Shopee surpasses Mercado Livre to become the most popular e-commerce platform for Brazilian consumers

Shopee’s customer satisfaction, as measured by the Net Promoter Score (NPS), surpassed Mercado Livre and Amazon . The company’s NPS score rose to 64 from 60 in a survey conducted in September last year .

It is understood that Shopee became the segment leader in this indicator in four of the country’s five regions, only tied with Mercado Livre in the Southeast region.

In addition , Shopee’s price leadership also improved and it continued to lead the market with 43.6 million active users.

Shopee's growth is driven by Brazilian sellers, who are responsible for the majority of sales within the platform. Bank of America Merrill Lynch said Shopee opened its first distribution center in Sao Paulo, which can reduce delivery time as most of the platform's sellers are based in Brazil.

Also of note is a partnership between Shopee and Brazilian digital bank Nubank last year , which offered customers a 10 Brazilian real coupon for purchases on Shopee.

Even so, Shopee is under close scrutiny from local consumer protection agencies . Shopee recently signed an agreement with Procon-SP to ban the sale of counterfeit and smuggled goods, in addition to promising to only sell products with invoices . A study prepared by the Retail Development Institute ( IDV ) in collaboration with McKinsey estimated that the country failed to collect 37 billion to 48 billion reais in e-commerce taxes, of which 19 billion to 20 billion reais came from cross-border transactions.

Looking at Brazil’s e-commerce market, while the growth rate of internet spending has slowed, it is still much higher than overall retail sales . Brazilian e-commerce has grown 38.6% since 2019 , while physical stores have grown 8.8%.

The Bank of America Merrill Lynch survey noted that product availability and services provided by online stores have improved since the start of the pandemic . Although some consumers still prefer physical stores, especially when they go shopping for clothes, the vast majority said they have no intention of giving up e-commerce when the pandemic is over .

But it has to be acknowledged that fewer people will plan to shop online in the coming period than they do now. The number of potential buyers will decrease in all sectors except furniture and home furnishings, appliances and books .

Bank of America Merrill Lynch attributed the results to the end of emergency aid, rising inflation, rising interest rates and increased unemployment, which have put pressure on household budgets. The resumption of in-person activities has also reduced disposable income for online consumption.

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