Selling in Latin America Marketing Insights & Reality

Market Basics 250 million low-income consumers $120 billion in annual purchasing power “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

Global Retail Giants Have made only modest progress in penetrating low income segments in Latin America Current retailing format is targeted at high income customers Carrefour, Metro & Wal-Mart carry merchandise aimed at upper class Ignored low income market segments

Fortune at the bottom of the Pyramid C.K.Prahalad recently published his findings on how firms can be profitable by serving those who are neglected today Latin American Governments are trying to solve Economic & Social problems Firms can seek growth and profit by refocusing on lower class and middle- lower class segment Wal-Mart became successful in US by concentrating on lower end of market

The Challenge Selling to lower end consumers is a big challenge Firms are unfamiliar with distinctive retail terrain of Latin America Understand the market needs Firms must offer different value propositions Modify their distribution & marketing strategies While maintaining current offerings to existing customers Will require a new business models

Retailing Sector

Recent History Economic Boom of 1990’s and