Lessons learnedin the largest e-commerceplatform in Latin America

Daniel RabinovichCTOwww.mercadolibre.com@drabinovich

New YorkAug 6th, 2012

Who we are (1’)

Some data (2011):

13 countries - #1 in each country

14MM buyers, 5MM sellers

100K professional sellers (Nielsen)

4.8BN gross volume

53MM units sold

1.3BN gross payment volume

1600 employees

MercadoLibre (NASDAQ: MELI) is the largest e-commerce platformin Latin America, and one of the top 10 in the world (Comscore)

Big challenges

Complexity(Product)

Innovation(Platform)

Monochannel(Mobile)

Personalization(Social)

1999 2012

Substracting is harder than addingEach separate part made sense, but the resulting product was too complex

Old version (1/5 scale) New version (1/5 scale)

Simple is HardSteve Jobs: “Don’t come back until you achieved a phone with only one button”

Simplify, simplifyThoreau

Credit: Chris Nodder (N/N Group) and Rich Hickey (Clojure)

In our case, it required a deep change in the business modelIt takes more than just “Web Design”

Old Optional Feature Fees New “Listing Types” allow cleaner results

Revenue-induced features that harm user experienceAnother “brilliant” idea

Old version: paid pictures New version: all pics for free

Get out of the Monkey Trap

Re-think the pricing model

Business Units

Pricing Model

Revenue streams

It was neccesary to fix revenue induced anti-patterns

Big challenges

Complexity(Product)

Innovation(Platform)

Monochannel(Mobile)

Personalization(Social)

1999 2012

Our own properties must use the exact same API we’re sharing with 3rd partiesFrom a Website to a Platform

MELIProperties

MobileApps

DesktopApps

3rd PartyWebApps

BackOffice

One common API

Even in small teams, hard-decoupling enables sustainable growthDecoupling is a great investment

New browsing options, back-end solutions, etc 3rd parties contributing to the ecosystem

Big challenges

Complexity(Product)

Innovation(Platform)

Monochannel(Mobile)

Personalization(Social)

1999 2012

Mobile is larger than desktopPlus, accelerating migration to smartphones

Fuente: Business Insider

HTML5 is the future, but not the presentThe greatest quality is achieved on native platforms

Generate a great product for all platforms. If you can’t, focus on one (Instagram)Fragmentation is your problem, not user’s

Inhouse Via partners

Each platform has particular usability standards. An example: back button

Mobile web as a landingSorted by its impact: transactional e-mails, Facebook, Google

Big challenges

Complexity(Product)

Innovation(Platform)

Monochannel(Mobile)

Personalization(Social)

1999 2012

But no e-commerce site has unlocked its potential yetFacebook is eating the web

Source: Salesforce

It was always like this. Now we have the proper technology to take advangate of it.Social circles influence purchasing decisions

Credit to Paul Adams (Facebook)

Intent is easier to capture, but not stronger than behavior Special items for special circles

Custom verb “see” (a listing)Activity Feed Integration

“Seen listings” summaryTimeline integration

A combination of FB social widgets and periodic aggregationsTake advantage of the OpenGraph

“Chicken and egg” problem. Social products need connected users. Social is different from Viral

Clics

Connections

Publishers

StoriesViral FactorA*B*C *D

A = Connections per Clic

B = Publishers per connection

D = Clics per story

C = Stories per publisher

Credit to Ed Baker (Facebook)

It’s key to properly “close” the viral loopGrowth can be exponential

Key takeaways

This experience is for all websites, not only large ones.

Simple is Hard: substracting is easier than adding.

A/B testing is useless when evaluating dramatic changes.

HTML5 is the future, not the present.

Native apps deliver the best UX. Mobile web as a landing.

Social apps are useless unless they are truly viral.

Once virality is achieved, growth could be exponential

Lessons learnedin the largest e-commerceplatform in Latin America

Daniel RabinovichCTOwww.mercadolibre.com@drabinovich

New YorkAug 6th, 2012