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Types of retail in Latin America

The fact that more and more people have a pet and even treat it as a member of the family has made the pet food industry grow rapidly. There are multiple chain stores in Latin America that offer the end customer different alternatives. There is also a great diversity of stores dedicated to the distribution of these products and there are also stores specially dedicated to the sale of pet products.

Retail market data 

The countries leading this accelerated growth are Brazil and Mexico. In Latin America alone, the annual growth of the pet food industry, according to the Euromonitor report, is 6% and is expected to reach 8% by the end of 2022.

In Mexico, according to the 2019 census there are 998 thousand 120 businesses that sell retail. In Brazil, 28% of the population currently works from home and half of them claim to shop at corner stores, according to the portal Brasilpostos. 

Among the options that are being offered in these stores is usually pet food, so when going to the corner store it is more accessible to buy food for your pet at low prices and in smaller packages, also these stores usually offer these products in bulk, which is a savings for consumers.

Retail options

Throughout Latin America there are several chain stores that offer the end customer a variety of pet food alternatives. In Brazil stores such as Magazine Luiza, Lojas americanas which are national companies to multinationals such as Carrefour, Wal-Mart, Sam ‘s Club. In Mexico: corner stores, supermarkets such as Chedraui, Soriana, as well as OXXOs, Extra (chain of self-service stores), without leaving aside also the multinationals mentioned above.  

All these stores offer the consumer multiple options, a variety of imported and domestic products. This is perhaps the fastest way to enter the market: through retail trade. On the other hand, there are also stores specially dedicated to the sale of pet products that also include veterinary services, bathing and canine esthetics.

Laika is an online pet store with a variety of products and home delivery service in Mexico, where you can find pet food from different brands. This company has expanded and already has a presence in multiple countries in Latin America.

It is common these days to see how physical stores now also have a presence through e-commerce and it is certainly a way in which you can sell retail, in stores like Laika. 

In Brazil, PetLove which in its beginnings started as a physical/veterinary store and then moved to the digital world. They have a very wide catalog with different presentations in pet care products.

Below are the characteristics of some retail stores, type of customers and how to communicate with them through the different retail outlets available in Latin America.

  • Corner stores. They are distributed in the neighborhoods. Sells a variety of products for daily consumption. Accessible to all. Personalized attention from the shopkeeper. Customers of corner stores are lower-middle class and according to Merca 2.0 are people on average 30 years old, stay only 3 minutes in the store, 87% usually arrive alone, travel 4 blocks on average to reach the point of sale and buy 39 times a month in this channel.
  • Specialty and veterinary stores: There are not many per neighborhood as in the previous case; in some cities there are even neighborhoods that do not have any. They are dedicated to the health and care of animals. Personalized attention. They sell accessories, medicines and specialized food. These businesses already have conditions for the sale of products and set their own marketing rules. The customers of these stores are of different ages, upper-middle class, who often go without any intention of buying, they just go to see the products or go directly for the product they are looking for.
  • Self-service stores: These are expanding more and more in all neighborhoods, where there is no personalized attention. They sell all kinds of products. They sell different brands of products and all products of the same kind are placed in the same place, i.e. in the case of pet food, all brands are located on the same shelf. These establishments already have product sales conditions and their own marketing rules. Customers are of different ages and any social condition, who usually go without the intention of buying. They just go to see the products, or they go with the intention of buying something else, and if the right marketing material is used they end up buying other things.
  • Food market. This is the place where most of the corner stores and many end consumers go to stock up, since they are looking for better prices and less intermediaries. It is difficult to implement marketing strategies. The customer usually does not pay attention to the brand. They buy certain products in bulk, such as pet food. The type of customer varies; they are usually people 40 years of age and older, lower-middle class. They are looking for medium quality products at a low price.
  • Grocery stores. These stores are in charge of supplying the corner stores. They sell a variety of products and everything that is needed in any home. The suppliers are the ones who carry the products; they have warehouses to store them. They sell wholesale and retail. The customers are the owners of corner stores and sometimes the end customer also goes. Usually the customers are lower-middle class. 

How to sell your products at retail?

Whether in prestige stores, corner stores or self-service stores, the importance of distribution is to position the brand in the customer’s mind. While e-commerce for the pet food industry is on the rise, especially for the younger generation, many consumers still prefer to purchase their products in a store. 

Almost all pet food brands are opening online stores and physical stores to distribute their own products, but they should not neglect this important retail strategy. 

OXXO has some brands such as Pedigree and Ganador for dogs and Whiskas for cats. Corner stores make use of bulk sales because of the cost and ease of selling small quantities to customers. While the variety of products is not great in most cases, it is a lifesaver for pet owners who have run out of food. 

Marketing strategies to approach retailing

Product availability. This consists of making sure that the point of sale has enough product so as not to give the customer a bad experience. 

Communication material. Don’t forget that it is your product that is in that store. Provide the necessary promotional material for the customer to see that your product is on sale in that store. 

Design a strategy for the sale of merchandise in these points of sale. It should be made clear that there is an exit strategy for products that are about to expire or simply did not sell, as well as a positioning strategy. Whether it is a corner store or a specialty store, it is important to make clear the strategies for the sake of the brand image, the product and the customer. 

Entering a sector such as the Latin American market through retail is the best way to position yourself. Although competition is very strong, since as mentioned above there are several options for the end consumer in the retail world, this is still a good option or at least an alternative. Don’t miss the next article where we will talk about the 4 strongest trends in the Latin American market and the advantages and disadvantages of retail.

Pet power

The retail option is available throughout Latin America, and while the strategies can be replicated in different countries in this region, the target audience must be taken into account. With the growth of this industry, the competition will undoubtedly become greater and especially the demands of customers towards the product they bring to their pets. It is vital to be more strategic and implement all available tools.  

Diana Mercado has a degree in Marketing with a Master’s Degree in Business Administration. Director of Zoo Inc. marketing and digital communication agency. I have worked for more than 10 years in marketing for the agricultural, livestock and pet food industry. For more information: marketing@zooincagency.com 

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