Why Mercado Libre grows while competitors slow

Over the past five years, Latin America’s e-commerce behemoth Mercado Libre held an average market share of nearly a quarter of all online retail sales in the region. It is likely to maintain such a position in 2022, according to an analysis by eMarketer, a market research firm.

But this steady performance is due to more than its marketplace platform.

While several retailers reported losses and saw online sales slow after robust pandemic-driven demand, Mercado Libre continued to grow. It posted a year-on-year increase of 61 percent in net revenue in this year’s third quarter.

Moreover, the company’s gross merchandise volume rose to 21.8 percent on a yearly basis, helping offset other players’ losses by infusing USD 4.44 billion into Latin America’s market in the first nine months of 2022.

“Our forecast expects 23 percent growth for the entire year. Assuming a decent Q4 performance, our estimates should be right on target,” Matteo Ceurvels, senior analyst for Latin America at eMarketer | Insider Intelligence, tells The Brazilian Report.

“Retail e-commerce sales in Latin America were slower than anticipated in the nine months of 2022 as macroeconomic headwinds began to take their toll on some – but not all – companies’ digital businesses. Mercado Libre falls into the latter grouping, where growth in GMV (gross merchandise value) remained in line with our overall projections for 2022,” Mr. Ceurvels observes.

Click here to read the full article.