A new study commissioned by FedEx and conducted by Forrester Consulting reveals that online shopping has largely taken hold in Colombia, and other Latin American markets. Worldwide, online shopping has exceeded $1 trillion (USD) per year, and is forecast to double again in four years.
The study, “Seizing The Cross-Border Opportunity,” conducted to better understand global purchasing behavior in cross-border e-commerce, found that in the Latin American and Caribbean region, 64 percent of consumers who buy online regularly make between 10 and 50 percent of their monthly purchases for items online. Among the most popular purchases around the world and in the region are clothing and apparel, along with books and cosmetics.
The findings show that Latin American e-shopping trends are largely influenced by the region’s craving for U.S. online merchants’ products and their accessibility to them via online and mobile channels. Additionally, Latin American consumers show higher esteem than the global average for small and medium sized enterprises (SMEs or PYMEs in Spanish) when sourcing products to buy online. In Colombia, catalogs are a popular way of discovering online merchants, much more so than any other Latin American country surveyed. The study also found a significant part of e-commerce involves cross-border shipments.
64% of consumers in the global survey who buy online regularly make between 10 & 50%of their monthly purchases for items online
“These findings reveal the opportunity that exists for small and mid-size businesses to enter the global commerce play by means of online and mobile platforms, and highlight how they can take full advantage of regional differences to expand their business beyond their borders,” says D.J. Miller, vice president of Marketing, Customer Service and Retail for FedEx Express, Latin America and Caribbean Division.
For the study, researchers surveyed more than 9,000 respondents in 17 countries and territories, including Mexico, Brazil, Colombia and Puerto Rico, as well as conducted interviews with small and medium sized businesses with cross-border operations.
29% of Colombians who shop online spend over $100 US per year on internet purchases
56% of Colombians prefer credit / debit cards as the preferred method for online payments
Only 28% of Colombians are concerned about the inability to track packages online
62% of Colombian consumers prefer to support small businesses online, a greater affinity than in any other Latin American country
Consumer survey participants included those aged 18 or older who have ordered a physical item shipped to themselves or another recipient over the internet within the past 12 months. Small and medium-size business interviewees were asked about the factors leading to their decisions to start an international e-commerce business, their experiences and challenges with fulfilling such orders, and the factors that may enable them to expand this practice. The study took place between July and September 2014.
One considerable brake on the growth of online shopping remains the lack of free-trade at the consumer level, with duties, tariffs, and customs issues remaining an impediment. 35 percent of global respondents cited high duties and taxes as a concern for cross-border shopping. 56 percent of global respondents would increase their cross-border shopping by 26 to 75 percent if purchases under $200 (USD) were duty free.
“The results of this study on global trends suggest that simplifying regulations just by harmonizing duty free limits across the globe could result in significantly more cross-border trade, benefitting consumers and businesses around the world,” said David Cunningham, chief operating officer and president, International, FedEx Express.