At the start of the week, private buying site Club Point announced plans to commence expansion efforts in Latin America, starting with Colombia and later moving on to Mexico, Peru and Uruguay.
With over a half a million users in Argentina and Chile, the startup will make its landing in these new markets with a commitment to “doing things right” in e-commerce, especially considering the number other contenders in the mix. From coupon platforms to online retail leaders with extremely aggressive internationalization strategies, Latin America’s e-commerce landscape is a jungle.
We spoke with Juan Pablo Torras, one of the founders of Club Point who now manages operations in Chile, about strategy and the startup’s plans moving ahead.
Clarisa Herrera: In the face of big competitors like Dafiti, Avenida, coupon sites and other market players, how do you differentiate yourselves and approach expansion?
Juan Pablo Torras: We’ve based our work on three axes that are also valid for this year. One is specializing by product niches, not being a generalist but instead bringing products that we actually see that our partners request – that’s why we have a form for people to tell us what brands interest them. Another question is service. We see that there’s a gigantic opportunity to provide service with high standards at an international level. All of this is sustained by very robust technological platforms that can scale as we grow.
CH: Does aiming at a specific niche set you apart from competitors?
JPT: I believe it does. You create a differential through actions that you can replicate. The form strategy can be applied in Colombia and in the next market we enter, and for that, we need technology, which sets us apart. The niche matters as well because people have to relate you with something. We’ve got a strong focus on women between the ages of 25 and 40 who are drawn to fashion and accessories. That woman is often the head of household, and that’s how we go about offering other products that may interest her.
CH: What market factors do you consider before launch?
JPT: First, we look at market size – it has to be attractive. We perform exhaustive research to figure out how different e-commerce models are working in those markets and later an internal analysis of our organization to see if we have some sort of competitive advantage that would allow us to be efficient and supply that market. If the internal and external mix works, we consider it an apt market to enter. We also look at how e-commerce itself has evolved in terms of logistics and transport, which are important in leveraging sales in each country.
CH: What conclusions have you drawn about the different markets?
JPT: We’ve worked hard to survey the market and have noted a number of patterns in common across Chile, Peru and Colombia, perhaps because they’re similar economies. On the other hand, we understand that the niches we specialize in – for example, fashion – in Colombia are widely accepted. This allows us to work with Argentine and Chilean brands and provide them with an opportunity to reach more markets.
CH: In a recent article, we took a look at the aggressive growth of Asian e-commerce companies, which often offer free shipping and have very low prices. How do you compete?
JPT: You’ve got to reflect in order to figure out where you stand in that context. I believe that what you have to do confront those types of giants has everything to do with curation. Being close to the market, you can gain a deep understanding of what sells – we’d love to have that brand so that when consumers go to the site, they see the trends we’re marketing and know that’s what’s coming, fashion, that’s what’s in right now. With those sites, there are obviously options, but they’re not specialists, they leave a niche space for us. We offer clients what they need. It also requires reflection in terms of being the most competitive possible. We work with a number of premium brands, so between that and curation, we are able to establish a substantial differentiator.
CH: What mobile strategy do you have in mind?
JPT: We’re going to implement a major mobile plan. Our site was already adapted to work on mobile, but now we’re going to move 100% to an application. In fact, we’re evaluating the possibility of launching a completely mobile business unit. We know that we have to be as disruptive as possible to continue growing.