3 Keys to Conquer the Latin American Market
By Sebastián García Díaz CEO Grupo Oxford
We would like to give a brief panorama and some advice to companies that are looking to expand their brand and sales to Latin American markets.
We know that, for some of you, consider that developing a plan to conquer Latam could be like landing on another planet! We are here to help you.
Latam is a big market in terms of surface area, 20 million kilometers, that represents almost 13,5% of the entire planet. The biological wealth of this region is famous for having some of the most important rivers of the world, jungles, mountain rages as Cordillera de los Andes, and plains for crops…
650.000.000 people live in America Latina in 30 different nations.
Brazil is the main market, with a surface that represents 47% of South America and it has the most important number of people: 212 million, as well as the most powerful economy in the continent. It is the only country in the region who speaks Portuguese.
The other three main markets are Mexico with 130 million people, Colombia with 51 million people and Argentina with 45 million people. In these countries, people speak Spanish as the rest of the nations in America, except for one or two little countries that speak French.
Ethnically, the region is a melting pot, with high margins of miscegenation and hybridization. This means that there is an abundance of racially indeterminate individuals (mestizo), as well as spaces in which white Europeans, Africa's descent or different native typologies predominate. To this was added, throughout the 20th century, an abundant Asian and Arab migration.
The region has significant levels of poverty, both urban and rural, and was the scene of highly uneven industrialization throughout the 20th century. Most of its economies are extractive, dependent on the export of raw materials.
¿Where are the opportunities in Latam Market?
There are 3 keys to understanding opportunities and making a good strategy to conquer this market.
First of all, in each country, the majority of the population is concentrated in a few large cities, usually in the capitals and two or three cities where 80% of the population lives. This reality allows us to explore these markets concentrating the investment in these districts.
The second key is that in each country there is an upper class and a middle class that are not big enough. On the contrary, they are not far away from the 15-20% added to the two classes. But inside these social classes the incomes and consumption behavior are similar to the ones in the “first world” and the most developing countries.
So we have the opportunity to explore the market of a country in Latam, entering by the main 2 or 3 cities and with a special focus in the upper and middle class that are a target that you can achieve without doing an extraordinary effort.
Buenos Aires, Montevideo, Asunción, Santiago de Chile, São Paulo and Rio de Janeiro, Bogotá, Lima, Guayaquil, Caracas, Mexico DF… in this handful of cities are focused in the Latam market.