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Will mostly U.S. based Online Video and Advertising Technology providers really be able to deliver the goods when it comes to the Latin American Online Video Market? What are the main challenges ahead? In order to find out more about the evolution of Online Video in LatAm, we asked major experts what online video formats they see growing the most in 2015. Below, their answers.

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Jorg Nowak, Head of Latin America, YuMe

“Video Advertising has arrived in Latin America and is certainly nothing new. At YuMe, our IAB and MMA Award winning ad units such as “Ngage” and others transform the traditional 30 second TV Spot/Pre-roll into an experience that engages the audience and create the brand recognition advertisers are asking for”.

The enormous opportunities presented by the Latin American and U.S. Hispanic online video landscape will be examined in-depth by major experts of the brand marketing, agency, media and measurement world at Portada’s Latin Online Video Forum on June 3 in Miami (part of #Portadalat.) Check out the evolving agenda and register!

Chris Stanley, CEO, Alcance Media

38859b2“Overall, I expect video to continue its strong growth as more advertisers see the benefits. As for the formats, pre-roll will be number one, but as more offerings become available in mobile pre-roll this should see strong growth as well”.

Mike Downs ‎VP, Hispanic & LatAm at TubeMogul

“Pre-Roll is the format growing most consistently, with the majority of that growth driven by mobile devices, and we believe that both will continue to develop in 2015. We work with advertisers looking for innovative solutions to deliver brand messages and will continue to do what’s best for them”.

Eric Tourtel, SVP and General Manager Latin American, Teads

iWl5-mjI_400x400“Pre-roll within a quality environment will not grow, quite simply because there are not any more inventories available (producing video content is expensive hence why there is not too much availability and it tends to be sold out immediately). Pre-roll within user-generated content may grow if advertisers prefer price over quality. Hope for users and advertisers mid-rolls and post rolls will not grow either since that would have a negative impact on the way people perceive brands (no one likes to be forced to see an ad while consuming video content).
I am convinced, thanks in part to our conversations with many brands and agencies, that Outstream formats will grow, and that inRead will soon be a commoditized format. Finally, 2015 will be the year of mobile! According to eMarketer, Latin America is the second fastest growing region for mobile phone internet user growth, ranked 2nd worldwide behind Central & Eastern Europe. eMarketer predicts Latin America will have 322 Million Mobile Phone internet users by 2018, a jump of 194M from 2014 (a 65%+ increase in 4 years alone).

In Mexico 94.7% of the mobile traffic goes through Wi-Fi

Research firm eMarketer expects  a very high growth rate of  mobile internet ad spending in Latin America, growing to US$2.24 billion  by 2018 from US$334 million  in 2014. One very important point to consider is that since the quality of mobile broadband’s is extremely low, people tend to use Wi-Fi on their devices all the time, to the direct detriment of the broadband quality available on mobile devices. For example, in Mexico 94.7% of the mobile traffic goes through Wi-Fi, which means we can deliver a lot of video on mobile. In our view the major growth in mobile formats will come from inRead and mobile-friendly formats”.

There will be a rapid increse in mobile internet ad spending, growing to US$2.24B by 2018 from US$334M during 2014

Manny Montilla Sales Director at Adap.tv

Manny_0165(1)“Although I think mobile video will grow tremendously in 2015, I think the more compelling growth to keep tabs on will be centered around publishers concentrating their efforts in generating more medium and large player inventory. The saturation of small player inventory and the increasing negative user experiences associated with them are making advertisers more and more prone to targeting away from small pre-roll inventory sources and concentrating their spends toward larger sized pre-roll sources”.

The opinions are manifold. As 2015 moves on, we should have a clear perspective on the format that best meets advertisers’ needs as well as users’ habits.

CHECK OUT:
10 things you need to know about the Latin American Online Video Advertising Market

Will Online Video Take Money Out of the Huge LatAm TV budgets?

The enormous opportunities presented by the Latin American and U.S. Hispanic online video landscape will be examined in-depth by major experts of the brand marketing, agency, media and measurement world at Portada’s Latin Online Video Forum on June 3 in Miami (part of #Portadalat.) Check out the evolving agenda and register!

The Latin America media and advertising markets are almost ruled by huge TV budgets. In this context, non-linear TV properties (e.g.  native digital properties as well as digital properties of magazines and newspapers ) have a tremendous opportunity to capture some of these TV advertising monies.

Lorena Hure contributed to this article.

GC_2008_400x400Guido Conterno, executive director at GDA, a consortium of major Latin American newspapers including Argentina’s La Nacion and Mexico’s El Mercurio,  says that  “newspaper and print based sites are rapidly incorporating video as a substitute of photos; once the processes are in place, and  robust webTV sites set, they will get a share of those investments.”

An important aspect that will greatly contribute to channel TV ad investment to the digital environment, is the technology provided by supply side platforms (SSPs).

2a39571According to Jorg Nowak, Head of Latin America at YuMe “This is certainly a global trend that is an important topic in LatAm as well.  Reason being is that clients request a faster turn around time to measure the ROI of the campaigns and that puts pressure on everyone in the campaign life cycle to work faster, as well as becoming even more detail oriented when it comes to categorizing the inventory by the various demographics. The latter can only be achieved by automating the process”.

An important aspect that will greatly contribute to deriving TV ad investment to the digital environment, is the technology provided by supply side platforms (SSPs).

However in Latin America, not so much in the U.S., it may take a while until traditional TV advertisers decide to transfer their budgets to digital video. For now, other experts tell Portada, most of the growth of online video comes from monies exiting display advertising (banner ads). Free TV ad and Pay-TV ad budgets, while much bigger budgets, are only threatened by online video in the medium and long terms.

066e2d4 As Carly Bellis, Co-Founder & CSO at Impaktu suggests: “I do not see this happening in the short-term, but it is possible that the shift will happen in the medium term, most likely via private marketplaces.  Right now the SSPs with inventory available in Latin America tend to have lower quality, non-local content at lower prices. From recent studies we also know there is a high incidence of fraudulent sites.  Local LatAm publishers with high quality, brand safe content do not want to lump in their content with the existing content and seemingly devalue their inventory.  The same is true in the U.S. with most premium publishers.  However, I do think that private marketplaces will be more readily adopted in the medium term, giving publishers more control over the buyers, the pricing and how their inventory is bought.”

Programmatic Video’s Latin American Infancy

Manny_0165(1)Manny Montilla, sales director at Adapt.tv (photos left), takes a similar position to Bellis: “I do see publishers adopting sell side platforms. However, I think it will happen in the medium term. Programmatic video is still largely in its infancy in Latin American markets. Right now there’s a lot of ‘toe dipping’ happening where publishers are brokering deals for their video inventory with a multitude of 3rd parties (mostly ad networks) who in-turn are trying to activate that inventory across programmatic partnerships and attract significant demand volume. As the comfort and education around transacting video increases and reasonable understanding is attained I think publishers (especially the larger ones) in Latin America will be losing out on major revenue if they don’t consider partnering with programmatic video solutions directly. The advantages of doing so are too compelling to ignore, especially as publishers establish their own private exchanges and start offering buyers more interesting slices of their inventory than would be available in a public market place.”

Major publishers in Latin America will be losing out on major revenue if they don’t consider partnering with programmatic video solutions directly.

What lies ahead?

The fact that implementing this technology would contribute greatly to deriving investment to the digital environment is confronted with the resistance publishers are confronted with.

iWl5-mjI_400x400As Eric Tourtel, General Manager for the Latin American market at Teads.tv (photo), says: “We also see some publishers that are a bit concerned about losing control of their inventory or their pricing, with some people incorrectly thinking that programmatic means ‘bought cheaply’ when in fact it means ‘bought automatically’. It is, however, simply a matter of training and sharing experiences”.

Programmatic does not mean ‘bought cheaply’ but ‘bought automatically’.

In short, even if everything shows TV ad investment will eventually be derived to the digital environment, there are a few challenges to be overcome first. So far, users are giving a positive sign to publishers with regards to their consumption habits; however, the implementation of the right technology to enable digital advertising in lieu of TV, might take some time.

The enormous opportunities and the evolution of the Latin American online video landscape will be examined in-depth by major experts of the brand marketing, agency, media and measurement world at Portada’s Latin Online Video Forum on June 3 in Miami (part of #Portadalat.)

CHECK OUT: 10 things you need to know about the Latin American Online Video Advertising Market