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E-Commerce in Latin America

By Carlos Brewer

June 21, 2009

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E-commerce is defined as an exchange of goods and services done through a digital data transfer by means of an electronic way as Internet.

Since its inception most of the Internet traffic consisted on e-mail and file transfers using different protocols and software pieces; however, with the creation of the World Wide Web, Internet traffic started to change; now it not only transfers e-mails and files, but instant messaging, multimedia contents, and secure data.

Many companies created their own portals and added them to their corporate image, and some of them realized that their portals could serve not only to show a modern and dynamic image or presence, but these portals will enable them to reach more customers than ever before using traditional ways.

As a consequence of these portals, a new way of goods and services was created: e-commerce. However, to get to the point where we are now, several technologies and years of hard work and constant improvements on the connectivity side had to be accomplished.

Few years ago it was really difficult to find a Latin American Web site where one could purchase a product or a service; there were really few companies with e-commerce portals and even few (or none) resellers Web sites. Companies were skeptical with the potential of Internet and they knew that Internet penetration was really low.

Since late 90’s this situation started to change and many e-commerce Web sites appeared; now a user can find everything from a single pen to cars, bus tickets, airplane tickets, etc.

E-commerce Web sites started in a very limited way and in some countries, Brazil being one of the first countries with e-commerce Web sites and then Argentina and Chile, later Colombia and the rest of Latin America.  Most of these e-commerce sites were developed by the same company in several countries.

However the progress of Latin e-commerce Web sites is affected by several factors:

·Connectivity issues: As previously mentioned in older posts, Latin America is a region with a comparatively low penetration of Internet connectivity.

·Consumer behavior: Latin American consumers prefer to buy using traditional ways; this is because many of them fear to send their personal data to e-commerce servers.

·Education: As mentioned in previous posts, many users of the Internet in this side of the world have little or no education on how to properly use the Internet.

·Online banking services:  Only few years ago Latin American banks started their online services as a way to improve their customer service and to enhance their portfolio of products such as virtual credit cards, special passwords to be used for e-commerce, and so on.

Despite all these situations e-commerce in Latin America is growing and improving; one aspect of this continuous growing is the economical situation, and e-commerce is an interesting option to those without a formal job or with a desire to gain economical independence, a common situation to many Latin American countries.



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