As an investor, one of the most pressing questions either on your mind or being asked of you is, “What’s the next, best big bet?” For Adam Bain, Twitter’s President of Global Revenue, one answer that satisfies this never-ending question, for the time being, is Brazil.
In fact, Brazil has been on the radar of firms and investors the world over as an emerging market for several years now. There are three other countries that join Brazil to form what the business world calls the ‘BRIC’ markets: Brazil, Russia, India, and China. But only Brazil will host the FIFA Confederations Cup, FIFA World Cup, and the 31st Olympiad in 4 consecutive years, representing a truly immense investment opportunity – and companies like Twitter know this.
Bain was quoted in an article from Sports Illustrated last friday May 9th saying,
You think about the next 10 years in Brazil and it is really going to be amazing from a business perspective. That’s why we are here building and we will continue to invest in this market in a big way.
Brazil and the other BRIC countries represent the largest opportunity for investment in the world because of the rapid growth and development of their respective middle classes. Brazil has seen solid spending growth from its middle class in recent years, though it has slowed somewhat due to the global recession, and it already represents Twitter’s 3rd largest subscriber market at an estimated 40 million, behind only the United States and Japan. It boasts this position with only about 44% internet penetration, just half that of the U.S. making it a very promising market for growth as it is an area with very high adoption rates for smartphones. Twitter’s Bain went on to say,
Brazil is the largest opportunity we see in Latin America and frankly across all of the other markets. Some of our most strategic deals that we have signed with marketers, which are global deals that we have signed over multiple years, many of them include work that they want to do here in Brazil during the World Cup and the Olympics.
Twitter saw record setting consumer interaction levels from the London 2012 Olympics, and are looking to engage with consumers in Brazil in the same way, and perhaps to leverage a new model of integration with TV for the World Cup, which the company launched in London. Twitter’s main source of revenue, promoted tweets, should also be a great vehicle for them for the World Cup, because according tot the article from SI, Twitter subscribers in Brazil have engagement rates three times that of the global average with this type of interaction.
But, Brazil doesn’t just represent an opportunity for Twitter because of its highly engaged domestic subscriber base. According to a 2012 article from The Economist, “tourism is expected to more than double to 3.3bn visitors every year” between the World Cup and the Olympics. It will be this influx of tourists that will most interest companies looking to make a splash at these two major events, and it is here that Twitter and other social media platforms have an opportunity to capitalize on these firms’ urge and need to interact with these consumers.
To put the dollar magnitude of the events to take place in Brazil in the coming years into perspective, the South Africa 2010 FIFA World Cup generate a reported $2.408 billion USD of FIFA’s $2.448 billion USD total broadcasting rights revenues, and accounted for $1.072 billion USD of its total $1.097 billion USD in marketing revenues. In total, FIFA estimates that the 2010 World Cup accounted for approximately 87% of its total income for that year.
These numbers are sure to increase for the 2014 World Cup in Brazil, and the key for Twitter will be its ability to transform and channel those marketing and advertising opportunities via its unique platform in a meaningful way. The company’s President of Global Revenues, Adam Bain, is certainly committed to investing the time and resources necessary to make that happen, and to make Brazil a springboard for growth for the next decade:
The world’s spotlight is going to move to Brazil in a very dramatic fashion and investment certainly follows with that.
What do you think about the investment opportunities that Brazil and the World Cup 2014 present? Let us know in the comment section below or on Twitter.