Performance-Driven Ad Formats Dominate Latin American Retail Media Markets

Marketing doesn’t happen in one stage. It includes a lot of stages, i.e. awareness, interest, consideration, intent, evaluation, and finally the purchase. The ultimate goal of every marketer or advertiser is to take the lead to the bottom of the funnel to get a higher conversion rate and revenues. However, it requires the investment of time, money, and effort to achieve the goal. According to the research, most people conduct online research nowadays before making a purchase. So, the chances of conversion will reduce if you directly go to the lower funnel actions instead of going through all the other steps.

The top of the marketing funnel plays a critical role in attracting consumers through blog posts, articles, videos, direct mail, eBooks, events, and various other strategies to create awareness regarding the product or service. Once they have good knowledge about your products and services, the chances of conversion will also improve. If it goes well, the consumers will then move to the next stage, i.e. interest. Now, they would like to see how a company or service can help them.

In Latin America, e-commerce channels rely on sponsored product ads which are considered “Lower-funnel actions”. Although the focus of brands is shifting towards upper-funnel actions, i.e. sponsored videos and display ads, sponsored product ads will remain on the top in marketing strategies at least for some time.

According to the client activity tracked by DataHawk in Q4 2021, 80% of the ad buys on Amazon in Mexico are for sponsored products, while 13.8% are for sponsored brands. The number of other ad formats of sponsored brand videos and sponsored displays is negligible as compared to sponsored products. It shows the reliance of most brands on sponsored products. However, it is not surprising at all because it was the first ad format that was launched in October 2018 in Mexico.

The other revelation by DataHawk is that the format of the ad is dependent on the budget of the company allocated for Amazon ads. If the company is big enough that it can spend more than $100,000 every month, it can use a mix of ad formats to reach its targeted audience on Amazon. On the other hand, if the company has a small budget to spend on ad buys, it will stick to one ad format, i.e. sponsored products, or a maximum of two ad formats in some cases.

“Mercado Libre” is a search engine that is being used the most in Latin America. Advertisers buy similar ad formats, i.e. sponsored products for this as well. The ad format of sponsored products helps different brands, advertisers, and sellers to boost their sales, increase their brand awareness, and improve their visibility and exposure on the digital shelf.

Every brand or company is so used to using sponsored product ad format that it seems to be incorporated into retailers’ UX’. It is included in the interface of the websites. Moreover, it is a golden opportunity for the retailers to increase the number of ad placements on the digital sites or properties to further increase the chances of attracting more audiences. However, at the same time, it shouldn’t cause any disturbance in the shopping experience of the consumers.

What are The Best Tactics to Use Lower Funnel Marketing Ads?

If you are also a low-budget company or advertiser who wants to make the best use of marketing ads by spending less, you should know the best tactics that can help you get effective results through lower-funnel marketing ads.

Offer Discounts or Seasonal Offers

Since you are relying on sponsored products, it must incorporate a tempting offer to grab the attention of the audience. It will give the consumer an incentive that he will need to make a final buying decision. 

Moreover, a seasonal offer can also play a vital role in capturing the interest of the audience. If there are holidays around for Christmas, New Year’s, or any other event, you can make your low funnel ads season-based to make them effective.

Urgency and Frequency

Creating a sense of urgency among the audience is another important tactic to improve the chances of conversion. When the consumer knows that an offer is going to end in a limited time period, it is highly likely that he is going to make the purchase.

Moreover, you should make such ads frequently to ensure that audience comes across them multiple times. Lower funnel ads cannot perform well if they are visible for once only. It won’t have any impact on the audience then.


Lower-funnel personalized ads can also help you achieve your goal. You can focus on two main aspects of personalization, i.e. product or location. You can use the updated tools and software to know about the interests and locations of your audience. It will help you target the right audience for your product or service at the right time. Since you are investing money in your ads, make sure you place them right where the chances of conversion are higher.

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