Etsy Enters Latin American Market With Acquisition of Brazilian Marketplace Elo7
Online crafts marketplace Etsy announced on Monday a $217 million deal to acquire Brazilian online marketplace Elo7, reports CNBC. Etsy CEO Josh Silverman is banking on Latin America to be a growth catalyst for the e-commerce company, calling Elo7 “the Etsy of Brazil.” Similar to Etsy, Elo7 allows merchants to set up an online shop and sell items to buyers, and is considered a leader in custom and made-to-order merchandise. The site, among the largest online marketplaces in Brazil, boasts of having 56,000 sellers and serving nearly 2 million shoppers.
Elo7 will remain headquartered in Sāo Paulo, Brazil, and operate as a stand-alone marketplace, the companies said. The Elo7 acquisition comes weeks after Etsy announced it would purchase London-based marketplace Depop for more than $1.6 billion to expand its presence in Europe.
Total Retail's Take: Etsy's deal with Elo7 will establish a foothold for the online marketplace in Latin America, an underpenetrated e-commerce region where Etsy currently doesn't have a meaningful customer base, according to a company press release. The move reflects the marketplace's targeted expansion, as following the close of the acquisition of Elo7, Etsy will operate four e-commerce brands: Etsy, Reverb, Depop, and Elo7.
Silverman told CNBC, “Brazil is one of the biggest economies in the world, but its e-commerce sector is still in just the early days of penetration, so we think e-commerce is really poised for growth in Brazil. It’s really well-positioned, we think, to capitalize on it, so we think it’s a perfect marriage.”
With existing strength in local brand awareness and approximately 1.9 million active buyers, Elo7 may present the perfect opportunity for Etsy to enter the Latin American market.
Kristina Stidham is the digital content director at Women in Retail Leadership Circle and sister brand Total Retail. She is passionate about digital media and handles video, podcast and virtual event production for both brands. You can often find her at WIRLC, TR, or industry events with her camera and podcasting equipment recording interviews with retailers.
Kristina holds a B.A. in Media Studies and Production from the Temple University Klein College of Media and Communication in Philadelphia. Go Owls! When she's not in the office, she loves to go on long walks, sing around the house, hangout with her two pet guinea pigs, and travel to new places.