Any business that wants to succeed globally had better respect the power of the Latin American woman.
That message was delivered emphatically in two ways recently:
- On October 31, Brazil elected its first female president, Dilma Rousseff, reportedly a former left-wing guerrilla who later became an energy secretary in Rio Grande do Sul state. Her election is an important global event in addition to a Latin American one. Brazil is the world’s eighth-largest economy. Companies ranging from Caterpillar to Louis Vuitton have made Brazil a hot destination for global expansion. In her first few days as president-elect, she has vowed to sustain long-term economic growth for Brazil by decreasing the country’s national debt and lower interest rates, which are among the world’s highest — a message characterized as investor friendly and hopefully comforting for multinationals who intend to succeed there.
- Just days before Ms. Rousseff’s election, my employer Razorfish, with the help of Terra, released a report (The Stampede) asserting that women are the key for multinational CMOs to build relationships with the so-called Classe C working class. This finding is significant because the Classe C population is fueling the growth the hot Latin American economic markets. According to The Sampede (announced on October 26) women are the main purchasers and decision makers in the homes of an increasingly affluent and powerful “new digital middle class” in Latin America, which might surprise executives who assume a patriarchal Latin American society. New digital middle class women are more likely to start their own businesses than men are, and as Razorfish executive Joe Crump told Fast Company, “Seven out of 10 borrowers in micro-lending are women. Online buying is also driven by women. Online, women have access to all the same shops as upper classes,” he explained. “Normally they would be watched by security in the actual shops.”
The Stampede shatters a number of misconceptions about the Classe C population that marketers need to overcome if they want to succeed in Latin America. In Brazil, Classe C constitutes about 100 million residents who “snap up cars, cellphones, and new homes, quickly becoming a prime target for marketers,” according to Advertising Age. Joe Crump, a New Yorker who lives in Brazil part-time, visited the the homes of Classe C residents in Argentina, Brazil, and Mexico, interviewing them about how they live and their media habits.
Faces of the new digital middle class
Among his findings: contrary to popular belief, Classe C put digital at the center of their lives. For them, digital provides opportunities to equalize the social and economic playing field in highly class-stratified societies — hence Razorfish renames Classe C the new digital middle class. In Brazil, 63 percent of families with a computer at home are Classe C compared to 23 percent for Class A/B as reported by MediaPost.
And as Joe Crump told Fast Company, the new digital middle class “want phones that are smart for their lives. They like phones that look high-end, but have features that suit their lives.” Savvy marketers like Samsung have already caught on to their sophisticated tastes in digital and are aggressively promoting mobile devices to them while less enlightened marketers assume wrongly that Classe C is a culture shaped by television.
You had better get to know her better
The new marketing power bloc
Whether you call them Classe C or the new digital middle class, this consumer group is going to be influencing businesses around the world for the foreseeable future. The Economist recently noted that Latin American economies will expand again by 5 percent even as many other regional markets only emerge slowly from recessionary conditions. Citigroup released credit card data in July 2010 that showed consumers in Latin Americas increased their spending 15 percent in the second quarter of 2010, while U.S. consumer spending fell 7 percent. And women lead the way.
For more on Latin America and Classe C:
- Razorfish Client Summit 2010 presentation by Joe Crump on the new digital middle class, 13 October 2010.