Post-COVID Digital Commerce in Latin AmericaBy Santiago Naranjo | Thu, 08/25/2022 - 12:45
When we talk about digital commerce today, we cannot ignore everything that happened in 2020, when the most important developments occurred in the sector and where Latin America played a crucial role from the get-go. Latin America is a region where many retailers, companies, and brands have understood the great demand that exists in the market. In addition, they have also had the opportunity to increase their market share, whether nationally or internationally, through easy, efficient and profitable solutions, such as marketplaces and Live Shopping as well as unified, and conversational commerce.
These methods — just to mention a few — have become essential tools for organizations and their global business strategy. Here are some standouts and their best attributes:
Marketplaces: Regardless of the industry, marketplaces can be considered a way to collaborate with sales and distribution partners to expand product assortment and increase sales. Entering marketplaces is currently a trend, driving the adoption of ecommerce around the world. Companies that have adopted a certain marketplace business model obtain added value benefits, such as larger customer bases as well as cross-selling and up-selling opportunities with a broader catalog and an easier fulfillment process.
Live Shopping: This is considered an increasingly popular method, even in the B2B sector. It is not only a live shopping experience but can provide additional results once the sale occurs. In addition, it can include technological developments within a commercial strategy as well as facilitating their implementation.
Conversational Commerce:In Latin America, people increasingly use WhatsApp more than the general global average. If there is one thing social distancing demonstrated, it is that human beings value and need social interaction, which is why many online retailers use Artificial Intelligence (Al), social media tools and personalized customer service strategies to enhance the online shopping experience. In a post-pandemic digital age, contactless services are gaining in popularity across the world.
Unified Commerce: Within an omnichannel methodology, we use and identify sales channels as the main tool for integration and logistics. By having a unified commerce, we consider the customer as the main actor who provides us with valuable information regarding their purchasing experience, simplifying processes within the digital commerce platform.
Success Speaks for Itself
Now that we have briefly addressed some trends, we can take a look at some regional success stories, considered today examples for the entire world.
One example is Victoria's Secret, which developed a unique “Click & Collect” system, referring to online purchase and store pick-up. The aim is to develop an effective same-day delivery service experience while increasing upselling percentages. As a result, a high number of customers quickly adopted this system, thus improving their experience, increasing store-traffic as well as sales. Today, “Click & Collect” represents approximately a quarter of online orders and a significant percentage of those customers end up buying other products.
BRF, one of the biggest food companies in the world present in 127 countries, also adopted a B2B marketplace system, considered a new transactional channel, targeted for launching and displaying new promotional products to their business customers. The strategy will allow them to double its presence in the region, in addition to offering a high level of market segmentation and niches, establishing relationships with clients, allowing them to reach an audience that the company could not access outside the internet.
Samsung, another company with relevant achievements in the digital area, has recently shared its implementation of Live Shopping, highlighting its event in Mexico where it launched the new Galaxy S22 5G. It sold more than US$1 million in gross merchandise value, with approximately 12,000 viewers participating over just a 54 minutes session. Together with Samsung, companies such as Grupo Éxito, Frávega, Sony (in Latin American countries Argentina, Brazil, Chile, Colombia, Ecuador, Mexico and Peru), Nestlé and Coca-Cola in Chile, KitchenAid, Totto and Grupo Cencosud in Colombia have garnered a great deal of success applying this modality due to its potential to increase conversion rates.
Innovation goes hand in hand with integrating an increasing number of digital transformation solutions and establishing partnerships with platforms like VTEX. The objective is that big brands and retailers offer their best services and experiences to their customers.
Good relationships with partners are fundamental to keep yourself well-informed about the newest and best technology options available, and to obtain optimal developments in security and logistics, along with efficient payment options, especially in ecommerce. This is why events, whether virtual or face-to-face, are an essential networking tool, these days. One example is VTEX CONNECT LATAM 2022, an event with networking opportunities aimed at providing a major push to the sector and where business and technology complement each other, offering a detailed vision of where current digital technology trends are heading as well as providing guidelines for real-case implementation studies for companies throughout the region.
Today, there is a great deal of economic uncertainty worldwide; therefore, convenience becomes a key factor for companies to foster different initiatives, become creative and dare to provide transformative solutions that add value.
Three of the 10 fastest-growing ecommerce markets in the world can be found in Latin America: Argentina, Brazil and Mexico, with the latter having an incredible market share and playing an extraordinary role since it connects North and South America. In addition, Mexico has one of the highest rates of new digital consumers. According to the latest study by eMarketer, it is expected that the ecommerce market in Latin America will almost double in size by 2026. This is a sector that is not slowing down and has great development potential, whose professionals and followers seek spaces to exchange knowledge and opportunities that will strengthen their businesses.