Across the world, digital marketing among businesses is increasing tremendously. Spending from 2017 to 2018 increased nearly 17 percent according to an October 2020 Statista report. Moreover, experts predicted an exponential increase in spending through 2025. In 2020, total expenditure has reached $345.948 million so far, up 3% from 2019. This spending is broken down amongst search, banner, social media, video, and classifieds advertising online. The breakdown of expenditure by region though is what globalized businesses and marketers should be looking at. Unsurprisingly, the US leads the world in online advertising expenditure. However, digital marketing in Latin America receives quite a bit of funding as well.
All across Latin America, consumers and companies are embracing digital marketing. The platform has become so customizable and malleable to the needs of so many industries. As a result, digital marketing in Latin America has grown exponentially. Biz Online Marketing dives into which industries are embracing digital marketing in Latin America.
Insight into the growth of digital marketing in Latin America
Like much of the world, digital marketing in Latin America has grown substantially in recent years. In 2020 alone, total expenditure in the sector reached over $11 billion in Latin America. Much of this growth stems from the region’s increase in per capita access to the internet. In 2019, the Global System for Mobile Communications (GSMA) predicted that nearly 70% of Latin American mobile users would have broadband mobile connection by 2020. This trend towards increased access began to change the world of marketing and business very quickly in Latin America.
COVID-19 was another influential factor in speeding up the switch to digital marketing in Latin America. Given the lockdown and quarantine mandates from national governments, the only way in which companies and businesses could reach consumers was through a digital space. Companies flocked to the digital marketing space to maintain relationships with their current customers through online public relations. Moreover, through search engine optimization techniques, they were able to reach new segments of their markets, acquiring new customers. Moving forward beyond the global pandemic, companies in Latin America will continue to embrace digital marketing. Already, the swift adoption and activity has started to alter consumer expectations for marketing and PR. Whether it be B2B or B2C companies, digital marketing in Latin America is no longer a trend. Rather, it is a necessity now.
Industries adopting digital marketing in Latin America
Digital marketing in Latin America is gaining momentum thanks to a handful of enthusiastic industries. The following industries benefit greatly from the dynamic and expansive components of digital marketing.
Tourism and travel
Firstly, the tourism and travel industries are embracing digital marketing in Latin America wholeheartedly. Before the global pandemic, the industries were gradually adopting the practice. However, once domestic and international travel came to a screeching halt, the industries started to struggle. According to the World Trade Organization, international tourist arrivals are down 39 (Caribbean), 35 (Central America), and 35 (South America) percent as of April 2020. While the industry couldn’t control border restrictions, it could control how it reached the market. Maintaining contact with the target market even while they weren’t actively traveling became the focus. This goal has been achievable through digital marketing means.
By increasing their online presence, tourism and travel companies can transcend the visual world of the viewer. Posting about oasis-like destinations keeps travel and adventure on the mind of the individual. Moreover, the breadth and depth of digital marketing allows both consumers and companies to explore and interact on large scales. Ultimately, this increases exposure and engagement for companies within the industry. Once travel restrictions are lifted entirely, the effects of digital marketing efforts within this sector should manifest quickly.
Banking and FinTech
Banking and FinTech are also taking advantage of digital marketing in Latin America. Due to the increasing internet and smartphone penetration, eCommerce transactions are extremely popular. Among eCommerce, banking, and FinTech activity, six markets make up 95% of the business. Ingenico, a digital payment services company, recognizes these markets as Chile, Colombia, Mexico, Brazil, Argentina, and Peru. Not surprisingly, these markets also have the most banking and FinTech companies in the region. These companies started their digital marketing efforts by merely making their services known, spurring an uptick in eCommerce. Now, the industry has figured out how to educate their target market about the industry, banking, credit, loans, etc. through digital marketing efforts. For these companies, digital marketing has become more than just a means of reaching the target market. Rather, it serves as an educational tool upon which a trusting customer-brand relationship will grow.
Consumer packaged goods
Finally, consumer packaged goods are embracing digital marketing in Latin America as well. The global pandemic shed light on what were looming threats to the industry. Most notably, home delivery services were quietly threatening the industry. Once COVID-19 hit Latin America, 17 percent of consumers switched over to the services. This drastically altered the shopping dynamic for consumer packaged goods. Being that customers were no longer in the store seeing and interacting with these brands and products, companies had to change their approach. No longer did product positioning within the stores determine sales of a good. Rather, the consumer’s awareness level of the brand prior to adding products to their virtual cart.
According to a recent McKinsey survey of winning companies within the CPG industry in Latin America, 90 percent had digital marketing as an independent function. By contrast, only 50 percent of nonwinning companies incorporated DM as an independent function. They found significant positive correlation between successful companies in the region and their digital marketing presence. A key component of this relationship though is the agility and malleability of the company’s campaign. CPG companies should adopt agile digital marketing in Latin America if they want to survive changing consumer shopping behaviors.
Adopt digital marketing in Latin America
Choosing to adopt a digital marketing strategy in Latin America will grow your overall business. Once you’ve made the decision to pursue a digital marketing strategy, there are many steps to follow. Firstly, you’ll want to conduct a digital/online audit of both yourself and your company. This will help you get an idea of what presence you currently have online. Moreover, you’ll better understand how the world sees your business online. Finally, you’ll get an idea for how your online personal brand is helping and/or hurting your business. Conducting this digital audit essentially gives you a starting point for your digital marketing to come.
After conducting the audit, you’ll devise a digital marketing strategy for your business. When creating your unique online marketing approach, the genesis should always be the “Why” of your business. Why do you and your company do what you do, the way you do it? From here, you can move onto the “How”. How does your business achieve its “Why”? Lastly, your strategy will cover the “What” of your business. This is the most broad portion of your digital marketing strategy. Essentially, what does your business do? The “How” and “What” will be what makes up a great deal of your online content. Your “why,” being the most important and most specific part of your strategy, is the theory and motivation behind it all.
Developing a digital marketing strategy can be difficult, especially without an experienced team. Another way to jump into the world of digital marketing is to hire a digital marketing agency. An agency has ample access to resources and years of experience and successes to support your digital marketing success. With them, you can focus on running your business.
Wrapping up
Digital marketing in Latin America is growing in popularity and importance. Especially given the conditions brought forth by COVID-19, it is nearly a requirement for businesses. Increased access to the internet and online activity have encouraged consumers to use it as a central means of information. As a result, businesses should use it to reach their customers, gain new ones, and communicate within the industry. Overall, the many benefits that come with digital marketing in Latin America will surely make the addition worth it.
As a digital marketing agency, Biz Online Marketing has the tools, resources, and experience to transform your digital marketing strategy. With the help of an accomplished team, your business can conquer the online marketing space. For more information on our services and company, reach out to us on our website. You can also find more information on our LinkedIn, Facebook, Twitter, Instagram, and YouTube accounts and pages.