Half of Digital Ad Spending in Latin America Executed in Brazil
Mobile internet ad spending in Brazil will rise 120% in 2015
Home to a population of 203 million this year, Brazil is the largest market in Latin America by any measure. Advertising spending is no exception. Digital ad spending in the country will rise 16.0% to reach $3.4 billion in 2015, eMarketer estimates. Such level of investment equates to a mighty 49.9% share of all digital advertising expenditures in the region this year.
Brazil, however, is in a tough spot at the moment with economic output shrinking every quarter since Q2 2014 and getting worse. Cited by The Economist, Haver Analytics and Thomson Reuters estimated reductions in Brazil’s output hovered around 2% in H1 2015. Adding to the negative outlook, the International Monetary Fund (IMF) projected in October 2015 that Brazil will endure a two year recession with 3.0% and 1.0% drops in 2015 and 2016, respectively, after a meager 0.1% expansion in 2014. The new IMF projections are far worse than the previously expected 1.5% GDP reduction in 2015 with a return to growth the following year.
Despite economic setbacks, Brazil’s sheer size will ensure its regional importance when it comes to digital advertising. Even in 2019, 45.9% of digital ad spending in Latin America will be executed in the region’s largest economy, eMarketer predicts. Such contribution amounts to $5.79 billion that year. This growth will partly be fueled by inflation, which is likely to remain far above the 4.5% annual target set by the country’s central bank, Banco Central do Brasil (BCB), but also by fast expanding mobile advertising outlays.
Mobile internet ad spending will rise 120% in 2015 and will maintain robust double-digit rates throughout the forecast period to keep Brazil tops in the region—eMarketer estimates that mobile ad budget will reach $599.3 million this year. That amount represents 46.5% of all mobile ad spending in Latin America. By 2019, expenditures in mobile ads will reach $3.75 billion to represent 64.8% of all digital ad spending in Brazil—up from 17.6% this year.
However, it is important to note that as massive as Brazil may seem against the regional background, Latin America currently contributes only 4.0% to the global tally of digital ad spending and an even smaller 1.8% portion to mobile internet ad spending worldwide, eMarketer estimates.