With Cash on Delivery Option, Has Linio Unlocked the Key to E-Commerce in Latin America?

In just under two years, another Rocket Internet e-commerce initiative, Linio, has taken off in Latin America, especially Colombia. Here's how.

In just under two years, another Rocket Internet e-commerce initiative, Linio, has become one of the 10 most-visited websites in Colombia. It has accumulated over 300,000 customers, and, according to company co-founder and Director of Marketing Pedro Freire, achieved 15-20% monthly growth.

Last year, Linio received a multi-million-dollar investment to accelerate its expansion in Colombia and Latin America. The startup is currently present in Mexico, Peru and Venezuela as well and hopes to lead the region “Amazon-style,” Freire explained.

Clarisa Herrera: You’ve got a lot of experience in generating sales in new markets with Rocket. What has your trajectory been?  

Pedro Freire
Pedro Freire

Pedro Freire: I started Groupon in Portugal and Spain with Rocket, and then I went to Asia to start a fashion e-commerce company called Zalora. Later, we looked at the U.S., and we recognized that Amazon was doing things quite well, but they’d forgotten that there was a whole world outside wanting to buy online. Then we thought, why not start Amazon for the rest of the world? Rocket then launched Lazada in Asia, Jumia in Africa, and, two years later, Linio in Mexico and Colombia, eventually expanding to Peru and Venezuela. Now we’re interested in continuing into other countries in the region.

CH: You’re in charge of marketing in Colombia. What are your thoughts on the market? 

PF: In Colombia, we’ve already got over 450 people – it’s one of the fastest-growing companies in the country. We started with few categories but wanted to grow more. We realized that it’s not the same as in other regions. People are more skeptical of buying online, and credit card penetration is low.

CH: How did you manage that reality and grow? 

PF: Our idea was to revolutionize the market and offer a proposal with a different value – you only pay for the product when it arrives at your house, it’s cash on delivery. It’s a model that isn’t known in e-commerce in these countries, and, of course, we’ve got other methods of payment. Our growth was exponential, and if you don’t like the product when you receive it, you can return it and get your money back. In parallel, we expanded in categories, from technology to home, sports and fashion. We want to offer products across all rubrics, with optimal customer experience, achieving the democratization of retail.

CH: Fashion is a strong category in Colombia. Is it the same online?

PF: Technology is the strongest category in terms of sales, and we sell fashion and accessories to customers to whom we already sell tech or products for the home. We’re working on our assortment of clothing brands, but it’s still not as significant as technology.

CH: Is Argentina among the countries you’re evaluating? 

PF: Argentina is one of the markets we’re considering, without a doubt. Obviously, with its current economic and political instability, we haven’t gone there yet and have put it off, but it’s a market we’ll arrive at soon.

CH: With increased competition in the niche, what is your differentiator? 

PF: Competition is constantly increasing, which is good, because it means that the market is there. Linio is part of a group (Rocket) with a lot of knowledge, all of us who have led the group’s sites have leveraged our experiences here – something our competitors do not and cannot have. Third is the local investment we’ve received. Nine months ago, we received a big investment in Colombia from Santo Domingo, which injected US$25 million, and that’s helped us to grow a lot. Our focus on the client is, without a doubt, another point in our favor.

This text has been adapted and translated by Emily Stewart from its original Spanish publication.