Latin America leads worldwide eCommerce growth“CAN countries” lead the world for eCommerce and mCommerce growth in next five years, new Worldpay data reveals
October 18, 2017
18th October 2017 – London — The global eCommerce market will grow at an average of 11 per cent over the next five years with Latin America leading the way, according new data from leading payments company Worldpay.
In its annual Global Payments Report, Worldpay found that the Latin American eCommerce market is set to grow at a CAGR of 19 per cent over the next five years, rising from US$59bn today to $118bn in 2021 – the biggest rise of any region1.
The research also found that the three fastest-growing countries for eCommerce are Colombia, Nigeria, and Argentina. These “CAN countries” are forecast to lead the world with annual rises in eCommerce of 31, 30 and 24 per cent respectively.
Worldpay’s research also examined the growth in mobile commerce, and found that total mCommerce penetration is set to rise from 38 per cent in 2017 to 47 per cent in 2021, driven by increased smartphone ownership and faster mobile networks. Latin America is set to be in the vanguard of mCommerce growth, with Colombia seeing a 64 per cent rise, and 45 per cent in Argentina – putting them in first and fifth position globally.
With its incredibly strong growth in both eCommerce and mCommerce, Argentina provides a fascinating case study that illustrates the rapidly rising Latin America market. In spite of a difficult economic history in recent years, Argentina benefits from an Internet penetration rate of over 80 per cent, and the largest proportion of mobile Internet users of all Latin American countries. The country is now on track to become an eCommerce powerhouse, on par with Brazil as early as 2024. Strong connectivity is helping to power the Argentinian eCommerce revolution, as the country’s recovery has taken hold thanks to the greater integration with world markets and economic deregulation that followed President Macri’s election in 2015.
According to the PEW Research Center, Argentina also benefits from a population with higher spending power and a larger middle class compared to its regional neighbours. These factors help to explain Argentina’s outstanding predicted growth in both eCommerce and mCommerce, and demonstrate the investment and growth opportunities for the world’s retailers and other merchants.
Shane Happach, Chief Executive Officer – Global eCom at Worldpay explained: “No-one can predict the global economic climate over the next five years, but we can be sure that consumer appetite for online and mobile shopping will continue to see extremely strong growth. The rise in smartphone adoption and the continued improvement in mobile networks have important implications for merchants looking to take advantage of an increasingly well-connected middle class with greater disposable income.
“However, it’s important for retailers to understand the idiosyncrasies of each territory. No two markets are the same in terms of the population’s preferred payments methods, and each has different regulatory requirements, mobile penetration and banking practices. That is why it’s so important that merchants do their homework before they invest in new countries to ensure that they make the right strategic decisions.
“With the right support, however, retailers can seize a unique opportunity to take a lead in these emerging eCommerce markets,” Happach concluded. Worldpay’s Global Payment Report 2017 report also highlighted how the payments landscape is continuing to fragment, with options such as bank transfers, cash on delivery and pre-paid cards stealing market share from more traditional methods like credit and debit cards. The research found that bank transfers are set to overtake both credit and debit cards as the second most popular global payment method behind e-wallets, adding an additional factor for retailers to consider when planning their eCommerce strategies.
Worldpay has published a list of guidelines for merchants looking to capitalise on the global eCommerce and mCommerce opportunity:
- Identify your priority markets and your business’s strategic ambitions for each country. Consider whether you wish to increase global reach, invest in mobile optimisation, provide recurring payments or subscription billing, or store consumer credentials for simpler repeat checkout. These factors and many more, depend on often complex cultural, legal and economic factors unique to each territory.
- Implementing new payment methods can bring both benefits and challenges – from a review of the website, new contracts, relevant payment providers, and in some cases, a sales process redesign. Compared to credit and debit cards, alternative payment methods have different operating processes for order confirmations, fulfilment timeframes, refunds, settlement of funds and overall user experience, so you will need to factor these into your business operations.
- Consider the most popular payments methods in each territory, and prioritise those which will complement your business model – there’s no one size fits all in any region so you’ll need to understand the best options for your company.
About the Global Payments Report:
This report has been compiled using a mixture of primary and secondary data sources. Primary refers to our own surveys and commissioned research; whereas secondary refers to authoritative third-party vendor data, and other publicly available data. The report also draws upon Worldpay’s decades of experience in providing global eCommerce solutions. The eCommerce projected growth figures contained in this report were sourced from GlobalData’s E-Commerce Analytics database and relate to the eCommerce industry as a whole, not Worldpay’s business. GlobalData collected this data using consumer surveys, B2B surveys and desk research. Any indicative predictions based on the data we have used should be treated as such.
Worldpay is a leading payments company with global reach. We provide an extensive range of technology-led payment products and services to around 400,000 customers, enabling their businesses to grow and prosper. We manage the increasing complexity of the payments landscape for our customers, allowing them to accept the widest range of payment types around the world. Using our network and technology, we are able to process payments from geographies covering 99% of global GDP, across 146 countries and 126 currencies. We help our customers to accept more than 300 different payment types. For more information, visit http://www.worldpay.com/global
For more information, please contact:
Global eCom Emily Lahey, PR Director +44 (0) 203 664 5663 email@example.com
Golin Nitesh Khetani +44 (0) 207 067 0128 firstname.lastname@example.org
Worldpay (UK) Limited (Company No. 07316500 / FCA No. 530923), Worldpay Limited (Company No. 03424752 / FCA No. 504504), Worldpay AP Limited (Company No. 5593466 / FCA No. 502597). Registered Office: The Walbrook Building, 25 Walbrook, London EC4N 8AF and authorised by the Financial Conduct Authority under the Payment Service Regulations 2009 for the provision of payment services. Worldpay (UK) Limited is authorised and regulated by the Financial Conduct Authority for consumer credit activities.
1GlobalData, refers to Argentina, Brazil, Colombia, and Mexico.