Targeting New Online Customers in Brazil

Each year millions of Brazilian customers make their first e-commerce purchase, and this public represents a large opportunity for online advertisers. In this article we will trace the demographics of new e-commerce customers in Brazil.

Growth of the E-commerce Sector in Brazil

According to market analyst E-bit, the e-commerce sector gathered BRL 35.8 billion in revenue during 2014, which represents a growth rate of 24% since 2013. This is a sector that has actually experienced expansion rates higher than 20% for more than five years in a row, and is expected to reach BRL 43 billion in value by the end of 2015.

Many analysts suggest that Brazilians are feeling increasingly comfortable with the habit of online shopping. Causes for hesitancy such as fear of having a credit card number stolen or buying from a fraudulent store are giving way for the appreciation of the benefits that online shopping provides, such as the possibility of making purchases from home and comparing prices with ease.

A combination of factors from the Brazilian economy and the country’s telecommunications infrastructure have also contributed to the growth of e-commerce sales. For one, policies developed to ignite the Brazilian internal market during the last decade saw the rise of the middle class, known as C class. This segment is comprised of consumers who were previously unable to buy durable goods and are now in position and are willing to buy a variety of products, if they are able to find the best deals to fit their budget.

Also, the penetration of fixed broadband connections in Brazilian households increased substantially over the previous years, particularly in regions such as the North and Northeast, a factor that enabled many of these families to connect to the internet for the first time and make online purchase.

E-bit’s data indicates that, of the 51.5 million e-commerce consumers that purchased online in 2014, 10.2 million were first time e-commerce buyers. Reports indicate that the previous year saw the introduction of 9.1 million Brazilian consumers, and, as the sector of e-commerce should maintain the high growth rates from previous periods, millions of Brazilians are expected to make their first purchase in 2015 and beyond.

Profile of New Online Purchasers

A study from March 2015 by credit scoring service SPC Brasil discovered that certain gender and social class segments of Brazilian consumers were responsible for most of the first-time online purchases that took place during 2013 and 2014. Some of the factors that have led to the increased adoption of this sales channel include the offering of lower prices than what is found at traditional retailers and the increased confidence in using personal information in online environments to make payments.

Female Consumers

According to SPC’s survey, 23% of women who buy online made their first purchase through this channel in 2013 or 2014. Over the last decade, the share of female e-commerce consumers in Brazil increased substantially, driven by factors such as the launch of popular online stores in the segments of clothing, accessories and cosmetics. Some market studies also show that Brazilian women have pioneered in purchasing from mobile devices, and are currently the gender responsible for the most purchases made through smartphones.

Middle class consumers

SPC’s research indicates that 26% of all e-commerce consumers from middle to low social classes made their first online purchase during the last two years. In most cases, these are consumers who look for the lowest price when purchasing expensive products, such as electronics and find the highly appealing deals offered by online stores.

Age Groups

Interestingly enough, data from SPC’s survey shows that there are very similar rates of new e-commerce consumers across the three adult age groups presented. Whether between the age of 18 to 34 or over 50, close to 20% of adult consumers made their first online purchase during the last few years.

Although the rate of new e-commerce buyers is similar between these age groups, the reasons for the adoption of this sales channel should be more diverse. For example, consumers over the age of 50 are most likely to have made their first online purchase after gaining confidence in the security methods provided by a particular store, while younger buyers commonly purchase online for the first time after gaining access to payment methods like credit cards.