MMA Mobile Regional Insights

MMA MOBILE REGIONAL INSIGHTSJULY 2016

Fabiano Destri LoboManaging Director LATAM

The initiative of the Mobile Marketing Association (MMA) in Latam, aligned with the global mission

of accelerating the transformation and innovation of marketing through mobile, draws attention

to urgent and important issues, enabling more education supporting the further growth of the

marketing and advertising ecosystem in the countries where it operates.

During this year, we will produce a series of educational materials, research and reports in order to

bring knowledge and celebrate the maturing of the mobile market for the marketing and advertising

industry in the region.

We are producing a total of four exclusive researches on mobile consumer behavior in Brazil, Mexico,

Argentina and Colombia; one Regional Insights Report that demonstrate the great growth and true

potential of the mobile medium in the region; five Playbooks and three white papers on subjects

important to the industry. We will also have interviews with major leading brands, agencies and

other members of the ecosystem in Latam; as well as winner cases studies of the Smarties Awards

and much more. All this material will be compiled and distributed at the end of the year in the

edition of the MMA Mobile Latam Yearbook 2016 for members only in pdf format and also through

an application.

In this Mobile Insights Report Latam 2016, the subject could not be different since we live in a world

where consumers are increasingly connected through their mobile devices. Mobile is accelerating

its relevance exponentially in relation to other digital channels. According to eMarketer, in 2020 we

will have approximately 250MM smartphone users across the region. The economic impact and the

contribution to GDP in the region will grow to US$ 275 billion by 2020.

If there were still doubts about the “year of mobile” announced at least 10 years ago, the numbers

and opportunities of this growing market show that much more than the year or the decade of

mobile, we live in the mobile era, and the best yet to come.

Enjoy!

Introduction

Table of contents

Big numbers

Users

Spendings

Behaviour

Technology

Marketing

Demographics

Trends

Final Takeaways

4

7

13

22

34

38

44

46

50

BIG NUMBERS

Information Age around the globe

Digital transformation in action

2.3 billions GB of web traffic.

8.8 billions videos watched.

36 millions shopping.

186 millions photos.

152 millions phone calls.

207 billions emails sent.

4.2 billions from searches.

803 millions tweets.

Mobile in Latin America Report - 2016

Source: World Bank

5

1990 1995 2000 2005 2010

80

100

60

40

20

0

Per

cent

agem

da

po

pul

ação

Melhoria do saneamento

Melhoria do abastecimento de águaEletricidadeEnsino médio

InternetTelefone celular

Banda larga móvel

2015

Mobile Subscribers

Hyper-Connecter World


Source: GSMA Mobile Economy, 2016

Source: comScore, 2015 LATAM Digital Future in Focus

6

Internet Penetration

Asia

644,393

412,446 421,990

216.600 224,905

134.050

188.272147.249

171.842

805,071

Europe USA & Canada Oriente + Africa Latin América

25%

40%17%

2%

4%

USERS

#Worldwide Mobile Subscriptions

#Mobile Phone + Density


Source: UIT,WirelessIntelligence, GSA/InformaeTeleco: http://www.teleco.com.br/pais/celular.asp

Source: Teleco and Regulator Agency

8

#Mobile Phone Users (millions)

#Mobile Phone Penetration (% of pop.)


Source: eMarketer

9

2013 2014 2015 2016 2017 2018

Brazil 130.1 137.3 141.3 144.7 148.0 151.0

Mexico 74.4 78.2 81.3 83.5 85.6 87.3

Colombia 30.8 31.7 32.4 33.0 33.7 34.3

Argentina 29.4 30.0 30.7 31.3 31.9 32.4

Peru 17.1 18.2 19.1 19.6 20.2 20.6

Chile 12.4 12.6 12.8 13.0 13.2 13.4

Other 85.4 87.5 89.4 91.2 93.6 95.5

Latin America 379.5 395.5 406.9 416.5 426.1 434.4

2013 2014 2015 2016 2017 2018

Chile 72.2% 72.8% 73.3% 73.9% 74.3% 74.6%

Argentina 68.9% 69.7% 70.6% 71.4% 72.0% 72.5%

Colombia 67.3% 68.6% 69.3% 70.0% 70.6% 71.2%

Brazil 64.7% 67.7% 69.2% 70.3% 71.4% 72.3%

Mexico 62.8% 65.3% 67.2% 68.3% 69.3% 70.0%

Peru 57.4% 60.4% 62.6% 63.8% 64.9% 65.8%

Other 58.5% 59.2% 59.8% 60.3% 61.1% 61.7%

Latin America 63.2% 65.2% 66.4% 67.3% 68.2% 68.9%

Mobile Subscriptions LATAM

Smartphone Users in Latin America

700M Mobile broadband connections across Latin America by 2021


Source: Ericson, Nov/ 2015

Source: eMarketer, July/ 2015* FGV

10

In 2017, smartphone user penetration will reach 49,7%.

This number is growing each year.

Non-connected person will become the exception, not the norm.

Mobile in Latin America Report - 2016 11

Source: eMarketer, July/ 2015

Global Data Snapshot

Latin America Distinctiveness

Wireless Internet Access LATAM Device Distribution LATAM



Source: Pew Research Center, 2015

Source: 2015_LATAM_Digital_Future_in_Focus

2015 WorldwideL atam

Total Population

Internet Users

Unique Mobile Substribers

7300M

3200M

4700M

634M

345M

380M

12

SPENDINGS

Mobile Broadband Connections Predictions and Current Revenue - LATAM


Source: GSMA, 2014

14

Mobile ecosystem contribution to GDP

US$242B

1M 1.3M

U$41B U$53B

US$275B4.1% GDP in 2013

Jobs directly supported by mobile

Jobs directly supported by mobile

4.5% GDP in 2020

2013

2013

2013

2020

2020

2020

Public funding ecosystem

Mobile ecosystem contribution to public funding in L.A. before regulatory fees.

Plus an addittional 1.2M indirect Jobs supported in 2013.

Employment

#Smartphone Users Worldwide

#Smartphone Users Worldwide Will


Source: eMarketer, Dec/2015

15

Mobile ad Spending by Country

Estimate correction: how 2016 would be according


Source: eMarketer, Sep/2015

16

Retail Online 2015-2020

US Mobile App Buyers, 2013-2018


Source: eMarketer, Sep/2015

Source: WeAreSocial | eMarketer | Ericson

17

The Global Mobile App Market

Total Number of Apps by Store Worldwide


Source: Statista, 2015

Source: App Figures, 2014

18

Google Play and the Apple App Store remain in very tight competition, with Google Play remaining ahead of the Apple App store in terms of the number of apps offered. As of May 2015, Google Play offers 1.5 million apps, and the Apple App store offers 1.4 million apps. All the results are as follows:

We can see all three stores really expanded their app catalog. It’s the kind of healthy growth you’d expect from a relatively new industry. The most obvious takeaway here, however, is that Google finally closed the gap and actually jumped ahead of Apple, ending the year with more than 1.43 million apps compared to 1.21 million. Amazon, although a distant third, grew its catalog by nearly 90% to 293k apps.

More apps than ever!


Source: App Figures, 2014* By Number of Developers

19

2014 App Store Growth By Number of App

Fastest Growing IOS Categories* Fastest Growing Google Categories*

Mobile Apps Download from all Stores - LATAM

US Mobile App Installers and Penetration


Source: eMarketer, Feb/ 2015

Source: comScore_IMS_Mobile_in_Latam_ENGUS

The State Of App Downloads

The State Of Monetization Per Capita in Latin America


Source: inmobi, 2015

BEHAVIOR

Digital Army Knives

50 Millions Users in 4 years

Average Online Hours (per month)


Source: DigitalBuzz

Source: WeareSocial 2015

23

• Every new component, every new sensor, turns into several new venues to explore.

• Users are less concerned in doing new things than they are in doing old things in a new way.

• Equilibrium between bigger screens and portability is finally converging.

• Apps are, right now, more atractive than websites on mobile.

Internet to Go

Categories Consumed Online


Source: Dataxis

Source: comScore, 2015_LATAM_Digital_Future_in_Focus

24

Brazil, where the combo sales model is common for Pay TV plus Internet, lost 460,000 subscribers in 2015.

Harsher economy is one of the factors. Given a excludent choice between a smartphone and a new computer, brazilian consumers prefer the mobile device.

People are also more concerned about being always online and as a result home connection may suffer a cut from household budget to insure the mobile broadband connection, which steadily grows.

At the same time, 75% subscribers of Pay TV in South America and Mexico have access to TV Everywhere services. Brazil is the country with most platforms in the region, 12 of the 53 total.

Categories – Child and Teen, Brazil

Online Video Consumption in LATAM


Source: Statista, 2015


25

Online Video Consumption in LATAM

Social Media actions in Latin America - 2014

Facebook Users in Latin America


Source: comScore, Inc., Video Metrix, AR, BR, CL, CO, MX, Home & Work, Persons: 15+, Apr. 2014 vs Apr. 2015


Source: Statista 2016

26

Who is on Facebook? Latin america

90% of Mobile Time is in Apps – Global Behavior


Source: Kaszek Ventures

Source: Flurry Analytics, June 2015

27

2012Q3 Q4

Ad Revenue Evolution ($M)

2015Q3 Q4

2013Q1 Q2 Q3 Q4

2014Q1 Q2 Q3 Q4

Desktop Mobile

1084176 1220

356

1022438

944656 1030

99012171373

10251475 1106

1804 10882112 1113

2477

8962424 912

2888

Facebook has replaced your mobile browser as your window on the world. 42% of app time occurs in most used app. 75% of app usage occurs in top 4 apps. 1/3 of mobile time is spent in social/messaging apps. But 70% of time in social apps is spent consuming media (videos, articles, ...).

The Constant Connectivity of Millennials in Latam


Source: “Digital natives” by comScore (study commisseioned by Facebook), Mar-Jun-2014*Facebook Internal data, Jan 2015

Illustration Designed by Freepik

28

Milennials (age 13-34) on Facebook across Mexico, Colombia and Argentina are...

...Constantly Connected

ArgentinaAccess continues to grow.

ColombiaTechnology and tradition live side-by-side

MexicoOnline vídeo is os par witch TV

• 19% use feature phones*

• 95% access Facebook from home

• 78% access Facebook on Android*

• 76% watch TV every day

• 62% watch TV every day

• 61% watch vídeo online every day

...Mobile-inclined ...Multiscreeners

90%Access Facebook daily

86%Access Facebook on mobile*

59%Access Facebook while watchingTV

Location-based Services

Locations Used - LATAM


Source: eMarketer, June/ 2015


Mobile Games Monetization World Map


Latin America expected to be highest-growing mobile games market with 50% CAGR* by 2017

30

Source: Newzoo

Mobile Games Monetization World Map


Source: Newzoo

Multiscreen and Multitask - LATAM

Network Quality and Satisfaction



Streaming video

Streaming music

Web browsing

Social networking

37%

25%

22%

16%

34%

37%

49%

47%

Reasons for sharing data with companies according to US users

IMPORTANCE SATISFACTION

Mobile App Download Share in Latin America


Source: eMarketer, June, 2015

TECHNOLOGY

OS in LATAM

Worldwide traffic and revenue by device and OS

Worldwide traffic and revenue share by OS



Source: Mobile Village, 2015

AndroidPhoneT ablet

Revenue

iOSO theriPhone iPad iPod Blackberry Symbian Windows Other

62%

2% 2%

17%27%

4%

17%

1% 1% 2% 2% 4% 1% 0%

42%

0%6% 5%

IT Access – Home devices ownership, Brazil


Source: Cetic, 2014

MARKETING

Mobile Ads Users Love

M-Commerce Current Users in LATAM

Brazilian growth sales by mobile


Source: 2013 – mobile internet Consumer Latin America MMA

Source: M-Commerceinlatinamerica–EricssonReport(ConsumerLab)

Source: E-bit Informação - Quarter Evolution, 2015

Mobile-commerce is still awaiting for strong development. However, considering rapidly increase in smartphone penetration in Latam and consumer interest, m-commerce is at an all-time high.

In July/2015 we achieved the highest sales by mobile devices (tablet and smartphone)

Orders11.9%

Revenues12.5%

Brazilian overview m-commerce


Source: E-bit Informação - Quarter Evolution, 2015Criteo, State of Mobile Commerce, Q3 2015

*to be considered a committed app retailer, a retailer had to have at least 25% of eCommerce transactions on a mobile device. Of those mobile transactions, more than 10% are from mobile apps.

Source: E-bit Informação– July/ 2015

Visitors: 35%

Share of Orders: 10,1%

Average Ticket: R$ 400,80

55% of desktop finalized purchases had a cross device journey

Apps convert twice more than desktop on retail, and have higher average ticket

User complete purchase on

% of users who used multiple devices in path to purchase.

Brazil cross-device share of eCommerce Transactions:

59% 60% 55%

Tablet Smartphone Desktop

Activities Inside Physical Stores Through Mobile Devices

Superior Experience Leads to Better Results for Apps


Source: E-bit Informação– June/2015 – Special Mobile Survey

Source: Criteo, State of Mobile Commerce, Q3 2015

Products viewed per user

4.3

Add-to-basket

Purchase

Products viewed per user

14.4

Add-to-basket

Purchase

CONVERSION RATE 3.7 CONVERSION RATE

x3.5

x2.4

x1.6

APPMOBILE BROWSER

Conversion Funnel from landing on site

Engagement time - Brazil

What Would One Mobile App Be In The Largest City In South America?


Source: comScore, 2015

Source: Spotify

Spotify is the fifth largest “radio broadcaster” in São Paulo regarding weekly reach.

Weekly reach 15 – 65 range.399 interviews.

Tips for Mobile marketing


Source: Sendible, 2015

• Use effective keywords.

• Identify your audience.

• Ensure that your e-mail is mobile-compatible and customised.

• Build your audience.

• Ensure that your landing pages can be accessed directly.

• Mobile technology.

• Customised content.

• Call for Action.

• Watch out for new tecnologies which enhance your mobile marketing.

• Play with website designs.

• Offer options for a 10 seconds break or a 30 minutes commute.

• Carefully consider the paywall worthiness.

• Respect your target bandwidth capabilities.

• It’s actually easier to ask first than to apologize later.

• Do not over push notificate your target.

• Keep an open mind about synergies with other apps and services.

DEMOGRAPHICS

Mobile Internet Users Profile


Source: comScore. 2015_LATAM_Digital_Future_in_Focus; emarketer, 2015; We are Social, 2016

TRENDS

GARTNER RESEARCH

MILLWARD BROWN


Source: GARTNER

• The Device Mesh

• Advanced Machine Learning

• Robo-writers create content: by 2018, 20 percent of business content will be authored by machines.

• Customer digital assistants hold conversations: by year-end 2018, customer digital assistants will recognize individuals by face and voice across channels and partners.

Source: MILLWARD BROWN

• Marketers will differentiate between lean-back activities and more active involvement uses.

• Header Bidding Will Drive Change in Programmatic Buying

• Connected TV Won’t Kill Linear TV Advertising in 2016

• Brands Waste Billions by Failing to Adapt Video Creative Across Formats

• Content Marketing Reaches the C-suite

PROXXIMA

Source: PROXXIMA

• Mobile rules over desktop and Google’s Mobilegeddon

• Increase in video ads acceptance

• Ad spending in digital media – social, web and search – is to surpass TV spendings in 2016

JWT


Source: JWT

• On-demand world and the end of cable television as we know it

• Context is king

• Smart cities

• Baby and beauty tech

• New buzzword: empathy

• Silicon Valley’s next frontier: Infrastructure

McKinsey&Company

Source: McKinsey&Company

• As shopping moves in-app, digital payments displace cash

• Nonbanks will continue to lead in peer-to-peer

• Loyalty enters a new age

• Domestic infrastructures move to real-time

• Cyber attacks will increase

TRENDWATCHING

Source: TRENDWATCHING

• Researchers are able to tell from a smartphone user’s mobile activity whether the user is bored with an 83% accuracy rate

• Start by ensuring your internal culture is something to flaunt, rather than hide.

• Playfully reposition your product or service in order to offer perspective shifts that shock customers into a radically new appreciation of the value you’re offering

TECHCRUNCH


Source: TECHCRUNCH

• Bitcoin Will Be Boring

• AI Will Whisper To You

• The Era Of Hardware Memes Approaches

• We’re All Probably Wrong: in 1894, the Times of London estimated that by 1950 every street in the city would be buried nine feet deep in horse manure.

Google - Education

• Journey to collge registration is 60% online

• 37% look for video information in the decision process

• 50% of potential students use search engines to compare learning institutions

Source: Google

FINAL TAKEAWAYS

Top 15 Takeaways


1. The information age is here to stay and it’s a global phenomenon. Some big numbers: 2.3 billions GB of web traffic; 8.6 bullion videos watched; 4.2 billion searches made; 803 million tweets; 207 billion emails sent and 186 million photos taken

2. There are approximately 5 billion unique mobile subscribers in the world today according to GSMA.

3. Mobile subscriptions in Latam have surged. 700 million mobile broadband connections across Latam are forecasted by Ericson for 2021.

4. Smartphone users in Latam have played an important role in this hyper connected world. According to marketers, there are 182 million smartphones in the region. Brazil leads the penetration with approximately 60 million, followed by Mexico with 46 million and Colombia and Argentina with 19 and 16 million respectively.

5. In 2017, smartphone user penetration will reach 49,7%. The number is growing each year. The non-connected person will become the exception, not the norm.

6. Mobile ecosystem contribution to GDP in 2020 is expected to reach US$ 275 Billion or 4.5% of GDP in the region.

7. According to emarketer, mobile ad spending in Latam will grow from 620 million in 2014 to 7.92 billion in 2019

8. By 2020, there will be 395 billion mobile internet users in the region.

9. App download have reached new highs making Brazil the most popular download destination with 75% share in Latam. Apps are, right now more attractive than websites. 90% of mobile time is in apps.

10. Emarketer has showed that 85% of that is games, 9% is communication, 3% is for entertainment, 2% is business and 1% is technology.

11. Online video consumption in Latam is more mobile than ever.

12. Social media eyeballs and revenues too

13. Location is the new search. The will be 8 times more mobile data traffic between 2015 and 2021

14. Latam expected to be the richest growing mobile games market with 50% CAGR by 2017

15. Marketers are closer to their consumer through mobile and will differentiate between lean-back activities to more active involvement

Sources


• App Figures

• Cetic

• CI&T

• comScore

• DigitalBuzz

• E-bit Informação

• eMarketer

• FGV

• Flurry Analytics

• Ford Motors

• Gartner

• Google

• GSMA

• INC.

• inMobi

• JWT

• Ericsson ConsumerLab

• McKinsey&Company

• Millward Brown

• Mobile Internet Consumer Latin America MMA

• Mobile Village

• Newzoo

• Pew Research Center

• Proxxima

• Sendible

• Spotify

• Statista

• Techcrunch

• Trendwatching

• Vend

• We are Social

• World Bank

About Hibou


Hibou: Owl. fr

Hibou is a market research company that goes beyond the traditional.

Hibou aims to see the consumer as a whole, an individual that has its own history, fears, qualities and drivers, a creature that observes and learns as he consumes products, campaigns and ideas, and so chooses his own way towards the product or service in study.

Using tested and true research methods in tandem with the fast paced changes of today - be them of any nature, from social to technological - Hibou tracks niches and opportunities that can generate scale, awareness and growth for brands and to align the values of companies and their customers, current or potential.

From product concept until campaign strategy, every step can benefit from an insightful look, testing and validation, and the rewarding answer for questions both old and new. Let the owl (hibou) find your answers.

Ligia Mello, CEO [email protected]

About the MMA


The MMA is the world’s leading global non-profit trade association comprised of more than 800 member companies, from nearly fifty countries around the world. Our members hail from every faction of the mobile marketing ecosystem including brand marketers, agencies, mobile technology platforms, media companies, operators and others. The MMA’s mission is to accelerate the transformation and innovation of marketing through mobile, driving business growth with closer and stronger consumer engagement.

MMA LATAM Team:

Fabiano Destri Lobo, Managing Director LATAM [email protected]

Thais Schauff, Director Business Development & Operations LATAM [email protected]

Argentina:

Soledad Moll [email protected]

Brazil:

Graziela Mazzer [email protected]

Mexico:

Carolina Mathieu [email protected]

Zelmi Etchegoyhen [email protected]

Do you want to know more about membership?

Reach out to us:[email protected]

Data & Analytics

MMA Mobile Regional Insights