Peru, one of the fastest growing economies in Latin America, is showing a bright future as an emerging e-commerce market.
LMZ123 was informed that, according to a report by Euromonitor International,
And this means that the Peruvian e-commerce market is still a fertile land worth investing in online retailers. So what is the current situation of the cross-border e-commerce market in Peru? If you want to set sail against the wind and do a lot of work, how should you start?
Overview of the Peruvian e-commerce market
1. Dream secret, e-commerce dark horse
There has always been a saying in the cross-border circle, "Latin America may be the last blue ocean of cross-border e-commerce".
According to eMarketer data,
Peru, as a cross-border e-commerce market with great growth potential in Latin America, undoubtedly attracts sellers from all over the world.
In the past two years, the rapid development of e-commerce in Peru has been mainly driven by the epidemic. LM123 understands that according to Capece, Peruvian e-commerce sales will increase by 55% year-on-year to $9.3 billion in 2021. Peruvian e-commerce sales accounted for 4.5% of total Peruvian retail sales in 2021.
Meanwhile, 41.8% of Peruvians (13.9 million) shopped online in 2021. Before the outbreak of covid-19, the proportion was only 18.6% (6 million). The number of new buyers also increased in 2021, by 30% compared to 2020, but the frequency of purchases was lower than in the capital Lima.
Brazil's population base is large, which is the cake that foreign traders want to win, and its competition can be imagined. Argentina's exchange rate fluctuations in the past two years have deterred many foreign traders and cross-border e-commerce sellers. Peru, by contrast, is one of the markets with little attention but great potential.
At the same time, the huge market potential has also prompted cross-border sellers to bet on online channels. More than 260,000 Peruvian companies sold through online channels in 2020, increasing to 300,000 in 2021. More than 90,000 of them have trading sites.
The penetration of the Internet has also further promoted the development of e-commerce in Peru.
2, mobile online shopping, strong consumption
As digitalization accelerated, online shopping became popular in Peru. Given the convenience of online shopping, as well as the ability to provide more discounts, coupled with the improvement of the return policy, consumer demand for online shopping has greatly increased.
LM123 was informed that, according to Linio's sales data, online sales in Peru increased by 56% during promotions such as CyberWow. With coupons and welfare subsidies, the average online shopping expenditure of Peruvians has also increased by 25%.
At the same time, peru has seen a significant trend towards online shopping mobility, with an increase in the use of social networks to purchase products and services.
According to a study by BlackSip, 58.6 percent of Peruvians prefer to shop online via smartphones and 27 percent prefer to shop online through a computer. The proportion of online purchases made via mobile devices is expected to rise to 73% in 2022.
In addition, 57% of respondents chose e-commerce platforms as a purchase channel, 48% of respondents purchased online through Facebook, and 42% of respondents purchased online through mobile applications.
3. Strategic layout and division of the market
a. Amazon
Amazon's Web Services Division (AWS) announced that it will make Peru the headquarters of a global public cloud infrastructure hub as part of Amazon's expansion strategy in Latin America.
Amazon said AWS will install computing, storage, databases and other cloud-related services around the populous, industrial and information technology hub in Lima, Peru. Amazon's huge investment in Peru's infrastructure and digital platform will open the door of opportunity for Peru's digital development, supporting Peru's economic recovery, digital entrepreneurship and digital transformation process.
LM123 learned that the new AWS Local Region for Peru will join the 16 existing AWS Local Regions in the United States.
b、ebay
LM123 learned that eBay announced a partnership with DHL Express to help Peruvian entrepreneurs enter the international market, providing various supports including sales, logistics, traffic and so on.
Through this partnership, customers under DHL Express can set up shop on eBay and have access to a variety of inexpensive quality services and professional guidance to successfully build an online presence on eBay.
In addition, eBay sellers can also get preferential prices for dhl Express express service, and sellers will see a range of options offered by DHL Express in the shipping options to get the product to the customer as soon as possible.
Adriana Azopardo, manager of DHL Express, said the partnership with eBay builds on the booming e-commerce boom in Peru and opens up opportunities for local businesses to sell in foreign markets. In addition to the state-of-the-art logistics services offered by DHL, the company will also target eBay's more than 147 million active buyers in 190 countries.
c、Falabella
Falabella is strengthening its digital e-commerce strategy in Latin America and has launched three measures to achieve its goals.
The first step is to optimize Seller Central. Bottazzini, CEO of Falabella, said: "We are improving our ability to interact with buyers and optimize our ability to track sales and inventory, which will also help attract sellers."
At the same time, Bottazzini revealed that Falabella.com will be launched in the Peruvian market in the second half of the year and will be officially launched in Colombia in early 2023.
Third, Falabella is also developing its Pilot Falabella Directo service, which allows sellers to deliver orders the same day or the next day. Management said the feature will be widely implemented in the coming months.
LM123 understands that from Falabella's investment plan of $711 million in 2022, $418 million (60%) will be invested in technology and logistics. Another 40 percent will invest in the development of brick-and-mortar operations in Chile, Colombia, Mexico, Brazil and Peru. Bottazzini also highlighted that the investment plan for 2022 will also be committed to continuing to promote e-commerce and launching new features to bring SMEs into the platform.
The development trend of the Peruvian e-commerce market
1. New development of logistics
LM123 was informed that
99Minutes is a logistics transportation and last-mile delivery company that currently has operations in Mexico, Colombia, Chile and Peru, and 99minutos processes more than 15 million packages per year for e-commerce companies and thousands of e-commerce brands.
Currently, 99Minutes has started operations in Arequipa, Chiclayo, Trujillo and Piura, and has warehouses in these four cities with an area of between 120-200 square meters.
As the first phase of gaining a foothold in the Peruvian market, 99Minutes will collect products from its customers' warehouses in the provinces, followed by delivery services to buyers.
Meanwhile, LM123 learned that Linio recently decided to expand the distribution center from 9,200 square meters to 11,600 square meters to meet the growing demand for package handling. In addition, in addition to expanding storage space, Linio will also speed up shipments.
2. The new pattern of payment
Since the beginning of the epidemic to the current stage, the e-commerce market in Peru has undergone a transformation. Before the pandemic, 12.5% of transactions were paid for by bank card, but now that share has reached 40%.
CAPECE pointed out that more and more people are using bank cards to pay, and in 2020 the main payment method is through debit cards, mainly because many consumers do not want to be saddled with debt, but in 2021, payment methods through credit cards have become the main means of payment. From the data point of view, the transaction amount paid through bank cards is 6.3 billion, of which the amount paid by debit card is 3.2 billion and the credit card is 3.1 billion.
At the same time, the payment method of e-wallet is also being accepted, and more and more people are using this method to pay. At present, the payment method of e-wallet has become the third largest payment method in e-commerce transactions, and the transaction volume has reached 2 billion.
It is also necessary to mention the transaction method of cash payment, which has reached 730 million transactions in 2021, and the cash payment platform business dominated by PagoEfectivo and SafetyPay is also continuing to grow.
In summary, for cross-border sellers, entering the Peruvian market and opening up Peruvian channels requires sufficient homework. Only by understanding local policies and market conditions and familiarizing themselves with local consumers' purchasing habits and payment preferences can we better cope with market challenges and achieve profitability.