landmark

landmark global

BrazilCOUNTRY FACTSHEET I JANUARY 2017

01 Introduction 03

02 How big is the e-commerce market in Brazil? 04

03 Who is the Brazilian e-shopper? 05

04 What and how do Brazilian e-shoppers buy? 06

05 What are Brazilian e-shoppers’ delivery preferences 08

06 How prevalent is the cross-border e-market? 09

Sources 11

Contents

CHAPTER 01 03

Brazil has been the focus of recent international attention, between the 2014 FIFA World Cup and the more recent 2016 Olympic Games. But as an economic entity, Brazil is widely acknowledged as one of the most prominent developing nations and a member of the BRIC group, which stands for Brazil, Russia, India and China.

Introduction

Portuguese

8,515,881 km²

196,500,000

R$ 28,600/year = $ 8,545 or € 8,657

Brazil

01

CHAPTER 02 04

37 million

Despite the fact that Brazil is already the

largest e-commerce economy in Latin America, e-commerce will continue to flourish as better

internet infrastructure is developed.

Brazilians shop online

e-commerce player in the world

10th

How big is the e-commerce market?

Brazil is the largest e-commerce economy in Latin America at R$69.2 billion ($20 billion, €18.8 billion). By 2018, analysts anticipate an increase to R$93.4 billion ($27 billion, €25.4 billion). In terms of population, 37 million Brazilians shop online, with another 10 million expected to join by 2018. Additionally, because of its large size, growing middle class and prominent location in South America, Brazil is a top choice for retailers looking for an online presence. In 2016, e-commerce made up 3% of the overall retail market. Still, Brazil ranks as the No. 10 e-commerce player in the world.

It is also important to note that Brazil, as an emerging economy, still has large areas of undeveloped land - particularly in the Amazon basin and rainforest. As a result, internet penetration is lower than some of the nation’s more developed allies. By 2013, internet pene-tration exceeded 50% in Brazil, but mobile internet penetration is far higher - pushing 90% over the same period. That indicates e-com-merce will continue to flourish in Brazil, particularly as better internet infrastructure is developed and more e-tailers capitalize on mobile e-shoppers.

02

2016 R$69.2 billion ($20 billion, €18.8 billion)

2018 R$93.4 billion ($27 billion, €25.4 billion)

CHAPTER 03 05

Who is the Brazilian e-shopper?

Between 2003 and 2013, Brazil’s median household income grew by 87% while the middle class almost doubled. The explosion of wealth empowered more individuals to consume and the e-tail mar-ket has benefited as a result. Today, about 45% of the population is between 25 and 54 with an average age of just over 31 - a prime demographic for online consumption. 86% live in cities, making it easier to receive deliveries.

About 65% of Brazilians are self-described Catholics. Brazil has the largest Roman Catholic population in the world. Therefore, Christmas is a prominent time of year for e-commerce sales - in 2015, the holiday season from Black Friday until Cyber Monday exceeded R$2940 million ($850 million, €799 million) in revenue.

Brazilians are well-connected to the internet, particularly through their devices. Of the 113.7 million internet users in Brazil in 2015, 73 million access the web through their smartphones. By 2019, that amount could balloon to nearly 100 million. Brazilians also spend more time connected to the internet than people in other countries, including the U.S., U.K., Germany, Japan, Russia, China, India, Nigeria and South Africa. Over 50% of Brazilians claim to stay connected “all day long”, compared to the global average of 28%. The high percentage may also have to do with Brazil’s relatively young average age.

03

Growth of median household income in Brazil

from 2003 to 2013

Brazilians spend more time connected to the internet than people in other countries, including the

U.S., U.K., Germany, Japan, Russia and China.

113 million Brazilian internet users, of which

73 million (64%) via smartphone

+87%

113million 64%

CHAPTER 04 06

What and how do Brazilian e-shoppers buy?

Compared to many other countries, the top goods for Brazilian e-shoppers are rather evenly split. The most popular items (books, music and movies) are only 12% more common than the least popular category (small home appliances). Here is how the top seven categories break down:

50%

51%

46%

fashion

books, music & movies

toys & games

04

How do Brazilians make their e-purchases?

Given the prevalence of mobile users in Brazil, a high percentage of e-shoppers make their purchases through a mobile device like a smartphone or tablet. In 2015, mobile purchases accounted for 2% of all online transactions. Mobile sales in 2016 may exceed R$38 million ($11 million, €10 million).

Books, music and movies 51%

Fashion 50%

Toys and games 46%

Shoes 43%

TVs, cameras, gaming consoles 43%

Computers 42%

Small home appliances 39%

CHAPTER 04 07

Which are the preferred payment options?

Two-thirds of Brazilian e-consumers pay through debit or credit cards, while just under 1 in 5 opt for Boleta Bancario payments, which are similar to money orders. Additionally, given Brazil’s developing economy, a large number of e-shoppers make payments in regular installments rather than lump sums. In fact, 80% of all e-commerce payments are financed over time, allowing Brazilian shoppers flexibility.

A large number of e-shoppers make payments

in regular installments: 80% of all e-commerce payments are financed over time.

60%

20%

20%

debit/credit card

money

Boleta Bancario

CHAPTER 05 08

What are Brazilian e-shoppers’ delivery preferences?

Brazilian e-shoppers tend to prioritize price and value over other factors. In fact, 59% highlighted cost of delivery as an important factor in their purchasing decisions, contrasted with 20% who indicated delivery time as a relevant consideration. As a result, 45% of Brazilian e-tailers now offer free delivery. Somewhat paradoxically, Brazil also has a remarkably low returns rate - only 15.6% compared to the global average of 27.5%.

Some prominent e-tailers have experimented with same-day delivery, though only for limited products. Overall, Brazilians prefer to use Correios - the national post office. Almost 90% of e-shoppers select delivery methods that go through Correios, while 36% use couriers and just under 13% choose motorcycle couriers.

While Brazilians may not have high expectations for delivery time, they do expect excellent customer service. When it comes to e-mail correspondence, 80% expect response in the same day, while 90% want their problems to be resolved within 24 hours. Just under 80% said poor customer service would cause them to permanently move on from an e-tailer.

In addition, 45% of Brazilian e-shoppers prefer to have their parcel delivered somewhere other than their own home. That may overlap with the 38% who have an item shipped to the retail outlet store at some point. However, while comparing offers from two different e-tailers, only 8% of Brazilian shoppers said the ability to pick up the item at a convenient location was an important factor.

05

Correios

of Brazilian e-shoppers prefer to have their parcel delivered

elsewhere than home

90%

45%

of Brazilian e-shoppers select delivery methods that

go through Correios

CHAPTER 06 09

How prevalent is the cross-border e-market?

Brazil has a strong cross-border online market - 49% of e-shoppers purchase goods from abroad. The U.S. and China are the most popular sources, earning 31% and 29% of Brazil’s cross-border e-market respectively. The most popular cross-border shopping category is clothing and accessories at 36% of all cross-border e-commerce sales.

While cross-border e-tail is quite common, Brazilians still expect a local approach as indicated by their preference for delivery through their national postal service. Brazilians also hope to see webshops in Portuguese, and they want their e-tailers to promote local events like Carnival in Rio de Janeiro, Copa Americana and Brazilian Indepen dence Day.

Cross-border e-tail is quite common, but Brazilians

still expect a local approach and prefer delivery

through the national postal services and

Portuguese as interface language.

Find out what the most popular e-shop countries are for the Brazilians

06

e-shoppers purchase goods from abroad

fashion is the most popular cross-border shopping category

49%

36%

CHAPTER 06 10

29%

31%

Where do Brazilian online consumers buy abroad?

China

United States

SOURCES 11

http://wearepentagon.com/news/online-shopping-habits-brazil.html

www.xe.com

https://www.ecb.europa.eu/stats/exchange/eurofxref/html/eurofxref-graph-brl.en.html

http://techinbrazil.com/shipping-e-commerce-products-in-brazil

http://www.webretailer.com/lean-commerce/ecommerce-brazil/

https://www.atkearney.com/documents/10192/5292753/Connected+Consumers+Are+Not+Created+Equal+-+A

+Global+Perspective.pdf/cee8c1c1-a39f-4753-a81d-e7028748e142

http://www.lifung.com/wp-content/uploads/2016/03/Overview-of-Brazil-Ecom-by-Fung-Global-Retail-Tech-Mar.-8-2016.pdf

http://www.aaxiscommerce.com/ecommerce-in-brazil-keeps-growing/

http://www.pfsweb.com/pdf/Global-eCommerce-Book-Brazil-2016.pdf

https://www.internetsociety.org/blog/latin-america-caribbean-bureau/2015/09/explaining-digital-divide-brazil

https://www.pressroom.ups.com/assets/pdf/2015%20Global%20comScore%20Brazil%20White%20Paper%20.pdf

landmark

landmark global

E N A B L I N G G L O B A L C O M M E R C E

Want to know more? Contact us

www.landmarkglobal.comsales@landmarkglobal.com