Latin American Advertising business

Latin American
Advertising business

An overview on the
Latin American
Advertising business
The Lan American adversing
market raises a great number
of quesons for many people
who look at it from a distant
perspecve. However, this industry
does not show a lot of differences
between one side of the Atlanc
Ocean and the other one.
In this market, the main players are
also the great six holdings in the
world: WPP, Omnicom, Publicis,
Havas, Interpublic and Dentsu.
Along with those, there are many
other local agencies, which, based
on outstanding talent – plenful in
this region – endeavour to posion
themselves in order to develop their
own business.
The behaviour of this Lan American
market in the light of certain
smulaons, such as technological
advances, is usually similar to the
European market. The growth of
adversing on the internet, which, in
Argenna, during 2013, represented
14% in the adversing investment
in the country, is just one of so
many examples to menon in this
summary.
This is the reason why, when dealing
with the Lan American adversing
market, it is impossible to give
explanaons very different from the
ones which would be given about
other markets in the world, but it is
possible to get a deeper knowledge
of it in order to make the right
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decision about the country or
area that is the most suitable for
some business development.
Although it could be agreed that
there are many similarities within
the Latin American advertising
industry, it is essential to point
out that there are some markets
which are bigger than others,
with dissimilar results depending
on the types of services and
areas where creativity plays a
more (or less) primary role at the
international level.
Argentina, Brazil and México
stand out above the others since
their advertising markets are
highly developed in comparison
with the rest of the countries
in the region. With regard to
Argentina, its backbone is the
superb creativity accomplished by
talented, skilful professionals who
are renowned worldwide. Among
other achievements, this fact has
allowed Argentina to become
one of the top ten most creative
countries in the world along a with
Brazil, according to the awards
won in Cannes Lions 2014.
As regards Brazil and Mexico,
besides the outstanding talent of
the professionals who work at their
various agencies, these countries
were able to add to the maturity
of their markets an outstanding
increase in adversing investments,
which is mostly related to their large
populaons.
Nevertheless, the advertising
market in Latin America is
much bigger and not restricted
to just these three countries.
There are several emerging
countries which, based on
benefits for the industry, an
open attitude towards the
world and the constant efforts
of the professionals working in
this business to improve their
capabilities, seek to position
themselves in order to be
competitive. Chile, Colombia,
Perú and Uruguay are good
examples of the previouslymentioned
group.
This general overview clearly
shows that the advertising
industry in Latin America
offers excellent possibilities,
both to capitalize on the
local markets and to become
a production centre towards
the world.
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ARGENTINA
Not only is the Argenne
adversing market
established among the
most 20 prominent ones
in the world but it also
has several interesng
aspects worth analysing.
All the most important
internaonal holdings
are represented by
their main agencies
where, as opposed to
what happens in other
countries, several of
the most disnguished
creaves in Lan America
are currently working
there. This creates a
mature, high-quality and
highly compeve local
market.
Moreover, in recent
years, in order to
guarantee the growth
of the industry, a
special district has been
established in the City
of Buenos Aires, with
tax advantages for the
agencies and producon
companies located there.
This was considered
as a beneficial issue by
the big companies and
also small and mediumsized
companies, which
gave them support
which enabled them to
reposion themselves in
the internaonal market.
The combinaon of these
factors: a developed
market, experienced,
young creaves (already
in the country) and the
cultural diversity of its
capital city make this
place a great opon
to have the lead in the
region. Thus, not only is
it possible to exploit the
local adversing market
but also the parcular
characteriscs of this
place allow it to offer the
opportunity of dealing
with accounts from all
Lan America from this
country.
THE GUNN REPORT
World Creavity Ranking
• 2013: 7 • 2010: 6
• 2012: 6 • 2009: 3
• 2011: 4 • 2008: 3
Area
2,780,400 km²
Populaon
40,117,096 inhab.
GDP
Total: USD 611.8 mill.
Per capita: USD 14,760
Currency
Argenne Peso
(ARS $8.16 = 1 USD)
Official Language
Spanish
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BRAZIL
If a leading role in the
region had to be selected,
without a doubt all the
eyes of the experts in the
adversing market would
be on Brazil. The size and
maturity of its market,
the current welfare of its
economy in general and
the level of local creavity
make this country not only
the greatest in terms of
investment but also a role
model.
With astonishing numbers in
advertising investments
(above 15.860 million
dollars), Brazil is
the perfect place to
experience a very fast
growth in this market.
Besides, it should be
borne in mind that
it offers different
possibilities for those
groups seeking to set up
a branch office there,
since it has several
highly developed
cities such as Rio de
Janeiro and Sao Paulo.
A special characterisc of
this market is the fact that,
due to various regulatory
and commercial issues,
creave agencies keep
media planning and
buying under their
responsibilies, unlike the
rest of the countries in the
region, where the media
agencies are consolidated
and have a very significant
parcipaon in the
business.
Perhaps the only weak
point when appraising
the feasibility of doing
business at a regional level,
is its language barrier, as
opposed to the other Lan
American countries. That
is the single fact that could
possibly make Argenna
or Mexico reduce the
gap when it comes to
establishing headquarters to
provide services for several
countries. However, the size
of the local market enables
Brazil to be considered as a
connent in itself.
THE GUNN REPORT
World Creavity Ranking
• 2013: 4 • 2010: 5
• 2012: 5 • 2009: 7
• 2011: 3 • 2008: 6
Area
8,514,877 km2
Populaon
201,032,714 inhab.
GDP
Total: USD 2,242.854 mill.
Per capita: USD 11,310
Currency
Real
(R$2.28 = 1 USD)
Official Language
Portuguese
6 | Lan American Adversing businees

This country is maybe the
biggest of the “emerging”
ones and the smallest of
the possible “leaders of
the region”. Why? The
answer is quite simple: Its
adversing market already
has an investment of 1.423
million dollars, a figure
that shows an evoluon
higher than 40% in the last
ten years, if we take as a
reference the 1.007 million
dollars invested in 2004.
Consequently, in terms of
figures, Chile is not such a
small market.
Besides, it has become
established among the
top 40 countries in local
creavity, according to
The Gunn Report ranking,
an achievement not yet
obtained by those countries
that have recently been
experiencing the first rises
in the adversing sector.
A stable economy with a
tradional internaonal open
atude is the reason why this
country is considered more
and more as the best choice
for establishing headquarters
to develop business in the
region.
Area
756,102.4 km²
Populaon
16,634,603 inhab.
GDP
Total: USD 268,413 mill.
Per capita: USD 15,424
Currency
Peso
(CLP $566.33 = 1 USD)
Official Language
Spanish
Area
1,141,748 km²
Populaon
47,662,951 inhab.
GDP
Total: USD 388,858 mill.
Per capita: USD 8,150
Currency
Colombian Peso
(COP $1,892 = 1 USD)
Official Language
Spanish
The adversing market
in Colombia has had a
very important growth
during the last two
decades, to such an
extent that, according to
a report carried out by
the Colombian Naonal
Associaon of Traders
(FENALCO, for its inials in
Spanish), the adversing
investment in the
tradional media (print,
radio and television) has
grown 5.9 per cent in 2013
as compared to 2012, with
a total amount of resources
for 1.2 million dollars.
Without the shadow of
a doubt, this situaon is
due to the high adversing
budgets of many local
companies and, lately,
to the arrival of various
mulnaonal corporaons.
As regards the players
in this market, it is
noteworthy that, as it
happens in the rest of
the region, all the great
internaonal groups and
many local small and
medium-sized agencies
coexist.
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When considering Mexico
in the context of the Lan
American adversing
market, it should be borne
in mind that this is one
of the three giants of the
region.
While it is true that in
terms of creavity it is sll
far below Argenna and
Brazil, Mexico maintains
a consolidated place in
this aspect, since for
the last few years it has
been among the top 25
countries in the world, and
its market is the second
largest in the region, just
behind Brazil.
This fact is closely related to
its large populaon and to its
existent level of adversing
investment, which is above
USD 5.5 million.
As regards its map of
adversing agencies, it
should be noted that not
all of them operate from
a single city but they are
distributed among the
Federal District (Mexico City),
Aguascalientes, Monterrey
and Guadalajara.
Area
1,964,375 km²
Populaon
112,336,538 inhab.
GDP
Total: USD 1,327,021 mill.
Per capita: USD 11,224
Currency
Mexican Peso
(MEX $13.25 = 1 USD)
Official Language
Spanish
Area
1,285,216.20 km²
Populaon
28,220,764 inhab.
GDP
Total: USD 200,292 mill.
Per capita: USD 6,572
Currency
Nuevo Sol
(PEN $2.78 = 1 USD)
Official Language
Spanish
8 | Lan American Adversing businees
It is widely known that
one of the Lan American
countries which has been
experiencing greater growth
for the last few years is
Peru. Consequently, its
adversing market is also
accompanying this general
rise of the country.
Between 2009 and 2013, the
adversing investment in Peru
went from USD 416 million
to USD 715 million per year, a
solid, steady increase of more
than 70%, regardless of the
digital area, which has had a
notable growth since 2011.
Considering all the sectors
in the adversing industry,
we can state that at the end
of the year 2013 it reached
over USD 800 million in
revenues, experiencing a
growth similar to the one of
the GDP.
All these figures summarize
that there is clearly a
consolidated market in this
country. Nevertheless, the
next big challenge for the
Peruvian agencies will be to
posion themselves among
the most creave countries in
the region.

URUGUAY
Although investments
in the Uruguayan
advertising market are
just 285 million dollars
– a figure which is not
bad at all given the
size of the country
and its population – it
has a long-established
tradition.
This is the reason
why there are big
internaonal agencies
and small and mediumsized
local agencies
in this country which
are included in a
naonal associaon
(Uruguayan Associaon
of Adversing Agencies
– AUDAP, for its inials
in Spanish).
Regarding the creavity
level in the country,
it must be remarked
that it has been for
years among the top
50 in the world, a
fact which emphasizes
even more its tradion
in adversing in Lan
America.
As regards the
participation of this
industry in the general
economy of the
country, advertising
has an incidence of
0.5 per cent on GDP.
Taking into account
the fact that there is
a competitive market
in this country, but
also that maybe the
final figures of the
volume of investment
may be lower than
the potential of
their professionals,
the challenge for
the local agencies
is to develop their
business in the region
as service exporters.
Area
176,215 km²
Populaon
3,286,314 inhab.
GDP
Total: USD 55,708 mill.
Per capita: USD 16,421
Currency
Uruguayan Peso
(UYU $23.53 = 1 USD)
Official Language
Spanish
Lan American Adversing businees | 9

We can help you to develop successful business in Lan America
Although you might have noced throughout this report that there are
many similaries between the adversing business in Lan America and
its counterparts in the United States or Europe, it is also true that there are
several cultural differences. In this business, in which the main capital is
the superior talent of the people who work there, the awareness of these
disncons and the cultural approach become essenal to achieving
success.
Our wide experience and knowledge of the adversing business, its
players, idiosyncrasy, parcularies and possibilies will ensure you a
suitable process. Our cooperaon is not limited only to all the corporate
and profitability aspects but also on some key issues such as a start-up and
pre- or post-mergers processes.
Besides, our relaonship with Kingston Smith W1 (WKS1) enables you to
rely on consulng firms with great experience in the adversing business
on both sides of the Atlanc Ocean.
Services:
• M&A
• Due Diligence
• Taxes
• BackOffice
• HR & Payroll
• Management Consultancy
• Audit
10 | Lan American Adversing businees

About us
Ad Business Embassy is a muldisciplinary organizaon made up of
chartered accountants and strategic consultants in various areas of
experse with extensive experience in counselling companies in the
markeng communicaons industry.
In our offices, located in Argenna, Brazil, Mexico, Chile and Uruguay,
or in the rest of the representaons we work with in Lan America,
you will find professionals who understand the problems of your
business and can provide soluons to the needs of your agency.
That is our mission, to be the main reference in each country for
agencies and other companies in the adversing business, both local
and internaonal, who need to establish or develop their business.
Please, visit our web page: hp://www.adbusinessembassy.com to
know more about us, services provided and clients we work for.
Contact us
Maas Tejero
Regional Manager
maas@adbusinessembassy.com
Gonzalo Benítez
Research Analyst
gonzalo@adbusinessembassy.com
Ad Business Embassy
HQ: Maure 4109 1st Floor
Buenos Aires, Argenna
Audiovisual District
(054) (11) 4553-7000
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