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Mercadolibre: The Leading E-Commerce Ecosystem in Latin America
Mercadolibre: The Leading E-Commerce Ecosystem in Latin America
Agenda
Introduction to MercadoLibre
Industry Overview
MERCADOLIBRE
Four business units that create a powerful ecosystem that strives to enable ecommerce wherever it occurs
On platform
Marketplaces
Payments Advertising
Off platform
Webstores
MERCADOLIBRE
MercadoLibre timeline
MercadoLibres history
Acquired Lokau
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Launched
IPO US$333mm
Source: Company
MERCADOLIBRE
MERCADOLIBRE
Transactional platform
Revenue Sources
42.6mm registered users (37% 5-yr CAGR) US$2.7bn GMV (46% 5-yr CAGR)
95% fixed price (5% auction) 75% new items (20% used) Strength in both enterprise marketplace and C2C Infinite inventory Top notch search engine Back-ended pricing
Key Initiatives
MERCADOLIBRE
791
787
4.6
450
1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
4Q09
1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
4Q09
40 35 30 25 20 15 10 5 0
6.0% 37 28 23 32 26 26 31 35 5.5% 5.0% 4.5% 4.0% 3.5% 3.0% 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09
MERCADOLIBRE
Payment processing
Revenue Sources
Financing
Merchant services
Mainly on platform (today) 60% financed payments Recently launched off platform payments in Argentina and Brazil
Increase penetration in marketplace (on platform) Merchant services: enable third party payments (off platform) Expand consumer credit offering
Key Initiatives
MERCADOLIBRE
TPV (US$bn)
TPV (US$bn)
Average ticket paid with MP US$
140 120 100 80 60 40 20 0 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09
52.3 81.5 66.8 55.3 53.2 79.6 113.9
135.8
11% 10%
9% 8% 7% 6%
0.2 0.0 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09
4Q09
TPV/Number of transactions
15
18% 16% 14% 13.5 14.9 12% 10% 8% 6% 4% 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09
10
9.9
Revenue Sources
Key Initiatives
Revenue Sources
MercadoShops has fixed pricing per monthly usage that gets credited back for marketplace fees Monetization mainly through MercadoPago Still in beta testing phase
Key Initiatives
MERCADOLIBRE
Total retail market: US$477bn2 Total ecommerce retail market: US$16.3bn2 Total advertising market: US$33.4bn2
Main Meli stats 27.5 million unique visitors in Latin America 1.3bn pages viewed per month on average To come from company 11th largest global retail site, 1st Retail in LatAm
Chile
Uruguay
#1 Retail site in each of the markets 672mm search page views/month (2009 average)
Argentina
1ITU
for countries where MercadoLibre has operations, as of 2008 for all Latin American countries, 2009 estimates One year average (Nov. 2008 Oct. 2009)
2IDC,
MERCADOLIBRE
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MercadoLibres is the most visited e-commerce site in Latin America and #11 globally
GlobalRetail web sites audience (January 2010)
Total unique visitors (000s) 1,237,448 259,866 244,658 119,801 99,928 53,861 43,788 43,487 37,023 35,315 34,833 32,196 Reach 100.0% 21.0% 19.8% 9.7% 8.1% 4.4% 3.5% 3.5% 3.0% 2.9% 2.8% 2.6%
1 2 3 4 5 6 7 8 9 10 11
MERCADOLIBRE: THE LEADING INTERNET ECOSYSTEM IN LATAM
Total Internet audience eBay Amazon Sites Apple.com Alibaba.com Corporation Yahoo! Shopping Wal-Mart Hewlett Packard RAKUTEN.CO.JP Groupe PPR Otto Gruppe MercadoLibre
1 2 3 4 5 6 7 8 9 10
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1 2 3 4 5 6 7 8 9 10
Source: ComScore
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EBITDA
EBITDA (US$mm) Margin
45 40 35 30 25 20 15 10 5 0
86%
38.7
50% 40% 30% 20% 10% 0% 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09
82% 78%
22.8
10 74% 70% 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 5 0
EBIT
EBIT (US$mm) Margin
17.9 19.0
Net income
Net income (US$mm) Margin
11.3 9.9 7.9 5.6 2.9 2.1 5.9 5.4 6.7
20 15
11.7 11.1 6.8 12.4
10
6.9
9.7
12 10 8 6 4 2 0
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Agenda
Introduction to MercadoLibre
Industry Overview
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Latin America has one of the best combinations of actual GDP and population size with expected growth rates
GDP and Population
Population, 2009E
Western Europe USA Japan
China
China
Asia Middle East ex Japan and and Africa China
Latin America
Western Europe
US
Japan
Source: IDM
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Consumer spending in the region is growing fast and new segments of the population are becoming first time consumers
Per capita consumer spending CAGR 2003-2008 (%) Loans to GDP, 2008 (%)
2003-2008 CAGR (%)
1%
282%
4%
18%
17%
30%
27%
15%
9%
24%
124%
7.2%
MERCADOLIBRE: THE LEADING INTERNET ECOSYSTEM IN LATAM
0.49
0.46
22%
7%
15%
18%
16%
13%
474 305
0.16 0.16 0.11 0.10 0.06 0.02 0.02
71
68
48
44
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40% 28% 25% 22% 21% 19% 18% 15% 15% 15% 13% 12% 12% 11% 11% 9% 8% 8%
Whirlpool Pirelli Cinemark Mattel Fiat Electrolux Carrefour Coca Cola Philip Morris Merck Pepsi Adidas Cadbury
Source: Bloomberg
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Latin America is expected to post the highest internet users growth due to improving infrastructure and low penetration base
Selected infrastructure statistics by region (sorted by internet users growth rates)
Wirelines Regions Latin America Asia Pacific ex China ex Japan China Eastern and Central Europe Western Europe Japan North America Number 87.6 184.6 239.9 22.2 148.6 44.0 137.5 CAGR (0.5)% 3.2% (2.4)% (4.2)% (5.9)% (9.9)% (14.5)% % Pop 16.1% 8.7% 18.2% 23.9% 31.5% 34.5% 41.5% Number 393.5 1,073.5 769.4 114.6 514.1 115.1 301.5 Wireless CAGR 6.1% 12.1% 8.9% 3.1% 3.4% 3.5% 5.3% % Pop 72.2% 50.7% 58.5% 123.3% 108.8% 90.3% 91.1% Number 150 229 265 41 320 123 325 PCs CAGR 11.2% 13.6% 10.8% 7.9% 5.2% 5.5% 2.6% % Pop 27.6% 10.8% 20.2% 43.7% 67.7% 96.6% 98.2% Number 33.3 46.5 104.4 12.9 116.1 37.9 96.2 Broadband CAGR 20.1% 17.3% 15.4% 11.6% 6.6% 10.6% 2.9% % Pop 6.1% 2.2% 7.9% 13.9% 24.6% 29.7% 29.1% Internet users Number 158.9 297.1 344.5 46.3 280.7 93.4 250.1 CAGR 20.3% 15.0% 11.8% 10.5% 3.9% 1.6% 1.2% % Pop 29.1% 14.0% 26.2% 49.8% 59.4% 73.2% 75.5%
prices by 70%), while ADSL modems would have prices reduced as well Source: Newsrun
14,141
7.3%
8.3%
9.1%
Brazil 58%
Source: Research reports, does not reflect Governments recently discussed broadband plans
MERCADOLIBRE
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37.8
0 2006
Source: IDC and Research reports
US$/unit
R$/unit
4,000
12.4X
3,000 2,000
2,981 1,733 1,486 967 597 611 1,292 592 1,140 586 1,131 615
2003 2004 2005 2006 2007 2008 6.7X 5.0X 3.7X 3.0X 2.7X
1,000 0 2003
2004
2005
2006
2007
2008
Source: Positivo Informtica, Bloomberg and J.P. Morgan estimates
MERCADOLIBRE
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making millions of Latin internet users among the most engaged in the world
Total online hours per visitor in a month Internet users by country (mm)
68 27 228 26
MERCADOLIBRE: THE LEADING INTERNET ECOSYSTEM IN LATAM
360
68 24 23 22 22 19 8 18 8 15 11 8 28
20
20
Source: company
MERCADOLIBRE
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11.9
5.7
2009E
2010E
2011E
2012E
2006
2007
2008
2009E
2010E
2011E
Source: IDC
Source: IDC
Western Europe
South Korea UK US Germany Japan Brazil Spain Argentina Canada Mexico China 1.5% 0.8% 0.8% 0.7% 0.4% 0.2% 2.3% 3.9% 3.2% 5.6% 7.8%
USA Japan China Central and Eastern Europe Asia Pacific (ex Japan ex China) Latin America
Source: IDM
MERCADOLIBRE
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2012E
2006
2007
2008
US
35%
Latin America Central and Eastern Europe
30%
25%
Asia Pacific ex Japan
20%
Western Europe
15%
10%
USA
5%
Japan
MERCADOLIBRE
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Advertisement: internet ad spend in the region is still an untapped opportunity with huge potential
Global advertising spending evolution (US$ B)
Total non Internet advertising spending Total Internet advertising % of total Internet advertising vs total advertising 107 93 14% 79 61 53 69 13% 40 11% 8% 6% 9% 10% 588 608 610 595 615 645 677
Western Europe
MERCADOLIBRE: THE LEADING INTERNET ECOSYSTEM IN LATAM
Japan
United States
2006
Source: IDC
2007
2008
2009
2010
2011
2012
Source: IDC
Latam
2006
Latam advertising spending evolution (US$ B)
Total non Internet advertising spending Total Internet advertising 3 3 2 1 28 30 31 33 36 40
Print 23% TV 53% Classified 14% Display 33%
2012
Latam advertising spending breakdown
All Advertising Except Internet Other 6% Internet Advertising Other 5% Keyword 34%
24
Radio 7%
2006
Source: IDC
2007
2008
2009
2010
2011
2012
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Agenda
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