Amazon launched its Mexican marketplace with great fanfare this summer, but the country’s e-commerce market is still tiny. One way Amazon is trying to grow it is by giving Mexicans a familiar place to pick up their online purchases: The corner store.
The online giant is running a trial delivering goods bought through its Mexico site to Oxxo, a ubiquitous chain of convenience stores, reports Mexican newspaper El Universal (link in Spanish). Femsa, Oxxo’s parent company, told Quartz the scope of the trial is modest—it includes only ten of Oxxo’s nearly 13,000 stores in the country, and a limited selection of what Amazon sells. A spokesman for Amazon declined to comment.
But analysts say such an arrangement could prove a neat solution to some of the problems that that have kept Mexico, the world’s 15th-largest economy, punching well below its weight in online sales:
Many Mexicans shy away from internet shopping for fear that criminals will steal their data from online retailers, or packages from their doorstep. Delivery services, moreover, aren’t that efficient or reliable.
As a result, Mexicans tend to buy services online but not physical goods. Internet retailing accounted for only 1.6% of overall business-to-consumer product sales in 2014, according to Amanda Bourlier at Euromonitor International. Americans, in contrast, bought 8% of their stuff online.
“In a geographically large country like Mexico, partnering with a retailer with national presence is an easy and quick way to build a distribution network from scratch,” Bourlier said.
Still, it’s unclear whether a partnership with Oxxo will allow Amazon to reach the vast numbers of Mexican shoppers who don’t have credit cards—another key obstacle to online commerce. (It might, if Amazon lets customers pay in cash at Oxxo when they pick up their goods.) While Latin America averages nearly 50 credit cards per 100 people, Mexico has only 22, according to Euromonitor.
Moreover, Amazon will have to figure out where to store packages amid beer coolers and shelves packed with chips, added Bourlier. Most Oxxo stores don’t exactly have acres of empty space.
Amazon and Femsa are keeping mum on details about the trial or how it’s been working in the few weeks since it started. But it might just be what Mexico’s reluctant online shoppers need to plunge into e-commerce.