The Business Year

Jaime Ramí­rez

CEO, Falabella.com

Lina Monsalve

Country Manager, Mercado Libre

Understanding the customer is key in e-commerce, and these leading retailers in Colombia have found the right ingredients for success.

What key principles are necessary to lead a successful digital transformation?

JAIME RAMÍREZ One of the key elements of any digital transformation is change management. Change starts with people; changing the way people approach and do things, and this is never an easy thing to do. Falabella started this process a few years ago. The company had always been more of a retailer, but that started to change. The company began a process to become a more digital business. This transformation process greatly accelerated during the pandemic because it forced many companies, not just Falabella, to look at things differently. As mentioned before, one of the key elements of this transformation has been change management. How to help people through the process of changing and evolving the way they work. Falabella recently introduced a new way of working, including a structure of portfolios and agile methodologies throughout the organization. As you know, agile methodologies have been around for many years within technological companies. They help to approach IT development in a different way by having squats, sprints, dating ceremonies and the daily huddle. All of these things help tackle technological development in a different way. Falabella is working on this essential front. Again, I think what’s most important is making sure that you help everybody move towards that new way of working that is part of the digital transformation.

How does Mercado Libre intend to adapt and transform commerce in Colombia?

LINA MONSALVE Our intention is to democratize commerce and finance. The idea is to become closer with communities, generating value in transformation. We continue to move forward with development in terms of technology. In 2020 and 2021, we opened two technological centers in Colombia in Bogotá and Medellín, generating more than 1,000 jobs. Looking at 2022, the goal is to continue to strengthen our services centers. We have a website for customer service that serves all of Latin America. Going back to technology, beyond strengthening the local centers, the goal is also to continue developing the tools that we offer to sellers, clients, and stakeholders. In the platform, we are moving closer to reaching the real-life experience in the online world. The other thing beyond technology and services is the logistic chain. We recently made public in various media the inauguration of our new, 52,000-m distribution and storage center. Related to this, Mercado en Vivo is one of our business units within the marketplace. The idea is also to continue strengthening the strategy to bring the online experience closer to clients. We support SMEs and entrepreneurs, and some 80% of the shipments that leave our centers to be distributed are delivered in less than two days, while 50% of shipments are delivered in less than a day.

What do you intend to accomplish over the coming years?

JR Our goal is to become the largest online retailer in the region. Right now, Falabella is among the leading players in this space, and a leader in Chile, Peru and Colombia. Our primary strength lies in having a hybrid model, that is, one present in both the digital and physical space. Falabella is a strong retailer with years of experience in this space. We know that retail is about planning and knowing what to buy and when to buy it. This is a valuable skill to have. Another strength is Falabella’s comprehensive ecosystem. It has a solid financial arm through Banco Falabella, which allows it to provide credits to both sellers and buyers on the platform. The company also has a strong loyalty program called CMR Puntos, which is among the leading loyalty programs in the region. This program brings a strong value proposition to the customer. Both sellers and buyers are becoming accustomed to receiving something in exchange for their loyalty. Falabella works to channel all of these strengths into becoming the region’s leading retailer for both the physical and the digital domains.

LM Over the last year, the company grew 26%. Maintaining our leadership position is linked to three areas. Technology is one of the pillars of Mercado Libre, and we focus on continuing to innovate and be one step ahead of our competitors. The other is to strengthen everything in the ecosystem of entrepreneurs, which is important not only to our social impact, but is also a win-win relationship, because we are strengthening our value proposal and product range. The third is logistics, which is undoubtedly an important factor. These three areas have an effect on improving our service, on reaching a positive cycle where we generate better experiences, as well as on our sellers and contractors that want to continue buying from us to sell our products.

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