The Media Industry in Brazil and the online publicity industry in Brazil, what Danish decision makers should know about it?
The media industry is, perhaps, my favorite industry of all industries. Not only because of the creative side of it it but also due to the pace of things happening that is very fast. New trends, and products are constantly emerging. Additionally the Media Industry has the capability to influence decision making, and influece how we perceive a product or a service.
Keep reading this article because I´ll share the following :
- Information on the Media Industry in Brazil
- The Media Penetration in Brazil
- A very good overview of the onnline publicity market in Brazil
- The online publicity market ecosystem in Brazil
- Trends for the online publicity market in Brazi
# 1. The Media Industry In Brazil.
May 10th of 2013 the US Media Consulting group, has released a study showing the media map in Brazil. I will share the main points of this study with you today.
- In 2014 will be the 5th country with highest ad spending.
- It is estimated that the total ad spending in Brazil by 2014 will be apprx. in the order of U$22,216 Billion of Dollars
- During the first semester of 2012 Internet ads was the media with highest growth in Brazil in terms of adspending
- Internet and Paid TV are the medias that grew the most in 2011, outperforming open TV media investment more than 2 times
Medias with highest growth rate-June 2013
Translating from left to Right
(Cinemas>Guides>Magazines>Newpapers>Radio>OpenTV>Exterior Publicity (Outlets)>Paid TV> Internet)
INVESTMENTS PER MEDIA
Television still is the most accredited media, and probrably the one that brings more return on investments for brands, generally in Brazil. The Internet ad spending is still relatively small when compared to Television, but Internet ad spending will be pretty soon taking over the magazines ad spending in Brazil.
# 2. The Media Penetration in Brazil
- Brazilians still watch a lot of Television. An average Brazilian person watches 5 hours and 28 minutes of TV per day (average)
- 90% of Brazilians affirm that TV is they prefered source for watching news
- 14,5 million Brazillians subscribed for Paid TV in June of 2012. An increase of 30% in suscriptions when compared to the same period in 2011
- Class C, or the so called “new middle class” is responsible for 30% of the Paid TV subscribers base
There are a few cultural reasons for that:
- An important cultural trait in Brazil that isn´t often mentioned on Media reports is the importance of soup operas in Brazil. Soap Operas are trend setters. Rede Globo is the main TV Network producing soup operas in Brazil and is very common that in last week of a ” good soap opera” in Brazil, to have a spiking increase on the number of TV sets turned on. Needless to say that media spent by then is very high, and only major brands can afford it.
- The circulation of newspapers is still growing in Brazil at rates of 1,8% in 2012. According to Gessica Hellmman a renowned studious on media in Brazil, approx 46% of the Brazilian population read newspaper.
- Nearly 11 % of the population or 21 million Brazilians read some newspaper
- 73% of the Brazilian audience still prefer to get to know the news thorugh print media rather than internet
Still, according to Gessical Hellmman the circulation of magazines has broken a sales record in 2011 having sold 13,7 millions copies. The magazine penetration is of 63% to the A and B classes and 38% to the C Class
- Radio is present in 9 out of 10 Brazilian household. According to US MEDIA Consulting, ballasted by IBGE statistics, 75% of the Brazilians affirm to have listened to the radio at least one time within the last week.
- 49% of Brazilian mobile users who have a radio use the radios often
- 80% of Brazilian automobiles are equipped with radios. The vast majority of car radio listeners are men belonging to the classes A and B between 25 and 54 years. However, 36% of the total of radio listeners are women belonging to the classes CDE.
- In Brazil there is a population of nearly 200 million people and 90 million out of the total have access to the internet. An increase of almost 200% when compared to internet users in 2006.
- As of active users Brazil accounts 63,5 million users, that means users that accessed internet either form their homes or the workplace
- According to comScore Brazil is now the 6th largest country in terms of online audience, only lagging behind China,USA,India,Japan and Russia.
- 73 Million Brazilians are subscribers for a mobile broadband plan.
How Internet is used in Brazil?
- Online Purchasing: 31 million Brazilians visit E-commerce websites on a monthly regular basis
- Social: 97% of all Brazilian Internet users are active on social medias
- Blog Reading: Blogs have a high penetration rate among Brazilian internet users.
- Game Industry: US$ 2 Billion was the amount of money spent by internet users with online games in Brazil in 2011.
# 3. The Online Publicity Market In Brazil
Brazil is known worldwide for its vast wealth of cretivity within the publicity market. In general the participation of Brazilian advertisers at the Cannes Festival has proved Brazil to be a strong country within the sector. It is important to remember taht these people are in its majority, offline advertisers.
The online publicity scene in Brazil, however, is still in its infancy, when compared to mature markets such as the US or the European markets.
According to IAB, the Internet Advertsing Bureau, the investments in online publicity in Brazil in 2012 including display and search, were in the order of R$4,57 Billion . A growth of 32,2% when compared to the R$ 3,23 Billion in 2011.
In Search, was invested R$2,7 Billion while in Social Media, Display and Richmedia the investments were in the order of R$ 1,8 Billion.Below a chart with the evolution of the Online investment from 2011 to 2012.
According to Fatima A. Bana, an online media specialist in Brazil, the Investments in Search will still grow in the short term, but Brazil tends to follow a trend that is already happening in the US or Europe, in terms of Display and Rich media investment.
The Ecommerce is one of Brazil´s Digital driving forces and is pushing online retailers more and more to engage with their audience.
A study done by E-marketer released on December 20th, 2012, shows Brazil as one of the hubspots for online media investments. E-Marketer also affirms that Brazil driven by the growth of online digital investments and E-commerce, will become the 5th largest country in terms of online publicity spending, by the end 2014, overcoming the U.K
It´s important to remember that although, the digital ad spending in Brazil is still relatively small when compared to the USA or Europe, it has been increasing tremendously within the last three years.
Mobile: ( Tablets and smartphones)
Ad spending on mobile is also a rising market. In 2012 US$ 24,6 million, represented 1,2% of the total ad spent in online publicity. E marketer estimates that the mobile market in Brazil will represent 5% of the total online ad spending in 2016, reaching nearly US$ 200 million.
# 4. The Online Publicity Market Ecosystem in Brazil
Below you can see the Brazilian Lumascape, created by Marcelo Santiago, director of Mbreak Comunicacao.
In this version Santiago shows the Brazilian Online Display Media Ecosystem. This is from December of 2012, and gives a very good idea of the online media market in Brazil at this moment, and ultimately, who are the main players.
As shown below, Brazil is still a virgin market compared to mature markets such as the European and North American markets.
The Demand Side of the Business
You can download a list with the 30 Major Brazilian Advertisers.This comprises the period from Jan to June of 2013.
Source IG, Portal
Obs: Values in BRL
The Supply Side of the Business
The Online Media Industry in Brazil is dominated by a handful of ad networks. Nearly 80% of all Internet traffic in Brazil is in the hands of 9 websites. Conversely, in the US, the major ad networks detain some 33% percent of all Internet traffic, which proves that::
- In Brazil there is little or no incentive to independent producers
- There is a general habit, a culture, of using large portals when browsing the web.
- There are very little alternatives of reliable and independent content
- The independent producers that are competent end up being incorporated by one of the major websites.
See below a figure with the online properties that received most traffic in Brazil. This figure is from a presentation from comScore Brazil, and the name of the presentation is “The Moment of Online Publicity in Brazil” .
ONLINE PROPERTIES WITH MOST INTERNET TRAFFIC- Jun 2013
SOURCE: comScore- June 2013
# 5. Trends for the Brazilian Online Publicity Market
The Demand side platforms promises to support agencies and planners to optimize the buying and the inventory management with diverse suppliers.
According to Marcos Gomes, Boo Box founder, what Brazil needs are self service systems, that enables the customer (agencies) to have full control over the platform, without the need of external interventions such as telephone or email. He even adds that, in Brazil there is a lack of transparent systems which enables the agency to decide how to use their DSP´s.
DSP´s use programmatic Media. The programmatic media is growing in leaps worldwide. According to the reports from Navegg – a DSP player in Brazil – there has been a significant growth in the usage of audience data for RTB campaings, within RTB platform.
TURN is the newest player arriving in Brazil (Sep 2013) which offers DSP´s and programmatic media – proving once again the untapped potential of the Brazilian Market.
According to Marcos Gomes the conversational media model seems non-existent in Brazil, but it has been widely used by Facebook and Twitter, mainly by the mobile users. Here they can see promotional ads by the side of posts done by the user’s “friends.”
Conversational media tends to grow even more in Brazil, within the next few years.
- TV is still “The Grand Old” in Brazil. But the internet is playing a major and continuosly growing role as more and more Brazilians get access to the internet.
- Although there still is still a lot of people with no- or minimal access to the internet, the right political measures are being taken for a wider social inclusion, which gives a huge opportunity for international telecom companies, internet advertisers, e-commerce shops,etc.
- The same is valid for mobile. Today, for every person there are two mobiles.
Users in general are able to hire more expensive subscriptions, rather than the pre-paid solutions, thus they are ablo to stay connected for a longer time.
- After interviewing one partner of AD. Dialeto, a major Brazilian digital agency,and after having a brief talk to an account manager from Predicta, I realized that Real time bidding in Brazil is growing in leaps and bounds and surely is a market that Danish companies should pay attention to.