Is data a source of competition or concern in the brazilian retail market?

Abstract

Context: businesses have always used data to make decisions, but the amount, variety, and speed of data have increased dramatically in recent years. This fact led to the emergence of big data, which in turn intensified innovation, led to new services and products such as real-time traffic information and personalized marketing and delivery services. While big data has led to efficiency gains, it has also sparked a new debate in antitrust: to what extent, if any, could data become a competitive concern? Objective: this article is a case study on the Brazilian retail market based on recent literature on barriers to entry fostered by data-based activities and the importance of data as an asset capable of creating market power and giving rise to anti-competitive practices. Method: a bibliographical review was carried out regarding the importance of data as a possible asset that creates barriers to entry, as well as the interpretation of the Brazilian antitrust authority – Conselho Administrativo de Defesa Econômica (Cade), in recent mergers, in addition to an exploratory analysis of data on access and revenue of the main retail players in different market segments and business types. Conclusions: the article concludes that, taking into account the case study, it is not evident that big data leads to highly competitive advantages in the retail sector in Brazil and that competitive concerns do not extend to all data-intensive markets, as data can be segmented and provide different competitive advantages that do not imply relevant barriers to the Brazilian retail sector.

Keywords

• data-driven markets
• competition
• retail
• consumer behavior
• multihoming