There are more mobile subscribers than people in Brazil, with 272.4 million mobile subscriptions shared among a population of 199 million. In 2013, for the first time, the number of smartphones sold (32 million) outpaced the number of feature phones (29.1 million). Mobile Web use is rising rapidly – 36 percent Brazilians are regular users of 3G services. But the majority (78 percent) of the population remain on prepaid – pay-as-you-go – contracts.
(Sources: Anatel/Teleco; World Bank; IDC/Abinee/Teleco; Anatel/Teleco).
• This guide was published in March 2014.
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Q1. How mobile is the Brazilian population?
Brazil is the world’s fifth largest telecoms market (mobiThinking) in the world. With 272.4 million mobile subscriptions (Anatel/Teleco) for a population of 198.7 million (World Bank) – a mobile penetration of 137 percent – Brazil has considerably more mobile devices than people. The mobile phones subscriptions also outnumber fixed lines (44.8m), by 6:1 (Anatel/Teleco).
Q2. What are the characteristics of Brazilian mobile market?
In Brazil, it is estimated that between 20 and 25 percent of handsets are smartphones. However the penetration of smartphones will grow as smartphone sales start to overtake feature phones – 2013 was the first year that more smartphones sold (32 million) were sold in Brazil than feature phones (29.1 million) (IDC/Abinee/Teleco). The smartphone is increasingly becoming an object of desire for aspirational Brazilians. The top manufacturers are composed by international players such Samsung, Nokia, Motorola, LG and Apple. There’s no local Brazilian manufacturer.
According to Anatel/Teleco, only 22 percent of Brazilians are on contract (post-paid) and this portion is growing much slower than pre-paid (pay-as-you-go) subscribers – only growing at 0.3 percent v 16.9 percent, between January 2013 and January 2014. Currently, Brazilians are more concerned with buying a smartphone than getting a contract.
Q3. What distinguishes mobile in Brazil from a) the rest of Latin America? b) Other leading mobile markets world wide?
Almost 80 percent of Brazilians are on prepaid mobile contracts. This makes Brazil a very interesting market as advertising could prove a crucial way subsidize telecom costs. (See Pepsico campaign in Q6). This could be an important factor driving higher adoption. Brazil is one of the top countries for the use of social networks and popularity of Whatsapp (Wired/Jana) shows that Brazilian’s are very open to new communication trends.
• With Brazil hosting both the 2014 World Cup and 2016 Olympics, this creates an unprecedented opportunity for the development of mobile marketing over the next few years.
• mobiThinking note: When it comes to availability of mobile statistics, Brazil puts the rest of the world to shame – the exemplary free online service provided by Teleco in Portuguese, English and Spanish is a goldmine for any company or organization interested in the Brazilian mobile market.
Q4. How do Brazilians use their mobile devices?
A survey by Convergencia Research/Acision (February 2012) of Brazilian mobile users, found:
• SMS has grown in popularity with Brazilian mobile users, as mobile operators have started to bundle messaging allowances with call plans. In 2011 Brazilians sent on average 22 SMS per month, in 2012 this quadrupled to 81 SMS per month. 89 percent of respondents had used SMS in the previous three months. 58 percent send more than one message every day.
• MMS is less popular – only 12 percent of respondents had sent an MMS in the previous three months – even though 77 percent of respondents had an MMS capable device.
• Mobile instant messaging (IM) was used by 44 percent of users. The most popular of these is Facebook Chat followed by Twitter and eBuddy XMS.
• Push email was used by 36 percent of respondents.
• GPS services was used by 21 percent of respondents – though only 22 percent had a GPS-enabled handset.
• mobile banking was used by 13 percent of respondents – mostly to check bank balances.
Another survey, by Hi-Midia/M.Sense (October 2012), of Brazilian mobile users found:
• Mobile Web was used on a daily basis by 72 percent of smartphone and tablet users. The main reason for those who don’t use mobile Web frequently is the expensive price of smartphone data plans. 90 percent of smartphones or tablets users are web-enabled, but only 36 percent of smartphones users had postpaid plans (21 percent for tablet users).
• On average, Brazilians have 16 apps on their smartphones, 13 free and 3 paid. The most popular are music, entertainment and navigation (GPS) apps, followed by photo, video and social networking apps.
• Using a smartphone to research a purchase is commonplace – 93 percent smartphones did this and 87 percent changed their minds following a mobile search. However, only 12 percent then go on to complete the purchase on smartphone, preferring to buy on a PC or in-store instead.
• 67 percent of respondents had bought a product and services (this doesn’t include mobile apps), via smartphone or tablet, at some point in the past. Most commonly people buy electronic items, tickets for shows and movies and home appliances, digital books, movies and music, print books and magazines. The most common reason given for not purchasing was fear of impulse buying and difficulties with the small screen.
Q5 How advanced is the mobile Web and mobile commerce in Brazil?
106.4 million Brazilians used mobile broadband in January 2014 (Anatel/Teleco), that’s 47.2 million more than the same time last year. The vast majority of these (97.8 million) access through a 3G mobile handset, access via 4G handsets is still small at 1.6 million, but growing fast. The remaining connections are data terminals and M2M (machine-to-machine connections).
Growth of mobile Internet usage and, with it, mobile advertising is being stimulated by the increased availability of both full-feature devices and flat-rate data tariffs from mobile carriers.
The potential for mobile Internet here is still huge: there are twice as many mobile phones as PCs and five times more mobile broadband connections than fixed broadband connections – 106.4 million v 21.3 million (Anatel/Teleco, Q4 2013). It won’t be long before most consumers will enjoy their first experience of the Web over a mobile phone, rather than a PC.
The use of mobile phones for Brazilian commerce and payments is still in the early stages. Numbers are hard to come by, but a forecast by the Camara-e.net – Brazilian Chamber of Electronic Commerce (via Hi-Midia, October 2012) predicted that Brazilians would buy R $ 2 billion (US $0.9 billion) of goods and services using their mobile devices in 2013.
To date most mobile financial services are aimed at the more affluent classes, via smartphone applications. We are still expecting news in this area from financial institutions and mobile operators, while the government is studying the possibility of using the phone as a channel for payment of social benefits.
Q6. What are the key mobile marketing activities for companies – mobile Web; mobile advertising; text campaigns; opt-in lists; applications etc?
Text-to-win is still the most popular format, but mobile advertising is becoming popular as well. Mobile apps mainly for iPhones and SMS-based CRM campaigns are growing in popularity. Carriers are also introducing new formats such as sponsored calls, in which consumers receive free minutes in exchange for hearing advertisements.
A campaign by Pepsico campaign to promote sales of Torcida snacks by offering free airtime to street vendors recently picked up Most Effective Mobile CRM campaign at the EMMAs 2013.
Q7. What is driving growth? What's holding it up?
The arrival of smartphones, the roll-out of 3G and new data plans being launched by carriers are all helping to drive growth:
• A survey by Nielsen (January 2013) estimated that 36 percent of mobile devices in Brazil are now smartphones.
• The majority of Brazilians now have access to a 3G mobile network – this is partly due to Brazilian regulator Anatel placing strict targets for 3G coverage on the four operators. Today Vivo’s 3G network covers 86.8 percent of the population, present in 3,140 cities; Oi covers 74.9 percent, in 951 cities; Claro covers 72.4 percent, in 1,563 cities; and TIM covers 70.4 percent, in 1,001 cities; (Anatel/Teleco, Jan 2014).
• Carriers are also offering very attractive data plans for prepaid subscribers. TIM and Claro are both offering unlimited access for R$ 0.50 (US $0.12). As social networks are popular with young Brazilians, most carriers have created plans that include unlimited access to the popular social networks.
Q8. What role do mobile operators play in the mobile ecosystem?
Carriers play three roles: the pipe (mobile connectivity), the mobile-media salesman and the policeman. For a campaign a brand and its mobile agency can use carrier’s opt-in list or create their own opt-in list – but if a brand uses their own list this must be cross-checked with the carrier's opt-out list, because Anatel’s rules make carriers responsible for policing users' permissions.
Carriers are rolling out aggressive mobile data plans, taking advantage of the appetite of the youngsters for accessing social networks on the go. An interesting example is the partnership of some carriers with Facebook, offering free data traffic for users of this application. Another trend is the migration of value added services (VAS) to apps, offering greater interactivity for users and creating opportunities for media companies.
Q9. What role does the Brazilian government play in the mobile ecosystem?
In July 2010, Anatel introduced regulations on opt-in mobile advertising and content subscription services. Wireless carriers are now prohibited from sending advertising messages via mobile phone without users’ permission.
In parallel, the Mobile Marketing Association (MMA) is working with Brazilian carriers (among others) to update the Consumer Best Practices paper, covering the main types of mobile marketing, first released in 2009.
Q10. What associations/industry initiatives are helping to push forward mobile best practice, standards etc or industry-specific initiatives such as m-health, m-banking, m-learning etc?
• Vivo has become known for m-health initiatives such as the Vivo More Healthy program, portal services and information related to health.
• In m-banking, the two main Brazilian banks, Itaú and Bradesco, has evolved a lot in the conversion of their core services in mobile applications, reducing costs and offering greater convenience for its customers.
• The m-learning space, in particular, is receiving a lot of interest, with initiatives by operators, media companies and independent startups. Abril Publishing, in partnership with Vivo, offers the VestibularStudent Guide, by which students answer questions on the same issues of the Brazilian qualifying exam. Qranio is a start up that is bringing gamefication to the m-learning. This is an SMS or app-based subscription service that tests children’s knowledge via quizzes – and rewards them with prizes if they get sufficient answers correctly.
• As mentioned above, the MMA, working with operators and key players in mobile marketing perform important work for the development of best practices in Brazil.
Q11. Which industries/sectors have shown the most interest in mobile Web/services/marketing in Brazil?
Both multinational and local companies are showing interest, with food and beverage companies being some of the most active. Retailers, consumer goods and energy companies are also embracing mobile marketing. Netshoes Click app is one of the most interesting. Using the application, you can take a picture of any sport shoes or clothing and, thanks to visual identification, buy it in the Netshoes online shop with a few touches.
Media companies are leading the way in terms of providing mobile content and interactive campaigns, but brands are catching up fast.
Q12. Which brands/publishers are the most innovative with mobile? What are the big success stories?
Fiat, Pepsico, Coca-Cola, Anheuser-Busch InBev, Unilever, Shell, O Boticario and Nestlé are all making significant investments in mobile in Brazil, as are many banks and financial services businesses. Meanwhile, Detran, Sadia, Pao de Açúcar, Globo.com, ClicRBS, G1, Revista, Rolling Stone, Playboy and Telelistas have all invested in their mobile sites.
At this stage, I believe all companies are interested as mobile is a key touch-point between brands and consumers.
Q13. Which companies (or sectors) are not using mobile, or not using mobile enough, that really would benefit from using mobile? Why?
The largest retail chains in Brazil have been slow to adopt of mobile to attract and retain customers. There is great (unrealized) potential for retailers to use mobile-based couponing and loyalty programs to grow their businesses as Brazilian consumers become more demanding and smartphone penetration grows rapidly. We hope that Brazilian retailers start to watch, and take encouragement from, how retailers in the United States and other countries are using mobile to engage customers.
Q14. What mobile campaigns stand out particularly? Are these long or short-term campaigns; is there cross-media integration?
Several Brazilian mobile campaigns have international buzz lately. The P&G had considerable success with a HuggiesTweet Pee action in which a sensor installed in the baby's diaper, which sent an alert to the parent’s smartphone when it was time to change the nappy.
Q15. What are the most popular and/or best mobile sites in Brazil?
For consumers, most mobile Web activity is mostly on-deck (on the mobile operator’s portal) – there’s still very little off-deck. About 80 percent of the traffic still comes from carriers’ decks, but third-party mobile sites, portals and app stores are starting to make inroads into the carrier’s dominance – this is forcing carriers to reappraise their portal strategies, according to comScore and GSMA.
For business customers, banks are the most popular destinations, such as Itau Mobile and Bradesco.
Examples of good mobile friendly sites are Pao de Acucar – the largest retailer in Brazil, Sadia – a large Brazilian food company and Globo.com – Brazil’s second largest Internet Portal.
Q16. Who are the key players in mobile Web/marketing in Brazil, in terms of:
• Mobile operators: the market shares of the four major carriers are: Vivo 28.6 percent; TIM 27 percent; Claro 25.4 percent; Oi 18.5 percent (Anatel/Teleco, Jan 2014).
• Creative/mobile agencies: F.biz, Pontomobi, Hanzo, Agência Ginga; Mobext, AgênciaClick Isobar.
• Mobile ad networks: Hands.
• Aggregators/integrators: Spring Wireless, Movile and Zenvia.
• Mobile content providers: Abril, Globo, Globosat and UOL.
• Mobile search engines: Google Mobile, Yahoo Mobile, Bing Mobile.
• Mobile associations: MMA (Mobile Marketing Association), MEF (Mobile Entertainment Forum), IAB (Interactive Advertising Bureau) .
• Must-attend mobile events: Tela Viva Móvel (Converge), Proxxima (M&M), MMA Forum LATAM.
Is there anything else we need to know about mobile in Brazil? What mobile hotspot should we profile next? Please email editor(at)mobiThinking.com.
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