Latin America represents a huge opportunity for digital marketers, with the world’s fastest growing online population, hungry for social, video and mobile content. The region is home to five of the most engaged social networking markets worldwide, with an online audience that is fast embracing video and mobile advertising.
According to research firm comScore, Latin America’s online population grew faster than any other global region in 2011, rising 16 percent to 129.3 million visitors in December 2011.
Google Sites reigned as the most-visited property in December 2011, reaching 123.4 million visitors in the region, while Facebook.com led as the most-engaging web property accounting for 25% of all time spent online in the region.
Online ad spend figures
Until recently, online ad spend has been slow to take off in the South Amercan regions, but 2010 saw some spectacular rises which continued during 2011. According to consultancy firm Magnaglobal, Latin America’s ad revenues grew by 13.2% in 2011, the biggest growth among developing economies around the world.
In Argentina, the Cámara Argentina de Agencias de Medios reported an 86% increase in online ad spend in 2011.
In Colombia, IAB Colombia and PwC reported in late 2011 that online ad spend grew by 69% between the third quarter of 2010 and the third quarter of 2011.
And just recently, IAB Brazil announced that online ad spend went up 25% in Brazil in 2011.
These increases—as well as 40% projected Internet penetration for all of Latin America in 2012—suggest that this year will bring even more spectacular growth for online media in the region.
Latin America leads the world for social networking
Social networking, which eclipsed portals as the most-engaging web activity in November 2011, accounted for nearly 30 percent of online minutes at the end of the year, an increase of 9.5 percentage points over the past year, according to comScore.
Latin America is home to five of the most engaged social networking markets worldwide. Internet users in Argentina averaged 10.7 hours on social networking sites in December 2011, followed by Chile (9.5 hours per visitor), Peru (8.7 hours), Colombia (7.6 hours) and Mexico (7.1 hours).
Entertainment and retail- video sees double digit growth
Entertainment sites continued to amass visitors in 2011, growing 14 percent to reach nearly 97 percent of all online users in the region. Peruvians, Colombians and Chileans spent the most time on Entertainment sites each averaging more than four hours per visitor at the end of the year.
In addition, online video viewing grew rapidly in 2011 as total videos viewed grew by double digits across Brazil, Mexico, Argentina and Chile, fueled by both an increase in viewing audience and a surge in videos viewed per viewer.
Fueled by the holiday shopping season, online retail visitation jumped 30 percent at the end of 2011 according to comScore, as more Latin Americans turned to the web to shop and purchase goods and services. Among retail categories, comparison shopping had the highest penetration with nearly 1 in 4 online users visiting these sites in December 2011.
Ad formats- Search revenues 3 times bigger than display
According to Magnaglobal, paid search is back on top as the largest revenue driver for online advertising, growing by 19% to total $14.9 billion, with display ads growing by 15% and online video spiking by 58% to pull in $4.7 billion in revenues.
Latin Americans continue to display a strong propensity for search. In 2011, the total number of searches conducted increased 38 percent to more than 21 billion in December, according to comScore. With an average of 173 searches per searcher, Latin America leads the globe in search frequency.
Mobile ads set to soar?
comScore reports that mobile phones and tablets continue to account for a growing amount of digital traffic, with Puerto Rico leading the region with 7.7 percent of all digital traffic consumed away from a personal computer.
Apple led across nearly all markets in share of non-computer traffic fueled by the iPhone and iPad.
After a slow start, mobile ads finally look set to take off with IDC research predicting an 80% increase in smartphone sales in Latin America in 2012.
Brazil ranks number 5 in the world in mobile Internet usage and other countries are catching up, including Mexico and Colombia.
comScore’s December 2011 Device Essentials report notes that mobile devices (including phones and tablets) accounted for an average of 12.6 percent of all web browsing in 10 major Latin American markets.
Brazil has 39.9% of its mobile web traffic coming from tablets, which accounted for 38.9% of Colombia’s mobile web traffic. Tablets are also important for accessing the mobile web in Ecuador (30% of traffic), Mexico (27.8%) and Costa Rica (27%).
Future ad revenue growth
Looking forward, Magnaglobal projects that global ad revenues will grow by 5% in 2012. By contrast, Latin America will post 13% ad revenue growth in 2012, leading all emerging economies in the world.
Magnaglobal goes on to forecase that Argentina will see the biggest ad revenue growth in all of Latin America in 2012, with 26.4%, outstripping all BRIC countries. Brazil will post 12% growth in ad revenues in 2012 and will rank #7 in the world in ad spend, ahead of Canada, Australia and Italy and just behind France.
Commenting on the region,s growth, Alejandro Fosk, comScore senior vice president for Latin America, said: “2011 was an extraordinary year for digital media in Latin America as more people than ever before went online and began adopting behaviors like social networking and watching online video with increasing frequency.
“The rapid adoption of these behaviors presents a world of new opportunities to digital marketers. In order to capitalize on this burgeoning digital economy, it’s important for brands and publishers to understand the key trends driving growth today so they can determine where to invest and how to position their offerings to the needs of the marketplace.”