- The Rise of Programmatic Advertising in Latin America
- Digital Advertising in Latin America
- Programmatic Advertising Spending in Latin America 2017-2026
- Overview of the Programmatic Advertising Industry in Latin America
- The Top Factors Impacting Programmatic Advertising Growth in LATAM
- The future of programmatic advertising in LATAM region
As programmatic advertising continues to revolutionize the digital advertising landscape, businesses in Latin America are seizing the potential of this technology to drive growth and reach their target audiences more effectively. With the increasing adoption of digital devices and advancements in technology, programmatic advertising in Latin America is poised for significant expansion and is expected to grow at a steady pace.
The Rise of Programmatic Advertising in Latin America
The growth of programmatic advertising in Latin America is indicative of the region’s evolving digital landscape. Brazil, Mexico, and Argentina are at the forefront of this shift, demonstrating substantial investment in programmatic ad spending. This trend is underpinned by the region’s burgeoning population, which presents a vast and diverse consumer base for advertisers.
Furthermore, Latin America’s increasing internet penetration and widespread adoption of smartphones accounting for 134 million in 2023, have created new opportunities for personalized advertising. As a result, advertisers are drawn to the potential of reaching a more engaged and diverse audience through programmatic methods.
The region’s receptiveness to this technology reflects a growing understanding of the value it offers in terms of efficiency and precise targeting. As programmatic advertising continues to gain momentum in Latin America, it is poised to redefine the way brands engage with consumers, driving more effective and personalized marketing strategies tailored to the unique dynamics of the region.
Digital Advertising in Latin America
Latin America is experiencing a massive digital transformation, leading to significant growth in digitally driven services and online commerce. Despite economic challenges, the region’s digital economy is defying global sluggishness, with Latin America expected to be the second-fastest-growing retail e-commerce market in 2023.
Latin American countries are set to dominate the top 10 in digital ad growth in 2023. While Brazil is the only country in the region to rank among the world’s top 10 in digital spending, the entire region is experiencing an ad boom. Five Latin American countries will be in the global top six for digital growth, with the region as a whole increasing its digital ad spending by 14.0%.
Although there will be a deceleration compared to previous years, the growth is still significant, driven by genuine increases in spending.
Programmatic Advertising Spending in Latin America 2017-2026
Programmatic advertising spending in Latin America has been on a steady upward trajectory over the years, reflecting the region’s growing digital advertising market. From $5.2 billion in 2017, the spending increased to $8.24 billion in 2021, and it is projected to continue its growth reaching $11.38 billion in 2023 and further escalating to $14.92 billion by 2026.
The overall Internet advertising spending in Latin America has been steadily increasing from $0.51 billion in 2010 to $13.29 billion in 2023.This growth reflects the region’s growing digital advertising market, with overall ad expenditure in Latin America expected to reach over $14.55 billion by 2024.
Overview of the Programmatic Advertising Industry in Latin America
The programmatic advertising industry in Latin America has seen significant expansion in recent years, with countries such as Brazil, Mexico, and Argentina emerging as major players in this dynamic landscape. These nations have sizable populations, well-established digital infrastructures, and high rates of smartphone usage, making them appealing markets for advertisers.
The Latin America Programmatic Advertising Market is projected to grow at a CAGR of 8.31% from 2022 to 2027, fueled by increased digitalization and the demand for a more connected consumer experience. Notable trends include the surge in digital media advertising and the increasing prominence of mobile programmatic ads.
Brazil stands out as the largest programmatic advertising market in Latin America. With a population of over 216 million people, Brazil has a well-developed digital ecosystem that has been under enormous digital transformation over the recent years. Programmatic ad spending in Brazil reached approximately $8.97 billion in 2023 with ad spending growth at the level of 7.1%. Advertisers in Brazil are leveraging programmatic advertising to optimize their ad campaigns and effectively reach their target audience.
Mexico is another key player in the programmatic advertising landscape in Latin America. With a population of over 128 million people and a growing internet penetration rate, Mexico offers immense opportunities for programmatic advertising. Programmatic ad spending in Mexico reached $2.61 billion in 2021. By 2026, the ad expenditure is expected to reach $4.82 billion. Advertisers in Mexico are recognizing the advantages of programmatic advertising in reaching their target audiences efficiently and maximizing their return on investment.
Argentina with a population of over 45 million people and increasing penetration rate of smartphones, is one of the key players in the Latin America programmatic advertising market. The country’s digital advertising market is projected to grow by 6.96% from 2023 to 2027, resulting in a market volume of $1,473,00 million in 2023 and estimated $1928.00m by 2027, making it the fastest-growing market globally with a 64% growth rate. In the Digital Advertising market in Argentina, it is projected that 74% of total ad spending will be generated through mobile in 2027.
The Top Factors Impacting Programmatic Advertising Growth in LATAM
The expansion of programmatic advertising in Latin America is heavily influenced by factors such as innovation, technological advancements, digital ad spend, localization, mobile penetration, video dominance, and personalization.
Latin America has been experiencing a rapid increase in digitalization, with more people gaining access to the internet and engaging in online activities. This trend has created a vast digital landscape, providing businesses with new opportunities to reach their target audiences through programmatic advertising.
Increasing popularity CTV advertising
The rise of programmatic ad spend in Latin America exploded by 482% in 2021 which indicates a strong trend towards digital advertising in the region. Furthermore, the popularity of CTV among cord-cutters and cord-nevers, especially within the younger demographic of Gen Z and millennials, has contributed to its rapid growth in Latin America. Advertisers have the ability to utilize programmatic advertising to reach specific audiences through connected TV devices, while also leveraging data to deliver tailored and relevant advertisements.
Dominance of Mobile Advertising
With 74% of total ad spending in the digital advertising market projected to come from mobile in 2027, it’s evident that mobile advertising is reshaping the landscape of digital advertising in Latin America. This dominance underscores the importance of optimizing advertising strategies for mobile platforms to effectively connect with the region’s audience.
Demand for a More Connected Experience
Consumers are seeking more personalized and seamless experiences across all digital platforms and programmatic advertising makes it possible. Allows businesses to deliver targeted and relevant ads to consumers, enhancing their overall digital experience and increasing the likelihood of engagement and conversion.
Positive Effect of Covid-19 Pandemic
The Covid-19 pandemic forced businesses and organizations to reevaluate their marketing strategies, leading many to shift their advertising efforts to digital channels. This accelerated the adoption of programmatic advertising as a cost-effective and efficient way to reach consumers during the global lockdown.
Retail Media Advertising Drives e-Commerce
Retail media ad spending is set to surpass $1 billion and represent 16.5% of ecommerce marketing spending in the next two years. Major players like Mercado Libre and Walmart Mexico are driving this surge, signaling the region’s potential to mirror the success seen in the US. With the rise of e-commerce, advertisers are leveraging retail media networks for their targeting and measurement capabilities, highlighting the significant growth potential of retail media advertising in Latin America.
The future of programmatic advertising in LATAM region
The future of programmatic advertising in the LATAM region is incredibly promising. With Latin America emerging as one of the fastest-growing regions for programmatic advertising, significant expansion in digital ad spend is projected, especially in key markets like Brazil and Mexico. The region’s high smartphone penetration and the increasing use of mobile devices are creating vast opportunities for mobile and video programmatic advertising. The Latin America Programmatic Advertising Market is expected to grow at a CAGR of 8.31% from 2022 to 2027, driven by the increasing digitalization of customers and the demand for a more connected experience. As businesses and organizations turn to digital advertising methods, the region’s programmatic advertising landscape will continue to thrive, making personalization and localization crucial in this diverse market.