Ecommerce in Brazil beats record as new trends emerge among consumers
Brazil reaches the highest percentage of e-shoppers in the country making online purchases daily, monthly or weekly. Find out what does that mean.
It is hard to to imagine daily life in 2019 without online shopping, given that it is so convenient that it can make the products we need and/or desire readily available in our mailboxes after just a few clicks. Brazilian e-commerce illustrates that reality quite perfectly, as it has beaten a new market record.
A report from PricewaterhouseCoopers (PwC), Global Consumer Insight Survey 2018 showed that 21% of e-shoppers in the country make online purchases daily, monthly or weekly. The highest percentage since the consulting company started to keep track of online consumption habits across different countries, shedding some interesting light.
Let’s take a look at a few factors that keep making the country so attractive to merchants considering going cross-border.
1. Mobile plays a big role in Brazil’s Ecommerce
Mobile devices are becoming increasingly important in the Brazilian e-commerce market. Purchases made through mobile channels have grown at a fast rate over the past few years.
From 2017 to 2018 there’s been a visible jump on the use of smartphones and tablets in the e-commerce scenario. 41% of e-shoppers in Brazil claim to have bought something through a smartphone daily, weekly or monthly in 2018. 30% said they did so through a tablet. In the previous year, only 31% of them were buying through their phones and 20% using their tablets.
Desktop devices are still the most popular medium for e-commerce in the country, for 61% of online shopping happens through computers. However, its use grew a mere 3% over the same period analyzed.
2. All categories are benefiting from an increased consumption wave
Current revenue in the Brazilian e-commerce market amounts to USD 15,893 million. The expected annual growth rate is 2.2%, which makes the predicted market volume for 2023 being USD 17,349 million. Also important noting that the average revenue per user (ARPU) in Brazil currently amounts to USD 130.00.
Compared to 2014, the number of buyers that made most of or all of their shopping online grew to 16% in apparel, shoes, books, music, movies and videogames.
The study also discovered that the Internet is the go-to place for 34% of the people who buy books, music, movies and videogames, and 27% for those who buy electronics. Other categories highlighted by PwC as a favorite by Brazilians were: health and beauty (24%), apparel and shoes (22%), furniture and household items (18%), sports equipments (18%), toys (16%), home appliances (19%), jewelry and watches (15%) and food (13%).
3. Online food retail is in the horizon
Backing a trend observed in other emerging markets, Brazil is the eighth among the top 10 countries with the most intention of buying food online. 24% of locals said that it was likely that they would purchase a food product through the web in the 12 months following the research.
At the top of the rank are: China (59%), Vietnam (54%), Thailand (35%), the United Kingdom (32%), Japan (27%), the Middle East (25%), and Singapore (25%).
4. Brazilians are optimistic towards the economy
Over the past 3 years, Brazil has faced its worst economic crisis. Profound discussions regarding the country’s ethical values and business practices have surfaced and are, hopefully, paving the way for Brazil to continue to be an important global player.
70% of respondents said they expected to maintain or increase their spending in 2018, while 77% hoped the Brazilian economy stabilized or improved during that year. It did. The country emerged from recession faster than expected and the economy is showing signs of improvement.
5. Marketplaces are increasingly popular
Merchants interested in doing business in Brazil should know that marketplaces are a major channel for online shopping in the country. 52% of them buy products on Amazon. 33% of those use the website to check prices in order to decide whether or not to make a purchase and 27% start their searches directly through there.
Other popular marketplaces in Brazil are Mercado Livre, Americanas, Extra, and Submarino. You can read more about them here.
6. Brazilians are willing to spend money on experiences
While in the rest of the world people usually destine 55% of their available income to material goods, the survey’s respondents in Brazil said they would rather invest their money equally in goods and experiences. 37% of them claimed that the reason for that investment was to take some time off just for themselves doing things such as traveling, attending art exhibits or trying a new restaurant.
7. AIl gadgets and virtual assistants are having a moment
When it comes to embracing new technologies, you can count with the people in Brazil. The avid social media users are also savvy for gadgets that promise to make their lives a little bit easier, and a bit more fun too!
When questioned by the PwC interview regarding the use of AI gadgets such as robots and virtual assistants, which include Amazon Echo and Google Home, 14% of Brazilians said they already own at least one of those. Other 59% said they would like to have one. These numbers are far more expressive compared to other countries across the globe. In fact, only China is ahead of Brazil in the use and interest of these technologies.
8. Brazilians are trusting the internet with their money
Over the period of just one year, Brazilian e-shoppers started to care less about the websites they spend money on. While in 2017 78% on them said they would only buy from a website they considered legitimate and trustworthy, in 2018, this number dropped to 68%.
Perhaps they are feeling safer because of marketplaces or simply being unconcerned when it comes to their online actions. In fact, less than half of Brazilians (47%) claim to give much thought regarding reliable payment methods. Only 22% restrict location sharing with the websites that request this kind of information, which makes targeted marketing a lot easier for sellers.
These are a few of the reasons that help explain why Brazil is such a big player in the e-commerce global market, and why you should consider it a destination for your cross-border expansion. The country has a huge internet user penetration. As of 2019, it is 57.3%. By 2023, that number is expected to be 61.4%.
Since Brazilians started to favour spending money in experiences and entertainment, companies in the Travel sector that realize this potential have big opportunities on their way. Digital products businesses should keep Brazilians on the radar as they are such enthusiasts of gadgets and new technologies, coming behind only after China in this particular trend. Health and Beauty and Fashion have been on the rise for a couple of years, so these are areas worth investing in, as well as the promising sector of Food Retail – which is also on the rise and presents good opportunities. Merchants from outside of Latin America can take advantage from this gap, since they can provide products that will be considered exclusive.
Among the signs of opportunities and optimistic consumer sentiment, it’s not hard to understand why Brazil is the most prominent market of Latin America – and more than that – why the region is the world leader in ecommerce growth. This can only mean one thing: the room for expansion in Brazil is booming.
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