An interesting trend has developed in the Brazil laser supplies ecommerce channel since the start of the year. Since gap intelligence began tracking the segment in mid-2009, the number of dual and value pack* offerings has increased from 2 to 24, with most of the growth coming in the past two years. The trend has become even more apparent recently. The arrival of more than a few products per month into the Brazil laser supplies ecommerce channel is rare, so it is especially notable that the number of dual and value packs available from Samsung has more than doubled since January. And Samsung isn’t the only OEM bringing value packs to the region. Since January 2012, seven new value pack offerings from HP and two from Panasonic have hit the channel. Currently, half of the resellers in the gap intelligence Brazil panel carry value packs from the three aforementioned OEMs.
The total number of available dual and value packs has demonstrated growth of at least 50% per year since gap intelligence began tracking the channel. In all of 2012, nine products entered the channel and so far in 2013, there have already been four.
With such impressive growth, specific factors must be driving the demand for such products. The most likely reasons include increased demand from consumers, as well as a rise in the use of ecommerce to purchase products. Starting with consumers, greater purchases of value pack products could reflect a change in the mindset of Brazilian shoppers. The purpose of a value pack is to give consumers a bulk discount compared to purchasing the included products individually. Shoppers have to pay slightly more up-front, but the final savings is usually justified through lower long-term cost and overall cost per page. Other benefits of a value pack can include a reduction in the number of purchases, though this mostly applies to dual packs where the consumer would receive multiple units of the same cartridge. Because Brazilians are known for having more price-conscious mentalities, increased acceptance of higher-priced products would be a notable change.
The increase in the number of value packs online could also be fueled by a spike in the number of consumers using the internet to make these types of purchases, leading OEMs to focus on expanding their presence in a variety of channels. Additionally, with the government’s push to expand broadband Internet access through the Programa Nacional de Banda Larga (PNBL) to those that do not yet have it, more Brazilians are gaining access to the internet, and as a result, shifting some of their purchases to this channel. However, because Brazil’s weak infrastructure makes transportation of goods difficult, the IT channel is likely to remain less-frequently used than physical locations, at least for now**.
Despite these obstacles, online purchases in Brazil are rising. The market volume of Brazilian ecommerce grew by 20% annually to $22.5 billion in 2012, according to Brazilian firms e-bit and Buscapé. According to the companies, the average ticket increased from R$338 ($170.39) in the first half of 2012 to R$346 ($174.42) in the second half of the year, attributable to promotional activities and greater sales of higher value-added products, such as smartphones, tablets, and notebooks, in the second half of the year.
One of the most notable examples supporting a shift in the Brazilian market is the arrival of a new Samsung dual pack in Brazil in IT channels roughly two months before the US. A new product debuting in Brazil prior to the US is quite rare, unless it is designed for that market, largely due to challenges with importing, taxes, and infrastructure. The fact that a higher-priced product was first pushed into a market where consumers have traditionally placed greater emphasis on price could demonstrate that there is actually a higher demand for these types of products, and that OEMs are looking to better support that demand.