Advertisers are benefiting from initiatives to increase their spending on paid search in Brazil. Making up for a lackluster digital market overall, paid search generates more clicks from Brazilian consumers.
High spending in search led to increased click through rates
As a PricewaterhouseCoopers (PwC) study reveals, advertisers are recognizing the rewards of investing in paid search in Brazil. According to the study, advertisers in Brazil will allocate $1.7 billion dollars solely to paid search this year. In comparison to overall ad spending in Brazil, investment in paid advertising accounts for 61% of total digital ad spending. Behind paid search spending are classifieds, displays, mobile devices, and video.
Trends show that paid search ad spending in Brazil is increasing at the same rate as overall digital ad spending. Between 2010 and 2013, paid search ad spending increased by 83.4%, which is nearly identical to the 84.2% growth recorded for all digital advertisements in the country. Further, PwC projects that paid search ads will continue to receive strong growth between 2014 and 2017. During this period, paid search is projected to increase by 57.3% while overall digital ad investments are anticipated to increase by 59.1%.
International comparison reveals that paid advertisements promise high ROI. As Kenshoo assessed, the average clickthrough rate, or CTR, in Brazil was 2.4% in 2013 for paid search. Brazil tops other countries, ranking in first place in paid search investments, with total investments at $5.2 billion. Moreover, paid search investments account for 39.4% of all digital ad spending, which also received an average CTR of 2.4%. With a CTR of 2.%, Australia lags behind Brazil in third place.
One last comparison is made to the United States market. According to PwC, 45.5% of digital ad spending in 2013 was allocated to search. For the year, the average CTR in the United States was 2.0%.