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Latam’s Emerging Internet Markets

In covering the rise of Internet in Latin  America, there seems to be a wealth of information about the larger markets such as Brazil, Mexico, Argentina and Colombia. In contrast, it’s harder to find data about smaller but surging Internet markets, such as Peru, Ecuador, Chile and Uruguay.

To help marketers, advertisers and media agencies plan their campaigns in these markets, we decided to put together some quick Internet data portraits for them.

 


CHILE

>Penetration: In June 2012 there were 10 million Internet users in Chile out of a total population of 17 million, which is 58% Internet penetration*. Chile is edged out by Colombia (59.5%) and Argentina (66%) in Internet penetration, but ranks higher than Mexico, Brazil and many other Latin American countries.
In terms of reach within socioeconomic classes, Internet penetration in Chile is 81% with classes ABC1, at 70% with class C2 and at 57% with class C3.**

>Future Growth: There will be 16.4 million Internet users in Chile by 2015, 64% growth. This will undoubtedly be helped by 97% PC penetration in Chilean homes by 2015.***

>Time Online: Chilean internautas spend an average of 24 hours a month online per user, in line with the global average of 24.5 hours per user per month.****

>Reaching This Audience: The types of sites with deepest reach among Chilean Internet users are social media sites (96% reach), community sites (95%), multimedia sites (93%), news sites (93%), blogs (87%) and game sites (87%).****

>Social Media: Chileans spend nearly 9 hours a month on social media and the country ranks #6 in the world in terms of its social media use. Facebook rules in Chile as it does in the rest of Latam, with 91% reach and 6.7 million visitors from Chile in May 2012.****

>Social Media to Watch: Despite Facebook’s reach, advertisers should also look to other fast-growing sites in Chile, like Tumblr (209% growth between 2011 and 2012), Scribd (258%), Slideshare (58%) Deviantart (36%) and LinkedIn (32%).****

>Online Video: Chileans watch many more online videos than the rest of Latin America, offering advertisers a fresh, effective format for reaching this market. Internet users in Chile watch 172 videos per viewer per month, significantly higher than the monthly online video consumption of Mexico (154 videos per viewer per month), Brazil (125) and Argentina (117). The vast majority of online videos watched by Chileans (82%) are on Google Sites, with VEVO and Viacom responsible for 5% and 1%, respectively, of the online videos watched by the audience. Current market indicators suggest the growth should continue strongly: between August 2011 and August 2012, the overall numbers of online videos that Chileans watched went up by 48%.****

>E-Commerce: Projections from Visa suggest that e-commerce in Chile will grow 14% from US$1.4 billion in 2011 to US$1.7 billion in 2012.

>Mobile Penetration: Currently it’s at 129%.******

>Smartphone Penetration: Currently at 30% but one estimate says that by 2015, 54% of the cell phones sold in Chile will be smartphones.******* However, Chilean Telecommunications Ministry subsecretary Jorge Atton recently estimated that in 2013 as many as 75% of the mobile phones sold in Chile will be smartphones.

>Mobile Internet: In 2011 mobile broadband connections in Chile grew by 105% to reach 2.96 million and surpass fixed broadband connections, which totaled around 2 million.********

Sources: *Internet WorldStats, **Estudio General de Medios, ***Pyramid Group, ****comScore, *****Cámara de Comercio de Santiago, ******Subsecretaría de Telecomunicaciones de Chile, *******Entel, ********Ministerio de Transporte y Telecomunicaciones

 


ECUADOR
>Penetration:
Currently there are 4 million Internet users in Ecuador, which means an Internet penetration rate of 27%.*

>Future Growth: By 2015 there will be 7.5 million Internet users in Ecuador, nearly 90% growth.**

>Social Media: Ecuadorian Internet users spend 6 hours a week on social media.*** Facebook is by far the most popular site, with 4.9 million users in Ecuador.**** Among the five brands with the most amount of Facebook engagement in Ecuador are KFC Ecuador, Pingüino Ecuador, Nine West Ecuador, McDonald’s Ecuador and Fioravanti.****

>Mobile Penetration: Overall, 78% of Ecuadorian homes have a mobile phone.*****

>Smartphone Penetration: Currently at 8%, which suggest there are 1.2 million smartphone owners in Ecuador. Demographically, 53% of smartphone owners in Ecuador are men and 47% are women. Smartphone owners skew fairly young, with 11.7% between 16 and 24, 11.5% between 25 and 34, 10.1% between 25 and 34, 7.2% between 35 and 44 and 5.7% between 45 and 54.*****

Sources: *Internet WorldStats, **Latin American & Caribbean Network Information Centre (LACNIC), ***Wave 6 study by UM, ****Socialbakers, *****Instituto Nacional de Estadísticas y Censos

 


PERU

>Penetration: In June 2012 there were 10.7 million Internet users in Peru out of a total population of 29.5 million, which is 36.2% Internet penetration*.

>Time Online: Peruvian internautas spend an average of 26.5 hours a month online per user, higher than the global average of 24.5 hours per user per month and higher than the averages for Internet users in Mexico (22.8 hours/month), Argentina (25.4 hours), Chile (24.9 hours) and Colombia (23.3 hours).**

>Reaching this Audience: The types of sites with deepest reach among Peru’s Internet users are community sites (97% reach), social media sites (96%), multimedia sites (96%), news sites (95%), directories (91%), blogs (82%) and game sites (81%).**

>Social Media: Peruvians spend 8.6 hours a month per user on social media, which is higher than Latam’s average per user (7.6 hours) and the global average per user (6.1 hours). Facebook is the #1 social media site, reaching 87.9% of Peru’s online population.**

>Entertainment: 97% of Internet users in Peru visited an entertainment site in January 2012 and their usage of these sites (4.2 hours per user) is higher than that of overall Internet users in Latam (3.3). Not surprisingly, YouTube has 73% reach in Peru.**

>Mobile Penetration: Currently it’s at 110%.***

>Smartphone and Tablet Sales: While it’s difficult to pin down smartphone penetration, it’s known that 28% of the phones imported into Peru in 2012 were smartphones, double the amount imported in 2011.**** An article on the Web site Nexonet cited projections from Samsung that indicate that 50% of the cell phones sold in Peru in 2015 will be smartphones. For their part, tablet sales in Peru have spiked by 334% in the first half of 2012, with 57,800 units sold. In addition, while Samsung’s Galaxy had a 60% share of the tablet market in Peru in 2011, Apple is gaining: of the 57,800 tablets sold so far in 2012, 13,589 were from Apple.****

>E-commerce: While online shopping in Peru has yet to reach the levels that it has in Mexico, Brazil or Argentina, one recent estimate suggests that e-commerce will grow by 30% a year through 2015.*****

>Mobile Internet: In Peru, mobile Internet traffic grew by 1,700% between 2010 and 2012.******

Sources: *Internet WorldStats, **comScore, ***International Telecommunications Union, ****Dominio Consultores, *****Sociedad de Comercio Exterior del Perú, ******Telefónica Móviles

 


URUGUAY
>Penetration:
In June 2012 there were 1.8 million Internet users in Uruguay out of a total population of 3.3 million, which is 55.9% Internet penetration*. A 2012 study done by Grupo Radar of 1,800 Uruguayans—1,098 of whom were Internet users—showed that 77% of people in Montevideo and 74% of people in the rest of the country had PCs in the home. PCs were present in the homes of 97% of the highest socioeconomic classes and in 78% of the homes of the middle classes.**

>Connection: In Uruguay, 86% of Internet users connect from home, while 35% connect from the homes of family or friends, 24% from work, 23% from school and 17% from public places, while 42% connect from cybers, presumably Internet cafes. Interestingly, some 20% reported going online with mobile phones or tablets.**

>Time Online: According to Grupo Radar’s results, the average Uruguayan spends 10 hours a week online, which would average out to 40 hours a month, considerably higher than monthly figures reported for other countries in Latin America.**

>Reaching this Audience: The top activities reported by Uruguayan Internet users include search (79%), social media (77%), email (73%), chatting (72%), downloading music (65%), YouTube (63%) and reading news (62%). Relatively low numbers report playing games (35%), downloading or watching movies (34%) and buying or selling online (22%).**

>Social Media: Nearly all Uruguayans surveyed by Grupo Radar (99%) are on Facebook, while other social media sites have much lower numbers. For example, only 11% use Twitter, only 2% use Sonico or Badoo and only 2% use LinkedIn.**

>Facebook Use: The majority of Uruguayan Internet users surveyed by Grupo Radar (89%) use Facebook to chat. Other top Facebook uses include sharing links, commenting on friends’statuses, uploading photos, writing comments or joining groups. Only 42% report becoming fans of pages (57% do not) and 31% report clicking on social media ads.**

>Researching Brands: About half (52%) of Uruguayan Internet users go online to find information about brands, while 48% do not. Brand websites are were the large majority (70%) go, though social media are in second place with 29% of users going there to find out information about brands. A small amount (13%) writes comments about brands on social media.**

>Social Media Ads: Grupo Radar’s study indicates that 49% of Uruguayan Internet users like that brands promote themselves via social media, 4% do not like it and 47% don’t care one way or another.**

>E-commerce: Overall global numbers for e-commerce are difficult to pin down but only 22% of respondents in Grupo Radar’s survey reported buying online. With those online shoppers, top online products included PC accessories, appliances, cell phones, clothes and sports equipment.

>Mobile Penetration: Currently it’s at 71%, according to the Instituto Nacional de Estadísticas.

>Smartphone Penetration: Current data is scarce but Pyramid Research projects sales of 1.2 million smartphones in Uruguay by 2017.

>Digital Media: In Grupo Radar’s study, 39% of Internet users in Uruguay reported reading news on line, with 64% reading news on El País’ site. Other news sites drew significantly lower responses: Observa (17%), Montevideo.com (14%), La República (14%) and El Espectador (7%).**

>Mobile Internet: In 2011 the amount of mobile broadband connections in Uruguay grew by 60%***

Sources: *Internet WorldStats, **Grupo Radar, ***Unidad Reguladora de los servicios de Comunicación

To find out how we can help you reach these emerging Internet markets or any of the other markets in Latin America via a strategic campaign across all media, please contact us.

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Latin America’s Ad Spend Is Set to Skyrocket

According to projections from e-Marketer, between 2012 and 2016, Latin America will be one of the world’s fastest-growing regions when it comes to ad spend.

Total ad spend for Latin America is projected to reach US$34 billion in 2012 and grow to US$51 billion by 2016, 50% growth. In terms of rate of growth, Latin America and Asia-Pacific will grow the fastest in ad spend between 2012 and 2016.

E-marketer also notes that online ad spend will spike in all of the world’s markets, particularly in China, which is set to become the world’s #2 market in online ad spend by 2014. Latin America is set to register $3.62 billion in online ad spend in 2012. By 2016, Latin America’s online ad spend will be $7.68 billion, a 112% increase in just 4 years.

These numbers seem to be in line with those from other sources. For example, eMarketer projects 11.8% growth in ad spend for Latin America during 2012, while recently MagnaGlobal projected 13% growth for this year. In addition, a variety of sources have noted increases in ad spend and online ad spend in Latin America.

To get a sense of the growth trend, here’s a look at ad spend and online spend figures for major markets in Latin America in 2011.

• Argentina: 31.6% growth in overall ad spend in 2011, 117% growth in online ad spend for 2011
• Brazil: 8.5% growth in overall ad spend in 2011, 20% growth in online ad spend in 2011, 39% projected growth in online ad spend for 2012
• Chile: 10.4% increase in overall ad spend in 2011, 30% growth in online ad spend in 2011
• Colombia: 8.8% increase in overall ad spend in 2011, 33% increase in online ad spend
• Mexico: 36% increase in online ad spend in 2011
• Panama: 7.7% increase in overall ad spend in 2011
• Peru: 16% increase in overall ad spend in 2011, 37% increase in online ad spend in 2011
• Uruguay: 7% increase in overall ad spend in 2011, 50% increase in online ad spend in 2011
• Venezuela: 7.8% increase in overall ad spend in 2011

To find out how we can help you reach Latin America via a strategic campaign in any form of media, please contact us.

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The Top 3 Sites for Latin America’s Internet Users

Broadcasted in March 2012, ComScore’s recent webinar—Futuro Digital Latinoamerica—offered a number of fresh insights into Latin America’s Internet audience. One relevant point for online marketers and advertisers is where Latin American Internet traffic flows the most.

ComScore’s results indicate that three types of sites draw the most Latin American Internet users.

#1 Google Sites
According to comScore, Google sites (which should include YouTube) drew the most Latin American Internet users in December 2011. Despite the heavy draw of Google, Latam’s internautas actually spent spent the most time on Facebook: 46,165 minutes. This is in line with the rapid rise of Facebook in Latin America and the region’s heavy engagement with social media.

#2 News Sites
News sites have 86.3% reach in Latam, nearly 10% more than the global average of 76.1%. Between December 2010 and December 2011, the news category grew by 32% in users. Among the Latin American countries where news sites have the biggest reach:

  • Brazil (97.6%)
  • Peru (95.9%)
  • Argentina (94.8%)
  • Chile (94.3%
  • Mexico (84.8%)

Argentina is #1 in online news consumption in Latin America, with an average of 99 minutes per visitor, well above the world average of 64 minutes. While Grupo Clarín and Grupo La Nacion are #1 and #2 in the news category in Argentina, Grupo Infobae seems to have the highest engagement—each visitor spent 75 minutes on the site in December 2011.

#3 Entertainment Sites
In Latin America, entertainment Web sites have a long reach of 96.7%, which is significantly higher than the global reach of entertainment sites: 88.6%. The countries where entertainment sites have the most reach include Argentina (97.6%), Brazil (97.5%) and Peru (96.9%). However, other countries aren’t very far behind: entertainment sites have 96.3% reach in both Chile and Mexico, and 94.5% in Colombia. Entertainment sites may be a particularly good way to reach Internet users in Peru, Colombia and Chile: they each spend an average of 4+ hours a month on these sites.

To find out how we can help you reach Brazil, Latin America or U.S. Hispanics via a strategic campaign across all media, please contact us at info@usmediaconsulting.com.

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social-media

Brands Should Be Careful with Social Media in Latam

We’ve seen that social media can be a brand booster in Latin America. However, a new survey of 72,000 consumers shows they have mixed feelings about the social media presence of brands.
TNS carried out the study, called Digital Life, which surveyed customers in 60 countries—including Argentina, Brazil, Chile, Colombia, Mexico and Peru—about their online habits, including social media. Here’s a rundown of the key results.

The Good
• 43% of Latin American social media users see social sites as a place to buy products, with 48% of Brazilians sharing this view
• 44% of Argentines say social media sites are a good place to learn about products
• Several Latam countries are more open to brands on social media sites than they are resistant, including Brazil (32%), Colombia (31%), Peru (32%), Mexico (20%) and Chile (18%)
• 46% of Latin Americans talk about brands online, including 25% of Argentines
• 55% of Latin Americans say they’re driven to get involved with a brand online by promotions or special offers

The Bad
• 45% of Latin Americans don’t want brands to market to them via social media—they see the brands as invading their social space
• 53% of Brazilians don’t want brands to market to them via social media
• 44% of Argentines don’t want brands to market to them via social media
• 37% of Mexicans don’t want brands to market to them via social media
• More Argentines go online to complain about brands (13%) than praise them (11%)

The Confusing
The numbers paint a jumbled picture. On one hand, almost half of Argentines think that social media sites are a good place to learn about products. Yet the same amount doesn’t want brands to market to them on social media. About half of Brazilians see social sites as a place to buy products, but the other half doesn’t want to be bothered by brands on social media sites. A good number of Latin Americans seem open to special offers from products, yet others don’t.
To further muddle things, in the press release that TNS put out to discuss Digital Life’s results, the company said that “misguided digital strategies are generating mountains of digital waste, from friendless Facebook accounts to blogs no one reads…The result is huge volumes of noise, which is polluting the digital world and making it harder for brands to be heard—presenting a major challenge for businesses trying to enter into dialogue with consumers online.”
Okay—but this doesn’t really explain things. Clearly, many of the respondents in these countries are fine with brands reaching out to them social media. And none of the preliminary numbers suggest that consumers perceive social media efforts from brands to be digital garbage.

Moving Forward
What is clear is that Latin Americans—and other consumers—are ambivalent about brands reaching them via social media. In addition, companies risk being perceived as invading their customers’ social media space. But does this mean that brands are “polluting” the digital world with their social media efforts? Not necessarily.

What is does mean is that brands need to look very hard at their social media efforts in Latin America. This is a divided audience—half are glad to see you there and half are not. So the question is: how do you win over the other half? Obviously, the answer will be different for every company. To find those answers, brands may want to explore case studies of successful social media use to see what kind of best practices they can glean and apply. They should also do research in these markets to determine how social media users see their efforts and refine them accordingly. Overall, the survey results point to a need for brands to constantly monitor and improve their social media efforts to make sure that they’re having a friendly dialogue—not an annoying, alienating monologue—with their customers.

To learn more about how we can help you reach Latin America with a customized campaign, contact us at info@usmediaconsulting.com.

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celia-cruz-la-negra-tiene-tumbao

Celia Cruz and the Art of Rebranding

In 1987, I was at the Jersey shore with friends and obsessively listening to the album Cuba y Puerto Rico son by Celia Cruz and Tito Puente. My friend Mario asked me, “So she’s like the Latin Madonna?” I had no response—I couldn’t think of two more different people than Celia and Madonna. But years later, I see something in common with them besides being singers. Madonna has consistently been hailed as a marketing master. Her ability to reinvent herself and absorb new musical trends keep her relevant in a Lady Gaga world.

Celia Cruz has never been called a marketing master—but she was. In her own way, she managed to rebrand herself effectively by following certain core principles. Before we get into that, let’s look at her brand’s liftoff.

Branding Brief
Celia built her brand in Cuba by scoring hits with the Sonora Matancera in the 1950s. She was a national star with some international recognition, mostly in Mexico and the Dominican Republic.
Celia left Cuba in 1960 and recorded with and without the Sonora in Mexico. Later in the decade she teamed up with Tito Puente. It seemed like the right move. Her compatriot La Lupe had teamed with Tito Puente on the same record label and notched a series of hits. However, despite being good, the albums—including my favorite, Cuba y Puerto Rico son—sold poorly. By the early 1970s, she was in danger of becoming a nostalgia act.

Then Celia rebranded. Here’s what she did.

Brand alignment. First, she appeared in a Latin opera called Hommy, produced by star bandleader Larry Harlow. This got her in front of the young salseros who were fans of Harlow and the other stars featured in the opera. She followed this up by signing with Fania Records, the hottest salsa label around. Celia was paired with megaproducer Johnny Pacheco, who had his own major brand equity with salseros, and produced the hit 1974 album Celia y Johnny. That same year, she traveled to Zaire to perform with the Fania All Stars in a concert before the Muhammad Ali-George Foreman championship bout.  Suddenly her brand was tied with that of Muhammad Ali’s, however indirectly, and a whole new audience of Africans became fans of the newly-crowned Queen of Salsa.

Customer relationship management. Celia’s fan base started in Cuba and followed her into exile. Celia never lost sight of her brand identity as a Cuban singer, so her albums always featured songs referencing Cuba or covers of famous songs by Cuban composers. Examples include “Canto a La Habana,” “Si acaso no regreso,” “Ochun con Changó,” “Vieja luna” and many others. This retained her original customer base—good, smart CRM.

Expansion. Celia made a point of selecting songs like “Toro mata”, a Peruvian folk song, the Brazilian song “Usted abusó” and other tunes from Latin countries beyond Cuba. These picks gave her an entry point with new markets who started with the song they recognized and then later bought into the rest of her brand. Heavy touring in these countries further expanded her brand into Venezuela, Colombia, Peru and Panama.

Strategic refreshes. Celia worked with a variety of producers to keep her sound fresh but wisely avoided trends like salsa romántica that were a poor fit for her brand. She also sang duos with stars from other countries, like Vicente Fernandez and Caetano Veloso, and mentored young salsa diva India. This ensured relevance with younger audiences—the  result was a steady stream of hits well into her 70s.

Consistent brand identity. Fans could count on Celia for fresh, fun songs, not odd artsy experiments. She knew her base of working class Hispanics and Latin Americans wanted escape through dancing, and she delivered: “La vida es un carnival” is a good late-career example.

She also kept her appeal to women strong by rebuking machismo with songs like “Que le den candela.” Beyond music, her brand identifiers included wild stage outfits, wigs and her catchphrase, ¡Azúcar!

Strict quality control. Celia didn’t abuse alcohol or drugs. She didn’t miss shows, either. As such, her target market (the audiences) and her distributors (concert promoters) valued her consistent quality. In contrast, her rivals and contemporaries did abuse drugs and miss shows, destroying not only their brands but themselves.

Tireless crossmedia promotion. Celia toured constantly, marketing herself on the front lines through concerts all over the world. She supplemented this by appearing in movies and soap operas. Celia was friendly and open with press of all kinds—an anti-diva who gave funny, charming interviews. Because of this, aside from some minor missteps in the 1990s, she consistently garnered great press. Her ability to adapt suggests that if she were still alive, there’s no doubt that she’d have a formidable Facebook page and thousands of Twitter followers.

The Takeaway
While none of this suggests Celia was cracking open marketing books or taking classes at Wharton between tours, it does demonstrate a profound marketing intuition on her part. Celia was far from the only music star to leave Cuba after 1959. But none of them had anywhere near her success.

What made the difference? It wasn’t mere talent or hard work: she was brilliant in the 1960s and worked hard with little success to show for it.

Ultimately, her astute rebranding maximized the impact of her talent and hard work, transforming Celia from a regional star to a worldwide Latin music icon.

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