Selling to consumers at the low-end of the economic ladder generally means selling merchandise at the low-end of the quality scale. It’s certainly nothing new.
But Brazilian retailer Magazine Luiza has different ideas about selling to poor people. In an article for Harvard Business School’s “Working Knowledge for Business Leaders,” writer Julia Hanna explains.
The store developed a flexible procedure for credit approval enabling customers with lower incomes to make purchases, and it uses virtual showrooms to help customers choose furniture, consumer electronics and white goods.
Frances X. Frei, the Harvard professor who researched the Brazilian retailer, describes Magazine Luiza as a better mousetrap, and she told writer Hanna that she hopes students will see the potential offered by underserved consumers.
The fact is that poor people gotta buy things, too. Could you be missing such an opportunity?