by Joline Vergauwen

Latin America has become one of the fast growing and most dynamic regions for advertising investment. Emarketer’s Global Media Intelligence Analyses (July 2015, September 2015, February 2016) and Mobile Advertising Watch give us some insights about this booming market.

Brazil is Latin America’s largest ad market, with about $42 billion spend on paid media in 2015 and growing also considering the growing middle class and the upcoming Olympics. The numbers conducted in 2015 couldn’t predict the impeachment of Dilma, the president in May 2016. To see if this has had a big influence on the numbers of 2016, we have to wait for the upcoming graphs and reports.

Although television is still the dominant ad channel in Latin America’s 2nd largest ad market, Mexico, digital is growing and will represent about $2.3 billion by 2018. Social media and video ads are overtaking banners and rich media.

Argentina’s ad market expansion is so powerful that it’s now the world’s fastest growing market for paid media. The total media spending is expected to grow by +23% by 2018, when the total market spend will be rough $9 billion, according to eMarketer research. Digital and mobile are driving this growth.

Smaller markets, such as Chile, Colombia, Ecuador, Peru, … should develop rapidly in the coming years since advertisers use their developing knowledge from these larger markets.
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“In general, advertisers in Latin America have been slow to invest in digital advertising formats because of the lack of reliable measurement metrics when it comes to digital. Advertising in traditional media remains attractive, as it is still able to reach a broad audience,” said Shelleen Shum, an eMarketer analyst. Up to now, South America is in full and fast-growing digital transformation, which offers a lot of new investment opportunities. By 2019, Latin America will represent 4,5% of the worldwide digital ad spending.

Digital Ad

The digital trends for Latin America: the growing markets of mobile, social media and programmatic buying.

Mobile industry

Until recently, most consumers in Latin America weren’t able to own smartphones due to import taxes and other charges. With the arrival of cheaper models, many residents are compensating making South America one of the biggest mobile markets. As digital consumers grow, they’re starting to use mobile and may not even have a computer. Emarketer’s Global Media Intelligence Report shows us that the mobile industry represents 4% – 5% of Latin America’s economy, compared with about 2% in more developed markets such as the US and major European countries. Brazil is Latin America’s largest smartphone market.

Smartphone

Social networks

The LATAM market has one of the highest rates of use of social networks, mostly accessed through mobile internet. According to Mobile Advertising Watch, about 20% of Facebook users come from this region, and about 180 million Latin American smartphone users connect with their social media networks on their mobile phones. Globally, more than 95% of the LATAM’s internet users participate in at least one social network and spend about 10 hours a month on social media.

Facebook

ComScore’s data shows that Facebook is by far the most used social network in South Amerika. Second ranks bitacores microblogging and Linkedin ranks third. Twiter, the popular network for sharing and reading current affairs, only ranks fourth in South America. Only 16.4% of social network users in Latin America used the platform at least once a month in the last year.

Social network

However, note that comScore’s data only include visits from laptops and desktops. Mobile visits would only increase the numbers significantly.

Programmatic buying  

Although a lot of advertisers are still focused on buying a demographic via a certain media in Latin America, there is an evolution toward audience buying, which is certainly where— besides ROIs and optimization—programmatic offers a huge advantage and offers value. Programmatic buying is an expanding market. eMarketer estimates that this market will continue to evolve due to mobile devices and the influence they have on social media, videos and native advertising. Programmatic buying is expected to represent 61% of digital spendings in 2018.

Without any doubt, Latin America is an optimal region for investment and innovation, as recent trends seem to mingle perfectly with the manners and customs of its inhabitants, an extremely positive condition for advertisers.

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