To some international corporations, Latin America is often perceived as a bloc. Epson, though, has been working hard on its strategy of expansion, knowing that there are considerable cultural, economic, regulatory, and political variations that influence business practices, consumption, and trade. The company synonymous with printing and imaging technology relies on its general director at Epson Mexico, Alberto Arredondo, to help carry out that strategy. And Arredondo is seeing results in the form of unparalleled growth. Today the brand leads in most markets (video projectors, point-of-sale printers, and large printing formats) with market shares above 40 percent in most of these business units.
Arredondo says Epson analyzes market conditions nation by nation. “Some countries are more price-sensitive, such as Brazil and Colombia; others like Mexico are brand-driven,” he says. “We respond by differentiating in terms of price for the same product, or by designing and introducing a product that responds to the requirements of a certain market.”
Arredondo is uniquely qualified to advance Epson’s expansion strategy in Latin America. Having had an international career; traveling extensively; living in Mexico City, Bogotá, and Miami; and holding various positions driving regional markets and business units, he gained considerable knowledge about the different cultural perspectives and business practices that exist in the Latin American region. He landed once again in Mexico two and a half years ago with the mission of finding out why Epson Mexico hadn’t grown over the previous six years and why it had the lowest market share (just 17 percent) in the video projector segment, even though the market was actually growing as a whole. His arrival marked the beginning of a process that led to revamping all sales, marketing, and operations while dramatically changing the organizational culture.
“For many years Epson’s structure in Latin America allowed subsidiaries to be very independent,” says Arredondo. Each general manager was given a revenue and profit target and determined his/her sales, marketing, pricing, and organizational strategy to achieve those targets. The corporation would provide the products, and each subsidiary took care of the rest.” That allowed marketing materials in Argentina, Colombia, Venezuela, and Mexico to look very different, and caused the company to appear to lack vision. “In order to reach the next level of efficiency in performance, consistency in messaging, and a higher position in the market, we needed to shift from a very fragmented organization to a regionally centralized one,” says Arredondo. At the same time, though, Epson wanted to maintain flexibility at the execution level to allow its leaders to respond to local needs and market practices.
Currently almost every business unit within Epson is well-positioned in Latin America. In the printing market, the company is ruling with its InkJet technology, especially after introducing the EcoTank solution (a printing technology that uses ink tanks instead of traditional ink cartridges.) “Through market research and interviews with customers, we realized that individuals and businesses that use printers were not happy with the traditional cartridge technology,” says Arredondo. “They wanted a more economical and durable solution.” With EcoTank, users can print up to 4,000 pages in black and white and 6,500 in color. EcoTank is one key reason Epson is growing at a fast pace in a stagnant industry.
Epson has grown its video projector business such that it now has an average market share above 50 percent in most Latin American countries, consolidating its number-one position across the region. The increasing demand stems from governments in many countries equipping schools with updated technology as well as private schools and corporations investing in tools used for teaching, conferences, and presentations.
Another growing business unit is large-format printing, extensively used in the advertising and graphics industries. Mobile printing solutions are also gaining relevance in Latin American stores, restaurants, and supermarkets. But Epson is highly interested in yet another area: textile printing. A year ago it introduced its first sublimation printers for garments. “We have seen rapid growth in every country mostly because this solution allows a more personalized design, giving clothing designers much more freedom,” says Arredondo. Moving forward, Arredondo envisions further efficiency and results from continued attention to the differences and demands of a diverse Latin American region.