With a population of over half a billion and two countries that rank among the world’s 15 largest economies, Latin America is firmly on the radar of digital business executives looking to expand their digital offerings. In a recent report, Forrester covers regional and country-level eCommerce trends in the six largest economies in Latin America: Argentina, Brazil, Chile, Colombia, Mexico, and Peru. A few key takeaways from this research are:
- Latin American eCommerce is growing — fast! Today’s online retail market is set to grow substantially: In 2023, shoppers in the six countries we track will spend US$129 billion online, representing a compound annual growth rate (CAGR) of 22.3% from 2018. Brazil is the largest eCommerce market and will remain so. Online retail sales in 2019 will be more than double those of the next two largest markets in the region — Mexico and Argentina — combined.
- Social media, trust, and payment alternatives are key for online shoppers. Consumers are enthusiastic about interacting with brands via social media: Over half of the consumers in Argentina, Brazil, and Mexico share content that brands posted on social networks on a weekly basis or more. Online payments present challenges for merchants operating across the region. Take, for example, Mexico, where nearly 60% of the population lack traditional banking services.
- Consumers are drawn to MercadoLibre and “super apps” for convenience. MercadoLibre has been instrumental in shaping consumer expectations around the online commerce experience. For example, its alternative payment offering, Mercado Pago, enables cross-platform online payments for millions of customers. Other companies such as Rappi and Glovo are developing “super-app” ecosystems that aggregate various online services and payment functionalities in one place.
- Aside from the “big three,” other countries in the region still offer opportunity. Argentina, Brazil, and Mexico garner the most global attention. But in Chile, the government has pushed the Start-Up Chile program, which supports entrepreneurs through financial support and visa allowances. Colombia, despite having the smallest eCommerce market of the six markets we track, will have the second-highest level of mobile eCommerce in the region. Also, despite having the second-smallest population in the report, Peru has the highest spend per online buyer of all the markets we examined.
For more insights on regional trends and country-specific analyses, Forrester clients can have a look at our full report here.