Colombia a leader in e-commerce during the coronavirus: Report

By Sergio Granada May 19, 2020

Colombia’s e-commerce sector grew by 9.9%, leading the way in Latin America, according to a report from regional e-commerce giant Mercado Libre seen by business news outlet Portafolio.

The report, which analyzes e-commerce sales in Latin American countries between March and April — a period where most of the region was experiencing lockdowns to slow the spread of the COVID-19 virus — also noted that online purchases grew by 119% in Colombia, second only to Chile, which saw purchases increase by 125%. 

Other countries in the region that saw growth in their e-commerce sectors from March to April include, Argentina, Brazil, Chile and Mexico.

Colombians, relatively new to e-commerce as compared to other more developed countries, are becoming more comfortable with online purchases, and COVID-19 may be accelerating this trend. 

As reported by Portafolio, Colombians have started to transfer their purchasing habits online as well as moving other financial processes to the digital space. For example, the study notes that use of online payment services during the examined time period increased by 71% for health-related purchases, and digital money transfers increased by 66%. 

Among the fastest-growing purchase categories for Colombians during the lockdown period are headphones, board games, video games, beauty and personal care, game consoles and facial care products.

A turnaround for Colombian e-commerce

Mercado Libre’s latest report marks a turnaround for Colombian e-commerce as the country’s population enters its eighth week of mandatory shelter in place orders. An earlier report from the Colombian Chamber of Electronic Commerce (CCCE) showed a 47% decrease in online sales from February to March, a dip that experts attributed to public uncertainty about the capacity and safety of delivery services still operating during the outbreak. 

New demographics are also adopting e-commerce during times of COVID-19 in Colombia. Bernardo Vanegas, co-founder of CCCE, recently told financial publication Dinero that the forced quarantine is pushing older generations to go online to make bill payments and other purchases. “Individuals between 55 and 70 years old, who did not even pay for online services because they would always go to the bank, today are confined for longer than the rest of the population,” he said, adding that this has forced them to move transactions online. 

Businesses that haven’t had a traditional presence online are also looking to make the jump to e-commerce to survive. Restaurants, gyms and other companies that once relied on foot traffic are quickly learning about how to run successful businesses online. 

The COVID-19 outbreak has made a significant impact on e-commerce worldwide, and Colombia is no exception. This nascent sector in Colombia looks to be receiving a kick as more people are moving purchases online and businesses are forced to adapt to stay afloat. 

Article authored by Sergio Granada, CTO at Talos Digital

This article includes a client of an Espacio portfolio company.