This week, the focus of our study will be the Mexican e-commerce market. We’ll discover the size, trends and growth prospects of this market. But before all, let’s learn about the Mexican economy and demographics in general.
Mexican economy and demographics in short
- Population: 128Mn people
- GDP/capita: $9,860
- 15th country in nominal GDP ranking
- 80% urban population
- Main industrial sector: automotive manufacturing
Now, let’s have a look at the e-commerce market of the second most crowded country in Latin America.
E-Commerce in Mexico
The Mexican e-commerce market is still infant, constituting only 3% of the total retail market.
Annually, the market generates $9Bn. This number is expected to hit $12Bn by 2023.
The country has a 68% internet penetration rate. With the government’s efforts to make domestic internet cheaper, the number rose 47% up to this point since 2013.
Consumer spending is on the rise since January 2018. 60.20Mn people shop online and the biggest share belongs to MercadoLibre, the local giant.
Trends in Mexican e-commerce
With an amount of $14Bn, Mexicans spend their money largely on travel services. And there is a 21% forecast of growth, again making it the leading sector. Electronics&media comes the second with a $2Bn revenue.
Facebook is the most used social platform. The addressable advertising audience is 86Mn people on Facebook, Instagram has only 22Mn. Therefore, advertising on Facebook is the most efficient among all social media platforms.
The busy daily lives of the urban Mexican population lead to an increase in money spent online on edible goods.
Even the internet penetration rates are low (68%) the decrease in smartphone prices has a positive effect on this number.
Different from most of the local e-commerce markets, Mexican people also have the option of ordering from mobile devices and paying later at convenience stores.
Advantages of the Mexican e-commerce market
Since it is an infant market, there is a lot of room for growth. The country’s e-commerce sales growth enjoyed a 35% growth in the past year.
Less than half of the population shop online, meaning, nearly 67Mn people are potential shoppers.
Insights to help you stand out from the competition
Since the online fraud rates are high, a secure local payment method can give your company leverage.
Mexican companies have relatively poor delivery services, compared to other local markets.
The average time for arrival is 10-15 days. If you provide a fast delivery service to the consumers, you can increase brand loyalty and attract new customers.
Hot Sale, El Buen Fin and Children’s Day are important days in Mexico’s retail market which online retailers can benefit from with the right promotion/discount plan.
Our research on Mexico’s online retail market reveals some useful insights:
- The market has low penetration rates but grows rapidly
- Advertisements on Facebook can reach up to 86Mn people
- Mexican government implements policies to promote e-commerce marketing, and the results are promising even in the short run
- Payment security is an issue that online retailers must lean upon
- A fast delivery service will give a retailer a significant advantage against its rivals