Retail, Mass Consumption and Commercial Channel

Reaching consumers in a confined scenario has been a complex task for companies distributing mass consumption products, since the operation of some of the commercial channels has been limited in the region's markets.

Tuesday, June 2, 2020

In Panama, companies engaged in the wholesale distribution of food products such as oats, beverages, snacks and others have faced challenges during the weeks of home quarantine, which was decreed by the authorities following the outbreak of covid-19.

See "Geomarketing and Decision Making" and "Costa Rican Consumer in the "New Normal"

Juan José Wipe Tala, PepsiCo's general manager for Panama and Central America, told that "... the greatest restrictions that have been experienced due to the pandemic are related to mobility, so it was necessary to adapt the supply chain and supply to bring products to each of the consumers in the available channels. Acting with agility to provide a quick response".

You may be interested in "Energy Drinks: What Brands Do You Prefer in the Region?" and "Beer: Brands, Tastes and Potential Market"

The article reviews that "... At the beginning of the lockdown, the first effect was felt by (PepsiCo) when more than 30% of the neighborhood stores they supply, closed due to the impossibilities of operating. This was one of the hardest hit sectors; sales fell in the first weeks of the quarantine by 20% to 30%. While in modern channels, like supermarkets, consumption was not so impacted."

Guatemala is one of the other markets that has limited the operations of the marketing channels. In this case, during the last two weekends of May and in the context of the total closure of the country due to the covid-19 outbreak, the government ordered the suspension of the operations of supermarkets and neighborhood stores or grocery stores.

Also see "Quarantine: Total Closure in Guatemala"

Faced with the challenges of the new commercial reality, since the beginning of the health crisis some companies in the Costa Rican market have chosen to make strategic alliances. In the first days of April, CentraAmericaData reported that Cooperativa Dos Pinos de Costa Rica and the Glovo and UberEats platforms, dedicated to home delivery of food and beverages, became allies.

In an official statement Rodrigo Larios, director of New Business at Dos Pinos, explained that "... With this new way of distributing our products to the place where people are, Dos Pinos becomes the first company of massive consumption and food that makes available a store in the Uber Eats platform."

In the context of this business transformation, CentralAmericaData developed a georeferenced information system, which allows the identification of behavior patterns and preferences of consumers in any Central American market. We have detailed information on the number of people, their location by area and their socio-demographic characteristics, such as gender, age, socioeconomic level and other relevant data such as interests and preferences.

The tool provides information on the concentration of the population by age groups, fundamental data for making business decisions such as where to open a new sales point, to adapt to new product delivery times, among others.

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Retail: Challenges of the On-Site Experience

July 2020

Given the gradual return to physical stores, customers will appreciate it if businesses disinfect stores several times a day, if other visitors are required to clean their hands before entering, and if employees use protective equipment at all times.

Although in this context of the spread of covid-19, digital channels have gained ground in Central American markets and this trend is expected to continue in the coming months and years, there are commercial establishments that will have to adjust their face-to-face sales strategy to the demands of the new normality, since there will always be customers who prefer to continue shopping in person.

Consumers Begin to Return to Supermarkets

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In recent weeks, Central American countries have reported an increase in the number of people who have moved to locations identified as supermarkets or pharmacies.

Due to the quarantines decreed by the governments of the region because of the covid-19 outbreak, in mid-April the concentration of people in residential areas of the cities registered its maximum level, but in the last weeks this trend has started to reverse, as consumers have visited more shops.

Retail: Traditional Channels and Consumption Patterns

April 2020

The restrictions on mobility decreed in the region open up new opportunities for sales points such as small self-service shops, grocery stores and corner shops, which can make use of home delivery service schemes to boost their sales in this context.

In the current context of health crisis, large supermarket chains have implemented safety and hygiene protocols, which force consumers to assume long waiting times to do their shopping.

Changes in Lifestyle and the New Commercial Reality

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Within this context of health emergency, the mobility restriction measures decreed by the governments have forced people to change their consumption habits, a situation that forces companies to look for ways to deliver the products to their customers.

In order to adapt to this new economic reality and derived from the outbreak of covid-19 in Central American countries, companies have been forced to rely on marketing channels that until a few weeks ago were not among the most important in their commercial strategy.