Ups investment ahead of World Cup and Olympics.
Continuing its rapid expansion in the Brazilian market, WPP Digital's Possible Worldwide has taken a 70 percent stake in Gringo, a local digital agency serving brands like Coca-Cola, Absolut Vodka, and Microsoft. The agency said the purchase reflects its strategy of building a "strong, native understanding" of the international markets it services.
As Brazil prepares to host two of the world's most significant sporting competitions - the 2014 Soccer World Cup and the 2016 Olympics - WPP has been heavily investing in the market there since early last year, alongside competitors Publicis Groupe and Interpublic.
Yesterday WPP said it has bought a 70 percent stake in mobile savvy Sao Paulo-based digital agency F.biz, while in May last year it acquired Midia Digital and I-Cherry, which focus on digital creative and search marketing services, respectively. Meanwhile, Publicis Groupe extended its reach into the Brazilian market last May with the acquisition of digital agency AG2 for an undisclosed sum, while Interpublic Group bought digital agency Cubocc in an effort to bolster its social and mobile expertise in Latin America.
Speaking with ClickZ last year, Roxana Strohmenger, a Forrester analyst following the interactive marketing space in Latin America, suggested major brands are looking to integrate themselves with both the soccer World Cup and the Olympics, presenting the opportunity for ad companies to firmly establish themselves in the market.
"With preparations and ramp up to [the events]... the amount of ad spend in the Brazilian market will increase significantly," Strohmenger predicted, adding that the country's growing economy and Internet user base adds to its appeal for holding companies like WPP.
Strohmenger also emphasized the prevalence of social media among Brazilians, describing them as "voracious consumers" of such services, including Facebook and local market leader Orkut. She suggested users are more accepting, and even expectant of brands on such services, presenting different challenges and opportunities to markets such as the U.S. "As long as advertisers build campaigns that are interactive and rewarding for their online target audience, social media will be a critical and successful channel," she said, implying further opportunities for agencies to help brands do exactly that.
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Jack Marshall was a staff writer and stats editor for ClickZ News from 2007 until August 2011.
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