13 May, 2019 BeOn

Online sales keep growing in Argentina: a review of 2018 results

Ecommerce keeps growing in Argentina. Online shopping became a common option for the Argentinian shopper: 90% of adults with internet access have made an online purchase at least once and 63% did it during last year. In this article, we analyze Kantar World Panel’s report about the evolution of eCommerce and the online shopper behavior in Argentina during 2018.

Kantar WorldPanel –in conjunction with the Argentinian Chamber for Online Commerce (CACE in spanish)- published in march their Annual Evolution Report for Online Sales. Conclusions were clear: online shopping became a regular and extended practice in Argentina. Not only the 63% of Argentinians made at least one online purchase during 2018 but also half of them did it regularly, that is to say, at least once per month. This tendency is increasing year over year: regular digital purchases went from 42% in 2015 to 49% in 2018.

Most consumers decide to buy online to save time and efforts. On one hand, the process is perceived as easier since they can order whenever and wherever they want and receive it at home at a specific time. Other customers choose the digital channel because it allows them to save time and to find the items they want faster than offline. Finally, with decreasing importance, there is price. It is worth noting that during last year, the most common disadvantages for online commerce -such as not being able to see the product physically, the need to pay with credit carda or delays in delivery- also decreased in importance.

What triggers online sales? Source: Kantar WorldPanel

What and how does the online shopper buy

The most required online categories in Argentina are Tourism and electronics. However, FMCG industry showed the most accelerated growth during last year. Food, beverages, cleaning, cosmetics and perfumery altogether had a total revenue of almost $26 million, a 12% more than total online sales.

Argentinian shoppers are using their mobile devices more often to do online research. There are not only looking for better prices but also more accurate information of products. While search engines -such as Google- are the most used, Market Places are gaining ground as a research option. Another increasing tendency is that purchases though mobile apps are also increasing their popularity, and growing faster than desktop ones, with a difference of 8 ppts.

Customers’ satisfaction with online sales is very high -around 98%- and the favorite option is home delivery, but only slightly above the pick up option, that keeps growing in popularity.

Different types of only shoppers in Argentina

Given the evolution of this purchase format, it is possible to differentiate three types of buyers. On one hand, 7% of customers can be classified as quotidian shoppers. They buy an average of 5 categories at least once a week, most of them are men with a high SES, and they usually do research and buy throughout their smartphones. On the other hand, regular shoppers make the 42% and consume an average of 4 online categories at least once a month. They are loyal users and highly value the previous purchase experience. Finally, the remaining 51% correspond to occasional shoppers: they buy at least 2 categories every 6 months.

Even though each category presents its particularities, all these shoppers have some common characteristics. Consumers are more rational that before, and they look for precise information, pay attention to special eCommerce dates when they organize they purchases and deliveries, and are continuously learning about the online scene. As a consequence, online content becomes a key point for all the companies that want to win online. They must focus their efforts in generating quality content in order to succeed.

2018 eCommerce results

2018 was an important year in terms of the growth of online sales in Argentina. Online sales increased a 47% from 2017 to 2018. These sales were distributed into 79 purchases orders, a 32% more than in 2017. Traffic grew 19% and 25% more of products were sold. This increment was driven by Food and beverages.

During the first semester, online incomes almost double (compared to the same period in 2017). The last Hot Sale incomes were a 97% higher, while online orders increased a 54%. Nonetheless, during the second semester, there was a deceleration of consumption: the CyberMonday generated an increase of 32% in incomes but only 40% in orders.

Despite the adverse economic context, the online channel keeps showing signs of an accelerated growth in Argentina, especially for FMCG categories. Shoppers are more interested and prepared for it than ever before and it is essential for companies to be ready to face all these new challenges if they want to win the online race. In the CPG industry, the digital channel grows 5 times faster than in traditional channels and this growth already represents the 20% of total growth. The industry is at its tipping point!

Source: Estudio Anual de Comercio Electrónico 2018 – Kantar WorldPanel y CACE