A silver lining to the challenging state of Latin American insights

The strong growth rates across Latin American nations, as revealed in ESOMAR’s Global Market Research 2023, brought a significant expansion in the insights industry in absolute terms – without factoring in inflation – reaching an aggregated turnover for this region of US$4.215 bn. While this figure includes the industries of Latin America as well as Canada, it shows the magnitude of the industry in this expanded area known as the “Rest of the Americas.”

However, it’s worth noting that among the countries in the Latin America region proper, only Brazil, Ecuador, Colombia, Uruguay, and the Caribbean – within those markets with turnovers above US$10 million – have maintained positive net growth after factoring in inflation. Brazil, the largest and one of the most rapidly expanding markets for insights in Latin America, boasts a net growth rate of 3.2%. In contrast, Mexico, the second largest market, reported a net growth of -7.7%.

This highlights the significant inter-regional differences and the diverse growth trajectories that exist across countries. Furthermore, Latin America continued to feel the reverberations of the pandemic, and only Argentina, Ecuador, and the Caribbean, among those with a turnover above US$10 million, surpassed their 2019 level of output.

The Rest of the Americas region saw significant growth in the Established Market Research sector, with a year-on-year absolute change of 9.3%. Despite this positive development, the Data Analytics and Reporting components only generated modest growth rates compared to 2021.

Unfortunately, the high inflation rates in this region resulted in a substantial decrease in growth for every sector, with even the Market Research sector showing flat behaviour in its net growth rate. Expectations for 2023, after factoring in inflation, are of positive growth of 3.3% for the Market Research sector and 4.4% for the Data Analytics one, while a negative rate of 4.9% is anticipated for the Reporting sector.

Overall, the Insights Industry in the region is expected to increase in 2023 by an estimated 2.4% in net terms. Many countries could see an upswing in their expected production levels if their central banks cut interest rates further, following the lead of some of their largest neighbours. While this could open up new economic and business opportunities in the market, the actual scenario could be very different for each country should they struggle with social, political, and economic challenges.

Indeed, the expansionary monetary policy applied this year to tackle the estimated inflation rate of 10.01% will create some challenges to generating substantial income growth, a significant obstacle that requires attention if countries are to make progress.

Latin America is set to witness progress in the performance of 13 out of its 20 markets, as they anticipate surpassing their 2019 turnover benchmarks. However, Brazil, Mexico, Peru, Uruguay, Bolivia, and Nicaragua will continue to grapple with turnover levels that fall below those recorded in 2019. Nevertheless, If no unforeseen events disrupt the industry's equilibrium, 2023 may serve as a significant milestone for Colombia, Chile, the Dominican Republic, Guatemala, Costa Rica, Paraguay, El Salvador, and Honduras, signifying a definitive rebound from the detrimental impacts of the pandemic.

The forecast for the Rest of the Americas in 2023 looks optimistic for the majority of countries, anticipating favourable net growth throughout the region, with an estimated industry turnover of nearly US$5 billion! 

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