Digital advertising is seeing fast growth in Peru with annual revenues of $82 million, but still lags behind other regions as local decision makers are slow to understand the importance of Internet spending.
Experts have been asked to try to change this through a Digital Transformation Summit Sept. 22 in Lima.
"As far as figures, the growth in digital ad spending in Peru has been around 32 percent annually and last year was 40 percent," Graciela Rubina, director of the local chapter of the Interactive Advertising Bureau, said in a telephone interview from Lima. "This year the economy is a bit challenging but with optimism we can reach 30% growth.”
In general, the Peruvian digital advertising industry follows worldwide trends such as the increasing importance of social media. However, local statistics show the digital advertising market still lags behind that of other areas not just in the developed world but even compared to other regional countries like Argentina.
For example, the traffic from mobile to websites is only about 10 to 15 percent of the total while in other parts of the world, such as Spain, it is already more than half.
Most ads produced in Peru for digital media are paid for by telecommunication industry announcers, such as mobile telephone providers. This is followed by education companies as a large proportion of Internet users are between 18 and 24 years of age. Most digital ads are still in websites in the form of displays, she said.
Retail organizations are a third group, as only relatively few ads from beauty, food and retail groups are on digital format. “Local retailers are slow to understand that they have to integrate Internet to their marketing campaigns from the start,” Rubina said.
Statistics show that Peru is also behind other Latin American digital advertising markets in terms of the percentage of total advertising spending that is digital.
Digital advertising in Peru as part of the total is still below 8.5 percent. “We believe this has no relation to what has happened in media,” Rubina said, as the proportion of people that already use Internet should justify a much higher digital spending.
“We consume radio, television, magazines through Internet and this has not been reflected in digital advertising spending and this is why today we want to speak to CEOs,” to make the case for more digital spending, she said.
In Argentina, as much as 13 percent of the overall advertising spending is already digital, and in Colombia the figure is about 11 percent, she said.
The Interactive Advertising Bureau Peru hopes it will get this message across at the Sept. 22 summit. It will feature as speakers Avinash Kaushik, co-founder of Market Motive which provides education on Internet advertising; Mohanbir Sawhney, director for the center of research and technology innovation at the Kellogg School; and Eric Moore, managing director of U.S.-based digital agency Huge.
Alerts Sign-up