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MARKETPLACE FOCUS: MERCADOLIBRE

25 May 2015

About MercadoLibre

MercadoLibre is an Argentinean online marketplace, and Latin America’s number one ecommerce site. It is currently present in 13 countries, including Argentina, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Mexico, Ecuador, Peru, Panama, Portugal, Uruguay and Venezuela. After eBay acquired 19.5% of MercadoLibre back in 2001, the marketplace became eBay’s exclusive partner for the Latin American region.

At the end of 2014, MercadoLibre reported a net revenue of $557 million, gross merchandise volume of $7.1 billion, enjoyed more than 121 million registered users and sold over 100 million items. Today, over 155,000 people make a living from selling on MercadoLibre, and more than 28% of Latin America’s internet users access the site every month.

MercadoLibre and Latin American ecommerce

Although a lot of consumers in Latin America are still very uncomfortable about buying online, that trend is changing fast. The number of online buyers in the region is expected to increase from 33.5 million in 2014 to 61.8 million by 2019.

In Brazil, for instance, the most mature ecommerce market in the region, business-to-consumer ecommerce sales are expected to increase from $17.8 billion in 2014 to $40.8 billion in 2019. Similarly in Argentina, the second largest market, ecommerce is set to grow from $3.4 billion in 2014 to $8.3 million in 2019, and the country will have 12.6 million online consumers, up from 7.8 million in 2014.

Is MercadoLibre for you?

Latin America, as region, is characterised by a rapidly growing middle class eager for a larger selection of quality goods; so merchants who target this segment, can be extremely successful when selling on MercadoLibre.

MercadoLibre offers a variety of items and services. Registered users are also able to list and purchase motor vehicles, vessels, aircraft, real estate, and services through online classified listings.

Four types of seller subscriptions are offered by MercadoLibre: Premium Gold, Gold, Silver and Bronze. Each subscription has respective listing fees depending on a product’s place in the search results, value of the item, coverage on category page, coverage on home page and promotion on other listings. MercadoLibre offers mixed subscription packages, as well, so a seller can have listings in across all four bands.

What does MercadoLibre’s offering include?

MercadoLibre’s automated online platform enables businesses and individuals to list items and conduct their sales and purchases in a fixed-price or auction-based format, with the preferred selling option (80% of purchases) being fixed price.

There are various methods for paying for items, such as credit cards, money on orders and MercadoPago, an integrated online payments solution offering users a secure online transaction. MercadoLibre also has its own shipping program, called MercadoEnvíos.

MercadoLibre has launched a cross-border trade programme, which started in the US, and will be expanding to UK and Canada later in the year. The programme is currently available for sellers present on MercadoLibre Brazil and Mexico, with Chile and Columbia coming up next. It requires no set-up fees and offers multiple integration options, enabling sellers to ship both ways – directly to buyer (DDU/Parcel), or to a local address (DDP/Freight-forwarding service), with MercadoLibre taking care of foreign exchange and local payments through Mercado Pago.

MercadoLibre also offers four other complementary services to its member companies:

  • MercadoShops, allow companies that use MercadoLibre to create their own personalised online store within the website
  • MercadoClicks, is an advertising service that enables companies to promote their products and services on the Web
  • MercadoSocios, is a partners programme that allows websites to accumulate benefits through MercadoLibre’s online promotion
  • MercadoSolidario, is a feature where foundations and non-profit organisations sell products or organise charity auctions, without paying any fees to MercadoLibre, as part of its fundraising activities

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