Living With The Internet A Latin American Study On What s Driving Web Behavior
Agenda Project Objective & Methodology Executive Summary Evolution of the Internet Latin America Online Behavior Latin America Key Statistics Appendix
Project Objective & Methodology
Project Objective & Methodology Objective: Understand what drives people to go online in Latin America and how to integrate marketing communications into their different online activities in best possible way. Focus: Four major LatAm countries were analyzed in this study Brazil Mexico Argentina Colombia High Focus Countries Top 2 countries that lead within the region, were analyzed in detail Focus Countries Top 4 countries with high internet usage were analyzed Methodology: Based on a survey done by our panel, 6,054 respondents aged between 16-64 years answered questions about their web behavioral patterns and their online brand interaction preferences. These respondents were further bifurcated into three sections of people; Teens (16-24 years of age) Men (25-64 years of age) Women (25 64 years of age) Other Data Sources: Leading industry data sources like emarketer, comscore and Internet World Stats were also used to compliment data and findings in this study
Executive Summary
Executive Summary Evolution of the Internet In last 5 years, global online behaviors has change dramatically 2007- The internet village was small; people used to spend most of their time on familiar and trusted sites 2011- The internet village has evolved; users today have wider choices & bigger voices Publishers focus on social & local offerings Brands, products and services are now connecting with users through a social & localized angle Evolution of internet From U.S. to global, leisure to routined, spontaneous to planned and static to mobile Latin America Overview As internet growth saturates in the U.S. and Europe, Latin America has emerged as one of the fastest growing regions in the world Latin America contributes to over 8% of global web audience Growth in Latin America is further expected to continue as broadband and mobile phones become more widely available and affordable Latin American Internet users are highly engaged and skew heavily towards a younger audience
Executive Summary Motivations to Go Online Research, Entertainment and Content Sharing are the biggest motivational factors for Latin Americans to go online People in age group of 16-34 are very active in sharing content online Staying in touch with friends is a common motivation to go online among all age groups, driven by women Entertainment is main motivation for teens to go online while Research and News are main drivers for adults to go online Internet Usage Trends Young people drive internet consumption in Latin America 62% of Internet audience is in the 15-35 age group (source: comscore) 53% of Teens spend 4+ hours online/day On an average, women spend more time on Internet than men Among young adults, 25-34 age group spends maximum time online
Executive Summary Activities on Social Networks Latin American consumers have a strong appetite for high-bandwidth activities such as content sharing, video streaming, music downloads, etc Uploading photos and sending messages are common activities among all age groups, especially women Writing blogs and watching videos online are popular activities among men Over 50% of teens use social networks to send messages, upload photos/videos and play games Despite the rise of social networking and text messaging, e-mail and IM are still important reasons to go online Online Brand Engagement Brand engagement through social media is very effective, especially with teens 64% of men prefer to engage with brands through owned media Women are more prone to get in touch with brands, if contact details are shared online Brands that are engaging, contextual and targeted appeal to the LatAm audience Top strategies adopted by brands to connect with LatAm online audiences are by providing discounts, superior customer service and customized product offerings
Evolution of Internet
2007 Internet Village was Small; People Felt Safe and In-control; Interaction was Limited Newsagents News feeds, sports homepage Post Office E-mails - Yahoo, Hotmail etc. Online Neighbourhood 2007 Banks Finance Shops e-bay, Amazon Pubs Forums and Social Networks
How Internet has Evolved Over the Years? 1 Customized Offerings Users can choose what they want to see online Customizable layouts and categories give users freedom to see content in a way they want Larger focus on consumer needs 2 High on Localization Verticalization of content categories Use of more local and targeted content Location based online content 3 Better Interaction Content has become more interactive and less static Higher engagement of brand with users Sharing of reviews & opinions More legitimate and credible content 4 Targeted Advertising Use of rich media ads User controlled ads Platform specific ads Geo-targeted ads Behavioral targeting of ads 5 More Digital Platforms Online properties are optimized to render on a variety of devices like tablets, smart phones, iphone, ipad etc. Further customization for operating systems and different screen sizes
2011 Internet Village has Evolved; Users Today have Wider Choices & Bigger Voices, Publishers Focus on Social & Local Offerings More Newsagents Local News Focus - News feeds, RSS, Portals, Newspapers & magazines Social News Social Bookmarking, Facebook walls Advanced Post Offices E-mails, IM Twitter, Facebook, Skype etc, used on variety of devices Social Angle Share and Recommend Online Neighbourhood 2011 More Banking Platforms e-commerce, Auctions, Live Trading Platforms, Mobile Payments Local Integration Online Bill Payments & Banking Planned and Researched Shopping More Retailers - e-bay, Amazon, Online Stores of Major retailers Localized Retail Research Pricewatch, Groupon, GetPrice More Gathering Places Forums and Social Networks with expanded apps, Blogs, Discussion Boards Social & Local Fan Pages, Local Communities
Five Basic Motivations that Drive Web Behavior Globally Communication Sending and receiving emails Using IM Using Social Networks Using VoIP Creation Uploading photos/videos Editing/managing websites Writing a blog/ news story Information Entertainment Reviewing a product/brand Using social bookmarks Using an information aggregator Subscribing to RSS feeds Watching videos Playing games Listening to music Transaction Internet banking Online buying
Communication & Creation are Preferred by Global Online Population; This Trend is Similar in LatAm Information, 8% Transaction; 10% Entertainment; 11% Entertainment; 10% Transaction; 15% Communication ; 41% Information; 11% Communication ; 43% Creation; 24% Creation; 27% Communication is the main reason for people to go online LatAm Audience pay more attention on Creation and Information gathering Transacting online is a common Internet based activity globally, however it is on rise in LatAm
The Internet Routine is Becoming More Important Than Ever to a Users Lifestyle Intimate Zones Public Zones Start of the journey End of the journey Social Networks Check for messages & respond (Facebook, Orkut) Final check of social network Blogs, forums, RSS and spaces Log into any forums or blogs to get updated Emails Log in & reply to messages (Gmail, Hotmail, Live Mail) Throughout the journey, Instant Messenger (MSN Messenger, AOL IM) is always on as is music (itunes/youtube) Social Networks Blogs, forums, RSS and spaces Final check of forums or blogs Emails Check emails again News updates Information search Google, Bing, Wikipedia etc. CNN, BBC, Newspaper Sites, News Aggregators etc. Entertainment Online Shopping/Banking Amazon, ebay, Bing Shopping etc. YouTube, Microsoft Showcase etc. From intimate public and back again NB: From other research we know that an average of six websites are visited on a regular basis
Even Though The Internet is Growing in Popularity, Awareness Of It s Pitfalls Are Also Getting Bigger Immediacy and ubiquity Easy to express feelings Free Access to information 24x7 connected One Stop Solution to all needs Personal security Time it takes away from other aspects of one s personal life Can t find what you seek Credibility of information Subscription based content Irrelevant ads
Detail Analysis of Online Behavior in Latin America
1 Top Motivations To Go Online
Staying in Touch, Research, and Content Sharing are Popular and Key Motivational Factors for People to Go Online (1/2) Stay in touch with friends Research for work Education Research how to do things Key Takeaways Staying in touch with friends is common activity among all age groups Research and News are main drivers for adults to go online For News/events Research products to buy To get ideas Entertainment Networking 61% of Teens go online to consume Entertainment related content Professional networking is low and is lead by women Teens and women are more prone to go online as compared to men Find music 0% 20% 40% 60% 80% 100% Teens Men Women Source:- Global Web Index, Wave 3+Wave 4 data
2 Internet Usage Trends
Young People Drive Internet Consumption in Latin America More Than 4 Hours Teens Men Women 53% 44% 49% Key Takeaways On an average 49% of all age groups spend 4+ hours online/day 53% of Teens spend 4+ hours online/day Men and Women of age group 25-34 spend most time online 3-4 Hours 20% 21% 19% Men aged 55-64 go online least Women spend more time online than Men 2-3 Hours 17% 22% 21% Teens outperform all other age groups when it comes to online consumption 1-2 Hours 9% 13% 10% Less Than an Hour 1% 1% 1% Source:- Global Web Index, Wave 3+Wave 4 data
Mobile Internet Access is On Rise in Latin America Home Teens Men Women 95% 93% 93% Key Takeaways Home is preferred place to access Internet, however, mobile Internet access is on a rise Penetration of smart phones and mobile broadband is driving growth of mobile Internet access Work 62% 79% 65% Consumption of online multimedia content is on rise, especially among teens Out of home venue e.g. Café/Bar 68% 57% 46% Advertisers should build strategies to engage consumers on new devices like smart phones and tablets Roaming e.g. On the move/ travelling 32% 29% 22% Source:- Global Web Index, Wave 3+Wave 4 data
Mobile Internet in Latin America is Used Mainly to Get Access to News followed by Research and Social Activities Key Takeaways News and information is highest consumed over mobile, especially by men Watched/Uploaded photos, videos 19% Transaction 9% Social Networking 19% News and Information 28% Search 25% Men, women and teens use mobiles to search maps and get directions Mobile social networking and watching videos is another popular activity among teens Women prefer to use mobile phones for banking and online buying Source:- Global Web Index, Wave 3+Wave 4 data
3 Activities on Social Networks
Social Networking is a Popular Online Activity IM, Content Sharing & Writing Blogs are Key Activities within (1/2) Send messages to friends Key Takeaways Latin Americans are high on social engagement Upload photos Instant message Search for new contacts Share a new story Play game Install application Join a group Upload videos 0% 20% 40% 60% 80% 100% Photo Sharing/Uploading and sending messages is common among all age groups IM and email is still popular among all age groups, especially women More than 50% of teens use social networks to send messages, upload photos/videos and play games 60% of men use social networks to make new contacts and friends Teens Men Women Source:- Global Web Index, Wave 3+Wave 4 data
4 Interaction with Brands Online
Brand Engagement Through Owned Media is Preferred, But Interacting Through Social Media is Essential to Reach out to Targeted Audiences Website to interact with company Listen to comments on forums/social networks Create applications /online services Videos online featuring the brand Contact me if brand is on a microblog Blogs to talk about company ponsoring music downloads Blogging about elevant products Key Takeaways Online advertising is on rise in Latin America Men engage with brands, with 64% visiting company website directly Women are more prone to get in touch with brands if contact details are shared online Brand engagement through social media is very effective, especially with teens Products that target teens have a huge potential in Latin America Social networks for support Creating brand community 0% 20% 40% 60% 80% 100% Teens Men Women Source:- Global Web Index, Wave 3+Wave 4 data
Highly Contextual and Engaging Brands are Preferred by LatAm Online Users Provide knowledge Be informative about products Entertain Help in organizing life Communicate like a real person Key Takeaways LatAm consumers engage with brands that communicate directly 48% of young audience between 16-34 years want brands to entertain them Brands that engage with consumers and help organize their lives tend to develop a close relationship with them Provide real time experience Help in meeting people Be a part of daily routine 0% 20% 40% 60% 80% 100% Teens Men Women Source:- Global Web Index, Wave 3+Wave 4 data
Providing Discounts and Customer Service Enhances Brand Loyalty on Social Networks Discounts for future purchase Customer service A feature to track delivery Access to new products prior to release Personalized recommendations An ability to interact directly An opportunity to be part of product /service ideas Exclusive insights about brand Details on friends purchases Virtual purchase opportunity 0% 20% 40% 60% 80% 100% Teens Men Women Source:- Global Web Index, Wave 3+Wave 4 data
Recommendations and Direct Communication Drive Purchase Decision of Consumers Further Key Takeaways Online and offline recommendations motivate purchase behavior Sponsorships 10% TV based offline ads influence purchase Featured on major online activities 18% Direct Communication 18% Offline advertisements 23% Recommendations 31% Direct communication is preferred, as people want to have a real time experience Online activities like social media, email and search help in advertising to the target audience Sponsoring online videos and sports teams creates awareness and drive purchase Source:- Global Web Index, Wave 3+Wave 4 data
To Summarize 1 4 The Latin American market is emerging and fast growing. Thus advertisers should explore in this region to gain early advantage over their competition Latin American consumers have a strong appetite for high-bandwidth activities such as content sharing, video streaming etc which clearly indicates huge opportunity hidden for advertisers as broadband penetration improves in this region 2 Latin American internet users are highly engaged and skewed towards the younger audience. This makes LatAm demographically attractive and favorable for future growth 5 The impressive usage of social media categories indicate terrific opportunities for advertisers to communicate effectively with their target customers. There is also good potential and growth in categories likes Retail, News, Travel and Finance 3 Mobile Internet access is on a rise in Latin America. Hence advertisers should build strategies to engage consumers on new devices like smart phones and tablets 6 Brand engagement through social media is very effective, especially with teens. Consumers also like to interact with products through company webpage/site. Thus advertisers should build relationships with LatAm consumers through interactive online advertising
Key Internet Statistics in the LatAm Region
Brazil Leads in Number of Internet Users; Colombia Boasts of Highest Internet Penetration in LatAm 17 16 Internet Users (MM) 2009 =163 MM 2011e=207 MM 32 30 65 25 21 40 41 79 Key Takeaways Brazil & Mexico are fastest growing Internet markets Mexico is fastest growing market with 12% CAGR on a 3 year basis Brazil Mexico Argentina Colombia Other LatAm Countries Internet Penetration (%) 2009 2011e There is a significant increase in growth of Internet penetration rates Internet penetration in Brazil & Mexico is low as compared to Argentina & Colombia 33% 40% 43% 39% 50% 55% Colombia has highest penetration rate with CAGR of 7% Growth in Internet penetration promises high growth potential 27% Brazil Mexico Argentina Colombia 36% Source:- emarketer, internet world stats and internal analysis
Latin American User Market is Big and Growing at a CAGR of 5% Mobile Phone Users (MM) 2009 = 449 MM 101 174 42 48 84 2011e = 523 MM 120 198 43 59 103 Key Takeaways 3G introduction is driving growth in mobile phone subscriptions Accessing internet through mobile phones is fast becoming a major need One third of Latin American mobile users are from Brazil The pie is becoming more wide spread rather than having a major proportion confined to a few countries only Brazil Mexico Argentina Colombia Other LatAm Countries Source:- emarketer, internet world stats and internal analysis
Online Advertising Spends are Increasing, Promising a Dynamic Future Online Advertising Spend (MM) 2011e = $1,139 MM $58 $55 $91 $650 $285 Key Takeaways Advertising spend in this region is increasing Brazil leads in total as well as online advertising spend TV attracts majority of the offline spend The CAGR of all countries is growing significantly Brazil Mexico Argentina Colombia Other LatAm Countries Brazil s total ad market is mature and online ad market is largest in the region Online ad markets in Mexico boasts a 3 year CAGR of 45% respectively
Appendix
Stats from comscore Please Note: Figures from comscore might differ from other sources used in this presentation. comscore only takes into consideration: Active internet users Internet users of ages 15+ Internet usages in Homes and Work Places
LatAm Region Has Over 111 MM Internet Users Growing at Over 15% annually; Among the fastest growing regions Worldwide Latin America Asia Pacific Internet Users by Region (MM) 1.324 1.222 111,4 +15% 96,6 534,0 +6% 505,7 +8% Key Takeaways Latin America and the Middle East/Africa are among the emerging markets with high growth rates North America is the most saturated region globally, Russia is the main driver for the growth in the European region Over 8% of the worlds internet users come from the LatAm region Europe North America Middle East- Africa 361,7 336,4 204,0 198,4 112,5 85,2 +8% +3% +32% 15 MM new web users were added between 2009 and 2010, a 15% increase The steady rise in broadband penetration will help fuel the growth of internet users within the region further Dec 2009 Dec 2010 % Growth Y-o-Y Source:- comscore Media Metrix, December 2010
Young Audience Dominates Online Population in Latin America Worldwide 53% % Composition of Internet Audience Key Takeaways There is a high % of young users in Latin America in comparison to the worldwide average 27% 26% 22% 14% 12% 62% of the internet audience is between 15-35 years old Latin America 62% 33% 29% 20% 11% 7% Age Groups 15-24 25-34 35-44 44-55 55+ Source:- comscore Media Metrix February 2011
Social Networking, Search and News are Categories with Highest Reach in LatAm Region Social Networking Search/Navigation News/Information Community % Reach of Key Categories in LatAm 98% 76% 91% 86% 80% 72% 79% 69% Reach Focus Key Takeaways Social Networking is the top category in Latin America Sharing photos is becoming a key component of the Social Networking experience E-mail Multimedia Photos Blogs Instant Messengers Technology Retail 34% 78% 61% 75% 70% 70% 52% 69% 55% 67% 66% 62% 63% 64% Growth Focus IM usage still remains the highest in Latin America, despite the drastic drop in the global usage Blogs and News/Info Sites capture significant portion of web audience There is also good potential and growth in categories likes Retail, Sports, etc Downloads 58% 57% Games 56% 53% Latin America Sports 41% 37% Worldwide Source:- comscore Media Metrix February 2011
Engagement Levels in LatAm are Over Worldwide Average; Argentina and Brazil Lead Within Brazil Mexico Argentina Total Hours Online Per Visitor in Latin America (per month) 21 22 23 Key Takeaways Overall usage levels have remained relatively high in Latin America LatAm users spend approximately 22 hours online each month (global average 21 hours) Colombia Chile 19 21 Companies in the LatAm region have a higher potential of engaging consumers by using digital platforms Venezuela 19 Puerto Rico 15 Worldwide Average 21 Overall LatAm Average 22 Source:- comscore Media Metrix February 2011
Reach of Social Networking Sites Continues to be Very High Throughout LatAm, Outpacing Worldwide Average Worldwide Asia Pacific Europe North America Middle East Latin America Brazil Mexico Argentina Colombia Chile Peru Venezuela Puerto Rico % Reach of Social Networking Sites Globally 75,7% 51,2% 91,0% 98,0% 83,1% 97,5% 93,6% 92,4% 97,0% 97,2% 96,0% 90,9% 96,2% 95,8% Key Takeaways 98% of audience use Social Networking sites with Colombia and Argentina dominating within the region In terms of Reach, Facebook is leader, however Orkut s strong following in Brazil generates heavier usage for the category overall Latin America is also home to some of the most highly penetrated markets for Twitter Other players like Hi5, Sonico and Fotolog.com still hold a strong audience in Latin America Source:- comscore Media Metrix February 2011
Thank You 43