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Amazon launches free one-day delivery in Brazil amid fierce competition

The move comes as rivals such as Mercado Libre and Magazine Luiza are investing heavily to ramp up delivery speeds and gain clients

Photo: REUTERS/Mike Segar/File Photo/File Photo
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E-commerce giant Amazon started to offer its Brazilian Prime subscribers free one-day delivery in 50 cities on Wednesday, amid fierce market competition in Latin America‘s largest economy.

The move comes as rivals such as Mercado Libre and Magazine Luiza are investing heavily to ramp up delivery speeds and gain clients.

The Amazon initiative, which already exists for Prime subscribers in markets across the United States, Canada and the United Kingdom, arrives two years after Prime was first launched in Brazil. Previously, Prime users in Brazil had access to free two-day shipping with the option of paying extra for one-day delivery.

READ ALSO: Amazon: the giant’s awakening in Brazil

“In the last year, we’ve developed better infrastructure especially in the country’s capital cities with new distribution centers, and this is what helped make one-day delivery possible,” Mariana Roth, head of Amazon Prime in Brazil told Reuters in an interview.

Cities that will have one-day delivery in Brazil:

  • São Paulo: São Paulo, Campinas, Ribeirão Preto, Santo André, São José dos Campos, São Bernardo do Campo, Guarulhos, Sorocaba, Piracicaba, Osasco, Praia Grande, São Caetano do Sul, Santos, Taboão da Serra, Barueri, Diadema, Mauá, Cotia, Hortolândia, Valinhos, Santana de Parnaíba, Sumaré, Votorantim, São Vicente, Pirapora do Bom Jesus, Mogi das Cruzes, Itaquaquecetuba, Carapicuíba, Suzano, Ferraz de Vasconcelos, Jandira, Franco da Rocha, Ribeirão Pires, Itapecerica da Serra, Rio Grande da Serra, Guararema, Francisco Morato, Biritiba-Mirim, Pirapora do Bom Jesus, Salesópolis, Mairiporã
  • Distrito Federal: Brasília
  • Minas Gerais: Belo Horizonte, Contagem, Betim, Santa Luzia, Sabará, Ribeirão das Neves, Conselheiro Lafaiete
  • Pernambuco: Recife
  • Rio Grande do Sul: Porto Alegre

E-commerce competition

E-commerce competition is steep in Brazil, home to an estimated 105 million e-commerce shoppers. Amazon ranked fourth in the country in terms of monthly website visits, trailing behind regional and domestic competitors Mercado Libre, Americanas and SoftBank-backed OLX, according to a ranking compiled by payments company EBANX.

READ ALSO: Brazil retailers hunt for M&A deals to compete for e-commerce dominance

Top 10 ecommerce websites in Brazil

Logistics is an especially tricky part of Brazilian e-commerce, in a continental-sized country with patchy infrastructure. Earlier this year, Mercado Libre announced an investment of BRL 10 billion ($1.91 billion) into logistics in Brazil, where, as of June, it has been experimenting with same-day shipping in some cities.

Roth did not specify how many new Prime users the initiative is expected to attract, nor how much revenue it is predicted to draw for the company.

Following is the timeline of Amazon’s activities in Brazil: 

  • 2012: Amazon Brazil launches with eBooks and Amazon Kindle e-readers.
  • 2017: Amazon launches stores with selling partners that span multiple categories, including books, electronics, home & kitchen goods, appliances, office supplies, fashion and sports.
  • 2019: Amazon opens fulfillment centers in Cajamar-SP and Cabo de Santo Agostinho-PE; Introduces Prime (the fastest-growing Prime program to serve customers across all regions in Brazil).
  • 2020: Amazon adds four new fulfillment centers in Cajamar-SP, Distrito Federal, Nova Santa Rita-RS, and Betim-MG; Increases the number of cities with two-day delivery for Prime members from 120 to more than 600 and growing; Launches Fulfillment by Amazon; Launches Amazon Delivery Service Partners; Donates BRL 5 million to two organizations on the frontlines of COVID-19; Introduces seven new Amazon devices; produces All or Nothing: Brazil’s Team [‘Tudo ou Nada: Seleção Brasileira’] the first Brazilian Prime Video original; Ads 10 million songs to Amazon Music for a total of 70 million titles available.
  • 2021: Donates BRL 5.3 million and joins forces with 50 other Brazilian companies to enable a COVID-19 vaccine production facility under the administration of Butantan Institute in São Paulo, which will produce more than 100 million doses per year.
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