Why is E-Commerce Booming in Brazil?

Why E-Commerce is Booming in Brazil

The average income of the Brazilian population has been increasing and Brazil has officially become a middle-class country. In fact, by 2020, Brazil is projected to be the fifth-largest consumer market in the world, ahead of France and the United Kingdom.

That’s a huge potential market. No wonder you want to do business in Brazil.

But wait, there’s more: more Brazilians than ever are online, and they’re not slowing down any time soon. Internet usage in Brazil is also exploding – and there’s a lot more room to grow. Brazilian Internet users grew from 40.7% of the population to 51.6% in 2013

If you compare these numbers to Europe (where it has pretty much topped out) and the US (where it’s getting close), it’s immediately apparent the potential for e-commerce is huge. More Internet users, with more income, means growth.

The bottom line is that Brazil remains the world’s second fastest-growing e-commerce market and is now Amazon’s biggest foreign market.

However, there are a few things to keep in mind before you move in for your piece of this rapidly growing market. First, because Brazilian consumers are late entrants to the world of e-commerce, they come with high expectations. They expect a seamless experience across all channels

Second, they are also very aware that Brazil is a huge market, so they expect their e-commerce experience to match their cultural expectations. In layman’s terms: they do not want to have to learn a different language and culture in order to be able to buy products. 

Overcoming the Culture Barrier

In previous articles we offered you actionable tips on how to do business effectively with Brazil and how to overcome the language barrier.

As Latin Post mentions, Amazon is a great example of what every e-commerce company should do to tap into this enormous potential. Among other things, the e-retailer plans to add Portuguese-language printed books to its Brazilian offerings this year, and will continue other initiatives to expand in the region. 

As Brazil continues to join the global Internet community, other digitally native/fluent U.S. companies that experienced incredible growth in the region last year — like Walmart Latin America, Adidas, and Netflix — will undoubtedly follow suit. 

For instance, Walmart is boosting e-commerce sales in Brazil by having a dedicated e-commerce team in São Paulo, Brazil, and spending on technology, logistics and customer care. Early in 2013, Wal-Mart launched its first national branding campaign in Brazil that reached an audience of 37 million consumers. The campaign focused on Walmart’s prices, online shopping security, product variety, product returns, and delivery guarantees.

Deploying better web technology and more targeted marketing are helping Wal-Mart grow faster online. “We are making the right investments in this space to differentiate ourselves and become a better Walmart”, Michael Duke, Walmart’s then President and CEO, told Wall Street analysts on an earnings call. These investments are paying off: “Over the last six months in Brazil, our walmart.com.br site has become the largest-traffic e-commerce site. For the first quarter, online sales in Brazil increased over 40%”. “In Brazil we were just named the number one trafficked e-commerce site,” he added.

So the key to success in Brazil is clearly understanding the market and targeting Brazil specifically – and that means speaking the language and understanding the culture (what Brazilians need and expect, and how to meet those expectations).

That’s where Street Smart Brazil can help: through Portuguese classes, in-company courses, intercultural coaching, and translation services – all of which you’ll need to truly tap into the incredible potential for e-commerce in Brazil. Try us out today: book a Trial Lesson.

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