Digital Business in Latin America: Cloud Storage Platforms and Software as a Service to Stand Out in 2023

The digital market in Latin America is growing above the global average and some areas of the sector get into 2023 under high expectations. This is the case for the cloud storage and SaaS (Software as a Service) sectors – application services used by companies for various functions such as team management, social media monitoring, customer experience metrication, among others.

Data from the Beyond Borders 2022-2023 study by EBANX shows that the SaaS/Cloud market in Latin America is expected to grow 28% annually until 2026, seven percent above the global average, being the fastest growing digital services vertical in the region. The sector’s boom is directly linked to the accelerated technological development of Latin American companies in recent years, which makes global companies that provide technological solutions want to compete for space in this market.

Another strong trend for the upcoming years in the digital market is the boom of the Digital Ads vertical – paid media ads on the internet. A brand’s online presence is nowadays seen as a key factor in the growth of any business, and last year alone, digital ad spending increased by 19% in Latin America. Considering that the number of online shoppers in the region is expected to grow by 6.6% per year until 2026, according to Beyond Borders, and that all digital business verticals in the region are growing above the global average, nothing indicates that the Digital Ads sector will slow down in the coming years. 

Read Also: Why Media Companies Will Thrive in A Cookieless World

The outlook is also optimistic for more established verticals such as online retailing and ride-sharing and delivery services. Juliana Etcheverry, Director of Strategic Payments Partnerships at EBANX, explains that Latin America today is a region that presents a horizon of digital business opportunities to be explored – both for sectors already well known to the public and for less mature markets, as is the case of streaming. 

“I don’t see any digital vertical slowing down in the region in the coming years. Rising markets like Latin America still have many opportunities for the digital economy – both in terms of reach and in terms of depth of understanding what consumers in the region need and want,” she says.

Latin America has a very diverse scenario, which varies according to the profile of consumers, among other factors. In Brazil, for example, online retailing has a 44% share of the sector’s total volume and continues to lead the national digital market. On the other hand, the commercialization of products through the Internet in other countries, such as Mexico and Chile, is already more consolidated, and does not have such a strong growth curve foreseen for the next few years. In these two cases, the digital markets that grew most last year were travel, streaming, and gaming.  

Besides the macroeconomic scenario of each country, which serves as a catalyst for trends, for Etcheverry, the diversity of alternative payment methods also helps shape the market. According to her, the more payment options available, the greater the consumption, a common feature among Latin American countries. “The one constant is that the digital market is expanding in all countries – and payments are a key to unlocking this market potential,” she says.

In addition, she points out that Latin America is far ahead in terms of technology and innovation in digital payments than most of the world. The region’s Digital Payments and Financial Services market – financial transactions and payments made through mobile devices – even serves as examples for other countries, such as Pix.

 “What we have seen happen in the region in the last ten years shows how the region has an appetite, a readiness for the new, in the quest for financial and digital access and inclusion. Latin America is the home of Pix, which now serves as a reference for several other countries.”

Juliana Etcheverry – Director of Strategic Payments Partnerships at EBANX