Ecommerce in Brazil has been climbing steadily, powered by growing internet penetration and rising household income, according to a new eMarketer report, “Brazil Ecommerce: Sports, Travel and Cheap Retail Maintain the Market's Momentum.” Even as Brazil’s economy slows, the country’s B2C ecommerce sales should see double-digit expansion this year and again in 2014, when the FIFA World Cup soccer tournament is expected to prompt a surge in domestic travel and event-related economic activity.
As in other countries, digital travel sales have played a major role in the growth of ecommerce in Brazil. Travel represented close to a third of the country’s total ecommerce sales in 2012, eMarketer estimates. Brazil’s sheer size means that air travel is required to get from place to place, and airline tickets can be expensive.
While not growing as fast as travel ecommerce sales, retail ecommerce sales in Brazil are likely to grow at a healthy double-digit pace through 2014. By 2016, eMarketer expects retail ecommerce sales in Brazil to reach $17.3 billion.
Retail sales will rise in part on the heels of a greater number of internet users buying via digital channels. In Brazil, where even small percentage changes equate to tens of millions of consumers, the size of the middle class is key to ecommerce growth.
eMarketer estimates that Brazil will have 26.7 million digital buyers in 2013, equal to 36% of internet users. That penetration level is a far cry from the US, where the figure is 73%, but Brazil outpaces Latin America as a whole, for which the average is 33.2%.
A study by Fundação Getúlio Vargas (FGV), a higher-education institution and think tank, predicts the middle class will represent 60.2% of Brazil’s population by 2014, at which point the group should include more than 120 million people.
As more middle-income consumers go digital, online retailers can expect to see more purchases being made, but at lower price points. The increasing number of middle-income online shoppers also suggests that comparison shopping, while already prevalent among consumers in Brazil, will grow even more common.
While the middle class, especially those in the upper end, will be a major driver of growth in ecommerce in Brazil, much of the segment’s sales will continue to come from wealthier buyers, who not only have more expendable income but also have more experience online.
The full report, “Brazil Ecommerce: Sports, Travel and Cheap Retail Maintain the Market's Momentum” also answers these key questions:
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Check out today’s other articles, “How Does Facebook Exchange Measure Up?” and “Mobile, Social Support Digital Game Revenue Growth.”
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