Today in our “Digital Power Houses” series, Portada talks with German Herebia, CEO and founder of Intextual. German shares his insight on the state of the digital advertising market in Latin America and tells us about Intextual’s operations, his advertisers’ preferences and their formats of choice.
At a Glance:
Type of Company: In-Text Advertising Network
Offices: Mexico, plus a sales network in Chile, Colombia, Peru, Venezuela, Central America and the Caribbean
Market presence: 50 million Spanish-speaking users in Latin America, Spain, and the U.S. Hispanic market.
Portada: How big is the contextual advertising market in Latin America?
German Herebia: "It’s difficult to estimate, because much of the contextual advertising in Latin America is sold by Google, which does not disclose its figures by region. We know that 30% of their income comes from the AdSense network, and that their worldwide market share stands at 40 percent. If we use these figures to extrapolate numbers for Latin America, then we could say that 12% of the total online advertising pie in the region is made up of contextual advertising.
This figure doesn’t include ads sold by alternative contextual advertising companies such as INTEXTUAL, whose enriched text formats guarantee a big brand impact, with CTRs that range from 2% to 15%, thus preventing banners from blending into the landscape and causing the banner blindness effect.”
Portada: What kind of financing do you have and what are your future financing plans?
German Herebia: “INTEXTUAL is financed by its founding partners and some seed capital investors. The operation grew organically in the first half of 2010 and is currently balanced. We are in the process of setting up our first round of investment to expand our sales operations and further improve a product that today serves more than 40 million Hispanics, including the U.S., Iberia and Latin America. We dream of a company with global reach, but we are moving one step at a time.”
Portada: Who is the typical advertiser interested in text ads?
German Herebia: “Any advertiser who wants to achieve high relevance in their ads will use text, image and video ads on INTEXTUAL because of our ability to segment by keyword within the content of affiliated sites in our network.”
Portada: Do you find any resistance from publishers in accepting contextual advertising because they think it somewhat affects the editorial integrity of their content?
German Herebia: "Every day, we add new publishers to the network because INTEXTUAL creates new ad spaces for them that don’t compete with their existing ads, thus generating a new source of income at the end of each month. INTEXTUAL lets the client customize the ads according to its needs, so that a site can choose not only the maximum number of ads it wishes to display, but also where to place them within the content. For example, we have sites that choose to display ads in the comment section of their articles, or which show only up to two ads per article. Some news sites choose not to show ads on editorial pages or on pages with political and business news, while preferring to display ads in their sports and entertainment pages.”
Portada: Who is the benchmark company for INTEXTUAL (contextual advertising) in the Anglo market?
German Herebia: “Vibrant Media, founded in 2000, is the pioneer of a very small group of ad companies that work with in-text ad formats. The company billed $100 million in 2009, mainly in the U.S. general market.”
Portada: What industries place the highest number of ads? Who are your biggest clients? What formats do they usually choose?
German Herebia: “Tourism, automotive, technology, education and financial sectors are the ones investing the most. However, we’re seeing a clear growth from laboratories and the CPG industry, which are beginning to steer their ad budgets from TV to Internet in order to complete their coverage, and whose favorite formats are contextual videos.”
Other articles in the "Digital Power Houses" series: