Selling In Latin America

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Selling In Latin America

  1. 1. Selling in Latin America Marketing Insights & Reality
  2. 2. Market Basics <ul><li>250 million low-income consumers </li></ul><ul><li>$120 billion in annual purchasing power </li></ul><ul><li>“ Low-income markets present a prodigious opportunity for the world’s wealthiest companies — to seek their fortunes and bring prosperity to the aspiring poor” -- C.K.Prahalad </li></ul>
  3. 3. Global Retail Giants <ul><li>Have made only modest progress in penetrating low income segments in Latin America </li></ul><ul><li>Current retailing format is targeted at high income customers </li></ul><ul><li>Carrefour, Metro & Wal-Mart carry merchandise aimed at upper class </li></ul><ul><li>Ignored low income market segments </li></ul>
  4. 4. Fortune at the bottom of the Pyramid <ul><li>C.K.Prahalad recently published his findings on how firms can be profitable by serving those who are neglected today </li></ul><ul><li>Latin American Governments are trying to solve Economic & Social problems </li></ul><ul><li>Firms can seek growth and profit by refocusing on lower class and middle-lower class segment </li></ul><ul><li>Wal-Mart became successful in US by concentrating on lower end of market </li></ul>
  5. 5. The Challenge <ul><li>Selling to lower end consumers is a big challenge </li></ul><ul><li>Firms are unfamiliar with distinctive retail terrain of Latin America </li></ul><ul><li>Understand the market needs </li></ul><ul><li>Firms must offer different value propositions </li></ul><ul><li>Modify their distribution & marketing strategies </li></ul><ul><li>While maintaining current offerings to existing customers </li></ul><ul><li>Will require a new business models </li></ul>
  6. 6. Retailing Sector
  7. 7. Traditional Retailing <ul><li>Traditional stores tend to be small about 2 to 50 square meters) and offer mostly counter service such as: </li></ul><ul><ul><li>Small supermarkets are self-service businesses, usually with no more than four checkout lanes </li></ul></ul><ul><ul><li>Street vendors and open-air markets don’t have a permanent location; many are mounted on carts that serve as easily moved stalls </li></ul></ul><ul><ul><li>Category specialists , such as butchers, bakers, and greengrocers, offer a limited selection of fresh foods. </li></ul></ul><ul><ul><li>Convenience outlets use kiosks that are less than 10 square meters in size </li></ul></ul>
  8. 8. Recent History <ul><li>Economic Boom of 1990’s and </li></ul>

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