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Country Manager - Latin America

Group 8
by

Julia R

on 25 July 2013

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Transcript of Country Manager - Latin America

Phase 1 - building market share
Phase 2 - improving profit margins
Increase plant capacity in Chile accordingly in order to minimize COGS
Adapting prices (competition, inflation etc.)
Improving retail sales by increased promotion and sales force where necessary
Phase 3 - cost-cutting & economies of scale
Scale back advertising drastically after long-term brand loyalty established
Scale back allowances and promotion to industry average
Continuing (minor) price increases (above inflation rate)
Increase number of SKUs to serve the whole market
Outcome
Product
Price
Place
Promotion
Enter with niche products (eg kids)
Focus on segments with high demand
Increased number of SKUs in highly segmented markets (Brazil, Argentina)
Prices above local competition but below foreign competition
"American brand"
Compete on price in Economy segment
Increased prices for Niche products
Traditional and hypermarket channel always entered
If profitable, self-service distribution
Sales force and allowance above competition in the first periods
New ad campaigns for all products when entering Mexico in first period
Adapting Mexican ads for all other countries
Renew ads every 2-3 years
Advertise heavily in the beginning, industry average after a while
Overall performance
Mexico
Peru
Chile
Venezuela
Brazil
Argentina
Entry strategy
Enter all markets in period 1-4

Period 1: Enter Mexico, build plant in Chile
Period 2: Enter Chile
Period 3: Enter Brazil, Venezuela
Period 4: Enter Peru, Argentina

Net contribution USD 108.4m
Net cum. contribution USD 467.5m
Overall market share 43.3%
BEI 81
Net contribution USD 16.4m
Net cum. contribution USD 102.2m
Overall market share 19.4%
BEI 71
Net contribution USD 115.6m
Net cum. contribution USD 394.5m
Overall market share 24.0%
BEI 69
Net contribution USD 3.3m
Net cum. contribution USD 15.6m
Overall market share 44.9%
BEI 73
Net contribution USD 7.8m
Net cum. conribution USD 28.6m
Overall market share 28.9%
BEI 70
Net contribution USD 24.6m
Net cum. contribution USD 97.2m
Overall market share 15.6%
BEI 76
Net contribution USD 230.1m
Net. cum. contribution USD 753.6m
Overall market share 26.5%
BEI 82
Conclusion
Success factors:
Aggressive marketing and deep penetration
Achievement of economies of scale
Challenges:
SKU fine tuning
Marketing budget allocation
Future improvements:
Quicker regional diversification
More precise adaptation to market changes
Advertising relative to market potential and needs
Global marketing simulation
Latin America

Group #8
Full transcript