December 6, 2012 2:53 pm

Amazon launches online bookstore in Brazil

Amazon has launched its first digital bookstore in Brazil as the world’s biggest online retailer by sales looks to profit from a boom in internet shopping in the region that inspired its name.

The US-based group, which was named after South America’s longest river, said on Thursday it had opened an online Kindle store in Brazil with more than 1.4m digital books including 13,000 Portuguese-language titles.

The Kindle device is expected to go on sale for R$299 ($143) in the country within a few weeks, Amazon said.

Amazon has also been looking to launch full ecommerce operations in the country through the possible acquisition of the online business of Saraiva, Brazil’s biggest bookstore chain, local media said.

Logistical and bureaucratic hurdles in the country, as well as local retailers’ close relationships with Brazilian publishers, makes it difficult for companies to break into the physical book market without making a local acquisition.

“Online retail is still a very messy industry in Brazil,” said Pedro Galdi, an analyst at SLW Corretora in São Paulo. “It’s just starting and there are lots of problems with delivery…many people are still scared of using their credit cards online too but there is a lot of room for growth.”

Brazil’s book market, where most titles are still religious texts, is also expected to grow as more of the population move into the middle classes, Mr Galdi said.

In a bid to challenge Amazon, Google started selling ebooks and films on its Google Play website in Brazil on Thursday. Last week, Japanese-owned Kobo also launched its own ebook reader across Brazil’s Livraria Cultura bookshops.

Although Brazil’s economy has slowed sharply over the past year, growing only 0.6 per cent in the third quarter from the second, the country’s consumer market remains attractive thanks to record-low unemployment and rising wages.

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E-commerce, in particular, has experienced a boom over the past few years as more Brazilians gain access to the internet and become accustomed to shopping online.

The industry is expected to be worth R$23.4bn ($11.2bn) by the end of this year – 25 per cent more than 2011, according to e-bit, a local consultancy service. Sales of books, along with magazine and newspaper subscriptions, make up about 10 per cent of online sales.

Amazon’s digital launch in Brazil is the latest attempt by the company to offset slowing growth in the US and Europe by moving into emerging markets.

The company has been in China since 2004 when it bought Joyo.com for $75m and turned it into its main China unit. In February this year, Amazon also launched an online shopping service in India called Junglee.com.

Although Brazilians can currently order goods from Amazon websites abroad, high import taxes and shipping fees mean products often cost more than twice their original price.

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