COVID-19’s Impact in Latin America

With the coronavirus pandemic leading to significant economic slowdowns across Latin America, we’re providing updated guidance to our clients about what we expect for digital ad spending during H1 2020, based on current information about how regional advertisers are responding to the pandemic and current market conditions. We finalized our most recent digital ad spending forecast for Latin America on March 6, 2020, before the cascade of drastic social distancing and market declines began to unfold in Argentina, Brazil, Chile, Colombia, Mexico and Peru. We will update our full-year forecast for Latin America digital ad spending in June. We also issued guidance for ad spending in Canada, China, France, Germany, the UK and US. You can access all our latest articles, videos and podcasts on the effects of the pandemic by clicking the icon at the right of the search bar.

Key Takeaways

• Digital ad spending in Latin America continues to grow, despite the coronavirus causing market volatility. From 2015 to 2020, digital’s share of total media ad spending in Latin America doubled from 18.0% to 36.3%. Given the current circumstances, this share should further improve in 2020. If a wider audience of consumers goes digital, it is highly likely that advertisers will follow suit by shifting their ad spending dollars toward digital formats on a more permanent basis.
• Display is still the region’s most popular digital ad format. As advertisers experiment and incorporate a wide variety of formats into their digital media mix, social media and video will continue to drive digital ad spending growth in Latin America this year. But advertisers should also keep their eyes on search as another viable ad format to invest in as ecommerce adoption surges in countries like Colombia, Chile, Mexico and Peru.
• Growing mobile phone usage will prompt advertisers to shift their ad budgets. With digital’s impressive growth ahead, advertisers must fully embrace the prominent role mobile devices will play in the consumer journey. They must also ensure that mobile becomes an integral part of their media strategy as time spent with mobile phones increases under government-mandated quarantines.
• COVID-19 poses new challenges for brands looking to develop messaging and campaigns. It is imperative for them to be present and agile while remaining empathetic. However, they must ensure they do not let their long-term strategies fall by the wayside. It will be challenging to strike a balance, but brands should never lose sight of what matters most: their customers.

Due to the rapidly changing economic conditions, we’re providing updated guidance to our clients about what we expect for ad spending in Latin America during H1 2020, based on current information about how regional advertisers are responding to the COVID-19 pandemic and economic downturn. With our estimates for 2019 as a baseline, we have taken a range of possibilities into consideration for how advertisers across Latin America will react—and have reacted—to the new environment in terms of their digital ad budgets. In June, we’ll update our complete Latin America ad spending forecast, including digital, based on our bottom-up methodology that will directly account for Q1 results at major digital ad sellers.