Even In The World Of Online Shopping, Location Still Matters (a lot!)

One of the major bottlenecks for the growth of the Brazilian economy is its underdeveloped infrastructure. For David Bell, however, this defect could end up being useful for Brazilian entrepreneurs in the digital economy.

A professor at the Wharton School at the University of Pennsylvania and one of the best business schools in the world, he is a reference when it comes to e-commerce and digital marketing. Its online courses, such as “Digital Marketing, Social Media and E-Commerce for Your Business”, have hundreds of thousands of subscribers.

In São Paulo for the HSM Expo, an event aimed at executives, he said that Brazil and other developing markets, such as India and China, will come ahead of developed countries in terms of the number of online transactions.

Why? These will be the “mobile-first” economies, where the customer takes advantage of the better online infrastructure than the offline one to make their purchases. Bell’s goal – who has just released his new book, Location (Still) is Everything, in Portuguese – in his talk was precise to teach what a successful company needs to do to succeed in this environment.

“The mobile device is the platform for disruption,” he said. “It engages constantly, it has a simple user interface, it’s an intelligent machine that knows its location, its context and its content, sends and receives payments. It will change every business, from laundry to education.”

How To Make Your Startup Grow

The key to growing sustainably is continually researching the location of your business and consumer. “Your customer’s location still matters a lot,” he said. “It means knowing your characteristics, your preferences and your options.” This, in turn, can translate into a more accurate and profitable business.
To remember Everything that makes up the location, Bell created the acrostic GRAVITY: geography, resistance, adjacency, neighbourhood, isolation and topography (the “y” only serves to complete the word, he confessed). The most important is adjacency, which is about how to spread demand across a territory.

“In each of the companies I looked at, demand always grows in a predictable way,” explained Bell, demonstrating with maps that it spreads out from pre-existing clusters. That is, it does not arise spontaneously or randomly. “The reasons for this are homophily – people like the same things – and contagion, as neighbors talk or observe behavior among themselves.”

Because of this interaction, he advised, it is important that the entrepreneur pays attention to the user experience in terms of interaction with the brand. Concern about packaging, for example, should also be part of the strategy: after all, they will end up in photos on social networks or draw attention on the street. “This is also content,” she said.

An offline presence is also strategic. Bell cited Amazon’s plans to open a hundred physical stores and Tesla showrooms where you can see and touch an electric car — but not buy it. “Customers still want to touch products and experience a brand’s service: how you use physical space is very important,” he said.

“In the digital economy, the ability to have a interpersonal relationship has never been more important,” he said, echoing columnist Thomas Friedman, who was at the event earlier. “You have to create the right content, the right platform and encourage your customers to build a community. It’s a very powerful thing for a business.”

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