of interesting synergies in the marketplace and great potential,” says Almeida.

To find out how more about our web, mobile, social media, email marketing and online video campaigns, as well as our capabilities in print, TV and out of home advertising, please contact us at info@usmediaconsulting.com.

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Using Content to Think Outside the Banner

Is content king? Some believe this 100%, others see it as a big myth. We’re not sure if content is king, but we do know one thing: it can deliver results that rule.

The Challenge
A major brand in the healthcare industry wanted an outside-of-the-banner approach for their next campaign. This meant going beyond the usual ad formats to engage users and prospective customers. While lots of ad formats can gain attention, engagement is about keeping a customer’s attention—and getting them to interact with the brand. According to studies done by Adobe, Microsoft Advertising, Nielsen and other firms, higher engagement with ads or greater “dwell” time leads to better response and ROI.

The Solution
The campaign was to run on iG, the top content-producing Brazilian portal that draws 29 million unique users per month. iG is a respected provider of information across a variety of channels, including health. We saw a great opportunity to create a subchannel within iG that would specialize in the area of expertise for the client. The client created the content. They made it independent, fresh and interesting, NOT an advertorial to sell products. The client also varied the type of content. Rather than just copy and photos, they developed high-impact content that included informational videos and slideshows to maximize the power of the web medium.

But having great content in place was only the first step. We also had to draw people to it. So we created specific banners that ran in a variety of sections within iG and that appealed to multiple market segments: men, women, families, etc. The banners were customized to each section, promoting specific products and inviting users to click to find out more. Once a user clicked on a banner, he or she would end up at the client’s subchannel. There, he or she would discover lots of fresh content related to the product while also seeing ads for a variety of other products. 

The Results
The client set specific engagement metrics: click-through rates (CTRs), overall traffic to the channel, page views and time spent. The campaign produced powerful results in all of these areas, as well as more engaged users.

The Takeaway
Consider content as a tactic. It allows you to go outside of the banner and engage customers to build relationships that can deliver results that extend beyond a single display campaign.

To find out how we can help you use content to create a winning campaign, contact us at info@usmediaconsulting.com. To get the big picture on Brazil’s media market, click here.

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Joining IAB in Latam

In July, US Media Consulting became a member of three branches of the Interactive Advertising Bureau: IAB Argentina,  IAB Colombia and IAB Mexico. We also traveled to Mexico to participate in that branch’s annual event—IAB Conecta—on July 28 and 29. The move is part of our continued expansion in these countries as our local offices continue to deliver powerful results with online advertising.  In Mexico, our sales have spiked by 7 times in just the first 2 quarters of the year. In Argentina, our sales are up 76% in the first 6 months of the year. And in Colombia, we’re set to increase sales by an eye-popping 600% by the end of the year.  

Our market expansion wasn’t the only reason we  joined these branches of IAB.  Another key factor was the opportunity to participate in Internet advertising research through the organization’s many committees. We’re also looking forward to the educational sessions offered by each branch. Finally, IAB offers the chance to connect regularly with our fellow Internet advertising professionals to share our market knowledge.

Besides selecting the committees we’ll be participating in, we’re also gearing up for IAB Now, IAB Argentina’s annual event that takes place this September. We look forward to working with our fellow members in all three countries to further best practices and research in the world of online advertising.

Louis Vuitton

Reaching Latam—the Hottest Retail Market in the World

Nine Latin American countries are among the top 30 emerging countries for retail development, according to a report by consulting firm A.T. Kearney. As an emerging retail region, Latin America far outstrips any other, even Asia and the Middle East.

Brazil is the number one emerging retail market, followed by Uruguay (#2) and Chile (#3), with Peru coming in at #8. Mexico is #22, Colombia is #24, Argentina is #25, Panama is #27 and Dominican Republic is #28.

What’s behind the high rankings? Booming Latam economies and dedicated shoppers. For advertisers and marketers, this report further confirms that now is the best time to reach out to this market.

Considering the boom in Latin American media, there are multiple options for taking advantage of the region’s hot retail market.

Online. A recent study by Microsoft Advertising indicates that 71% of Latin Americans go online to research before buying. Besides information, they want savings. That’s why Groupon has exploded in popularity in Argentina, for example.
>How we can help: An online campaign on high-traffic Web sites customized to the demographic you’re after. We can set this up for the whole region or for specific countries. Either way, our longtime relationships will get you great CPMs.

Print. Newspapers and magazines are expanding their reach in Latin America. In 2010, circulation spiked 5% overall for Latam newspapers. Brazilian newspapers have enjoyed a 4% increase in circulation so far in 2011, while Brazilian magazine circulation went up 7% in 2010.
In addition, Latin American newspaper sites draw big traffic. For example, according to comScore, Colombian newspapers El Tiempo and El Espectador rank #7 and #20 among the country’s most popular sites. In Argentina, Clarín is #5 in amount of unique visitors per month and La Nación is #10.
>How we can help: Our close relationships with all the major newspapers in Latam stretch back nearly a decade. We can easily set up a combination print/online campaign to allow you to reach the readers of these popular newspapers with both media. Or we can conduct a print-only campaign—again, our relationships can get you superb pricing, a variety of  formats and premium positions

TV. Latin America’s  traditional leader in ad spend remains firmly in place. However, going beyond free TV to pay TV allows you to reach the more affluent customers that are powering this retail surge. And pay TV is exploding in the region. Currently there are 42 million subscribers, but by 2015 half the homes in Latin America will have pay TV.  
>How we can help: Our relationships with major networks like Televisa, Globosat  and Bloomberg TV will deliver competitive pricing to match their impressive reach.

To learn more about how we can help you reach Latin America’s booming retail market, contact us at info@usmediaconsulting.com.

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Speaking Latam

Can English-Only Sites Offer Big Reach to Latam?

Nearly all the top 40 Web sites in Latin America are either in Spanish or Portuguese. But 5 are only in English—and they still draw millions of unique visitors from the region. Here’s why.

Top 40 Countdown
Not surprisingly, per comScore the 40 most popular Web sites in Latin America include big brands like Microsoft, Facebook, Terra, iG and Vevo.

While almost all of them are in Spanish or Portuguese, 5 are not—their content is English-only:

Site comScore Latam
rank
# of uniques per month
MTV Networks Music #21 13.5 million
Conduit #28 12.8 million
Amazon sites #33 12.8 million
CBS Interactive #34 10.94 million
English-language Wikipedia #9* 9 million


A Handy Tool
Do these numbers mean that these 5 web properties are pulling a desirable, high-income audience that’s highly fluent in English? Not exactly. With all of these sites, Google Toolbar provides a rough translation into Spanish or Portuguese. It’s not perfect or similar in quality to content originally written in these languages for the audience, but it works. As such, users can go to all of them and get what they want. With MTV, they’re likely to be watching videos, TV shows and movie trailers that don’t need a pitch-perfect translation to enjoy them. The same applies with a shopping site like Amazon or a tech site like Conduit: as long as you can follow the basic directions, navigation is relatively easy. With Wikipedia, the start page lets you choose Spanish or Portuguese as an option. Or you can use the toolbar to translate English Wikipedia content into either language.

English Exceptionalism
However, toolbar translations don’t drive traffic. These 5 English-language exceptions attract a combined 64 million Latam users because of:

  • Worldwide brand equity
  • Unique services

And CBS Interactive is the exception to the exceptions. Unlike most of these other sites, it draws readers with content. CBS’ site portfolio offers tech news, reviews and downloads with CNET and ZDNET (4.6 million combined monthly uniques), playing tips and reviews for gamers with Gamespot (1.7 million), music downloads via last.fm (3.6 million) and news/entertainment info through CBS News and TV.com (1 million).

This broad mix delivers a deeper reach with different audiences that tend to skew A/B in terms of socioeconomic class. And because of the unique, high-quality content on CBS Interactive’s sites, they’re stickier, so users stay longer—all the better to reach them with ads.

*#9 ranking is for all Wikipedia sites, including Spanish Wikipedia and Portuguese Wikipedia

To find out more about reaching Latin America with online advertising, contact us at info@usmediaconsulting.com.

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Reaching Around Segmentation in Latam

Typically, segmentation is key to a campaign’s success. Know your customer, tailor your campaign to that knowledge and enjoy your success. But segmentation isn’t the only path to success.

Redefining the Segment
Recently, one of our tech clients was looking for buying strategies for Latam sites. They wanted their ads to deliver unit sales, not branding. So these ads needed to get in front of eyeballs and convert a user into a buyer. While a tech site would have been an obvious route to try to yield segmentation, the client wanted to sell computers. We realized quickly that anyone who’s online is potentially a customer—all Internet users were the segment to go after.

Quality Content = Conversion
With that in mind, we looked to high-traffic sites. Typically, portals for certain countries like Brazil, Mexico and Argentina are a good target. And they worked. However, this one size didn’t fit all. We discovered that for certain Latam countries, newspaper sites also worked well. Examples include Colombia’s El Espectador and El Tiempo and Argentina’s Clarín and La Nación. Why? Local content. Running traffic numbers through comScore, we noticed that the highest traffic from portals for certain countries ran through e-mail or IM programs. People see the ads when checking e-mail or sending IMs to friends and family, but they often responded better when the ads ran in content-rich sites like newspapers. They spent more time browsing these sites. So they were more receptive to the messaging from the ads than when they were focused on checking and responding to emails and IMs.
     This is not to say that portals don’t offer great reach—they do, especially if they have local content for the market. But the content made the difference in conversion with this campaign, and we noticed that in certain markets, like Peru and Central America, local newspapers function as de facto portals because of their brand equity.

Tighten the Pitch
Of course, strategic placement to deliver big reach was only part of why this campaign worked so well. The client created time-sensitive ads with great offers and strong calls to action—and they refreshed them regularly. Combining this with high-reach sites is what drove the success.

The Takeaway

  • Reach can be more important than segmentation if the product has broad appeal
  • Latam portals have great reach, but in certain markets local newspapers work just as well or better because they have millions of loyal readers who migrated from the print
  • Look at what users DO on high-traffic sites. E-mails and downloads keep them too busy to focus on ads. But quality content gets them to browse around and makes them more open to add messaging.

 To learn more about how we can create a powerful online ad campaign for you, contact us at info@usmediaconsulting.com.

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