Digital Media Opportunities in Brazil 2015 Mid Year Update
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The document provides an overview of Brazil's market opportunities in 2015, highlighting the country's growing consumer base, significant internet and mobile adoption, and expanding e-commerce. It also outlines challenges such as bureaucracy, high taxes, and operating costs. Overall, Brazil demonstrates potential for digital companies despite economic struggles and structural barriers.
Digital Media Opportunities in Brazil 2015 Mid Year Update
- 1. Opportunities in Brazil 2015 Mid Year Update
- 2. Brasil Online 1995-1996 ZAZ 1996-1999 Terra 2000-2005 DM9DDB 2006 iG 2007-2013 Latam Connection 2013 caiquesevero@latamconnection.com About the author Caique Severo
- 3. Opening international markets for digital companies Market Intelligence Business Development Sales Representation www.latamconnection.com
- 4. Agenda 1. General data about Brazil 2. Internet and technology: broadband and mobile 3. Digital media: social media, video, ecommerce 4. Challenges of doing business in Brazil
- 5. General data about Brazil
- 6. 2015 204 million people Source: IBGE, june 2015 - http://www.ibge.gov.br/home/default.php
- 7. 2014 7th largest country in GDP US$ 3 trillionpurchase power parity standard Source: Finance Ministry - http://www.fazenda.gov.br/area-destaques/economia-brasileira-em-perspectiva-30.12.2014
- 8. Source Central Bank of Brazil: : http://www.bcb.gov.br/pec/appron/apres/Apresentacao_RTI_06_2015.pdf 2015 Decrease in GDP - 1.1%Estimated
- 9. Source: IBGE April 2015: http://www.ibge.gov.br/home/ 2015 Unemployment 6.7%
- 10. Big shift in economic classes Million of people in each economic class Source: Finance Ministry, December 2014 - http://www.fazenda.gov.br/area-destaques/economia-brasileira-em-perspectiva-30.12.2014 Class AB Class C Class D/E
- 11. Growth in higher education % of people ages 25-34 with at least an undergraduate degree Source: IBGE 2004 2013 15% 8%
- 12. Cars sales doubled in a decade Number of new cars on the streets Source: Anfavea, November 2014 - http://www.anfavea.com.br/tabelas.html
- 13. Domestic airline travel grew 164% in 9 years Number of passengers Source: ANAC, November 2014 - http://www2.anac.gov.br/estatistica/demandaeoferta/DemandaeOferta.asp Domestic November 2005 November 2014 7.952.936 3.011.295
- 14. Inequality is lower but still high % of income per capita by deciles of income Source: IBGE - ftp://ftp.ibge.gov.br/Indicadores_Sociais/Sintese_de_Indicadores_Sociais_2014/SIS_2014.pdf 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 42% 15% 11% 8% 7% 6% 5% 3% 3% 1% 46% 16% 10% 8% 6% 5% 4% 3% 2% 1% 2004 2013 The 10% richer gets more than 41% of all income
- 15. Demographic bonus Decrease in number of child per woman Source: World Bank, Google, others
- 16. Demographic bonus 2010 2020 More people in the economic active age Men Women Men Women
- 17. Internet and technology adoption
- 18. Internet users in Brazil Non-users 70 Users 95 Million of people over 12 years old Source: F/Radar 2014 - http://www.fnazca.com.br/index.php/2014/12/16/fradar-14%C2%AA-edicao/
- 19. Internet users by social economic class DE 7 C 48 AB 38 Million of people over 12 years old Source: F/Radar 2014 - http://www.fnazca.com.br/index.php/2014/12/16/fradar-14%C2%AA-edicao/
- 20. Internet users by age 73% are under 35 years old 60+ 346-59 8 36-45 14 26-35 24 18-25 24 12-17 20 Million of people over 12 years old Source: F/Radar 2014 - http://www.fnazca.com.br/index.php/2014/12/16/fradar-14%C2%AA-edicao/
- 21. Fixed broadband has more than 24.6 million subscriptions Source: Teleco: http://www.teleco.com.br/blarga1.asp april 2014 december 2014 march 2015 april 2015 24,6 24,4 23,9 22,9
- 22. Broadband penetration still growing Brazil Chile Argentina 54% 50% 42% % of households Source: ITU, State of Broadband 2014 - http://www.broadbandcommission.org/Documents/reports/bb-annualreport2014.pdf
- 23. Mobile
- 24. 3G access near 150 million Number of access points (000), 3G devices 1T14 2T14 3T14 4T14 Jan/15 148.837 144.668 123.203 118.474 105.402 Source: Teleco: http://www.teleco.com.br/3g_brasil.asp
- 25. Source: Teleco, October 2014 - http://www.teleco.com.br/4g_brasil.asp As low as US$ 0.3 per day Pre-paid mobile broadband
- 26. Source: Teleco, October 2014 - http://www.teleco.com.br/4g_brasil.asp Twitter, Facebook, WhatsApp Free usage Social media
- 27. Source: Teleco, October 2014 - http://www.teleco.com.br/4g_brasil.asp 4G 7.7 million devices connected in January 2015
- 28. 3/4 of phones sold are smartphones 4,7 15,1 Smartphones Feature phones Source: IDC, december 2014, http://br.idclatin.com/releases/news.aspx?id=1777 Sales by type in third quarter 2014
- 29. Mobile phones are the most used device to access the internet at home % of internet users Source: F/Radar Tablet Celular Portable PC Desktop PC 42%40% 52% 12%
- 30. Tablets sold per year (Million) Source: IDC 2010 2011 2012 2013 2014 Estimated 2015 8,1 9,5 8,4 3,1 0,80,1
- 31. Access through tablets % of internet users Source: F/Radar 2013 2014 14% 9%
- 32. Best seller tablets 78% of sales are under US$ 200 51% of sales are under US$ 120 Semp Toshiba US$ 79 Android 4.2.2 7” screen 8GB drive CCE US$ 128 Android 4 9” screen 4GB drive Multilaser US$ 87 Android 4.2 7” screen 8GB drive
- 33. Usage by type of device Source: comScore: http://www.comscore.com/por/Imprensa-e-eventos/Apresentacoes-e-documentos/2015/2015-Brazil-Digital-Future-in-Focus
- 34. Major players on mobile Marketing campaigns, app development, ad network (Hands) Marketing campaigns, media buying End user apps (PlayKids, iFood), mobile payments, sms messaging
- 35. Advertising
- 36. Digital ad spending Brazil is by far the largest market in Latam Emarkete: rhttp://www.emarketer.com/Article/Total-Media-Ad-Spending-Brazil-Pass-20-Billion-This-Year/1012339
- 37. Digital ad spending Total online ad market: US$ 2.6 billion (2014) IAB Brasil: http://iabbrasil.net/assets/upload/boas_praticas/1431624853.pdf Search + Classifieds 1.258 Display + Social Media 903 Video 261 Mobile 232 +14% estimate for 2015
- 38. Media Portals Verticals Legacy print
- 39. Retargeting, DSPs, Ad Networks and segmentation Retargeting, performance advertising Behavioral targeting Demand Side Platform Affiliate marketing, CPA Blog ad network Data Management Platform and data provider
- 40. Social Media
- 41. Social media is the biggest category Source: Comscore,May 2015: http://www.comscore.com/por/Imprensa-e-eventos/Apresentacoes-e-documentos/2015/2015-Brazil-Digital-Future-in-Focus
- 42. Time spent on social media Source: Comscore,May 2015: http://www.comscore.com/por/Imprensa-e-eventos/Apresentacoes-e-documentos/2015/2015-Brazil-Digital-Future-in-Focus Average minutes per visit
- 43. Social Media audience Source: Comscore,Maio 2015: http://www.comscore.com/por/Imprensa-e-eventos/Apresentacoes-e-documentos/2015/2015-Brazil-Digital-Future-in-Focus
- 44. Online video
- 45. 64 million people access online videos Source: Comscore, september 2014 - http://www.comscore.com/por/Insights/Presentations-and-Whitepapers/2014/2014-LATAM-Digital-Future-in-Focus
- 46. Leader of video engagement in Latam Minutes per viewer Reach of the total population Source: Comscore,Maio 2015: http://www.comscore.com/por/Imprensa-e-eventos/Apresentacoes-e-documentos/2015/2015-Brazil-Digital-Future-in-Focus
- 47. Video ads engagement growth Source: Comscore,Maio 2015: http://www.comscore.com/por/Imprensa-e-eventos/Apresentacoes-e-documentos/2015/2015-Brazil-Digital-Future-in-Focus
- 48. E-commerce
- 49. Ecommerce US$ 11.16 billion (+24%) 2014 Source: eBit http://www.ebitempresa.com.br http://www.ebitempresa.com.br/clip.asp?cod_noticia=3958&pi=1 9.7%Mobile Commerce
- 50. Fashion and beauty are leading categories Source: e-bit/eMarketer - http://www.emarketer.com/Article/Brazil-Ranks-No-10-Retail-Ecommerce-Sales-Worldwide/1011804?ecid=SOC1001 % of total transactions, first half of 2014
- 51. Room for growth in mobile commerce % of purchases made on mobile devices Source: Criteo Brazil US UK Japan 49% 41% 27% 10%
- 52. E-commerce Fashion/Clothing Cosmetics Electronics CarsAuctions/Trade Comparison General
- 53. Challenges of doing business in Brazil
- 54. Bureaucracy Days to open a business OCDE Latam & Caribbean Brazil 102,5 30 9,2 Source: Doing Business 2015
- 55. Bureaucracy Hours spent managing taxes OCDE Latam & Caribbean Brazil 2600 365 175 Source: Doing Business 2015
- 56. Tax costs Total taxes (% of profits) OCDE Latam & Caribbean Brazil 68,9 48,3 41,3 Source: Doing Business 2015
- 57. Office space rent (US$ / cubic meters) Lima Buenos Aires Caracas São Paulo 90,8 46 30 21,5
- 58. Big Mac Index (US$) Mexico 2.86 Argentina 3.88 Colombia 4.48 Brazil 5.28
- 59. Traffic in São Paulo 5/23/2014: 214 miles (344 km)
- 60. Conclusions Opportunities Challenges • Growing consumer base • Big mobile adoption • Demographic bonus • Bureaucracy • High taxes • High operating costs