The 360° of e-commerce

On 9th December 2014, a group of executives in the e-commerce business participated in the discussion forum By Invitation Only (BIO), which took place in Integration’s Mexico City office. The objective of the event was to allow for the exchange of experiences and knowledge on relevant themes in an entrepreneurial context and create an opportunity for the guest to network.

The conversations were led by Diana Matute and Rodrigo Seabra, directors of the operation with experience in our Marketing & Sales and Implementation Practices. They began by presenting the challenges of the sector to debate the most important themes, such as logistic solutions, payment means, purchase experience and product offer, exposing a complete vision of the current problem in Mexico.

Read more on the points approached during the event

It can be affirmed that Mexico has potential for the development of online commerce when comparing sales penetration with internet access. However, most local companies still don’t have representative proposals for the development of an online sales channel, leaving the market with a long way to do until it is mature.

The expectation is that the market will present a strong growth in e-commerce over the next three years, with the entry of new players such as E-bay and Amazon, among others. The participants in the forum are anticipating that the compound annual growth rate (CAGR) for 2020 may be more than 16%.

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One of the key challenges that the sector presents is the payment means: credit card penetration; increase in the approval and reduction of the anti-fraud protection mechanisms applied by the banks for credit and debit cards.

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A latent opportunity is the marketing investments of a company in the sector, to balance the focus between increasing the traffic of single visitors in the online stores and improving sales conclusions (in Mexico this number is very low, approximately 0.5%). In some cases, it is more profitable to invest in improvements to increase the conclusion rate than increasing traffic of single visitors. This rate can be increased with small changes in images, product description and discounts.

On the other hand, logistic suppliers can become a key player in the development of this market, adding a lot of value in inventory order and management, considering the integration between several providers and points of reorganisation in an online store (wholesalers, transport, packaging campaigns, stores etc.).