Catching the Latin American wave of IM use

Friday, August 12, 2011

Social network news has been increasingly working its way into Latin American coverage as more and more people get online and get connected. The movement has not gone unnoticed by Amsterdam-based IM aggregator eBuddy, which has been able to build up a significant customer base in the region with virtually no marketing campaigns.

BNamericas spoke with Salvatore Punzo, director of eBuddy's strategic partnerships for EMEA and the Americas, regarding this development and future plans for the region.

BNamericas: How did eBuddy come into being?

Punzo: We started a few years ago when we wanted to develop this concept to integrate different IM platforms on a single interface - that's how eBuddy was born. It was more or less a conversation between two friends, asking if they could get MSM on the mobile. That's how it all started.

BNamericas: The business model is advertising based?

Punzo: Yes, that's why both of our applications available on the market are completely free, and they'll stay that way, with advertising on web or mobile.

BNamericas: What are some of the actions you've had in Latin America and the Caribbean?

Punzo: The region is pretty new and surprising for us. It's our third market, after Southeast Asia, then the Middle East. Being a Dutch company, Latin America is a new region for us to explore in terms of the culture. But the user has been great in the region. Without any marketing or promotion of our application in the region, we've grown very fast.

eBuddy is a powerful brand in Latin America; the users know us. We just need the big players to see our faces and show them that we're here and already successful in the region. Now we want to go hand-in-hand on the commercial side.

This means we're approaching all OEMs and operators in the region. Right now, our users in the region have eBuddy because they go and download it directly from our website, thanks to word of mouth but not because they find it in an applications store. They know the application and the brand; they look for it and use it. So the next step for us is to create a relationship with the operators and OEMs in order to provide better service to our end users.

BNamericas: Would the idea be, for example, to "open the door" and have eBuddy on the startup menu when you turn on the cell phone? Are you negotiating this service with operators?

Punzo: That's actually one example I always use when I talk to operators in Latin America. I compare the regional market a lot with Southeast Asia because of the demand and market needs. Those are things we're already doing in Southeast Asia. In eBuddy language we call it co-branding opportunities for them. We've been talking with operators in the region to develop this type of business model.

BNamericas: Nothing signed yet though?

Punzo: I'd say we're in good conversations. I think we'll have news pretty soon. Our main countries in Latin America are Mexico, Brazil, Argentina and Chile.

BNamericas: How do you negotiate the advertising to put on your website?

Punzo: It's done through a sales house. In the region, we have a sales house in Brazil, Argentina and Chile. And we have a sales team in Amsterdam - where we have our headquarters - that coordinates all the advertising and manages the relationships with the different sales houses in the region.

BNamericas: Are you undergoing any negotiations with regional networks to put them on the eBuddy site?

Punzo: Not for the moment. So far the ones that we have - Yahoo, MSN, Gtalk, Facebook - seem to be working fine for us, but we're always open for conversation.

BNamericas: What's the yearly revenue turnover you have for Latin America?

Punzo: I can't really provide specific numbers; the region is pretty new for us. We're just now implementing the advertising and have been in the region for less than a year. Before it was just market penetration, no advertising. So we don't have a yearly report for the region yet.

BNamericas: What type of user base are we talking about then in the region?

Punzo: I can tell you that between web and mobile, about 8mn users. In Brazil alone there are 4mn users, and 3mn users in Mexico. It's a huge difference between these two big countries and the rest of Latin America, but in Chile and Argentina we're seeing significant growth, about 150-180% in Chile and 300% in Argentina.

BNamericas: But since you have such a bigger base in Brazil and Mexico, how much are you planning to grow in those markets?

Punzo: Our attention is definitely on those two countries, and because of the types of relationships we've been creating in the past few months and plans for the future, we're expecting to double the base in about the next year or two.

BNamericas: How?

Punzo: Particularly because we just launched a new application. Even though people associate it with the original application, it's completely different. It's to challenge the competitors in that category in the region. It's called XMS, which will basically challenge BBM and What's Up.

One of the big differentiators is that the user discovery is through the phone book and Facebook. You can integrate all of your Facebook friends into the application, you can log in from one phone to another if you switch devices, you can do a Facebook login and get your account anywhere. It follows the same concept as rich media, and at the same time you can update your status on Facebook and on Twitter directly from the application. You can aggregate it through a PIN system - same as BBM - or by sending a text message, or when a friend of yours downloads the application, it automatically will push the new contact that has just arrived into your list of friends.

About the company

Netherlands-based eBuddy is a free online IM aggregator, available as a web-based and mobile version, for MSN, Yahoo, Gtalk, Facebook, ICQ, MySpace and AIM (AOL). The application can even work when the user is behind a firewall, and it requires no downloads or software installation.

It processes 200bn messages a year and is considered the world's largest independent messaging provider.