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Tag Archives: Entrepreneurship

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Young Guatemalan Entrepreneurship

Katia Arias No Comments

The Lucky Attitude describes millennials as the “Startup Kids”, the generation that wants to be their own boss and the ones that see more value in creating something for themselves than climbing the corporate ladder.

Although such is a general statement, millennials in Guatemala are proving it right. With 40.3% of adults between 18-64 intending to start a new business and 60% of them believing they have the right capabilities to do so, you find yourself facing a country that ranked #107 in the Global Entrepreneurship Index.

But why are Guatemalans so special when it comes to business? My visit to the annual “Product Fair” sponsored by “Empresarios Juveniles” and “Universidad Rafael Landívar” gave me a good idea.

Image Credit: Katia Arias

Image Credit: Katia Arias

The program “Young Enterprises” is a semester long workshop where first and second year students from the business department come together in groups to build a functioning small-scale enterprise from scratch. Throughout the workshop, students must adopt different managerial roles, develop a product and create a business/marketing plan to launch their final concept at the product fair, where they are judged based on how well they developed and presented their idea.

As I walked by “grading” the stands, I couldn’t help to notice four prominent trends:

  1. Taking advantage of what’s local and traditional

The new generation of Guatemalan entrepreneurs has rediscovered the power of tradition and is exploiting it right!

Why are traditional products so attractive?

Because they not only offer a useful piece of clothing or accessory, but also a culturally valuable piece that can’t be found anywhere else in the world. By printing the Guatemalan identity on bags, shirts and wallets you’re giving these products a level of authenticity and “exoticness” clients inside and out of the country find very attractive. When clients buy traditional products they’re buying a story, a piece of the country and an “authentic” pass into global citizenship (which many people find extremely desirable and valuable).

Local products, however, have another advantage. While you’re promoting your country’s uniqueness you are also helping the artisanal community both socially and economically. Since entrepreneurs rely on indigenous craftsmanship to create their pieces, they embark themselves in a journey to better understand their people and roots. Also they keep the money within the local economy helping the country grow.

So, when clients see “local and traditional” they are sold. They see artisanal (which is “cooler” than commercial), they see cultural value and they see social impact (which makes them feel good about the purchase, and as I mentioned before, almost 90% of purchases are made through the emotional brain).

 

Image Credit: Katia Arias

Image Credit: Katia Arias

  1. Using social causes as marketing tools

 Speaking of the emotional brain, young Guatemalan entrepreneurs have also learned to take advantage of the country’s critical situation to create marketing campaigns with social aspects.

With the huge spectrum of social and economic gaps in Guatemala, people have many “causes” to choose from when they think of Social Corporate Responsibility. I was surprised of how many students chose to support a cause as part of their marketing. Their products were simple, almost useless to the eye but buying them helped someone, so suddenly the products had a social value impossible to ignore.

There was a stand selling bottle openers. The products didn’t have anything special on them, but if you bought one (for very cheap) you would be helping a kid’s shelter. So technically you bought the cause not the product.

Another stand offered bracelets to support breast cancer. I liked their approach when they said to me; take a bracelet for a meaningful donation of Q.20. Notice they didn’t say the words price or cost. Although they had adopted the structure of an nonprofit, I was happy to see that the salespeople prepared themselves to offer their products using the right vocabulary and approach.

Image Credit: Katia Arias

  1. Targeting Millennials

 According to PFS, “millennials may only comprise 26% of the population, but they contribute to approximately 35% of retail spending. That said, new and old businesses must seek to understand what millennials value to properly market to this generation; and, in consequence, their baby boomer parents.

The World’s leading research and insight platform, Qualtrics divided millennial values in four: relationships, socio-ecological impact, easy-grab and high-tech.

Most of the stands did offer products that fell in one of these categories: from fashionable iPhone chargers to eco-friendly bottles, one-step make-up removers, traditional clothing and artisanal jewelry.

Image Credit: Katia Arias

Image Credit: Katia Arias

  1. Employing charismatic salespeople

 The category of “relationships” in the millennial value circle refers to how well the company seeks to relate with the customers before they sell them a product.

Latin America is comprised by what sociologists call “primary cultures.” Where most people rely on inter personal relations to meet their needs. These cultures value extended family systems and social connectivity as well as oral forms of communication and natural-spiritual concepts.

These cultural traits have helped Guatemalan entrepreneurs become natural salespeople (at least some). “4Her” was the small business that captivated me the most. They had incredible traditional products and they knew the story behind them. But, what really helped was the team’s customer service. The only reason I didn’t buy from them was because I didn’t have any cash on me!

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Image Credit: Katia Arias

Conclusion

 In conclusion one could say that Guatemalans are growing to become great entrepreneurs because they are taking a proper advantage of their local resources and causes as well as their natural sociability. On the improvement side, I youngsters still have a long way to go when it comes to understanding their customer and sharing their story. The products I saw at the fair were great but I left wanting more information from each one, I left feeling as if students didn’t do enough research on their market and as if they were doing it “just for the class”.

Overall, however, visiting the product fair was a very enriching and insightful experience to see what young people value and believe is important. I was impressed by the quality of the products and marketing material (given they only have a semester to plan everything) and would definitely recommend the activity to anyone interested.

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