Building on Cedric’s useful post…
I recently came across some initial analysis on how Shopee’s foray into South America is going.
I have to say I was pretty stunned. It looks as though Shopee could pull off a smash and grab raid in Brazil on Mercadolibre’s home turf, (akin to Afterpay’s overtaking of Affirm in the US).
Headline differences between the two businesses:
Shopee goes for massive product discounting and blockbuster endorsement driven advertising, Mercadolibre has invested in distribution and uses free delivery as its customer acquisition investment strategy.
SEA has wallet, payments and also digital banking (Sea Money in SE Asia), although only the payments side sits within Shopee, Mercadolibre has not just payments on and off the platform but also online banking and fund management. SEA also has a gaming arm.
In any case as a holder of both MELI and SE I was concerned/anxious on how this head on competition would play out. I want SEA to succeed but I don’t want MELI to fail.
Here’s some early data on progress to-date, (focusing on the last 12 months).
Specifically I found this 18 month progress chart on monthly App users interesting within this Seeking Alpha article…
This prompted me to run a search on google search terms which whilst wasn’t as conclusive as the app usage data did show how much progress SEA has achieved in Brazil against incumbents…
Clearly whatever way you cut it, Shopee is making an impact in Brazil with or without the benefit of pre-existing supply chain!