E-commerce. You have probably already heard this expression before. But what is e-commerce, and what does it mean? E-commerce is an abbreviation of “electronic commerce”, the act of buying or selling products electronically using the internet, and is often used to refer to the sale of products and services online. Finally, the expression is also used to describe the platforms where these transactions take place.
What is e-commerce, and why is Latin America a good market for it?
What is e-commerce?
An online store, or e-commerce, is simply a website where you can sell products or services using the internet. The customer accesses the store through an electronic device (computer, laptop, smartphone, tablet), at any time or place, chooses the product, makes payment via credit card, online payment services or bank deposit and, after a certain shipping time, receives the product at home.
To be successful, an e-commerce platform needs to guarantee intuitive navigability and a 100% safe purchase for its customers, while making sure that they return to the store. In addition to value for money, quality of product and terms of payment, another factor has had a great influence on the purchasing decisions of Brazilians in recent years: the security of retail e-commerce platforms. As a recent survey by the Chief Marketing Officer Council’s Report points out, 6 out of 10 marketing leaders believe that the most critical demands from today’s customer are privacy and responsibility with their data.
Market opportunities for e-commerce in Latin America
E-commerce is growing fast in Latin America, one of the most mobile-friendly and internet-friendly regions in the world. According to a recent survey by the Regional Center for Studies for the Development of the Information Society (Cetic), the number of Brazilians who use the internet continues to grow by 3% per year, from 67% to 70%, which is equivalent to 126.9 million people. Brazil, Mexico and Argentina are all in the top 10 of global markets in terms of total time spent on the internet, with Brazil in second – with its population averaging 9 hours a day connected to the internet.
So what is e-commerce representing in LATAM? Opportunity. On the one hand, less than 1 in 4 people are online shoppers in Latin America, and e-commerce represents only 2% of the region’s total GDP. On the other hand, Latin America is the world’s second fastest-growing e-commerce market, expanding 25% annually through to 2021, according to Americas Market Intelligence. With many opportunities for expansion, e-commerce platforms both foreign and local have tremendous growth potential.
Important e-commerce facts
As mentioned before, e-commerce can involve any type of online transaction between two parties where a purchase is made. It refers specifically to the transaction of goods and services, and that’s easy to understand. However, what is e-commerce in terms of platforms? There’s a great number of e-commerce solutions and choosing the right fit for your business depends on your budget, preferences, and company needs. Is your business B2B, B2C, C2B, C2C? First of all, you have to understand your audience, their preferences and where they normally purchase their items.
If until recently the key to creating good experiences in online sales was to invest in personalizing experiences, today success lies in the transparency with which users’ personal data is captured and used, and especially in the way e-commerce is concerned with the exposure and privacy of its customers.
You don’t have to be a programmer or a computer expert to open a virtual store. In fact, store management can be very simple if you adopt an online marketplace to do it, instead of starting from scratch. The advantage of adopting a marketplace is that you don’t need any advanced computer skills or any type of programming knowledge to manage your e-commerce properly.
If you’re interested in doing business online, it’s important to stay up to date and understand what is e-commerce and all its possibilities. With plenty of room for growth, e-commerce platforms in markets like Brazil, Mexico, Chile, and other Latin American countries have found business potential in the region. Having an e-commerce platform is cheaper, better at targeting customers and more likely to succeed than focusing only on a physical store. Are you looking for some tips to get in the market with your business? Check out our 101 article about online Integration.
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