Latin America Digital Signage Market - Growth, Trends, Forecasts (2020 - 2025)
Latin America Digital Signage market is segmented by Type (Hardware, Software, Services), End User Industry (Retail, Transportation, Hospitality, Corporates, Government), and Country.
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Scope of the report
Key Market Trends
TABLE OF CONTENTS
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The Digital Signage Market in Latin America is projected to register a CAGR of 14.3% during the period 2020-2025.Digital signage enables content and messages to be displayed on an electronic screen and changed without modification to the physical sign. The adoption of digital signage is becoming more popular and mainstream with technological advancements and a reduction in the price of display technologies.
Digital signage constitutes a significant percentage of ad revenue across enterprises operating in different industry verticals. This is mainly possible due to digital signage’s inherent benefits, such as quick information dispensation, easy control, and modification.
Digital advertising spending in Latin America remains lower than the global average, inhibited by lesser digital penetration and the popularity of TV within the region. However, as more consumers come online for the first time, brands make digital an essential part of their media strategy to engage with consumers across all channels. The region also took the leading position in the ranking of increased investment in digital advertising in 2018. Internet advertising spending in Latin America was around USD 5.8 billion in 2018 and is expected to reach USD 7.5 billion by 2020.
Also, the increasing spending on digital advertising in the Latin American region is expected to further create significant opportunities for the growth of the region's digital signage market. According to IAB Peru, digital advertising spending grew from USD 66 million in 2014 in Peru to USD 132 million by 2019, which is almost double in growth.
Additionally, the presence of US-based digital signage vendors is growing in the region, and many self-service kiosks with advanced features are being offered in the region. For instance, the first digital biometric kiosks for automatic passenger registration were launched in Mexico at three major airports. The new self-serve kiosks systems use biometrics rather than visas to leave and enter the country.
However, few issues, like high initial investments, high maintenance cost, and high power consumption, are restraining the studied market growth in the region. However, the advancement in the technologies and integration of biometrics with digital signage systems can help the region to overcome these issues.
In April 2020, Spanish digital signage company Deneva launched a Safe&Tech range of digital signage solutions designed for life after the peak of the initial wave of the Covid-19 pandemic.The Safe&Tech range has advanced high-precision AI systems for people counting, to ensure capacity management and management of inflows into a store. The system incorporates an alarm function for staff and security so that they know when occupancy is close to the maximum allowed. The company has partnerships all over Latin America.
Scope of the report
Digital signage is essentially a display technology that shows text, images, and videos. It uses LCD, LED, projection, and e-paper to display the digital advertisement content. The study characterizes the market based on type, such as hardware, software, and services and by end-user industry, such as retail, transportation, and hospitality, among others primarily in the Latin American region.
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Key Market Trends
Retail to Witness Significant Growth
To get leverage over the physical stores, the retail players in the region are integrating the digital tools at their disposal to share relevant and profitable content at their premises and integrate digital ads into their retail stores to create a different in-store user experience.
Digital signage displays are used by retail stores to show advertising, information, or other relevant content to deliver targeted messages. Digital signage maximizes the message's impact and allows the retailers to reach their audience effectively and profitably.
For instance, digital signage is installed in a shopping center in Cuernavaca, near Mexico City, to attract visitors. The signage consists of a cylindrical LED screen with 368,640 pixels. Similarly, Musimundo, one of Argentina’s largest retail chains, installed digital signage to deliver its 200-store network. It features a mix of video, brand awareness, in-store, and collaborative promotions.
Companies, such as Triad Retail Media, a company operating in the digital retail media segment in 2017, announced its entry into Mexico. This strategic move has been undertaken to leverage the growing digital ad spending demand in the region. This expansion will help the company deliver measurable value to more retailers and brands seeking to convert online and mobile shoppers.
A majority of the millennial shoppers are visiting retail stores to have an interactive experience. Many retailers, such as Wal-Mart de Mexico, the Mexican and South America Walmart division, installed more than 5000 digital signage displays and touch-screen kiosks covering 292 stores across Mexico. Content is delivered through large-screen LCDs in crucial store locations and touch-screen kiosks in the pharmacy and other areas.
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Brazil is expected to Dominate Market Share
Brazil is one of the highest revenue-generating countries in Latin America due to the country’s technological leadership in this region, as well as the reputation of being an innovation leader. According to “The State of innovation in Latin America” report published by Visa Innovation Center in March 2019, Brazil is currently home to eight of Latin America's most innovative firms.
Government initiatives are also contributing to market expansion. For instance, Sao Paulo banned all billboards in 2007 to fight what it saw as the growing problem of "visual pollution." This caused the preference of citizens to shift from printed signage to digital signage, thereby compelling the companies to come up with innovative market offerings.
The country’s fast-food market is growing due to an increase in the middle-class population. World Bank estimates that the middle class has grown to 50% of the country’s population in recent years. Due to increasing disposable income, the citizens also expect a better dining experience and ambiance.
Keeping this in mind, Brazilian QSR chain, Bob, is using BroadSignInternational LLC's digital signage software to reinforce appetite appeal via technology. It features 100% brand-related content, updates location-specific pricing based on demand and promotions, and loyalty programs are advertised on point-of-sales and dining areas.
Wendy’s company also partnered with NCR Vitalcastto provide digital signage solutions to its newly-opened restaurants in Sao Paulo. It allows the restaurant to customize its messages, menus, and images based on the time of day.
The entry of global companies in Latin America, as well as continuous investments by firms in existing companies, is also a major driving force for the market growth in Brazil. For instance, in November 2018, IntermediaTouch, an interactive signage provider, partnered with Connect2Global to build its presence in Latin American countries, including Brazil.
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The Latin America Digital Signage Market is moderately fragmented. With a few players dominating the market share, the companies keep on innovating and entering into strategic partnerships in order to retain their market share.
October 2020 - Telelogos, a software provider for digital signage, media, and connected devices, expanded its presence in Latin America by opening an office in Mexico City. The Latin American presence will allow the company to be very reactive to the regional clients' demands and to strengthen relations with their local partners.
May 2019 - AdMobilizedeployed its audience analytics package into interactive subway doors at three stations in the Sao Paulo Metro in Brazil. The interactive doors would provide a variety of information, ads, and news to travelers. The company would also be able to analyze the effectiveness of its advertising on the doors by quantifying the number of people standing in front of the doors along with their gender, age, and facial emotion analysis.