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BRAZIL A LATIN AMERICAN COUNTRY

Brazil is the largest country in Latin America. The total population of Brazil is 170 million. The south
east part of Brazil has the highest population and then comes the north east region. The GDP and per
capita of the south east is more than that of the north east of Brazil.
CONSUMER BEHAVIOR
The consumer behavior in Brazil to the detergent market is different in the north east and the south east
of Brazil and is depended on many influences.

Culture and sub culture


North East Brazil
65% of the population is a mix of African and European origins and their lifestyles, rituals and values
share an African influence. Music and humor are the key elements of their culture.
South East Brazil
Only 35% of the populations share an African influence whereas the rest are the migrants from Europe.
This part is the financial and the political hub of Brazil.
Social class
North East Brazil
More than half of the population fall in the low income category .The economy is heavily dependent on
agriculture. It is more labour intrinsic type of job. Most of the women in the family are housewives.
South East Brazil
Only 21% of the entire population fall in the low income category and most of the women are from the
working class.
Group Membership
North East Brazil
Most of the women meet and wash their clothes in public laundry or pond in a group. Cleanliness being
an issue of gossip, every woman tend to keep their family clean to please the group.
South East Brazil
Most women own a washing machine so self esteem and social status is given less importance.

Apart from price of the detergent, the important attributes for the north east customers as per the rankings
are:

Power of detergent
Its fragrance
The ability to remove stains without the need of soap and bleach
The dissolving power with the water
Packaging
Impact on colors

Whereas the south eastern customers are habitual decision makers. They would prefer to use the same
detergents that they are using unless they dont get any flaws.

UNILEVER & ITS STRATEGIES:


Unilever is the pioneer of consumer goods industry in Brazil and a clear leader in the detergent powder
category with an 81% market share achieved by brands like Omo, Minerva and Campeiro.
Omo
High quality at a premium position which is for the high end market
More than half %of the total market share
The highest profit margin that Unilever generates is from the sales of Omo(Cash Cow)
Minerva
Mid quality product with low brand awareness and second share in the market
Campeiro
Well-known cheapest product but with a low top of the mind penetration
STARTEGY
Unilevers main line of promotion was through the media advertising. This is cost effective and
irrespective of the income, Brazilians are avid television watchers.
It faces a huge threat from P&G and hence Unilever should look into tapping the niche markets
before its competitors entry into them
Whether or not to market detergents to lower income consumers in Northeastern Brazil and how to go
about it:
The lower income segment isnt tapped by any of the giants of the detergent industry hence it provides
opportunity to the company for growth in this segment.

As per case study it is known that Northeasterners believe bleach is a must for removal of stains;
detergent powder is used only to make the clothes smell good.
For the Northeasterners cleanliness is perceived as important despite of their low income survival.
Cleaning of clothes for them is also seen as a measure of dedication of the woman of the family.
Hence the challenge is to change few age old perceptions and yet successfully make a mark in the lower
income segment.
For this Unilever will have to convert the laundry soap users into an Omo class user.

WHY EXTENSION OF MINERVA:


Not possible to have a low cost product under the Omo brand since this would confuse the consumers
about the original Omos credibility
Many brands extension does not succeed because consumer does not learn new habit or it
contradict with the previously learned positioning.
PRODUCT
Especially cleanliness
Whitening and productivity
Emphasis on stain removing capability
Intact like perfume and softness
Various sizes and types
Use of packaging other than cardboard boxes e.g. plastic sachet
PRICE
PENETRATION PRICING to make them adaptive
PROMOTION
Product should not be advertised as a product meant only for the low income group since this might
create a negative impression about the company.
Television advertisement should be low context and very simple with humor.
Medium like hoardings, radio and television should be used.

How consumer adopt the product

ADOPTION TRAIL -

buy the product for the final use


consumer try the product

LEGITIMATION - conforming consumer that you have got the right benefit
ATTITUDE -

creating an attitude about the brand

COMPREHENSION -Understanding and education of receiver


AWARENESS -

providing information through advertisement, public relations etc.

Buying characteristics of Brazilian consumers

Impulse purchasers
Women are increasingly becoming the heads of households
More than half the Brazilian teenagers have experimented with alcohol
Globalization causes parents to seek bilingual schools for their children
Microbreweries expanding in Brazil
More Brazilians eating healthy foods
65% of consumers in Brazil prefer to pay cash for their purchases, according to research points of
Boa Vista Services.

According to Credit Suisse Researchs Emerging Consumer Survey 2011, Brazilians devote a
considerably larger share of income to discretionary spending than consumers in other BRIC countries

Consumer Behavior of the Base of


Pyramid Market in Brazil
Some of the ways in which consumer behaviour characteristics among the Brazilian Bottom of
Pyramid (BoP) are different from their better-off countrymen are:
A different configuration of the perception of value not solely determined by lower price,
A stronger need to compensate for a dignity deficit and lower self-esteem,
A stronger preference for personalized relationships,
A high aspiration to feel socially included in society, and
A preference for stores with a crowded and overstocked atmosphere.
Low-income classes represent almost 70% of the Brazilian population and in some segments
they are responsible for more than half of the market. These are consumers with lower selfesteem, who are brand-loyal (despite their limited budget) and for whom a positive and personal
relationship determines the selection of consumption alternatives.
The 4 As which we found essential for a successful strategies to reach BoP includes- access,
affordability and availability, awareness. Relevance is an additional criterion that is also gaining
importance.
Knowledge review
With a GDP per capita of US$8,300, Brazil still displays an extremely unequal income
distribution and presents the highest Gini index.
Table 1 DISTRIBUTION OF ECONOMIC AND SOCIAL CLASSES IN BRAZIL,2008
Source: ABEP (Brazilian Association of Research Companies)
Social classes
Monthly
family Monthly
family Distribution
of
income(R$)
income(US$)
Brazilian population
(%)
A1
14,366
8,256
.6
A2
8,099
4,655
4.4
B1
4,558
2,655
9.1
B2
2,327
1,337
18.0
C1
1,391
799
24.5
C2
933
536
23.9
D
618
355
17.9
E
403
232
1.6

US$!=R$1.74(Exchange rate 1 January 2010)


It might be surprising to know that the poor people in Brazil pay more; this is because they
usually shop at small, independent stores, which charges higher prices, owing to their
inefficiencies and higher operational costs.
According to a research by Van Kempen, 'a substantial proportion of the urban poor in
developing countries are willing to pay for a designer label as a symbol'. He claimed that there
are apparently two main reasons for this:
1- Designer labels are a symbol of status and integration in society. As they buy a branded
product, poor people feel as if they belong to society and are not excluded
2- It is a kind of differentiation from extremely poor people, who cannot afford these products
Besides, poor people tend to be more loyal to branded products because they cannot make
mistakes; the financial risk is too high.
While the products and services messages directed to the upper classes stress the idea of
'exclusivity' and differentiation for the 'middle class masses' the messages to the low-income
classes highlight the idea of 'inclusivity': that is, suggesting an access to a 'middle class' standard
of living.
Low-income working housewives, rather than 'watching' TV actually 'listen to TV; after their
journey from jobs outside the home, they often continue to labour at their domestic chores such
as cooking , cleaning, laundry and ironing, during these moments ,TV is set at a higher volume.
Recognizing this behaviour pattern, commercials directed at these targets often rely on
repetitions (and simpler, because of their lower educational level) voice messages, so that ideas
could be conveyed without watching the images. These patterns differ from the middle- and
upper-class working housewives who still enjoy the help of low-paid maids.
Door-to -Door sales is a successful way of reaching the customer; for instance the Unilever
Shakti programme in India. It has also been seen that small-scale, decentralized initiatives may
make more sense in low-income markets.
Major Findings
Importance of dignity
The BoP Brazilians perceive themselves as second-class citizens. The disguised, but
intense racial and skin colour prejudice aggravates the poor self-image of the Brazilian
poor
Honesty is highly regarded, and there is a strong resentment when stores show any kind
of conspicuous indication of surveillance to prevent pilferage
Even standard procedures, such as asking for ID at checkouts if paying on credit and
checking whether the ID picture matches with the consumers features, normally
accepted among the Brazilian middle class, may be perceived as offensive among lowincome consumers. In response to this sensitive issue, for instance, the sales staff at the

stores of Casas Bahiathe largest appliance chain store in Brazil, which enjoys an
exceptional positive image among low-income consumersis specially instructed, during
a credit transaction, not to conspicuously check whether the ID picture matches with the
ID presenter.
Brands are used by the people to reflect an image that consumers want to incorporate.
For instance, consumers declared, I buy Omo (leading powdered soap brand in Brazil,
from Unilever); I take good care of my family.
All housewives stress on the importance of low prices as the major attribute in selecting
supermarkets, but showed a very significant preference for shopping at the conventional
and higher-priced supermarket. This behavior can be partly explained by halo effect
which states that positive perceptions of some attributes of a brand influence a more
favorable perception of other brand attributes. The conventional supermarket was
evaluated very highly in many attributes, such as courtesy and friendliness of service,
merchandising, visual merchandising, facilities, store atmosphere, price promotions; all
these positive evaluations have exercised a contagious effect on its price image.
Personalised relationship
The importance of relationship has been highlighted as a major marketing ingredient of success
for any business enterprise.From bargain tips to mutual cooperation (for example, to build a
house), a more informal and friendlier relationship in BoP markets compared with high-income
markets is noticeable. The different dimensions that need to be taken into account are: Personal
service, mistrust of large corporations and face-to-face contact, as discussed further below.

Personal service

Compared with high-income consumers, BoP consumers want a more personal service.

Mistrust of large corporations

Large companies are often perceived as exploiters. They did not perceive that the new, no-frills
format was the way the company could achieve lower costs to offer lower prices. Instead, the
perception was that the no-frills format was created to save investment as the poor neighborhood
did not deserve an upper-scale facility, and as such the company could maximize its profits.

Face-to-face contact

Low-income consumers highly value face-to-face contact. The mistrust of institutions and the
lack of formal education make these consumers more suspicious.They prefer, everywhere they
shop, to have face-to-face contact in order to know from whom they are buying and to better
understand what they are buying.

Value proposition configuration


Customers always seek to maximize value or, in other words, the relationship between benefit
and cost. Working along the value concept, Baker et al. (2002) have adjusted this relationship to
recognise that the consumers subjective perceptions, and not the rational reality, are the
determinants of behaviour and, as such, the value proposition became the relation between the
perception of benefits over the perception of cost. the way they perceive the value proposition of
brands, products or stores.
The meaning of abundance
There is a very positive perception of abundance. Some of the behaviors that support the
claims are:
1- Low-income consumers are used to a crowded atmosphere, such as commercial streets full of
pedestrians. When a store is too clean and without many colours, low-income consumers dont
feel attracted to the store.
2- Popular events, such as carnival and regional parties are characterised by a mixture and
abundance of luxuriant tropical colours and vivid visual elements
These are some of the visual merchandising characteristics and aesthetics that appeal to lowerincome consumers:
1. Abundance and volume of products displayed. It conveys an image of a well-stocked
store with competitive and low prices
2. A large amount of promotional products and large and colourful price offersagain to
satisfy the rational consumers needs and search for low prices
3. Comfortably crowded aislesagain as a sign of an overstocked and busy store
4. High-end facilities (such as marble floors) to satisfy aspirations
5. Courteous and personalized staff to provide service and information when needed
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Pressented By:
Abhishek Tiwari(02)
Ajay Kumar(04)
Amandeep Punia(08)
Dhiraj Kumar(20)
Gurpreet Singh(23)
Santosh Yadav(48)