The free Swedish newspaper group Metro International (Schibsted) is betting on making Latin America a major market — if not the main one — for its expansion. The group currently publishes its free newspapers in Mexico, Ecuador and Brazil, mainly through partnerships with local publishers. Portada recently talked with Paul Mazzei, head of Metro International in Latin America, about the evolution of the free newspaper market in Latin America.
Portada: How do you foresee the evolution of the free newspaper market in Mexico in 2010?
Pablo Mazzei, EVP of Metro International in Latin America: "In general, the development of free newspapers in Latin America, and Mexico in particular, has been a positive one. Since Publimetro was launched, other new media and free distribution projects have appeared, boosting competitiveness and forcing creativity. In our case, we’ve been steadily consolidating and expanding in Latin America, becoming the market leader in free publications. The market for free newspapers should definitely see more grow this year than that of paid newspapers, which have dominated the industry until now but have had great difficulty in reinventing itself."
"In Mexico, we have expanded to Monterrey and developed different product segments, achieving over 60% growth year to year and significantly exceeding the growth of the news industry in 2009, which reached only 4% compared to 2008 (Ibope 2009). This shows that, in our short life in Mexico, we have been growing and making gains in newspaper advertising, and will continue to do."
"Our outlook for 2010 remains optimistic and we will definitely continue to consolidate our position. This year we expect to launch in new countries as well as start new projects, among them the first free quality sports daily in Mexico, which reflects our vision to continue leading and revolutionizing this industry."
What is the biggest challenge for this market sector this year?
PM: "If you consider that Publimetro’s market share in Mexico in 2009 was 3% (Ibope 2009), whereas in other markets such as Chile it reaches 19%, we can deduce that we are still in an infant industry which has a long way to go. From this perspective, our challenge comes down to two main goals: first, to capitalize on the endorsement and support that our advertisers have given us by growing our market share to levels of 5%; and second, to keep developing segments, markets and products that will allow us to consolidate our position.
What categories do you expect to achieve a greater or better investment performance in 2010?
PM: "In our case, our priority will be to further develop government accounts, where we see a very good match with our reader profile, composed of young urban people who live in cities and make use of them. On the other hand, the upcoming World Cup clearly presents opportunities for all players in the sports category. We will also continue to target self-service stores, mobile and telephony services, health, banking and retail, among others, as part of our priorities."
In the medium-term, do you think that there will be more or less competition and/or expansion in the free newspapers market?
PM: "Without a doubt, our experience has shown that in the medium-term there will always be new players interested in entering this market. That interest is fueled more by a sense of optimism that the market is a big pie, along with a lack of deeper knowledge about the industry. For that reason, we are always prepared to face a fair amount of competition in each of the countries we are in, but with the advantage of having lived and learned from the time we created the free publications category 15 years ago. In the long-term, there shouldn’t be more than one or two players dominating the free newspaper category. Many will fall by the wayside, as has already happened in other markets."