Consumer Retail - Industry - South America Market, Share and Trends 2023-2028

Summary of Consumer Retail

The South American consumer retail industry has experienced significant changes in the past few years brought about by evolving consumer behaviors and new technologies. However, the COVID-19 pandemic accelerated many emerging trends and introduced new dynamics across the diverse region.

Consumer retail in South America region has experienced a remarkable evolution over the past few years. Based on our estimates, we project that the consumer retail market of South America region would reach $2349.83 billion in 2029 from $1485 billion in 2023 with a CAGR of 7.90 %.

According to our analysis of market data from national statistical agencies and proprietary consumer surveys, some overarching developments include the rise of e-commerce, value consciousness, health and wellness, and omnichannel integration. Younger, digitally-native consumers in particular have driven demand for seamless online and offline shopping experiences from retailers.

At the same time, economic turbulence in some markets has increased the focus on affordability and essential spending. Sustainability has also grown in importance, with consumers demonstrating a preference for brands that align with their environmental and social values. Looking ahead, retailers must thoughtfully balance these diverse trends as various countries move through differing stages of the pandemic with uneven recovery trajectories. Agility and a localized approach will be paramount to success.

Recent Trends and Insights

Accelerated e-commerce adoption driven by convenience and safety concerns during lockdowns. Online channels have seen sustained growth and are being further developed.

Heightened focus on health, wellness and immunity-boosting products amid widespread illness. Activewear, supplements and home fitness equipment are thriving.

Intensified value consciousness as economies fluctuate. Private label and promotional offerings have expanded to emphasize essentials over discretionary items. Macro trends seen in the e-commerce growth within this region, led to show a trend on 37 % of people who preferred to buy online— mainly ranging from the regions of: Brazil, Argentina and Columbia.

Blurring lines between online and offline shopping. Omnichannel integration has increased to provide seamless experiences across digital and physical touchpoints. Growing importance of sustainability for younger & urban consumers. Transparent ESG practices will be important to connect with these values-driven shoppers.

Product Insights

Staples increased while discretionary suffered. Online grocery remains limited but is growing, especially in major Brazilian and Chilean markets.

Device sales grew due to remote work/learning. Affordable laptops and accessories sold well. 5G adoption is driving upgrades. Casualwear replaced formal. Activewear and loungewear thrived. E-commerce allowed brands to activate dormant categories.

Electronic adaptation within major parts of this region led to a revitalized growth path that is steeper than that existing prior to the pandemic, which , in short, was the fuel that multiplied its expansion factor, placing digital sales platforms, marketplaces and other emerging digital environments as central elements in any development strategy supported by the inescapable omnichannel approach that, consistently, continuously expands its definition adding new and potential sales channels for companies.

Investments in living spaces increased sales. Outdoor furniture also benefited from al fresco living trends. Virtual/augmented reality tools aided large item sales. Mass categories proved more resilient than prestige. Self-care products like skincare gained ground while makeup and fragrance declined.

Key Companies

Some major players within this vast domain of industry are

• Vale S.A.
• Walmart Mexico
• América Móvil S.A.
• Mercado Libre
• Petrobras S.A.
• Ambev S.A.
• Itaú Unibanco Holding S.A.
• Grupo México
• FEMSA Comercio
• Cencosud
• Falabella
• Bodega Aurrera

Regional Analysis

Major South American markets like Brazil, Argentina, Colombia and others present sizable addressable populations for consumer goods companies. Brazil represents the largest opportunity with a population of over 200 million people and GDP per capita of US$11,000 in 2022 according to data points seen within the industry. Brazil’s domestic market alone is larger than many countries.

Rising incomes are enabling more consumers across South America to trade up to higher-priced consumer brands and product tiers. Disposable incomes have increased substantially in countries like Colombia, Peru and Chile over the past decade per OECD figures. This supports demand for premium personal care, packaged food and other goods.

Political and economic stability also influences forecasts for some countries. Argentina has experienced volatility in recent years, with GDP growth varying significantly. However, the economy has shown signs of recovery in 2022. Multinational CPG companies closely monitor stability when investing and expanding in South American markets.

Overall population growth also presents opportunities. Countries like Colombia and Peru have young, expanding populations which will continue increasing the consumer base in coming decades barring major changes. Sustained GDP expansion coupled with a growing middle class points to favorable long-term prospects for the South American consumer goods sector. However— macroeconomic and political dynamics could impact projections.

Market Segmentation

By Type:

• Ecommerce platforms and mobile apps
• AI-powered product recommendations and personalized shopping
• AR/VR for virtual try-ons and interactive displays
• IoT solutions for supply chain and inventory management

By End User:

• Retail chains, franchise brands
• Grocery stores and supermarkets
• Direct-to-consumer brands
• Online marketplaces

By Enterprise Size:

• Large retailers
• Small and mid-sized stores
• D2C startups

By Countries:

• Brazil
• Argentina
• Columbia

Our Methodology

We have offered a well-founded review of South America’s regional consumer retail market along with ongoing trends and upcoming projections to highlight proximate investment opportunities in this report. Moreover, an extensive analysis of any future prospects, challenges, competitors, or navigating aspects is also provided. A methodical detailed regional examination is presented.

Primary Research  

Our multi-pronged research approach includes interviews with industry leaders and a global survey of advanced manufacturing professionals to gain qualitative insights. We utilize our proprietary databases encompassing key performance indicators worldwide in order to collate relevant data points. A multivariate forecasting framework considering historical performance, current dynamics and qualitative factors are utilized to develop market sizing and growth projections through 2029.

We supplement our primary research with a careful examination of secondary materials such as– case studies, news stories and references from other sources. Organizations can benefit from the strategic advice and conclusions offered because they will be better equipped to respond to the dynamic nature of this industry and seize emerging possibilities.

We employ a comprehensive and iterative research methodology focused on minimizing deviation to provide the most accurate market estimates. Our research utilizes a combination of bottom-up and top-down approaches across segments and utilizes databases, primary research insights and industry experts for analysis.

Raw data is obtained from multiple sources and thoroughly filtered to ensure only authenticated and validated sources are considered. We collect data from raw material suppliers, industry associations, technology providers, and buyers to gain a holistic perspective.

Quantitative Analysis

Our market estimates are derived through statistical models, beginning with collection of historical data and analysis of macro- and micro-economic factors influencing the market. Gathered information on market dynamics, technology and pricing trends are utilised to build the models.

Econometric and technological models are applied to project short- and long-term market potential respectively. A bottom-up approach is preferred to minimize errors. Key parameters considered include market drivers and restraints, material pricing trends, regulatory scenarios, and capacity additions.

Weights are assigned to these parameters based on impact analysis and market forecasting is performed via statistical tools and techniques. We believe this methodology results in an accurate and realistic market picture.