The forecast: An early market mover, Mercado Libre is beating Amazon at its own game in Latin America. Launched in Q2 2009 as Mercado Libre Publicidad, then rebranded to Mercado Ads in September 2020, the regional ecommerce giant managed to gain a significant edge over Amazon in Latin America through years of multibillion-dollar investments into fortifying its retail flywheel. (That flywheel comprises ecommerce, logistics, financial services, media, and advertising.)
- This year, we expect Mercado Libre’s digital advertising business to grow by 44.5%. The company will represent more than half of all retail media ad spending in Latin America as it deploys new technologies to compete for marketing dollars that have been difficult to access.
- Meanwhile, Amazon’s digital ad revenues will also grow by double digits (29.4%) this year in Latin America to $326.6 million, but it will struggle to reverse its declining market share against more locally relevant players. This is a stark contrast to Amazon’s dominant position in other parts of the world like Canada, the US, and Europe.