Go-To-Market Lessons From High Growth eCommerce Sites in BRIC
2 weeks ago, I gave a speech at eCommerce Brazil Forum 2013 in Sao Paulo on Similarities and Differences in eCommerce in BRIC and led the panel with the 2 leading Latin American online retailers: Dafiti (Malte Hoffman as a Co-Founder) and Buscape (Pedro Guasti, VP of Marketing and Intelligence).
We explored the trends in ecommerce in developing countries to see what we can learn from and apply today. We took a number of questions from the audience.
Our similarities were apparent: Brazil, Russia, India and China (and we can even add South America) comprise huge markets, with proven demand for various goods sold online for different reasons.
By the year 2015, according to various industry projections:
- Brazil can provide up to $25 billion US dollars of online sales
- Russia up to $38 billion
- India has a potential within $11 to 38 million
- China tops all with $443 billion
Those are the markets hard to ignore.
Other common trends include: the eccentric or hard to deal with government, the reality of building your own logistics and fulfillment companies in addition to your ecommerce business, and cash-preferred and thus complex payment processing.
Sounds like a handful to solve for to an average online store in US, lucky to have a tall number of services, technology and processes already setup and competing for its business. Yet, there are brave souls that venture out and solve those problems head on. Get my list of the top 10 ecommerce sites to watch and study in BRIC.
The differences exist mostly in culture and the pre-existing environmental conditions. Some of which are good to dig deeper into to find profit making opportunities in ecommerce (i.e. identifying specific niches based on the cultural pull or the real pain that must be solved today given the reality and people waiting for it, ready to pay for the convenience).
We could see Russia as a great market for high end fashion and jewelry, given the strongest cultural trait to dress up and wear the best, even if it costs up to $2K per a clothing item. There is a reason why big fashion retailers from France and UK are moving to setup their ecommerce operations in Moscow.
In China, and Asia as a whole, you can pretty much sell anything you can imagine. Marketplaces ecommerce model is very common. It really opens one’s mind if you can read Chinese to explore some of the sites and see the level and broad scope of what is possible.
In India, the travel industry seems to be the most successful, feeding on the need of family arrangements that spread across continents.
While Brazil spends the most on beauty products. No wonder it is one of the beautiful countries in relation to its population. Plus, cosmetics is so expensive there, women go to the US with empty suitcases and come back with tons of merchandise they stack up for months. From my own experience of travel to Brazil, I was always shocked by the prices you have to pay for the basic items in the drug store.
We also found a number of go-to-market lessons for ecommerce companies launching in Russia, Brazil, China and India. The common 6 lessons include:
1. Tap into the culture
(find what surely sells given the strong cultural coloring or the situation).
2. Solve what you can first
(if you have to create a fulfillment team like courier delivery in Russia by Ozon.ru or on delivery cash fleet in India, do so).
3. Adopt a marketplace model
(spread the risk).
4. Partner up with competition
(you only win in the developing economy if you share the costs against the common enemies).
5. Invest in technology and people
(no brainer, but both move the needle in corporate speak).
6. Dare to be different from the status quo
(you are not your government).
Want to learn more and get the details?
- You can get the full scoop on CommerceBrain slideshare. Yet, most of the great insights are in the actual speech and panel discussion. Stay tuned as the video will be up in a few weeks.
- I will be sharing more stories and how-tos on the BRIC ecommerce in my upcoming ecommerce book. You will discover more success examples from online retailers all over the world, tips from the world-class consulting experts in internet marketing and retail. Plus, you get access to tons of the shared resources. Sign up for the limited time free download invite on the launch page.