By Brazil Stock Guide – Mercado Livre (NASDAQ: MELI) has reduced the minimum purchase eligible for free shipping in Brazil to R$19.90, a move aimed at accelerating buyer growth and expanding its e-commerce ecosystem, a top executive said on Tuesday.
Speaking at the UBS LatAm Conference in São Paulo, Brazil country manager and senior vice president Fernando Yunes said the change exceeded the company’s internal expectations across key performance indicators.
Lower shipping friction boosted buyer numbers, purchase frequency and conversion rates, Yunes said. Customer satisfaction also improved, with net promoter scores reaching record levels.
The free-shipping eligibility threshold was previously set at R$79. The company has lowered it several times since 2017. Each cut expanded the market and encouraged consumers to shift purchases from physical stores to online channels, Yunes said.
The move also attracted new sellers and expanded the availability of lower-ticket items on the platform, a trend the company expects to continue in coming quarters.
Brazil’s e-commerce market remains highly competitive, but Mercado Livre has increased its lead. Market estimates place its share between 39% and 42%, compared with roughly 15% for the second-largest player.
Yunes said increased competition has helped grow the overall market by raising consumer awareness and encouraging first-time online purchases, rather than hurting incumbents.
E-commerce penetration in Brazil stands at about 15% to 16%, still well below levels seen in the United States, China and Europe. Mercado Livre believes penetration could reach around 30% within five years.
Logistics remains a key competitive advantage, according to Yunes. The company is investing in faster delivery in major cities while expanding lower-cost shipping options nationwide through volume consolidation and data optimization.
Mercado Livre also benefits from integration with Mercado Pago, which offers credit cards, installment payments and consumer loans. The fintech arm has increased conversion rates and average ticket sizes on the marketplace, Yunes said.
The company plans to enter Brazil’s pharmaceutical market via a first-party model while pushing regulators to eventually allow third-party sellers, as in other countries. B2B commerce is another growth area, with new tools for volume pricing and invoicing.
Artificial intelligence is being used across logistics, credit, fraud prevention and product listings, and will increasingly support pricing and conversational commerce, Yunes said.
Looking ahead, Yunes said Mercado Livre expects a larger market, higher e-commerce penetration and further market share gains over the next three years.
“In this business, scale and execution matter,” he said.
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