Mexico a Digital Oasis For E-commerce

Q: What challenges do clients in Mexico typically face when entering e-commerce marketplaces, and how does Lievant help them overcome these challenges?

A: We are an e-commerce agency that offers two types of services. The first is active management, which handles the operation of our client's digital businesses, except for fulfillment centers and logistics. We are responsible for everything from advertising campaigns to marketing and media strategy. We operate digital channels in marketplaces such as Mercado Libre, Amazon, Walmart, and Liverpool. Our other service is consulting. We help local and foreign companies enter Mexico’s e-commerce segment, including cross-border e-commerce. 

We offer different studies and strategies depending on the industry. Some companies require a business model analysis, while others only require strategies to maximize sales. We offer a comprehensive approach that covers most areas of e-commerce, including platform development, media buying management, SEO, active marketplace management, and everything related to creativity. We are prepared to address any content-related need, as well as any other requirement our clients may have.

Q: How does Lievant's business model maximize sales and give companies a competitive edge?

A: We are enablers that use mathematical formulas to understand how to drive business growth. We specialize in data analysis and business intelligence to understand how to maximize the effectiveness of digital businesses. We consider ourselves a digital performance agency because 95% of our clients hire us to achieve concrete results, such as increasing revenue or achieving profitability. Although we also work on brand positioning and concept creation, we generally work in collaboration with other agencies. 

Q: What unique opportunities or advantages does Mexico offer the e-commerce market?

A: Mexico’s e-commerce market is three times bigger than Argentina’s and four times bigger than Colombia’s. While Mexico's e-commerce figures are half of Brazil's, both countries compete in the same league thanks to Mexico’s growing middle class and significant purchasing power.

Mexico is competing in the major e-commerce leagues with an annual turnover of over US$30 billion. While the United States leads the global e-commerce market, with sales exceeding US$1 trillion, Mexico offers a wide universe of opportunities where business saturation is not so high, allowing it to generate good digital business. This situation represents an excellent opportunity for all companies that wish to come to Mexico and establish and develop successful businesses.

Q: How is the Mexican consumer evolving and how does Lievant change its strategies accordingly? 

A: The evolution of the Mexican consumer accelerated significantly following the pandemic. Before, about 30% of Mexicans consumed digital products and services; now, this percentage surpasses 60%. Mexicans have quickly adapted to the digital environment; however, there are still challenges. For example, Mexican consumers prefer marketplaces instead of company websites, which are preferred by EU buyers. For that reason, Amazon, Mercado Libre, and Liverpool control 85% of the e-commerce market in Mexico. Mexicans trust these portals and feel safe when buying through them, especially when making digital purchases for the first time.

Q: What key industry trends do you see in the e-commerce and marketplace sectors? 

A: Live shopping and videos will accelerate significantly. This strategy has been proven in China and is starting to grow in the United States. We have video channels in Mercado Libre and traditional social networks, such as Facebook and TikTok, which have become sources of traffic to websites. This means that shopping with influencers will be on the rise. 

The e-commerce sales formula will change with the entry of new media and players. In the future, it will be quite easy for anyone to sell online, even without the need to create an account in Mercado Libre or Amazon. Future sellers will use platforms such as TikTok, Facebook, or Google Shopping, leading to a much broader e-commerce ecosystem that will also lead to challenges, such as the need to implement effective security and control policies to prevent fraud.

AI will play a key role in advertising, product recommendations, emails, and all aspects of e-commerce marketing. In the next few years, AI will provide fully personalized product recommendations based on an individual’s shopping behavior, taste, and internet behavior. AI will become key in reaching digital consumers and offering new products.

Q: How does Lievant approach new technologies like headless commerce, customization, automation, and AI? 

A: We are constantly reinventing ourselves. Last year, we formed a dedicated 3D modeling team and focused on the metaverse and non-fungible tokens (NFTs). This year, we have focused on incorporating AI into our processes, which will play a crucial role in ad strategies and optimization. This evolution is supported by tools already in use, such as Google Ads and Facebook, which have been employing AI and machine learning for a long time. While AI will not radically change the industry, it will allow us to be much more assertive in what we do.

The popularization of AI took most companies around the world by surprise. We are working on understanding and applying AI in our operation, while simultaneously teaching our customers about it. It would be wrong to claim we are experts in the field because at present, no company can claim to have completely mastered this field.

Q: In the short and long term, what challenges and opportunities does Lievant foresee in the e-commerce and marketplace landscape? 

A: Mexico is clearly adding many new sellers to marketplaces. The country is among the Top 20 in digital presence but it is fifth in retail. Mexico is a "digital oasis," where there are many opportunities because there is still much potential for growth. Mexico now offers many opportunities but in three years, it will reach a point of maturity and limit its growth to less than 10% year over year. It will become like the United States, the United Kingdom, and Germany, which have more well-established shopping behaviors.

Q: What are Lievant's goals for 2024 in the Mexican market?  

A: Our goal is to drive the growth of Mexican companies in China. We are dedicating significant money, resources, and efforts to bring these companies to the world's largest marketplace: Tmall Global. One of our main objectives is to get a large number of Mexican companies to join this platform. We have been working on this for three years and now have an office and staff in Shanghai, China. We are focused on several categories, such as Mexican tequila.

Transactions in China amount to US$6 trillion per year, of which US$3 trillion are domestic transactions. Half of all global e-commerce takes place in the Chinese market. Despite any slowdown, the Chinese market is so large that some Mexican products have the opportunity to increase their sales by at least 10 times just by entering it.

Lievant is a consultancy that specializes in e-commerce and marketplace projects. It boasts over 13 years of experience and proven results in the market.