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Usmx2012 onlinetrends ap.pptx


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Interactive Advertising trends in Mexico 2012

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Usmx2012 onlinetrends ap.pptx

  1. 1. Interac(ve  Marke(ng  Trends  2012    Reflexions  of  the  Mexican  Internet  Adver5sing  Industry   Adriana  Pena,  Sweden  Dec  2011  
  2. 2. Being  on  top  of  trends  and  making  business  decisions  based  on  their  implica5ons  has  never  been  harder  but  in  the  other  hand  has  never  been  as  fascina5ng     I´ve been a passionate participant of innovation all my life. Doing things different or for the first time has been the driver of my career. Now I have a unique opportunity to sit down from the pits and watch the cars running at accelerating speed and drawing conclusion from what I see. From these cold lands of Sweden I have been able to analyze great sources like Forrester, e-marketer, Mashable, Sociagility, Comscore, Brand Republic and tons of bloggers and journalist who had published an enormous amount of information. The data is all there, making sense of it and drawing conclusion for our market has been a thrilling endeavor. I hope you find this presentation interesting and useful, but most of all I hope you share the same passion I feel for being part of the generation that is driving such amazing changes in our business.
  3. 3. Interac5ve  marke5ng  budgets  will  be  as   big  as  TV  sooner  than  expected  in  US   In Mexico we still have a long way to go, but online advertising budgets are still expected to grow double digits in the next coming yearsSource:  Forrester  
  4. 4. Disregarding  the  actual  size  of  online  adver(sing  budget  of  Mexican   adver(sers  the  trend  heads  towards  a  strong  growth,  making  online   marke(ng  a  discipline  that  cannot  be  minimized  anymore       In Mexico despite what official sources have been publishing, I estimate based on industry information that online budgets may not be more than 4.5% in 2011 On the other hand expected growth for 2012 is 20-30% at the expense of other media like magazines, TV and Newspapers  One  of  the  challenges  to  agree  on  the  size  of  the  internet  adver5sing  budgets  lays  in  the  defini5on  of  online  budget:  is  it  only  money  being  paid  to  media  partners,  or    does  it  inlcudes  brand  web  pages,    development  of  aplica5ons  and  agency  fees?    
  5. 5. In Mexico we have to consider these other factors as well: 1.  Younger brand managers and younger employees in general at clients and agencies will pitch for Interac5ve  Embeds  itself  in   their fresher ideas to be heard 2.  Social Media and recent political the  mix:  the  next  digital   effects of it makes anyone who is not in touch with new media look decade  is  here   outdated 3.  Marketing effectiveness has not being proved for consumer brands The  following  factors  in  US  will  enable  the   but a 40% reach of internet in growth  over  the  next  five  years:   Mexico makes a very compelling argument   4.  Tablets, Iphones androids and 1.  Bigger  interac(ve  teams   other ”cool” devices in the hands of tons of people will make it very 2.  Excitement  about  emerging  media   hard to ignore the relevance of new media 3.  Interac(ve  marke(ng  effec(veness   5.  Rebates paid by media players to media agencies above 10%, makes 4.  Customer  obsession   online adverstising the most profitable media for media agenciesSource:  Forrester  
  6. 6. Percep5on  of  effec5veness  will  drive  a  different  mix  of  interac5ve   marke5ng  spending   Although in Mexico investments on Internet Marketing will grow, lack of proper use of ad serving technology as well as an over use of clicks or cost per click as measurement of campaign´s ROI makes it very difficult for Marketing Directors to be fully convinced of effectiveness of online media The overall effectiveness of online media is still somehow a myth to be proven especially for the mass consumption advertisers that happen to have the biggest marketing budgets   •  TV penetration is overwhelming in the country and is the most easy to be measured and proven media •  Media agencies rarely use the required technology or proper methodology to prove basic metrics like unique total reach of an online campaign so traditional media planning parameters like audience reach or number of people touched by an online campaign are unknown or severely under estimated since most campaigns are being measured only by website visits or ad clicks •  There are very little studies on actual effects on brand health from an interactive marketing campaign in Mexico •  Very few big advertisers have an e-commerce business and the consequent experience of efficiencies in conversion rates that internet has in e-commerce strategies
  7. 7. Social  Media,  Mobile  Marke5ng  and  Display   adver5sing  will  drive  US  Interac5ve  Marke5ng  Spend   Search’s    Share  Shrinks     Share  will  shrink  11  points  as  marketers   refocus  their  search  marke5ng  strategies   based  on  ”geTng  found”  by  users.    Brands   will  expand  the  play  field  in  which  they   could  be  found  by  its  customers  by  moving   their  search  budgets  to  be  present  in  mobile   devices  and  social  networks    Source:  Forrester  
  8. 8.  Video  ads  will  be  the  fastest-­‐rising  category  of   online  spending  in  the  next  coming  years   1.  US  online  video  ad   spending  to  grow  43%  in   2012.    Digital  video  ads  reproduces   the  richness  consumer  associate  with  TV   at  a  lower  cost  and  can  be  used  a  reach   extender  medium  for  TV  with  the  same     ad.  Source:  
  9. 9. Search  spend  shicing  to  display   1.  Search  behavior  and  their  associated  marke5ng  spend  moves  to  other   media.     A  por5on  of  marketer´s  search  budgets  will  move  to  mobile  and  social  networks  as  users  rely  more  on  non-­‐PC  devices   and  nontradi5onal  search  engines  like  Youtube  or  FaceBook     2.  SEO  Technology  tempers  the  growth  of  agency  fees.       Development  of  be]er  SEO  pla^orms  will  make  it  easier  for  brand  pages  to  be  found  therefore  these  technologies  will   undercut  or  replace  agency  fees  dropping  SEO  costs  about  15%   3.  Rich  search  ads  capture  brand  dollars.     Improved  search  engines  interfaces  will  deliver  new  display-­‐like  ad  formats  embedded  into  search  results   4.  Small  and  medium-­‐size  business  (SMB´s)  adopt  and  grow  search   programs.     Affordable  search  management  solu(ons    like  Clickable  and  offline  directories  like  SuperMedia  from  Verizon   Superpages  are  managing  search  adver5sing  for  local  marketers  who  want  to  transi5on  away  from  yellow  pages  ads   5.  Search  spend  shicing  to  display.     Increasing  keywords  costs  will  eschew  paid  search  for  biddable  display  search,  display  ads  bought  through   automated  auc(ons    Source:  Forrester  
  10. 10. Marketer´s  love  affair  with  display  media  is  back:     Driven  by  ad  exchanges  that  simplify  media  buying  process   1.  Increasing  cost  of  niche  and   remnant  inventory.  Online  ad   exchanges  like  AdBrite  enable  adver5sers  to   buy  niche  inventory  and  also  to  buy  all   inventory  for  its  real  market  value   2.  Be]er  online  ad   management  tools.  New  data   management  pla^orms  improve  audience   targe(ng,  eliminate  overlap  across  mul5ple   publishers  and  measure  the  contribu(ons  of  a   given  impression  towards  business  goals  Source:  Forrester  
  11. 11. According  to  Forrester  This  year  Mobile  overtakes  Email  and  Social   Media  in  US    1.  Marketers  will  create  more  relevant  mobile  ads.    A   skyrocket  growth  in  acquisi5on  of  smartphones  and  tablets  will  allow   be]er  ads  for  mobile  devices.  Also  be]er  mobile  ad  servers  will  enable   be]er  ad  targe5ng  to  specific  clusters  of  users  2.  Tablets  with  their  expensive  ad  units  will  become   mainstream.  These  devices  will  contribute  to  the  increase  of  mobile   marke5ng  investment  due  to  the  innova5ve  and  expensive  ad  formats   they  enable  3.  Adop5on  of  smartphones  and  tablets  accelerates  the   demand  for  content  consumed  on  these  devices  including,  video,   audio,  social  media,  games,  news,  books  and  other  types  4.  Buyers  will  embrace  mobile  commerce  and   adver5sing  that  drives  it.    Mobile  commerce  will  top  31  billion   and  the  upcoming  explosion  of  tablet  adop5on  will  amplify  this  virtual   circle.  Already  47%  of  tablet  owners  have  shopped  on  their  devices  5.  Email  will  s5ll  be  part  of  the  mix  of  interac5ve  marke5ng  but  spend   on  email  marke5ng  delivery,  crea5ve,  analy5cs  and  so  won’t   increase  mainly  because  of    their  very  low  CPM´s         Source:  Forrester  and  KPCB  
  12. 12. Although  all  brands  will  jump  into  some  kind  of  social   media  ac5vity,  Social  Media  total  investment  will  grow   moderately  1.   Due  to  the  rela5vely  low-­‐cost  of  Social  media   management,  brand  expenditures  on  it  won´t   grow  as  much.  2.  Developing  own  social  assets  like  a  Facebook   page  or  TT  profile  involves  low  costs,  mostly   community  managing  related  only.  Listening  pla^orms  cost   only  5k-­‐10k  a  month  and  there  are  very  good  open  source   pla^orms  3.  Social  networks  offer  limited  paid  inventory.   The  biggest  social  media  outlets  for  adver5sers  FB  and  TT   have  only  a  few  pay  per  click  adver5sing  op5ons,   significantly  smaller  than  tradi5onal  media  portals  4.  Listening  will  develop  into  social  intelligence.     Social  data  will  be  integrated  to  exis5ng  CRM  databases  5.  More  interac5ve  marke5ng  investment  will  spawn  more   ad-­‐supported  content   Source:  Forrester  and  KPCB  
  13. 13.  e-­‐commerce  reloaded:  Mobile  and  in-­‐store  digital   experiences   Mobile  commerce  is  the  next  big  thing  in  business.  This  will  have   an  impact  specially  on  retailers  and  the  way  consumers  interact  with  them.  70%  of   those  who  have  smartphones  have  used  them  on  store.  On  the  other  hand   following  what  calls  “Retail  Renaissance”  consumers  will   enjoy  shopping  products  and  services  in  the  real  world  more  than  ever  and  this   will  be  driven  by  the  fusion  of  technology  and  engaging  experiences.     1.  Offline  in-­‐store  experiences  will  have  its  online  experience  too.  8  out  of  10   consumers  research  their  purchases  online.  While  online  conversion  rates  for   e-­‐commerce  are  around  2-­‐3.5%  offline  conversion  rates  from  digital  ads  to   stores  for  fashion  retailers  are  20-­‐25%   2.  Barcode  scanning  is  on  the  rise   3.  Time-­‐or-­‐loca5on-­‐based  offers  and  rewarding  visits  through  some  kind  of  geo-­‐ located  social  media  like  Foursquare  will  be  more  frequently  used   4.  Tablets  will  fuel  deeper  experiences  and  interac5ons  with  retailers  and   products,  especially  luxury  products  and  cars  Source:  Trendwatching  and  e-­‐Marketer  
  14. 14. Reflexions  for  Mexican  Marke5ng  Industry:   Display  Adver5sing  Following  the  interna5onal  trend  in  Mexico  online  display  adver5sing  (be]er  known  as  banners  and  videos)    will  get  the  mayor  chunk  of  the  growth  in  interac5ve  spend.    These  are  great  news  for  media  players  and  bloggers  as  well.  The  local  drivers  of  this  growth  are:    1.  Tradi(onal  media  players  like  magazines,  TV  and  radio  are  becoming  full  mul(media   companies  and  will  encourage  a  strong  growth  of  their  digital  new  business  2.  Small  niche  content  players  are  jumping  in  since  digital  is  cheaper  to  produce  than  all   other  media  (bloggers  like  whatevertomorrow,  etc)  and  some  old  small  players  will  shut   down  their  printed  edi5ons  and  leave  only  their  online  versions  
  15. 15. Reflexions  for  Mexican  Marke5ng  Industry:  Display       Marke5ng:  Ad-­‐exchanges  already  here  but  s5ll  with  a  long  way   to  go     1.  As  in  the  US  ad-­‐exchanges  are  already  in  the  local  market,  providers  like  Ad-­‐ Ne5ck    are  successfully  selling  to  adver5sers.  This  technology  enables  a  much  more   cost  efficient  alloca5on  of  ads  and  makes  it  much  easier  to  buy  space  in  niche  content  players   including  bloggers   2.  These  players  could  represent  a  threat  to    tradi5onal  media  buying  agencies   since  they  automa(zed  the  media  buying  process  and  reduce  the  need  for  “alloca5on”  advice.     On  the  other  hand  they  bring  more  transparency  to  the  buying  process  since  buying  prices  are   auc5oned  directly  by  the  adver5ser.  These  could  represent  a  long  term  challenge  to  agencies  that  buy   media  since  another  source  of  revenue  for  them  are  markups  in  adver5sing  rates    
  16. 16. Reflexions  for  Mexican  Marke5ng  Industry:    Social  Media  brand  ac5vity  will  increase  tremendously    1.  Relevance  of  social  media  has  grown  tremendously,  due  to  many  recent  public   events  the  percep5on  of  it  importance  in  society  has  grown  2.  Mexico  is  one  of  most  ac5ve  countries  in  Social  Media  (see  Comscore  graphic  in  slide   11)    3.  Brands  and  Cyber  stars  are  already  ac5ve.  Many  brands  already  have  a  profile  in   FaceBook  ,  or  twi]er.  Celebri5es  are  already  charging  “Product  Placement”  fees  ranging  from  1k  to  60k   just  to  post  a  comment  about  a  brand.    4.  Most  of  Mexican  adver(sers  will  jump  into  some  kind  of  social  media  ac(vity   in  the  near  future  since  Social  Media  is  the  “cool  thing”  to  be  doing  right  now  and  to  open  a   brand  profile  in  FB,  TT  or  YT  is  free.  
  17. 17. Reflexions  for  Mexican  Marke5ng  Industry:     Social  Media  brand  ac5vity  will  increase  but  social  ad   investments  will  not  necessarily  grow  as  much  Social  Media  Brand  ac5vity  will  grow,  crea5ng  a  new  market  for  related  service  providers  1.  Media  buying  within  social  media  pla^orms  is  somehow  a  limited  ground  since  mayor   players  offer  few  adver5sing  op5ons    (although  this  may  change  in  the  near  future  since   52%  of  traffic  goes  to  SM).    On  the  other  hand  a  significant  factor  in  Mexico  is  that  FB,  TT,  and  Google ´s  You  Tube  do  not  pay  direct  rebate  fees  to  media  agencies  (some  ad  networks  who  resell  social   media  ads  do  so)  therefore  social  media  ads  investments  won´t  grow  as  much  as  one  might  expect  2.  Related  services  like  community  managing,  content  crea5on,  consul5ng,  development   services  like  social  media  applica5ons  and  “social-­‐media5on”  of  tradi5onal  webpages    will   sprout.  This  will  bring  room  for    new  revenue  streams  for  tradi5onal  online  agencies  and  as  well  as  new   independent  players  (many  bou5que  specialists  have  appeared  in  the  market  to  provide  with  community   managing  services  and  analy5c  services)  3.  Mexico  is  par5cularly  fond  of  Twi]er  so  the  new  brand´s  profile  that  they  have  launched  for  21   global  adver5sers  will  drive  more  brands  to    Twi]er  (h]p://  .    Some  of  these   global  adver5sers  already  have  interac5ve  marke5ng  investments  through  their  Mexican  branches  like   Coca-­‐Cola,  Dell,  American  Express,  Pepsi  and  Nike  
  18. 18. Reflexions  for  Mexican  Marke5ng  Industry:    Search  will  keep  growing  but  at  a  lower  speed  1.  Bigger  Adver5sers  in  Mexico  have  less  need  of  Search  based  online  strategies.   Search  is  a  fundamental  piece  of  the  interac5ve  mix  when  a  brand  is  doing  e-­‐commerce  or   when  the  main  objec5ve  of  a  campaign  is  to  drive  traffic  to  a  webpage.  Adver(sers  of  consumer  brand   products  who  are  currently  under-­‐spending  in  online  and  who  will  be  the  ones  driving  the  upcoming   growth  in  the  Mexican  market  are  not  into  e-­‐commerce.  Therefore  they  most  likely  tend  to  use  more   display,  social  media  or  develop  glossy  applica5ons  for  smart  phones  and  tablets  than  search   They  don´t  need  to  be  found  as  much  as  they  need  to  be   remembered  2.  An  addi5onal  force  in  Mexico  to  keep  holding  back  the  share  of  Search   Marke5ng  is  that  the  main  player  Google  does  not  pay  to  any  agency  rebate   fees.  Therefore  profitability  of  media  alloca5on  in  search  is  significantly  lower  for  agencies  than   recommending  display  adver5sing  or  other  digital  online  ini5a5ves  to  their  clients  
  19. 19. Reflexions  for  Mexican  Marke5ng  Industry:     Search  will  keep  growing  but  at  a  lower  speed  As  in  the  US  market,    affordable  search  management  solu(ons  for  small  and  medium  companies  (PYMES)  are  in  the  way  to  burst  into  the  market.    The  dominant  player  in  this  sector  has  been  Seccion  Amarilla,  from  grupo  Carso.  They  have  a  very  good  chance  to  lead  the  conversion  of  these  adver5sers  since  they  already  have  them  as  clients  and  they  have  all  the  resources  and  the  strategy  to  do  so.  Most  of  these  adver5sers  won´t  develop  a  webpage  on  their  own  or  a  Facebook  profile  but  would  gladly  migrate  to  something  digital  if  a  one-­‐stop  shop  solu5on  is  offered  to  them.      It´s  hard  to  speculate  if  this  market  will  be  shared  with  Google  or  other  big  players  including  Facebook  or  if  it  will  be  mainly  a  transi5on  of  business  model  within  Seccion  Amarilla  who  is  the  leader  in  Yellowpages    segment  
  20. 20. Reflexions  for  Mexican  Marke5ng  Industry:     Mobile  Marke5ng  will  be  a  more  common  part  of    the  mix  than   before  1.  Explosion  of  Smart  phones  and  Tablets   acquisi5on.  There  are  already  at  least  9  million   smart  phones  in  Mexico  and  penetra5on  of  this   kind  of  devices  will  grow  at  a  85%  rate.  Also   tablets  are  in  the  rise  worldwide  and  in  Mexico  as   well.  These  premium  consumers  will  be  a  very   a]rac5ve  market  to  be  reached  2.  Innova5ve  ad  formats  will  a]ract   trendy  adver5sers  as  well  as  luxury   brands.    Smartphones  and  especially  tablets   allow  more  engaging  ad  formats  and  branded   content.  These  will  be  very  appealing  to  early   adop(ng  adver5sers  and  to  agencies  or   developers  that  will  try  to  sell  these  higher   revenue  ads  to  its  clients      
  21. 21. 4  Take  outs  for  the  road    1.  In  2012  Interac(ve  spending  will  surpass  magazines   and  maybe  even  Paid  TV  in  Mexico  2.  Brands  will  fully  embrace  social  media  ac5vity  this   will  sprout  many  new  services  related  to  community       management,  content  produc5on  and  measurement    3.  Mexican  adver5sers  will  increase  their  investments   on  display  adver5sing  triggering  more  demand  for   online  inventory,  specially  the  one  for  video  ads  4.  Brands  will  explore  different  ways  to  get  advantage   of  the  rise  of  Smart  Phone  and  tablets  euphoria          
  22. 22. Challenges  and  Opportuni5es    Agencies   Clients   Media  and  Content  producers  1.  The  center  of  the  conversa5on  will   1.  Clients  will  demand  more  mature   1.  More  revenue  will  come  from  digital   be  how  the  online  marke5ng   agencies  that  can  provide  them  with   adver5sing   budget  should  be  split  among  all   solid  clear  integrated  interac5ve   2.  Tradi5onal  media  companies  will   the  possible  interac5ve  ac5vi5es   strategies;  the  core  issue  will  how   seize  the  opportunity  reinforcing   and  how  these  make  sense  in  a   much  they  should  be  inves5ng  in   their  online  adver5sing  s  offer  to   bigger  scheme  of  things.  This  is  a   online  marke5ng  but  how.   their  clients   challenge  for  most  of  the  current   2.  Level  of  complexity  of  interac5ve   3.  Social  Media  and  Mobile  will  trigger   par(cipants  in  the  market  since   marke5ng  for  clients  will  rise  since   demand  for  content,  content         they  are  specialized  in  their   discipline.       brands  will  need  to  have  an  any-­‐ Time  any-­‐where  digital  points  of   producers  could  produce  content   for  clients  or  find  new  ways  to  get  2.  More  budget  on  online  will  demand   contacts  with  their  consumer   digital  sponsored  deals   more  produc(on  of  ad  formats,   deploying  conversa5ons  and   4.  Small  players  will  become  more   social  media  and  mobile  apps,  social   presence  according  to  each  digital   relevant   media  glossy  profiles  therefore   channel     many  independent  providers  will   jump  in  to  the  arena   3.  More  clients  will  have  their  own   internal  experts  on  interac5ve  3.  Social  Media  bring  opportunity  for   marke5ng   new  services   4.  Mobile  e-­‐commerce  and  mobile   apps  will  be  explored    by  early   adopter  adver5sers  
  23. 23. Some  References     US  interac5ve  Marke5ng  Forecast  2011  to  2016   Forrester  Research    State  of  Media-­‐Social  Media  Report  Nielsen   KPCB  Internet  Trends  2011  October  18       Millward  Brown  UK  Predi5ons  2012  2011-­‐2012  digital   predi5ons   eMarketer  2012  trends   Euro-­‐RSCG  TrenspoTng  for  2012  12  crucial  consumertrends  2012  Retail  Renaissance