The economic decline in Brazil has hit the retail sector hard , but eCommerce is still growing. To understand the state of affairs in retail eCommerce in Brazil, in 2016 Forrester surveyed online retailers in Brazil together with industry partner e-Commerce Brasil. Here are a few findings from the research:

  • Retailers are feeling the pain of operating in the midst of Brazil's economic recession. Nearly 60% of online retailers say slowing consumer spending with be a significant barrier to their eCommerce growth over the next 12 months. Furthermore, more than half cite the operational constraints of keeping up with constant regulatory change.
  • Online retailers are increasing their eCommerce technology budgets. Despite the pressure to reduce costs during turbulent economic times, 64% of Brazilian retailers we surveyed are increasing eCommerce investments to help them weather the storm.
  • Investment priorities include marketing, mobile – and uniquely! – marketplaces. Retailers this year are focusing on marketing and mobile, much the same as in the US and other global markets. Unlike many other markets, however, Brazilian digital commerce pros are also prioritizing marketplaces. Why? Third party marketplaces are a relatively simple way to sell direct to consumer online. And retailers like Magazine Luiza and Walmart Brasil are prioritizing launching marketplaces on their own retail sites as a source of new revenues.
  • Mobile is a big focus area. Retailers report than an average of 20% of online revenues now come from purchases that consumers make directly on smartphones. In response, 56% of retailers are increasing their investments in mobile. But Brazilian retailers have their work cut out for them: 50% of retailers either are in the early stages of developing a strategy – or don’t have a mobile strategy at all.
  • Social emerges as a top customer acquisition tactic. This year, retailers in Brazil also told us that social networks are one of the top three most effective resources to acquire new customers – actually edging out email marketing programs. Like many global markets, of course, search marketing is still a digital powerhouse. Web-only retailers see more customer acquisition success on social networks, and store-based retailers see significantly more traction with offline advertising than their pure-play counterparts.

I encourage Forrester clients to read the report series for more detailed information on: 1) key performance indicators (KPIs) 2)  retailers’ priorities, challenges and mobile strategies, 3)  marketing and site features, and 4) the size and composition of eCommerce teams.

What observations do you have on the state of retail eCommerce in Brazil?