Canela Media: We are ready to take advantage of the advertising jump to streaming in Mexico

Mexico is a very important territory for Canela Media. It was its first market after the US, and for Isabel Rafferty, founder, and CEO of Canela Media, it is a land very close to her heart because she is a Mexican native.

“What we have seen is that the audiences on the streaming side have adapted very quickly, but what has been lacking in the Mexican territory, and I think it will happen soon, is the growth of the advertising side, since being an AVOD company we still see that the brands depend a lot on the TV side and have not yet made the leap to invest in OTT, which complicates for us the Mexican territory a bit today”, said Rafferty.

“The audiences are there, but the brands have been a bit slow to invest. It has been a challenge,” she said, noting that it is important to educate brands about the benefits of AVOD.

“OTT has not found its space yet: it is not TV, it is not digital and I think it makes it difficult for it to grow. This is what happened in the US a couple of years ago when the AVOD market grew, and the investment was not there, because that investment was not very well defined on the brand side. I believe that in the Mexican market today there is a great desire, a hunger to understand it well. We know that the audiences are there and that Mexicans consume a lot of streaming, but the brands have been a bit slow on the investment side,” commented Rafferty.

MEXICO IS WAITING FOR THE ADVERTISING EXPLOSION IN AVOD
According to a Statista study, the revenue generated by OTT services in Mexico was close to US$1,115 million in 2021 and by 2026 it will be US$1,900 million. In addition, 2022 saw the highest percentage of growth in the number of Internet users in the last eight years reaching 96.87 million (+9.3%), which represents 80.8% of the population +6 years of age, according to data from the MX Internet Association and the firm Knowsy AI. The favorite activity of Internet users in Mexico is connecting to networks and digital platforms (84%).

In addition, according to the Digital 2022 Global Overview Report, carried out by WeAreSocial and Hootsuite in Mexico, 97.9% of Internet users consume streaming TV on a monthly basis.

“It is a challenge to help brands make that leap. I think it’s also a bit of a learning curve because they have a digital side where they don’t know how to give value to streaming and they try to put digital video models on a more premium platform. The CPM values that try to include a more premium model are not there, they are very low. It still has its complications, and has been difficult in the Mexican market,” she commented.

Canela.TV was the first platform in Latin America to include formats with interactive versions in its inventory, almost doubling audience interaction time: +38 seconds gained above 20 seconds, delivering engagement rates of 3.97 % vs .70%, beating their benchmark by 459% for AVOD platforms.

Another example of the benefit of Canela’s platform for its advertisers is that it has “increased the awareness of mass consumption brands in Mexico and the US through channel sponsorships that display customized collections where the reach goes beyond the actions within of the Canela.TV, linking their brands with targeted and segmented audiences relevant to their products and delivering results such as 96.51% in VCR, 96.68% in billboard ads and amplifications in social networks.”

“Our sales teams are educating agencies, presenting the benefits of streaming, very educational stuff, good information and research,” Rafferty said.

Ana Laura García Téllez, senior manager of Cinnamon Marketing in Mexico, mentioned that there are already “very good brands that are working with Cinnamon in Mexico.” She indicated that they are in full ‘evangelization’ work with decision makers and there is a lot of interest in advertising with the platform.

Téllez said that global advertising budgets are leaning towards connected TV (CTV). “The higher spending on digital video, including CTV, shows the shift in audiences to streaming. In Mexico, streaming has grown to represent 15.2% of total TV usage as of December 2022 (data from Nielsen Streaming Content Ratings and Nielsen National TV Panel).”

Rafferty assured that Canela.TV audiences continue to grow in Mexico. She indicated that from 2021 to 2022 there was a growth of +172%. As an example of the positive performance of the Mexican audience, she mentioned the Canela.TV reality show, Secretos de Villanas: Las Vacaciones, launched in November 2022, “immediately positioned itself as the most watched program, and after a month and a half of its premiere were in third position.”

Rafferty listed several of the original projects that are most relevant to the Mexican market such as Secretos de las indomables, which debuts in August of this year; the daily show ¡Ponle Canela!; the informative series Narco impacto, produced in Mexico and part of Canela News, and the co-production of various films. On the side of Canela Kids, she mentioned SúperEllas, whose second season is already in full preparation including the selection of the characters.

“We are aiming a lot at the future of Mexico. We believe that soon we’ll be a switch of advertising moving more towards OTT. It is a critical moment for the Mexican market and we are ready to take advantage of it”, she concluded.