Mexico has a population of 128 million and is the second largest economy in Latin America after Brazil. As a previously neglected market, why is it now regarded as a “gold-digging” holy land for e-commerce?
1. Increased Internet usage equals more e-commerce opportunities
A major reason that previously restricted the development of e-commerce in Mexico was the low Internet usage rate, but now the situation has changed. The rapid increase in Internet usage has enabled more Mexican users to shop online, and 75% of Internet users said they want to buy goods online.
2. Mexicans’ attitude towards online shopping has changed
Lack of online shopping experience and concerns about safety have always been obstacles to Mexican consumers’ online shopping. As online shopping continues to become more popular, consumers are becoming more and more confident in online shopping. Data shows that the scale of B2C e-commerce in Mexico has increased by 400% in the past five years, with online shopping transactions of US$7.312 billion in 2017 and reaching US$9.224 billion by the end of 2019.
3. Credit card users are gradually increasing
The relatively low credit card usage rate was once one of the factors hindering the development of e-commerce in Mexico. To this end, relevant Mexican institutions have taken some measures to increase the proportion of sales terminals that can accept bank card payments, and online shopping payment technology has also been improving. However, many Mexican consumers still hope that there are other ways to replace bank card payments, such as cash on delivery, bank transfers, and e-wallets.
Although Mexican consumers use various devices to browse products, most still prefer to shop on desktops or laptops, and 86% of online shopping occurs on computers.
4. Mexico’s low-end consumer goods are expensive
Mexico has a large population, but most people tend to buy low-priced products. Mexico’s income is very uneven, and the income of ordinary workers cannot afford high-priced products. It can be seen that low-priced products have great potential in the Mexican market. Most Chinese products are of good quality and low price, and low-end products can also obtain relatively lucrative profits. Like many emerging markets, young people aged 25 to 35 are the main consumers, and the main consumer categories are beauty, 3C electronic products and accessories, furniture and kitchenware, and toys. With the continuous development of Mexico’s economy, leisure and sports products have also shown huge market demand.