The e-commerce sector shows its resilience in the Brazilian market as new research from Mintel estimates that e-commerce sales are set to grow 10% this year, reaching a total value of R$57 billion by the end of 2017. While a marked improvement over the estimated 7% growth seen in 2016, e-commerce sales have slowed significantly in recent years compared to the 23% growth in 2015 and 25% growth the market experienced in 2014. Despite this slowdown, market performance is positive considering the economic crisis the country has faced over the last three years. Looking forward, Mintel predicts the e-commerce market in Brazil to grow on average 10% per year to reach R$93 billion by 2022.

Amongst the market barriers, Mintel reveals that online purchase delivery is considered too expensive by 49% of consumers. Providing personal information on the internet can be another issue for the Brazilian consumer, with 31% saying that they don’t feel safe providing their bank account/credit card details to online retailers. Women seem to be more concerned with this than men as 34% of women say they feel this way compared to 28% of men.

Overcoming the high prices associated with delivery is a huge barrier in the Brazilian e-commerce market. In the United States, we see retailers encouraging consumers to collect the products purchased online in store in exchange for a discount. Regarding gender difference behaviour pattern, brands that have physical stores could offer the option for women to be able to pay directly at the store in an effort to ease their concerns with sharing personal financial information online. Brands that do not have physical stores could make partnerships with physical channels (for example, banks, libraries) to offer alternatives of safer payments,” suggests Juliana Martins , market research specialist at Mintel.

Desktops and laptops take the lead as the preferred means of online purchasing. Mintel reveals that most of Brazilian consumers have bought online using a laptop or desktop computer (57%) or a smartphone (48%), in the 12 months to April 2017. Only 18% of Brazilians have made purchases online using a tablet in the same period of time.

Brazilians aged 25-34 are also the main online buyers using smartphones (58%) compared to those aged 35-44 (49%).

These figures suggest that there are opportunities for brands in different categories to target younger audiences. For example, Mintel research on Brazilian Millennials reveals that 53% of old Millennials (aged 28-35) search or watch the news via a smartphone. Furthermore, 60% of consumers aged 28-35 search for products using this device. In addition, ads on smartphones can appeal to older Millennials, so advertising in news and research apps could attract these consumers,” Juliana concludes.
Some Brazilians may be interested in promotions for tablets’ apps, including cosmetics

In the Mintel survey, among the Brazilians who said they had made online purchases through tablets, 45% said they had bought bought hard-copy books, CDs, DVDs, and video games and 32% have bought toiletries and cosmetics in the 12 months prior to the survey (April 2017 ).

Despite not being the most widely used device by Brazilians for purchases online (only 18% have used tablets to shop online in the 12 months to April 2017), its users do buy certain products through it. Companies that work with downloads of books, music, and video games and that sell beauty and personal care products have the opportunity to create apps for tablets in order to boost sales. Advertising the app functionality in stores, and offering special deals for those who download it, can attract users to this sales channel.
 Online purchases, by selected products and electronic devices – Brazil, April 2017

“Which of the following, if any, have you bought online in the last 12 months? Please select all that apply.”

Base: 1,082 internet users aged 16+ who have made purchases online in the last 12 months

Mintel_Fig1English

Source: Lightspeed/Mintel

Paths to Purchase Online

Showrooms can make products more accessible to consumers

The experience of buying online is not always that simple. For example, some consumers visit a physical store before purchasing a product online. Mintel reveals that this is true for 37% of Brazilians when buying electrical appliances, 35% when buying clothes, and 31% when buying toiletries/fragrances/cosmetics.

One of the barriers cited by consumers for purchasing online is precisely the fact they prefer to try the product in person before buying (eg sample beauty products, taste food products). According to the survey, 22% of Brazilians agree with that. Thus, the experience of buying online can be damaged.

One solution is to create showrooms for products to be as close as possible to the consumers. This was done by Oppa, a home décor brand. Their products used to be sold online only, but now consumers can go to one of its stores and see the products. The American brand Bonobos, which sells men’s clothes, works as a showroom where customers try the products chosen online and request adjustments if necessary. Warby Parker, American brand of eyeglasses, is unique in its sales strategy. It sends some models of glasses to where the customer wants, so customers can try them, ask the opinion of family and friends and decide which of them they will buy.

Having a physical store can, therefore, add value to the product and increase customer loyalty.

Paths to purchase online – Brazil, April 2017

“Which of these actions would you be likely to take when planning an online purchase for the following products? Please select all that apply.”

Base: 1,500 adults aged 16+

Mintel_Fig2_English

Source: Lightspeed/Mintel

Social media increases traffic to e-commerce websites

Women are more likely than men to use social for recommendations (eg Facebook, blogs) when they want to buy clothes and toiletries/fragrances/cosmetics online. The survey shows 24% of women use these online channels to buy clothes (versus 19% of men) and 17% use them to buy beauty products (compared to 12% of men).

Social media and bloggers have been increasingly used by brands to attract consumers to buy their products. The use of social networks such as Facebook, Instagram, and YouTube increases traffic to e-commerce websites of all sizes, and nowadays it is imperative that companies have pages on these social media channels to strengthen the relationship with customers.

Paths to purchase online – Brazil, April 2017

“Which of these actions would you be likely to take when planning an online purchase for the following products? Please select all that apply.”

Base: 1,500 adults aged 16+

Mintel_Fig3_English