The Brazilian Tablet Market

tablets-montageAs worldwide sales of tablets are affected by lackluster growth, Brazilian consumers continue to show significant interest in these devices, to the point that the expansion rate of this market in the country remains one of the highest in the world.

According to market researcher IDC, the third quarter of 2014 saw sales of tablets in Brazil rise by 18.1% when compared to the previous year, while global shipments grew 11% during the same period.

Similarly to other devices like smartphones, the interest towards tablets from Brazilian consumers can be attributed to the relatively low prices, part of which are the result of tax incentives applied to devices produced in the country, and an overall acceptance for build quality and functionality that is unlike the consumer culture of other territories such as North America.

Tablet consumption in Brazil

Tablet salesIDC’s data from Q3/2014 points out that most tablets sold in Brazil are entry level, budget minded products. Around 78% of all tablets sold during this period had retail prices of less than BRL 500, and over half of these devices cost less than BRL 300.

The highest selling tablet models in Brazil belong to a number of local brands such as CCE, Positivo and DL, manufacturers that manage to market budget-oriented products able to compete with global brands such as Samsung, LG and HP.

Meanwhile, Apple, the world leader in tablet sales, had a 5% share over tablets sold in Brazil during the third quarter of 2014, a sign that a considerable portion of consumers interested in the brand buy their products when traveling abroad, as a way to avoid the costs of Brazilian taxation.

Tablets from the brands that are assembled in Brazil, and therefore are entitled to reduction of determinate taxations, still end up hitting the shelves at price points around 60% higher than the ones offered in markets like the United States. This is one of the main causes of the high sales of products available in the grey market.

Additionally, the main functionalities sought by tablet users in Brazil differ from other market. Brazilians are usually focused on consumption of digital entertainment content and social media, and this may be one of the most significant causes for the wide adoption of entry level devices.

Main uses of tablets by Brazilians

The results of a research by ComScore from September 2014 indicate that the most commonly used functionalities of tablets by Brazilian users were internet browsing, at 82%, checking email, at 74%, using apps, at 67% and accessing social networks, at 65%.

The main interests of Brazilian tablet users are mostly related to functions that do not necessarily require or are benefit from high end screens or processing power. For example, only 34% of users from the same research watch movie streaming on tablets, and a large portion of users play social games that run reasonably well on these devices.

When these results are taken into consideration with other data from the Brazilian market, one might assume that Brazilian users generally treat tablets not as second screens, where digital content is consumed, but as basic, extremely cheap PC’s.

As the country’s tablet sales continue to rise, the retail of desktops and notebooks are seeing a continuous and relentless drop year after year. From the third quarter of 2013 to the same period in 2014, PC sales in Brazil fell 25% to a combined 2.6 million computers sold, according to IDC.

With the growth of the Brazilian middle class, which holds limited purchase power for electronics but remain interested in the general functionalities of computers, the sales of tablets are expected to keep growing over the next few years, mostly driven by these devices accessible prices and basic, yet appealing uses.

Innovation Norway is responsible for promoting the Norwegian industry abroad. Our office in Rio de Janeiro manages Innovation House Rio, our business incubator office, and helps Norwegian companies in their efforts towards the Brazilian market.

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