Verdhe: an empathic solution for the impoverished Class C in Brazil
The recent economic downturn in Brazil, that used to be one the strongest economies in the globe, has confronted the once emerging classes C and D with the decrease of power of consumption. A recent study published on Estado de São Paulo, one of the most relevant daily newspapers in the country, shows that until 2017 10 million people once qualified as Class C should return to the basis of the pyramid. One aspect that should be highlighted here: these were the same consumers who, due to injections of money through social programs lead by the Federal Government, were responsible for a bubble of consumption, especially when we talk about houseware and electronics.
In this scenario, we have the foundation of Verdhe in Recife, North East of Brazil — a startup recognized by the British Foundation Ellen MacArthur as one of the highlights of circular economy in Brazil. The venture uses the Reverse Logistic to resell electronics that have been returned to the stores by the purchasers, most of them with the packing damaged only. The products that would be discarded in the environment or returned to the manufacturer are acquired by Verdhe, tested, certified and sold for the final consumer with up to 70% of discount.
Despite of the innovation of using Reverse Logistic — North East is challenging on this aspect, as most of the manufacturers have their distribution centers or industrial plants in the South East what makes it incredibly expensive, Verdhe comprises the concept of empathy to the consumer, given the present scenario of the Economy. In Pernambuco, state where Verdhe’s point of sale resides, we have 6% of the homes without essential houseware equipments such as refrigerators, according to IBGE (The Brazilian Official Institute of Research). Given the fact that the income of families had decreased 12% on the last 3 years, according to Nielsen Institute, to offer solutions that ensure the access to quality of life is empathic and educative. If the brand takes the challenge to encompass values such as Environmental friendly and communicate it properly to their consumer, it is possible to foster a different mindset in this layer of society. Since the business model encompasses this value, the brand would be distant from a greenwash speech.
Verdhe goes beyond this empathic relationship with the costumer. There are plans to deploy a system of franchising for small entrepreneurs that reside in the poor communities. These “battalladores emergentes” — a phenomena that consists on the emergency of unemployed workers who have the informality of small ventures as the only way to ensure their income and describes the GIG Economy — are a sensible group of consumers that best represents the economic downturn. To offer solutions for them is one of the trends appointed by the latest Trendwatching report in Latin America. The numbers speak by themselves: According to FGV (Getulio Vargas Foundation), for the first time in the last 12 years, informality has increased in Brazil. The same study shows that this informal market has consumed BRL 975 billion in 2015. All the evidences show a thriving market to Verdhe. The worker’s pocket and the environment say thanks.