The seller achieved monthly sales of 400,000 US dollars in 4 months, and a new cross-border blue ocean emerged!

In the cross-border overseas market, competition in Europe and the United States is increasing year by year, and sellers are busy looking for emerging e-commerce markets to create new growth curves.

With the help of the epidemic as an accelerator, Latin America stands out. In 2022, Latin American e-commerce will lead the world with a growth rate of 20.4%. Among them, the e-commerce penetration rate in Mexico, Brazil, Chile and Colombia is higher than 50%, and there is huge room for growth. Industry giants such as Yibai Network and Tongtuo have entered Latin America, and the former has also listed the leading platform Meikeduo as a key development platform.

Latin American consumers are very receptive to Chinese products. Chinese sellers have become frequent customers in the top categories on Meikeduo . A domestic tool brand has achieved monthly sales of 400,000 US dollars in just 4 months. The new blue ocean has attracted many sellers to stop by. Consumer electronics, sportswear, auto parts, etc. are all hot-selling categories. What new trends are there in product selection on the platform? Let's find out.

Latin America becomes a new blue ocean for cross-border transactions, and Chinese sellers are "surging"

The pandemic has taken a big step forward for global e-commerce, and its impact on Latin American consumers has far exceeded that of other regions. Out of necessity, many people have completed their first online shopping, buying necessities such as groceries, household goods and clothing. These changes have continued, making Latin America one of the fastest growing e-commerce markets.

According to research firm Statista, Latin America has more than 300 million online buyers, a figure that is expected to grow by more than 20% by 2027; in 2022, online retail sales in Latin America are estimated to reach $168 billion, and will account for nearly 20% of total retail sales by 2026. At the regional level, Brazil and Mexico are vying for the lead, each accounting for nearly 30% of the Latin American e-commerce market; in addition, economies such as Argentina and Colombia are also growing rapidly.

To make money in emerging markets, third-party platforms are an indispensable bridge. Mercado Libre is one of the top ten e-commerce platforms in the world and the largest e-commerce platform in Latin America. In 2022, its GMV reached US$34.449 billion, a year-on-year increase of 22%; 148 million independent active users, a year-on-year increase of 6%; 1.147 billion items sold, a year-on-year increase of 13.2%. Many cross-border sellers use it as a channel to open the blue ocean of Latin America.

Made in China is very popular in Latin America. Aaron, business development manager of Meikeduo South China , said that the average spending power of Latin American consumers is lower than that of European and American consumers, but higher than that of Southeast Asian and African consumers. Chinese products generally have certain advantages in product quality and cost-effectiveness, which is in line with the needs of Latin American consumers.

"On the Mexican site of Meikeduo, Chinese sellers' own brands have been pushed to the forefront in the categories of smart wearables, mobile phones, tools, auto parts and some shoes and clothing. Often one or two of the top three categories are Chinese brands. From this perspective, Chinese products and Chinese brands are highly accepted in Latin America.

Take tools as an example. Before we recruited Chinese sellers, most of the sellers on the platform were first-tier European and American brands. In 2021, a Chinese industrial and trade integrated seller entered the market and surpassed the first-tier brand sellers who originally occupied a certain market share that year.”

Monthly sales of 400,000 USD in 4 months, these products are hot selling

Meikeduo has presence in 18 countries and regions in Latin America, including Mexico, Chile, Brazil and Colombia, which are open to Chinese sellers. In many of its sites, 3C, home furnishings, personal care, tools, auto parts and other products are hot-selling categories, which are also the specialty products of Chinese sellers.

At the end of 2020, after conducting a comprehensive product research, a tool brand directly sent a large number of goods to overseas warehouses, and achieved monthly sales of 400,000 US dollars in April 2021, upgrading to a brand official store; its sales have since increased even more, and it has become the number one store in the category. In June last year, a 3C brand applied for a Meike multi-store, and by the end of the year it ranked first in the smart wearable category, which is amazing.

At present, the 3C category of Meikeduo is relatively saturated, and the number of sellers who can enter the market and successfully take a piece of the pie is relatively limited. Sellers without a supply chain will find it difficult; but in the categories of clothing, maternal and child products, and auto parts, the proportion of Chinese sellers is still rising.

Which categories have the fastest sales growth?

In 2022, the top three sales categories of Meikeduo Mexico Station were home furnishings, apparel and sports, and consumer electronics. The annual growth rates of the three categories on the site were 35%, 32%, and 20% , respectively. The GMV of cross-border sellers of home furnishings and apparel nearly doubled, and 3C sellers, who already had considerable performance, also saw an increase of more than 30%.

In the same year in Brazil, the top three categories in sales were auto parts, home furnishings, and apparel and sports, with annual growth rates of 38%, 32%, and 26% , respectively. The growth of apparel and sports was particularly prominent. The total GMV of cross-border sellers doubled in 22 years, and the overall annual growth rate of the GMV share of cross-border sellers increased.

Aaron said that among many categories, auto parts and motorcycle parts are relatively in line with the selection criteria of high demand + low saturation. "Latin America has a relatively large demand for car and motorcycle repair and replacement parts, followed by automotive supplies. The local consumption is considerable, but auto parts and motorcycle parts have a certain threshold, and there are relatively few professional sellers."

Diverting Chinese sellers, Meikeduo "favors" brands

Among cross-border e-commerce platforms, the entry threshold of Meikeduo is not low. Sellers must achieve monthly sales of 20,000 US dollars for a single store on other platforms, or a total sales of more than 30,000 US dollars for two stores.

In 2020, Meikeduo opened the "overseas warehouse + self-delivery" dual mode in Mexico, which became the first stop for most Chinese sellers to go overseas to Latin America. Aaron admitted that due to this, the number of Chinese sellers on the site increased, and some categories have reached a certain threshold and started to "squeeze" prices. Categories such as 3C may require sellers' products to have a certain degree of differentiation.

However, at the beginning of this year, Meikeduo also opened its Chilean overseas warehouse model to Chinese sellers. Meikeduo has high hopes for this relatively blue ocean market and hopes to bring high-quality sellers into the Chilean market during this year's recruitment.

"At present, the competition in the Chilean market is relatively relaxed, and the overseas warehouse model has been opened, which is an opportunity for Chinese sellers."

Aaron prefers branded boutiques in the two operating modes of general distribution and boutiques . "Many powerful sellers are doing general distribution in the form of branded boutiques. They may have covered all categories, but each category is entered with a brand. In comparison, it is more difficult to grow with low capital and pure general distribution, because the success rate of product selection varies, and those who can stand out in each category are all branded boutiques."

The platform is also trying to show favor to brand sellers. With the rapid growth of Chinese sellers, Meikeduo hopes to allocate more resources to brand sellers.

This year, Meikeduo has a new policy: Chinese sellers who sell in the form of brand flagship stores on other platforms and have monthly sales of more than 60,000 US dollars will have the opportunity to directly open a brand flagship store of the same category for sales when they enter Meikeduo. Before this, all brands entering Meikeduo must start as ordinary stores. In some relatively saturated categories, sellers may need to achieve monthly sales of 100,000 to 150,000 US dollars before upgrading their stores.

With Meikeduo as a bridge, more than 10,000 Chinese sellers have entered the Latin American market. Want to know more about the platform and the trend selection in 2023? Scan the QR code below , register for the meeting, and listen to the on-site analysis of the platform manager Aaron.