MercadoLibre.com
From Wikipedia, the free encyclopedia
| MercadoLibre | |
|---|---|
| Type | |
| Founded | August 2, 1999 |
| Headquarters | Ciudad de Buenos Aires, Argentina |
| Industry | E-commerce |
| Slogan | Donde compras y vendes de todo. |
| Website | www.mercadolibre.com |
| Type of site | e-commerce |
| Registration | required to sell and buy |
| Available in | Spanish Brazilian Portuguese |
| Launched | August 2, 1999 |
MercadoLibre.com (literally "free market" in Spanish) or MercadoLivre in Portuguese (Brazil) is a website dedicated to online auctions. It is eBay's Latin American partner. MercadoLibre is Latin America's number-one auction site. It is currently present in Argentina, Brazil, Chile, Colombia, Mexico, Ecuador, Peru, Uruguay, Venezuela, Panama, Costa Rica and Dominican Republic.
Contents |
[edit] Fast Facts (December 2007)
- MercadoLibre has more than 24.9 million registered users that buy and sell articles.
- In 2007 users completed buy-sell transactions in MercadoLibre for more than U$S 1.500 million.
- Originally known for its auction sales format, nowadays 88,8% of MercadoLibre's community of users choose the fixed price format. Besides, more than 79,1% of the sold articles are new.
- The 5 largest categories are: Computers, Electronics and Telephones, Cars, Motorcycles and other vehicles, Sports and Video games and Musical Instruments.
- More than 25.000 people get all or almost all their income selling through MercadoLibre.com's e-commerce platform.
[edit] History
MercadoLibre was established in August of 1999 in Argentina and rapidly expanded to Brazil (as MercadoLivre.com), other South American countries and Mexico. Marcos Galperin, current CEO, began the company while still in business school at Stanford University. Finance professor Jack McDonald had been helping Marcos to contact potential investors, and asked John Muse, an invited speaker and co-founder of the Hicks Muse private equity fund, if Marcos could drive him to his private plane. Before boarding his plane, Muse expressed his desire to have his fund invest in the idea and soon thereafter the company started. MercadoLibre received funding from JPMorgan Partners, Flatiron Partners, Hicks Muse Tate and Furst, Goldman Sachs, GE Capital and Banco Santander Central Hispano. In September of 2001 eBay acquired 19.5% of MercadoLibre in exchange for eBay's recently acquired Brazilian subsidiary of Ibazar.com.fr. In this transaction, MercadoLibre also became eBay's exclusive partner for the Latin American region.
In November 2005, MercadoLibre acquired 8 DeRemate's operations (till then, DeRemate was MercadoLibre main competitor in the region). The acquisition includes: Brazil, Colombia, Ecuador, Mexico, Peru, Puerto Rico, Uruguay and Venezuela.
In 2006, MercadoLibre.com launched new operations in Costa Rica, Panama and Dominican Republic.
[edit] The MercadoLibre system
MercadoLibre works in the same way as eBay does: customers bid for an item, and the customer with the highest bid after a determined date wins the item. But the main selling option MercadoLibre's community use is fixed price. The seller offers a product at a fixed price and the first buyer who offers that amount, gets the product. The customer must then pay before receiving the item bought or by meeting with the seller in person, they can make the transaction face to face. There are various methods of paying, such as "MercadoPago" (MercadoLibre's version of PayPal), credit cards and money orders. When sending money to a seller, the customer puts his or her trust in the seller to send the item. Once the transaction is finished, the seller and the buyer writes feedback on each other.
[edit] MercadoPago
MercadoPago is MercadoLibre's safety payment system. When adding MercadoPago in its listings, sellers allow buyers to choose among many payment alternative methods such as cash, bank transfers and credit cards or installments, among others.
[edit] MercadoSocios
MercadoSocios, MercadoLibre's Partners Program, allow small, medium and large websites to accumulate benefits through MercadoLibre's online promotion. Payments are generated once new users register and make operations referred by partners and when commissions are paid to MercadoLibre related to activity coming through partners websites.
[edit] MercadoSolidario
MercadoSolidario is MercadoLibre's section where foundations and non profit organisations sell products or organise charity auctions without paying any fee to MercadoLibre as part of its fundraising activities.
[edit] Criticism
MercadoLibre has been accused of maintaining an unfair system by several of their users; they charge a publication fee even if the user doesn't sell an item, which eBay also does. They allow both new users and users with negative feedback to participate in auctions and bid on expensive items without contacting the sellers, which eBay also does. This often results in losses for the sellers.
Also MercadoLibre claims that the site is only an intermediary between buyer and seller, and it is not responsible for the behavior of any of its users (including its own employees), which eBay also does. This topic generates great controversy, because when a fraud occurs they do not mediate, leaving their users (both sellers and buyers) with no assistance whatsoever.
Other criticism is of their system of "Bonificaciones", which consists of partially refunding the money collected for the selling fees; however MercadoLibre only returns a small percentage (40%) of the selling fees, which eBay also does only partial fee refunds for non paying bidders. MercadoLibre claims that it is the seller's responsibility to conclude the transaction, even though many of the unsuccessful sales are made by users with zero or negative feedback.
Finally, when MercadoLibre absorbed the DeRemate regional sites, MercadoLibre became a monopoly. Although other sites have emerged, none of them have been able to challenge MercadoLibre similar to eBay's monopoly in English speaking countries; however DeRemate.com launched a new site called Dereto.com in an attempt to challenge MercadoLibre again.
