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online ad spend

Online Ad Spend Skyrockets All Over Latam

While other countries can’t boast Brazil’s doubling of online ad spend in 2011, they’re actually not that far behind.
It’s projected that Mexico will join Brazil in having its online ad spend reach 10% of the country’s overall ad spend in 2011. This marks an increase of 3% compared to 2010, when online’s share of total ad spend was at 7%. This surge comes on top of Mexico’s 35% growth in online ad spend between 2009 and 2010, when it reached 3.3 million pesos ($273 million).
While Mexico’s 35% increase in online ad spend is impressive, other Latam markets are also heating up in this area:

  • Argentina: 50% increase in online ad spend in 2010, 27% projected increase in 2011
  • Chile: 29% increase in online ad spend in 2010, 35% projected increase in 2011
  • Colombia: 56% increase in online ad spend in 2010, 40% projected increase in 2011
  • Peru: 44% increase in online ad spend in 2010, 40% projected increase in 2011
  • Uruguay: 40% increase in online ad spend in 2010, (no 2011 projections available yet)

Total online ad spend in Latin America is also on the way up. Zenith Optimedia projects that it will grow by 14.4% in 2011, 2012 and 2013.

Where the Money Is Going
In many countries, display banners still rule. They make up 70% of the digital ad spend in Chile, 83% of the digital ad spend in Colombia, 61% of the digital ad spend in Mexico and 50% of the digital ad spend in Argentina. Search advertising is relatively low in many Latin American countries when you consider how it dominates the online activities of many users. For example, a recent comScore study shows that as an activity search grew 34% in Brazil between March 2010 and March 2011. In the same period, it grew by 23% in Mexico, by 28% in Colombia and by 21% in Argentina.
Among the growth categories are social media (106% in Mexico in 2010) and online video. In fact, an IAB Uruguay study suggests that advertisers will spend more than 25% of their budgets on online video ads.

Factors Behind the Surge
Obviously, improved infrastructure has made a huge difference. The region’s hot economies are also playing a role. With better purchasing power, more people can connect by either buying computers or connecting via their smartphones. And in Brazil, LAN houses have opened up Internet access for class C consumers.
But beyond physical and economic factors, what’s important to note is the Internet’s role in purchasing decisions. comScore’s 2010 study on Latin American e-commerce reported that 97% of Argentine Internet users go online to research products before buying. The same pattern was found among users  in Brazil (87%), Mexico (91%), Chile (90%), Colombia (94%) and Peru (91%). This suggests strongly that advertising online to drive retail traffic is a strategy that will yield rewarding ROI.

To learn more about how we can help you reach the Latin American online market with a variety of premium media outlets, please contact us at info@usmediaconsulting.com.

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mexico-digital-1405

Keys to Understanding Mexico’s Online Market

Recent research from IAB Mexico, comScore, Microsoft Advertising and Asociación Mexicana de Internet (AMPCI), among other sources, offers insights into this growing market.

 

Size
In 2010 there were 34.9 million Internet users in Mexico, with 40 million projected by the end of 2011 and 56.4 million by 2014—50% penetration. Mexico is currently the fastest-growing Internet market in Latin America, ahead of Brazil, Argentina, Colombia and Chile.


Online Ad Spend

In 2010, it was 3.3 billion pesos ($273 million), 7% of the overall ad spend. However, online ad spend in Mexico in 2011 is projected to be 10% of the overall spend. It’s #2 in the region in online ad spend, second only to Brazil, whose online ad spend will also hit 10% of the overall spend this year.

 


User Profile

Mexican Internet users are split evenly by gender, 51% men and 48% women. They skew younger: 64% of the Mexican online population is under 35 but has significant purchasing power.
Mexicans spend 25.8 hours a month online, very close to major markets like Colombia (26.6 hours), Brazil (27 hours) and Argentina (28.7 hours). Another interesting fact about Mexican Internet users is that they spend double the amount of time online than they do watching TV, whether free TV or cable.
Desktop and laptops are the most common way for them to connect, but in 2010 30% of Mexican users went online via cellphones and 14% went online with smartphones.


What Mexicans Most Love to Do Online
Search (91% reach), social media (90%), multimedia (78%) and email (77%) are the top activities in terms of reach. Mexico ranks #6 in Facebook usage in the world and is among Twitter’s top 16 markets. Mexico is also one of LinkedIn’s fastest-growing markets.

Activities Growing in Popularity Among Mexican Internet Users


Online entertainment:
Among Mexican Internet users, this category has 86% penetration, bigger than that of all of Latam (84%). Mexicans spend 3.4 hours per visitor on entertainment sites, more than any group of Internet users in the world.


Reading about technology and news:
58% of Mexican Internet users go online for news or to technology sites. Not surprising, since computers and software are what Mexicans mostly buy online. In addition, 33% of Mexican Internet users visit a newspaper site every month.


Listening to music:
According to IAB Mexico’s 2010 study, 22% of Mexican Internet users listened to music online in 2010, up from 16% en 2009. Music is part of their multimedia consumption, which has 78% penetration in the market.


Shopping:
15% of Mexican Internet users shopped online in 2010, triple the amount in 2009. Mexico is #2 in e-commerce in Latin America and it’s growing by 50% a year. Forrester’s projects it will reach $3.4 billion by 2016.

Reaching the Mexican Online Market
A number of the media we represent may be helpful in targeting these important segments in the Mexican online market, including:

• Technophiles: CNET.com draws 1.4 million unique users a month in Mexico
• Music lovers: last.fm draws 1.3 million unique users a month in Mexico
• Gamers: Gamespot.com draws 560,000 unique users a month in Mexico
• Entertainment: TV.com reaches 200,000 female unique users a month in Mexico
• News: Our Jumba ad performance network includes 25 of the top newspapers in Mexico, including those with the biggest online reach 

To learn more about how we can help you reach Mexico via online or other media, 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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The comedy show Custe o Que Custar satirizes pop culture and politicians.

6 Basics about Brazil’s Media Market

Brazil is big these days. No surprise there: a spiking GDP, 190 million potential customers and a well-developed media market are getting lots of attention. You also can advertise there and make money without a local presence. These basics on the country’s media market will give you a sense of the potential rewards and challenges.

#1     Brazil’s media market is big. And small. While there are lots of media choices, only 7 firms control 80% of what’s read, heard or seen in Brazil. Organizações Globo rules TV, film and radio and is competitive in print and web media. It commands around 75% of Brazilian TV ad spending. Beyond free TV, Globo’s has interests in Net Serviços, the country’s largest cable company, and SKY, the largest satellite dish company. In print, Abril produces 73% of the highest-selling magazines in the country.

Domingão do Faustão is one of Brazil's top shows.

#2     TV still rules the media mix. This medium has the most penetration in Brazil (over 90%) and commands 60% of the overall ad spend. Other forms of media lag way behind, with newspapers a distant second at 12.7%. This is markedly different from the U.S., the U.K. and even Argentina, in which TV dominates but other forms of media don’t lag as far behind. Brazil is closer to Mexico in this sense, where 76% of ad investment goes to TV.

#3     Magazines are an emerging force. Circulation has been rising since 2005, spiking 7% in 2010. Biweeklies saw the biggest growth at 21%, followed by 8.1% for the weeklies and nearly 5% for the monthlies. The U.S.’s Condé Nast recently launched a joint venture with Globo, Brazil’s biggest media conglomerate, to create a new company. Edições Globo-Condé Nast will launch popular Condé Nast titles in Brazil, including Vogue.


#4     Online is gaining ground. Brazil has 73 million Internet users, the 8th largest Internet audience in the world according to comScore. Often, 43 million is the figure reported, but that doesn’t factor in the many users at LAN houses in the country. ComScore’s calculations take that into account.
     Since the country’s overall population is 190 million, this means there’s a 38% penetration rate. Not as deep as that of the United States or European countries, but this is changing quickly. The amount of Brazilian Internet users grew by 20% in 2010 and research firm Forrester’s estimates that it will grow 18% a year between 2011 and 2016. E-commerce grew by 40% in Brazil in 2010 and Forrester’s projects it will grow 178% by 2016 to reach US$22 billion. Seven out of 10 online Brazilians visited a retail site in December 2010, with Mercado Livre, Lojas Americanas and BuscaPe boasting the most uniques. Group-buying sites like Clubeurbano attracted 50% more unique users between August and October 2010. And banking giants Itau and Banco do Brasil each had a 50% growth in uniques during 2010. For its part, Brazilian portal iG draws in more than 29 million uniques a month.


#5     OOH is a power performer. Laws restricting billboards in Sao Paulo and Rio did nothing to stop the message getting out. Agencies just got more creative, using projections onto buildings, plasma screens in restaurants and digital panels in airports and malls to reach the audience. And it worked. That’s why out of home (OOH) ad investment shot up by 16% in 2010 to reach US$464 million. Digital OOH ad investment is growing particularly quickly in Brazil. It went up by 58% in 2010 and is projected to grow by another 60% in 2011 to reach $147 million.


#6     For print, consider buys with niche titles. The top two socioeconomic classes in Brazil are A and B, followed by class C, a lower middle class, then the poorer classes, D and E. Around 6 million people are expected to move from class C to class B in 2011 as the economy expands and government programs target poverty. One tendency of the emerging classes in Brazil is to consume more media, particularly magazines. In fact, Brazilians spend more than double the amount of money on magazines than they do newspapers. And when they look to spend, they show an interest in specialized information on decoration, fashion and food. This has given rise to more niche magazines, like Gloss, a teen magazine with a circulation of 140,000.  Other hot niche pubs include luxury magazine Wish Report and yachting magazine Nautica.

To learn more about how we can help you leverage the power of Brazilian media, contact us at info@usmediaconsulting.com.

To learn more about how we can help you leverage the power of print in Latin America, 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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