“International Unveiled,” a World Tour in 3 Stops – Third Stop, Caribbean & Latin America
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Welcome to the third and final post of this series centered around the amazing world of international search and social.
This week I am taking you to the Caribbean and Latin America (CALA). We will be taking a closer look at the Argentinian, Brazilian and Mexican markets.
This fascinating region hosts some of the world’s greatest natural resources, such as the Amazon Basin (Amazonia) covered by the largest tropical rain forest. It is also known for breathtaking wonders like the Andes Mountains, paradise-like beaches in the Caribbean and world-class meats and wines in Argentina.
Most of the countries in this region are still in economic development, slowly closing the gap with the world’s big powers. Brazil and Mexico have some of the lowest digital buyer penetration rates (% of internet users who have made at least one purchase via any digital channel during the calendar year) but at the same time represent some of the largest opportunities for development (source WebCertain/eMarketer).
A look at what is coming up: the region will host some of the world’s largest and most exciting events in the coming years including Formula 1 races in Mexico and Sao Paulo as well as the Rio de Janeiro 2016 Olympics.
Let’s dive into each market
Still in its “infancy” phase of internet penetration, Argentina is definitely an interesting market to have on your radar for years to come. Indeed, as the current internet penetration rate is only just above 50% and only half of these internet users actually purchase online. There is a lot of room to grow. As a matter of fact, B2C ecommerce sales are projected to grow by 18% in 2015 over 2014 (4th largest growth percentage after China, Indonesia and India) (source WebCertain/eMarketer).
One thing to keep in mind is that Argentinian online shoppers spend considerably less than the global average ($508 vs $1,459) (source WebCertain/eMarketer).
While Facebook leads the pack in terms of social media adoption in Argentina, WhatsApp – the messaging service bought by Facebook for $19B in 2014 –actually has 44% penetration rate in the population.
A local favorite, Taringa, was founded in 2005 and is the largest social media created in Latin America. The network has “only” 27M registered users, which of course appears small when compared to Facebook’s 1B+ user base.
Another local site that is growing rapidly is MercadoLibre which can be compared to a mix of Amazon and eBay with both professional and amateur sellers (eBay is actually the site’s largest shareholder).
To close with Argentina, you should also know that Spain’s Spanish and Latin America Spanish are quite similar yet different. While they understand each other, they have different pronunciations of different words (such as “ordenador” and “computadora” for example, both describing a computer). So when you target Argentina or any other Spanish-speaking country in Latin America, make sure you localize your content to avoid looking like a company that uses a “one-Spanish-fits-all” approach.
Brazil is currently the 7th largest pool of potential online shoppers (in absolute amount of people having access to internet). However, due to challenging economic factors, Brazilians are yet to develop their online purchases volume. Only 39% of potential online shoppers are active digital buyers, and on average an individual spends $800 per year and per person (vs. $2785 in the US for example) (source WebCertain/eMarketer).
The Brazilian population is among the youngest worldwide – 88% of population under the age of 55 – , and they are extremely active on social media, spending on average of 3.8 hours per day on social networks (Source: SocialNomics.net).
Their online content consumption primarily occurs on mobile devices due to the lack of landline internet infrastructure in large parts of the country and therefore requires marketers to either have a mobile site or responsive design to ensure they can experience your brand on any smartphone.
On the search engines front, Chinese internet giant Baidu has realized the potential of Brazil and launched BaiduBusca in 2014, a search engine dedicated to this market. This launch was accompanied by the opening of a small office in Brazil which is intended to eventually include a research and development center partnering with local universities.
To date, Google’s dominance of the Brazilian market is still in place, but as BaiduBusca seems to play the hyperlocal card – creating unique features and adapting existing ones to Brazilian needs and usages – they could grab some percent of market share in the years to come.
To conclude with Brazil, it is important to note that there are quite significant differences between the Portuguese they speak and the one spoken in Portugal (some examples on this blog post and this video).
Finally, with a projected year-on-year growth of B2C online sales of 15.4% in 2015, Mexico ranks 6th among the fastest growing countries after China, Indonesia, India, Argentina and Italy (source WebCertain/eMarketer).
Part of the explanation of this impressive growth rate is once again the relatively low internet penetration rate around 40%. The base of internet users has grown by 3.5M since 2014 and this trend is expected to continue (Source: The WebCertain Search & Social Report 2015).
The online habits of Mexicans are similar to their American counterparts, primarily using Facebook, G+,Twitter and Google. An impressive 96% of millennials in Mexico use social media, making it one of the highest adoption rates worldwide.
They do have local favorites when it comes to travel, using Despegar and Decolar (also widely used across the other Spanish-speaking countries in South America) more often than Expedia or Booking.com.
Another interesting fact about the Mexican market is the important presence of exact domain names. These domains can be owned by various individuals and businesses from tourism boards to OTAs to bloggers. Due to multiple elements, these exact match domains benefit from high organic rankings, often on page 1, for highly competitive terms. As they are very aware of their visibility and power, working with the owners of these sites usually comes at a very high price, up to several thousands of dollars for an article with a link (which on top of it would be considered as buying links, a spammy tactic penalized by Google).
With strong competition from local and international OTAs and exact match domains, ranking on page 1 of Google Mexico is a very challenging feat. To rank, a page needs to provide exceptional value to the user (and have amazing optimization) to have a chance at outranking some of these large players.
Argentina: Adapt your tone and vocabulary to local flavors to ensure you appear relevant to the local audience. If you are in consumer goods, definitely check out MercadoLibre and its opportunities. You may also want to consider adding a WhatsApp sharing button on your pages to allow them to share your site with their friends.
Brazil: Be prepared to build a robust social media presence if you want Brazilians to hear about you and start buying your products.
Mexico: Look at alternative search terms or more detailed, targeted queries for your website’s SEO strategy rather than going for the higher competition terms (as they might not prove worth the investment in time and budget with an appalling dominance of OTAs and exact match domains).
Across the region: Once again, my global moto is that if your website allows you to localize and input in-language content, that should definitely be your first step. This will allow you to show your audience that you care about them and make efforts to talk to them in their own language. Be human to your audiences, they will like it!