Venezuela is in a crisis. It has become one of the poorest countries in the world, but entrepreneurs keep pushing the boundaries of what is possible. Thus, there are certain eCommerce roadblocks Venezuela must surpass in order to revive its economy. Here are its top three obstacles:
- Low buying power
One of Venezuela’s main concerns is the low consumer buying power. Many customers usually do not have enough money to make purchases, making traditional mass advertising ineffective. Thus, here are three solutions entrepreneurs have adopted instead:
- They focus on understanding their targets and carefully crafting their marketing campaigns. Since not everyone can afford the luxury of buying, you need to know who can, where they are, and how to best approach them.
- Entrepreneurs test small but frequently. Because most of them are avoiding high investments, they are consistently testing out different products and channels to see what works best.
- They import products that are hard to find. Focusing on the needs of those that can make purchases is important. Many eCommerce businesses in Venezuela try to find a gap and fill it quickly to attract customers with things no other company can offer. These gaps are usually visible because of the shortage of supply.
2. Delivery and transportation
Delivery logistics is a crucial aspect of online shopping, but many Venezuelan companies can’t afford to buy overpriced gasoline or invest in motorcycles and cars for delivery. Thus, they have turned to delivery services instead. These services are sponsored by companies, helping not only online stores but local businesses as well. This is an interesting outcome of a bad situation, especially since it gained even more popularity just a few weeks before lockdown.
3. Supply shortage
Most factories in Venezuela have closed over the years, putting both Venezuelans and eCommerce companies at risk. In 2016, this led to a 50 to 80% rate of food shortage , pasteurized milk availability going down 95%, and 80% of all medicine becoming unavailable. Even to this day, one in three Venezuelans does not have enough to eat. To ensure production can reach normal levels, the government must combat corruption, mismanagement of the economy, and hyperinflation, while caring for the lack of maintenance and investment in this sector.
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