E-commerce is growing
Written by Alfonso Elizondo
Electronic commerce is booming in Latin America. The growth in the use of the internet and social networks increases the opportunities for companies that sell online. According to Worldpay, online sales will grow by 19% in the next five years, much more than the global average of 11%, and it will reach 118 billion dollars in 2021. Two of the three fastest growing eCommerce markets in the world are Colombia and Argentina.
Latin American companies that sell online have many problems such as lack of security when paying online, low use of banking services and serious logistics issues. The World Bank also points to the problem of lack of roads and railways and inefficiency at airports and seaports.
According to different national information sources, ecommerce will record sales growth of around 25% in the region, with Brazil accounting for most of its recorded sales. In 2014 Brazil spent 15.2 billion dollars on retail e-commerce sales, according to the Brazilian Chamber of Electronic Commerce, which amounts to 13% higher than sales for the previous year.
It is followed by Mexico with annual sales of 12.2 billion dollars and annual growth of 32%. In third place is Chile, where electronic commerce registered nearly 4.3 billion dollars, followed by Peru with 1.25 billion, 16% and 25% higher than the previous year.
In the rest of the world, e-commerce growth is very uneven. In Europe it is in the developing stage and is much higher than in other countries such as India, Thailand and Indonesia. In Spain, ecommerce reaches 58% of the population, just 1% more than the previous year’s 57%. In general, the countries with the highest population density are those that make most use of e- commerce, for example the United Kingdom, South Korea, Germany, Japan and the United States. In the United Kingdom the percentage of population that has purchased through e-commerce in 2017 reached 76%, 72% in South Korea and Germany, 68% in Japan and 67% in the United States, while Spain and the countries of Eastern Europe are still very far from these percentages.
The global value of electronic transactions in 2016 was 1.9 billion dollars worldwide. The countries that lead the average annual expenditure on e-commerce purchases per user are the United Kingdom with 2033 dollars, the United States with 1630, Canada with 1052, Germany with 1050, while the average for Spain is only 687 dollars
The Hootsuite report indicates that the difference between eCommerce and mCommerce is very vague and it makes the point that success stories such as Facebook Live and other applications such as Facebook or Marketplace will provide more opportunities for 'social commerce', a line that will surely get favourable ratings on Facebook. At the same time We Are Social has declared that in the coming year more than two trillion dollars will be spent buying products and services via the internet and a large number of people will make their first online purchase.
The growth of more specific and appropriate mCommerce services and the optimization of payment systems via mobile phones will enable more variety and convenience to be offered to buyers. However, before the 'brands' can take full advantage of these benefits they need to do more to integrate all their marketing actions, coordinating their activities online and off line.
Addendum: It is obvious that the appearance of electronic commerce, in both products and services, will lead to the disappearance of the existing large supermarkets facilities and all kinds of stores for direct sales to customers, large industries for the production of food and articles for domestic use, systems for transporting products in large quantities, credit systems and payment systems. It will be a totally different society from the current one and it is already in its first stage.