Having outlined an expansion strategy, the next step is its implementation. Entering a new market is a challenge that must be outpaced by every business, and when it concerns LATAM countries, partnering with a local expert will determine the success of a company.
A local expert proves to be the most valuable lever as it will help you hurdle the challenges that any company faces in a country with which has no familiarity.
What kind of challenges companies need to hurdle?
Establishing a business in Latin American countries, such as Brazil, Mexico, Argentina, and Colombia, means handling not only with the basic needs of management and marketing, but also with infrastructure issues, the linguistic barrier, and the sociocultural differences. As the LATAM geo-economy becomes more and more attractive as it represents more than 155 million potential buyers, it becomes the number 1 priority to hurdle challenges such as:
The heterogenous LATAM emerging region
Mislead by the fact that Latin America has only two predominant languages, i.e., Spanish and Portuguese, most merchants assume this emerging region as a compact set of economies. However, each country has its cultural nuances and presents different levels of infrastructure development that determine the market behavior and their consumers: internet penetration rate, local traditions that dictate special shopping dates and the existence of an assortment of alternative payment solutions are just a few examples of the existing dissimilarities.
How can your business benefit with local experts’ guidance?
Given the above heterogeneous scenario, in order to ensure that the expansion strategy goals are achieved without jeopardizing the investment made, companies are strongly recommended to partner with a local expert that will guide them throughout the process, as well as to provide their business with a full package of services:
Expand your business to LATAM with help of a local expert
In Latin America, payments have some particularities, such as:
- According to BoaCompra’s estimates, only 22% of credit cards issued in Brazil are enabled for international transactions.
- Many consumers prefer cash-based or other alternative payment methods.
- Cards must be processed locally, in the native currency.
- Customers pay in installments.
Therefore, when choosing a local expert to help you with your LATAM expansion it is advisable to opt for a payment aggregator such as BoaCompra since it meets all the above know-how: in local payment preferences; on the role of installments payments in emerging markets such as Brazil; and in the importance of alternative payments, which are key to deal with countries with low rates of people using banking services, such as Mexico – the second largest economy in Latin America.
But a partnership with a payment aggregator can bring even more benefits, especially to merchants who are not well acquainted with the fragmented reality of the Latin American market. According to Cláudia Feijão, account manager in BoaCompra, some merchants can make some detrimental mistakes for their commercial expansion, such as trying to apply the same checkout model to all markets, lacking the complete understanding how important is the investment in customization.
“As far as merchants are concerned, the realities are varied,” explains Cláudia Feijão. “On the one hand, there are merchants who have an in-depth knowledge of payment providers, but they do not understand the Latin American market. On the other hand, there are merchants who need more detailed monitoring, since they do not know the particularities of Latin America or how an international provider works. That’s where we come in.”
Thus, the main role of the account managers is to better understand the needs of the merchant and provide them with a personalized and thorough follow up. Through account managers, merchants gain a personalized follow-up service, which includes proposals for improvement in the organization and adaptation of the online checkout, hence optimizing the business to the reality of Latin America.
This specialized guidance is not only focused in the checkout improvements, since account managers can also advise about the particularities of the Latin American market, such as the individual market’s consumption habits and favorite local payments.
In conclusion, by partnering with a payment aggregator your business will have all the conditions and know-how to tap the promising Latin American market without the need for a local presence, allowing you to sell both physical and digital goods in a feasible manner.