To what extent have 2016's results met your initial expectations?
Our results in 2016 met both my expectations and those of our shareholders. Our performance is above the average of the National Association of Self-Service and Department Stores (ANTAD). When we are above the ANTAD average, it connotes a great performance; in other words, we are acquiring the market of a competitor. We have been above this average for the last three years.
How has the process of digital transformation at Elektra been?
We launched our e-commerce platform in September 2017. We are adapting our business to the most up-to-date digital marketing and online distribution trends. Customers now want to buy whenever they want, wherever they are, and in whatever way they want. We have significant inhouse expertise on e-commerce after hiring a former Amazon director. We are pioneers because our e-commerce platform has functionality and features that go beyond what is on the market today.
To what extent will this e-platform offer new products that are not available at your stores?
We will offer a much wider product catalog than in stores, and it will broaden our target market. Anyone can purchase on the Elektra website since it will be mobile friendly. In addition, we will be able to cover 99% of the Mexican territory, as long as the area has a zip code
Elektra offers consumer loans to unbanked consumers. What makes this possible?
It is a business model that has been in the market for 67 years. It has been based on understanding the needs of such clients and creating a business model that could satisfy this type of customer. We are able to serve these customers after conducting risk analysis and probability of payment checks. We have a strong alliance with Banco Azteca, which provides the credit to our customers so they can buy our products. All our stores work in conjunction with Banco Azteca. From the end of November 2017, customers have been able to ask for credit to make a purchase directly from our web site.
What will be your brick-and-mortar strategy now that you have this strong online presence?
We are still opening stores in middle- to low-income neighborhoods. The brick-and-mortar trend will remain for a long time in Mexico, unlike in the US, where people are already migrating massively from shopping in a physical store to shopping online. That is the reason why we are still opening stores. There is a population segment that will not have access to our digital platform or at least it will not be easy for them.
Tiendas Elektra is present in Central America and Peru. What criteria do you use to choose the countries where you start operations?
Elektra has not expanded to a new country in the last 10 years or more. We entered those markets because we believed our business model would be well accepted there. In fact, these countries are similar to Mexico. Currently, we are satisfied with the number of countries where we are present. We focus on strengthening our presence in current countries, including Mexico.
How has the demand for electrical appliances here evolved in recent years?
Today there is a greater demand for experiences than products. Millennials have a marked tendency to buy online; they do not want to enter stores. Regarding the products we sell, they are more or less the same; this has not changed significantly. In our case, we have perhaps gained a share in the motorcycles market. We did not sell them before; now we are the number-one seller of motorcycles in Mexico. We also sell electric motorcycles and bicycles. We have just hit the market with new models, though prices continue to be the entry barrier. The market tendency for buying electric vehicles is growing.