A summary for Corporate Marketers, Media Sales Executives and Advertising Agencies to see what clients are moving into the market and/or targeting Latin American consumers right now.
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- Despegar & Falabella
Despegar.com, Corp., the leading online travel company in Latin America, announced it has entered into an agreement with Falabella Financiero, a subsidiary of Falabella, through which both companies plan to establish a 10-year commercial agreement in Chile, Colombia, Peru, and Argentina, the term of which could be extended. Included in the transaction is the transfer of 100% share ownership of Viajes Falabella’s operations to Despegar.The acquisition of Viajes Falabella in Chile, Colombia, Peru and Argentina, together with the license to use the Viajes Falabella brand name has been agreed for a total consideration of US $27 million. The transaction assumes the transfer of these operations free of any financial debt.With this agreement, clients of both companies will have access to an enhanced travel and tourism product and service offering, through an omnichannel service model (online, call center and physical stores). In addition, customers will be able to access exclusive discounts, earn double CMR Points Falabella’s loyalty program, both at Viajes Falabella and Despegar, as well as an expanded product offering in exchange for CMR Points at Viajes Falabella.Viajes Falabella will maintain the brand, its network of physical stores and its digital platforms, to enhance the supply of products and services of Despegar.
Natura will take over the operations of The Body Shop in Latin America. Effective on May 2019, the shift is part of the Natura &Co group’s strategy to enhance synergies between its different brands and is in line with the transformation plan of the British cosmetics brand aiming to strengthen its presence in the region.Today, The Body Shop has about 160 stores in Latin America, including franchises and own stores, with presence in Brazil, Chile and Mexico. Natura’s Retail Director, Paula Andrade will also lead the operations of The Body Shop in the region, using the existing structures of the two businesses. A General Manager will be named in Brazil, where most of the stores are concentrated, as well as in Chile and Mexico.In Latin America, the plan includes: the adaptation of the global portfolio to regional specificities, with a greater emphasis on the fragrance and gift categories; a review of the store network management; the adoption of new systems to make The Body Shop retail more competitive; and increased brand awareness. In addition, the group wants to optimize The Body Shop production costs by using the Natura production facilities.Natura’s retail operation also continues to expand, with 37 own stores in Brazil and nine in international markets. In the second quarter, there are plans to open eight more stores in Brazil.
Santander has offered to take full control of its Mexican business through a 2.6 billion euro (£2.24 billion) all-share deal as the Spanish bank chases potentially higher returns available from Latin America. The deal proposed will unwind Santander’s listing of 25 percent of the bank on the Mexican stock exchange in 2012. The move is part of efforts to focus more on emerging economies while cutting costs to counter squeezed margins in mature European markets.The Mexico deal will also bring Santander head to head with Spain’s second-largest bank BBVA, which makes about 40 percent of its earnings from Mexico.Mexico is a highly profitable market, where Santander has set a mid-term target of 19-21 percent for the underlying return on tangible equity.Santander expects the transaction to have a return on investment of approximately 14.5 percent, to be neutral on earnings per share and to contribute positively to the group’s core Tier-1 capital ratio.
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- General Motors
General Motors has spent five years re-writing its playbook for making money in Latin America and the interior of China. Now, it’s show time for the first results of a project code-named GEM, for Global Emerging Market.The No. 1 U.S. automaker plans to unveil two small SUVs that will be part of a new family of sedans and SUVs the automaker forecasts will make up one in five of its global vehicle sales by 2023.This is just the opening salvo in a nearly US$5-billion bet by GM to sell up to 2 million technology-laden, modern-looking vehicles annually to consumers who today cannot afford GM vehicles designed for the United States, but may someday as their incomes rise.GM has finally found a way to make affordable vehicles in bulk for emerging markets, loaded with the technology that consumers want and still make a profit.The Chevrolet Tracker and the Buick Encore are the first tests of a new strategy for engineering vehicles to appeal to buyers in around 40 nations of the world’s middle class such as Brazil and Mexico.