The CEO of ad agency Mullen Lowe says that smartphones are revolutionizing e-commerce and online sales. Jose Borghi says that proof of this is the fact that Uber is one of the strongest ranked brands in Brazil and Airbnb is rapidly climbing in terms of brand strength. Both Uber and Airbnb are online based platforms for taxi services and living accommodations. Uber takes advantage of on demand smart phone apps and Airbnb takes advantage of the internet to connect potential hosts with potential guests.
The Brazilian economy is in a recession right now but e-commerce continues to increase year after year points out Jose Borghi. Online sales increased over 15% in 2015 when compared to the previous year. It was worth around a $41 billion real (currency) market segment in the economy in 2015. By the end of 2016, forecasters project that e-commerce will rise by yet another 8%. The first quarter of 2016 saw more than 24 million online orders placed and revenue of almost $10 billion dollars.
An increase in online commerce despite a weakening economy has put traditional brick and mortar stores on notice continues Jose Borghi. E-commerce continues to rise because many online retailers offer lower prices, a vast product selection and all of this from the comfort of home without having to get up and go to a store. Smartphone applications also play a major role in the rise of e-commerce says the CEO of Brazilian ad agency Mullen Lowe formerly called Borghi Lowe. The apps allow people to purchase items faster and more conveniently straight from their phone even while on a train or park for example. In our world of looking for ways to do things faster and more conveniently, these smart phone apps are impacting the world e-commerce in a positive way by boosting sales.
Which industry is most affected by online commerce and smartphones? It is the fashion and clothing industry. Mr. Jose Borghi states that sales of clothing through smartphone and tablet applications is responsible for about 40% of all sales, even when traditional stores are taken into account.
Jose Borghi also states an interesting survey to purvey just how big a role smartphones now play in online commerce. A study done by Criteo in 2015 found that sales of items through smartphones and tablets now make up more than 50% of all online sales. After the fashion and clothing industry the travel industry is the most widely impacted industry by smartphones and online commerce. All retailers should realize this trend and adapt or miss out on a major market segment summarizes Jose Borghi of Mullen Lowe.