蘑菇AV

The result: Mercado Libre鈥檚 ad business is gaining speed鈥攁nd shows no signs of slowing. Retail media revenues jumped 59% YoY on a currency-neutral basis in Q2. Our take: Mercado Libre鈥檚 retail media engine is firing on all cylinders, providing high-margin fuel to support key growth levers like free shipping and brand marketing. But while advertising can help offset those costs, it can鈥檛 carry the full weight鈥攅specially as broader profitability shows signs of strain. 鈥淢别谤肠补诲辞 Libre鈥檚 first-mover advantage laid the foundation for its retail media dominance in Latin America, but its real edge lies in continued ad innovation,鈥� said 蘑菇AV principal analyst Matteo Ceurvels, pointing to new offsite offerings like the Display Extended Network and a deeper push into CTV.

Retail media鈥攆ueled by Mercado Libre鈥攚ill be the fastest-growing channel, with a compound annual growth rate (CAGR) of 23.0% between 2025 and 2029. Connected TV (CTV) will also scale rapidly as viewing shifts to larger screens, but it will represent just 2% to 3% of the digital ad pie during the same period. Digital鈥檚 rise will reshape the competitive landscape.

Mercado Libre, which combines data from its digital marketplace and fintech arm, Mercado Pago, to build richer audience profiles and enable more precise ad targeting across its ecosystem. Rappi and DiDi go even further, operating across retail, banking, and travel.

How will tariffs affect prominent ecommerce players like Mercado Libre? Tariffs will make US brands less competitive in Latin America, forcing players like Mercado Libre to adjust their international seller acquisition strategies and navigate new pricing pressures. Mercado Libre could use this moment to position itself as the go-to platform for cross-border ecommerce between the US and Latin America.

One of Latin America鈥檚 most successful fintechs is Mercado Libre-owned digital wallet provider Mercado Pago, which boasts 61.2 million monthly active users. The rollout of instant payment systems is poised to drive even greater digital wallet adoption across Latin America.

Mercado Libre will be the primary beneficiary of this regional largesse. Retail media鈥檚 share of digital ad spending is significant everywhere. China remains an extreme outlier, but every country we track will see annual increases in retail media penetration. None but China will likely reach a 50% digital ad spend share for retail media鈥攂ut all will see that share rise going forward.

Mercado Libre and Reddit, the two projected front-runners, have a much smoother path ahead鈥攁lthough both are growing from a small base. Mercado Libre will lead in growth again in 2026. Click here to view our full forecast for digital ad revenue growth by company worldwide. Retail media and social media ad platforms will dominate the top 10 list for growth.

Mercado Libre. OXXO. Peterson Institute for International Economics (PIIE). Sodimac. Spotify. Televisa.

Its share is much lower in Latin America, where Mercado Libre has emerged as a dominant force. The retail media market is starting to fragment outside of Amazon鈥檚 footprint. This is partly due to large domestic retailers investing in media networks. This includes Loblaw Advance and Canadian Tire鈥檚 Triangle Media, which provide a range of advertising options by tapping into loyalty programs.

Mercado Libre. YouGov.

That鈥檚 not the case in other markets鈥攍ike Latin America, for instance, where Mercado Libre is a homegrown juggernaut with 33.1% of ecommerce sales in the region. Walmart Canada is the nation鈥檚 second-largest ecommerce retailer, expected to account for 6.3% of ecommerce sales in 2025. The company鈥檚 strong growth is thanks to its assortment of grocery and general merchandise.

Mercado Libre鈥檚 retail business is thriving: Advertising revenues rose 50% YoY in Q1, and there鈥檚 ample room for growth.

Mercado Libre is bullish about growth opportunities: The ecommerce giant is making massive investments to extend its dominance of the Latin American market.

Mercado Libre, which combines data from its digital marketplace and fintech arm, Mercado Pago, to build richer audience profiles and enable more precise ad targeting across its ecosystem. Rappi and DiDi go even further, operating across retail, banking, and travel.

Mercado Libre will invest a record-breaking $2.45 billion (MXN 43.45 billion) in Mexico this year to grow its logistics network, strengthen Mercado Pago (its payment app), and expand technology capabilities. Between 2017 and 2024, Mercado Libre will have invested $7.72 billion (MXN 136.90 billion) into its operations in Mexico鈥攖he largest amount by far among its peers.

The retailer鈥檚 ecommerce infrastructure is outdated, complicating its efforts to double sales by 2033 and close the gap with Amazon and Mercado Libre. Some of the $6 billion will go toward the opening of two advanced distribution centers in Baj铆o and Tlaxcala, which will use advanced robotics and AI technologies.

Mercado Libre will account for 66.5% of ecommerce sales in Argentina this year: Amazon sees an opportunity to chip away at that share by offering a $5 flat international shipping rate.

Retail media is the fastest-growing digital channel, led by Mercado Livre. CTV will capture a small share but is scaling quickly as viewing habits shift from mobile devices to larger screens. The old media guard will lose ground to digital-native competitors. Once the undisputed ad market leader, Globo has ceded ground to players like Meta.

This is the first installment of our 鈥淏razil Ad Spending Benchmarks鈥� series, which helps ad buyers and sellers calibrate their spending and revenue mix against the market.

This is the first installment of our 鈥淢exico Ad Spending Benchmarks鈥� series, which helps ad buyers and sellers calibrate their spending and revenue mix against the market.