Winning Strategies for the New Latin Markets

Citation

Spillan, J.E. (2004), "Winning Strategies for the New Latin Markets", International Marketing Review, Vol. 21 No. 6, pp. 666-667. https://doi.org/10.1108/02651330410568079

Historically, many discussions have focused on the turbulent events that have been barriers to entry and investment in Latin American markets. While Winning Strategies for the New Latin Markets by Robles, Simon and Haar continues the discussion of the uncertainties in market entry, it frames the discussion from a positive, exciting and challenging perspective. The book ambitiously outlines the factors and forces that are shaping the new Latin markets. It shows how consumption patterns and technological trends are changing the “business as usual” mentality in almost all Latin American countries. Argentina, Brazil and Mexico emerge as the shining stars that offer opportunities and challenges for business opportunities.

The book has three parts and eight chapters. The parts include the new environment, sector specific strategies and an in‐depth conclusion. The full text is detailed with numerous examples and statistics supporting the authors’ ideas, concepts and arguments. Using various charts, graphs and tables, the authors provide a substantial and effective comparative analysis that allows the reader to understand the trends and draw his/her own conclusions about the new business environment that exists in Latin America.

In the first part of the book entitled “The new environment” the authors spend three chapters discussing the Latin business in a new economy. These chapters focus on describing the macro outlook for business development. The discussions highlight the economic uncertainties, the regional integration strategies, technological trends and specific company strategies that businesses face as they meet the new market conditions. The details and explanations the authors offer are comprehensive and easy to understand. The other two chapters in this section concentrate on the Latin consumer composition and the competitive landscape that exists in the new economy.

The book starts out with a rich discussion about how the last decade of the twentieth century introduced unprecedented transformation in Latin America. The new business drivers, such as global financial systems development, regulatory reform, regional integration, market transformation and technology, have reshaped the environment and business thinking in the region. The process of privatization, market liberalization and structural reform has changed the way business is conducted. A major example of this transformation relates to the retail market metamorphosis. The change from open markets to malls and enclosed modern self‐service supermarkets is just one illustration. With these changes came significant increases in trade, which created an investment boom through the 1990s. Exports tripled and foreign direct investment (FDI) increased eightfold. Such trends have affected the products and structure of business operations. The transformation and increased FDI have given multinationals an opportunity to expand their business into Latin American markets. As such, the competitive landscape has become more intense and thus has required companies to introduce new and innovative strategies to compete.

Robles, Simon and Haar continue their analysis by presenting the complexity of the Latin consumer. They explain, in detail, the nature of the Latin market and the consumers that comprise it. Based on rigorous analysis, they believe that the key to understanding this market focuses on defining the core Latin identity. This is important because marketers must not only view the Latin market from a geographical perspective, meaning those countries south of the USA, but also include the 34 million people of Latin origin in the USA. Marketers have to consider three major segments, the Brazilians, the Mexicans and the US Latin American markets, as critical components of the region. The authors call this the golden triangle representing approximately 67 per cent of a $1.6 trillion market.

Within the context of the Latin markets, the authors have identified three main drivers of buying behaviour: economic insecurity, demographic shifts and increased concentrations of buying power in cities. Their analysis indicates that the major consumer purchasing activity is located in three major markets: Brazil, Mexico and Argentina. These three countries represent 75 per cent of the Latin American consumer buying power and 68 per cent of all the households in the region in 2000. The most relatively affluent markets are Argentina, Mexico, Venezuela, Uruguay, Puerto Rico, and Latinos in the USA with Chile classified as a high middle‐income country also having substantial consumer buying power.

In the second part of the book, Robles et al. direct their attention to describing the construction of infrastructure networks, reaching new consumers, finding market growth and improving health care services and products. In this context, the authors outline the constraints and challenges that need to be overcome in order to implement viable marketing strategies. With a poor telecommunications and energy infrastructure existing in just about every Latin country, building new modern ones continues to be extremely important. The authors maintain that the creation of the infrastructure will allow regional network strategies to emerge so that investors, marketers and business developers can initiate business activity that will broaden and deepen the market opportunities in Latin America. Network strategies will evolve over time to adapt to changing market and regulatory conditions. Thus, organizations will have modified their structures and business operations to meet the needs of the new infrastructures. The authors’ analyses reveal that the narrow regional integrator and specialist approach were the top performing strategies in 2000. Finding a value proposition that matches (positions the company) to meet rapidly changing consumption desires in the new Latin markets will require different business policies and strategies.

The final part of the book presents a preview of the windows of opportunity that are possible with winning strategies in Latin markets. In this section, the authors analyze the strategies that are possible in uncertain and volatile markets. The process of privatization, market liberalization and other structural reforms are the drivers of opportunity, which can offer businesses the possibility to develop strategies that never existed before. As the authors have so effectively stated, the new business landscape now provides a major link to the global economy. As such, trade, investment flows and the connection to larger markets enhance the opportunities for Latin markets to grow, develop and widen the windows of opportunity. The authors’ analysis clearly indicates that the position as an integrator, a specialist, a shaper and a regional/national champion will be the primary strategic roles available to business and marketing entrepreneurs in the new Latin markets. To implement these strategic roles, brand relevance will be a key strategic option that will be crucial to building winning strategies in Latin markets.

The political uncertainties that have dominated Latin American history are absent from the discussion. As one reviews the history of Latin America, it is obvious that this one variable could become a major obstacle preventing the continuation of the transformation and existence of market opportunities. Unforeseen political changes could dramatically alter the positive direction that has allowed the strategic opportunities to evolve in Latin markets.

This book provides an exceptionally fresh contribution to the business literature. It is an in‐depth analysis that contains a wealth of information about the reality of Latin market environments. It is a first rate detailed presentation of the opportunities available to business people who craft and align winning strategies to the new business landscape unfolding in Latin America. The authors close a major gap that has existed in understanding the economic and business environment existing in Latin American markets. The book provides substantive details, significantly important insights that are invaluable to business developers, marketers and entrepreneurs interested in Latin America.

Overall, Winning Strategies for the New Latin Markets is well worth reading for both academics and who are interested in understanding the contemporary business environment in Latin America and for practitioners who are interested in pursuing business opportunities in that region.