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With global sales reaching 4280 billion in 2020, shopping online is one of the most popular consumer activities in the world, without a doubt, this trend will endure, ecommerce will continue to expand and their digital sales channels will become increasingly important.
Where the action occurs
As we said in our previous article, online sales have 2 main channels, one is the Direct To Consumer (DTC), those ecommerce own, where companies choose a platform such as Shopify, WooCommerce, Magento, among others, to create their online store, under the domain of their brand and there they offer their products or services directly to the consumer, whose satisfaction and closeness become the main objective of the business.
El Direct To Consumer has been gaining relevance in recent years, especially during the pandemic, its presence has been strengthening in Latin America and the world, and every day more companies are contemplating the transfer of their offer to the digital environment. Later, when it has a higher level of development, it will be interesting to find out its percentage of penetration by country, from Cubbo we will be sharing this information with you.
The other channel is the Marketplace, like Free Market, Amazon, Walmart, Liverpool, Claro Shop, among many others, which act as intermediaries between the customer and the seller. Generally, they are highly recognized brands, which charge a commission per sale to the supplier, in return for allowing them to appear on their platform or virtual showcase.
And it is precisely one of the Marketplace that we are going to talk about in this article, these giants of ecommerce they have taken over the online sales market, have a turnover of millions of dollars annually and have become an ally and a necessity for the marketing of products, for those businesses that do not yet have their online store or need to publicize their brand.
The Marketplace in Latin America continues to grow
El COVID 19 not only did it generate significant levels of growth in the DTC, causing millions of companies around the world to turn to this sales channel, as expected, the results of Marketplace they also achieved high growth rates, and so during 2020, these channels increased their sales levels, as we will see in the following graph by region, where the greatest evolution occurred in LATAM with 36.7%, 10.3% more, compared to territories such as Asia, where there are giants of ecommerce such as China; a context that presents a very favorable scenario for these sales spaces.
Marketplace with the highest number of sales
4 platforms are distributed in the Latin American market, including Marketplaces with the highest number of sales in the region during 2020, we found the following:
Free Market: The giant of Argentine origin, is among the fastest growing online markets in the world. Your sales in LATAM during 2020, they reached USD $20,930 million, which represents 24.6% of total sales by Marketplace In the region, it also registered almost 668 million visits per month, while its total number of active users accounted for 132.5 million (approximately half of the online consumers, reported in Latin America for this period).
Among the 3 countries where it registered the highest number of sales during 2020, we find Brazil, where it is listed as one of the mobile applications of ecommerce most used, reporting sales of more than USD $2.2 billion; followed by Argentina, where it totaled USD 980 million and Mexico with USD $575.2 million. In other territories such as Chile, Colombia and Peru, Mercado Libre doubled its sales during the pandemic, results that demonstrate its important position in the region, where it surpasses world-class players such as Amazon.
B2W Digital: The Brazilian e-commerce company, mother of some of the sites of ecommerce most visited in Brazil, such as Americanas, Submarino, Shoptime or SouBarato, reported sales of USD $3.24 billion in 2020, 45% more than in 2019. Under this Marketplace more than 31,000 Brazilian sellers offer their products to more than 17 million customers.
Amazon: In addition to the above Marketplace, this giant of the ecommerce It is one of the world leaders in online sales and although its penetration in Latin America has not been as smooth and fast as expected, in Mexico and Brazil, countries in the region where it has a presence through its own portal, its results are quite representative.
With headquarters in North America, Europe, Asia and LATAM, Amazon ranked third among the most popular online markets in the world in 2020, recording global sales of USD 475 billion, where more than USD $236 billion were generated in North America (first place in the world ranking went to ecommerce Chinese Taobao with USD $609 billion and the second for B2C Tmall with USD 593 billion).
Amazon has a 1% share of total global retail sales. In the case of Latin America, although no specific data are recorded for Brazil, in Mexico it reported sales of USD $1,644 million during 2020; its popularity in the Mexican country reaches 56%, while 54% of SMEs sell their products on this portal.
Amazon is a Marketplace which has been able to maintain its leadership over time, which will surely continue to expand in the coming years, on different continents. It will be interesting to see its growth strategies in Latin America, where it faces major competitors such as Mercado Libre.
Magalu: during 2020, this Marketplace Brazil recorded the highest turnover in its history: USD $1.49 billion, thus becoming one of the leaders of the ecommerce in this country, which, among other things, was attributed to strategies such as the diversification of its categories and items, going from 15,000 to 47,000 products offered, which allowed it to expand, increasing its network of sellers by 212%.
Other important Marketplaces in Mexico
Claro Shop
As a commitment by the largest cell phone company in Mexico to online sales, Claro Shop was born, Marketplace which today has more than 500,000 products from 10,000 renowned brands, as well as more than 25,000 customers, which has given it recognition and preference among Mexican buyers.
Liverpool
Under the banner of providing the best service, Liverpool has managed to position itself as the Marketplace with the largest chain of department stores in Mexico, leading the list of ecommerce most remembered in the fashion category in the country. Its creation allowed the brand to expand its sales channel, complementing its more than 120 physical stores with its portal ecommerce, which represented more than 29% of the brand's sales during 2020 ($115.473 million), registering growth of more than 150%
Elektra
With more than 70 years of experience, it is one of the most recognized brands in Mexico, during 2020 it reported more than 81 million visits, which gives us an idea of its importance within the Mexican economy, where it has a greater presence.
Its more than 400,000 products allowed it to increase its online sales by more than 100% during 2020, which represented more than 15% of the company's total revenues, a figure that by 2021, they expect to increase to 25%. During the second quarter of the year, its sales reached $36,068 million pesos.
Coppel
It offers its consumers multi-category products, for which it provides quite affordable credit alternatives. Coppel has positioned itself as one of the most important online shopping firms in Mexico, placing it in third place in the country's most important marketplaces in 2019, surpassing competitors such as Walmart and Liverpool.
Walmart
Its hypermarket format offers a wide range of products, offered by more than 70 thousand vendors, from food to clothing and other merchandise. In 2019 Walmart ranked third among the companies with the highest number of sales in Mexico. During the second quarter of 2020, its net sales increased by 13%, where the Marketplace contributed 0.6% of revenues for these three months.
Understanding the existing consumer needs in each country and providing solutions that contribute to their economic growth has, in many cases, been one of the main strategies that has allowed Marketplace extend beyond their own territories.
As sales channels and partners for DTCs, these platforms will continue to be prominent representatives of online commerce worldwide. If you have your own ecommerce, are you looking to expand your sales or publicize your brand, the Marketplaces can be a very good option for the growth of your business, analyze their advantages and disadvantages and make an informed decision. To support you, we share the following article developed by Cubbo, where you will find a complete comparison of the costs and savings that can be generated by appearing on these channels, we hope it will be useful From Zero to Ecommerce, everything you need to know to create your online store Until next time!
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Sources of information:
Antevenio Linio Statista Statista Statista Statista Statista Statista Statista Statista Statista Statista Statista Statista Statista Statista Statista Statista The Republic Cubbo Statista Statista Statista The Republic Statista Enrique Ortega Investments/News The Republic America/Economy Ecommerce ccs Ecommerce ccs Merca20 Fashionnetwork The Port of Liverpool Vtex Businessinsider Expasion The CEO Forbes Statista Expansion Marketing4Ecommerce Statista Substarck Merca20 Statista Marketplaces 2021 AMVO White Paper
