Brazilians have been undergoing significant lifestyle changes in recent years, including the ‘urban exodus,’ which consists of swapping big cities for smaller ones in search, primarily, of quality of life. This movement has reshaped the retail market, creating a growing demand for solutions that are close, agile, and accessible. All aligned with the style and expectations of this new audience.
Hyperlocal retail, as this phenomenon has been labeled, is based on the premise that both consumers and companies look at what is nearby, thinking locally and prioritizing convenience and opportunities, respectively.
Examples abound. Major retailers like Grupo Pão de Açúcar and Carrefour are already investing in smaller formats closer to communities, such as Minuto Pão de Açúcar and Carrefour Express. Meanwhile, startups like the Swedish Lifvs, with autonomous stores available 24 hours, or the Brazilian Ame Go, which automates purchases with AI and Wi-Fi, show how convenience is transforming retail.
‘The future of retail will be increasingly decentralized and connected. Stores don’t need to be large, but rather agile, convenient, and tailored to local needs,’ emphasizes César Baleco, CEO of IRRAH, a technology group specialized in solutions for the retail sector.
In addition to large chains investing in local businesses, hyperlocal retail is also aligned with the growth of small businesses in Brazil, which represent the majority of recently opened companies. In September 2024, 349,500 new small businesses were registered, accounting for 96% of the total CNPJs created in the period, according to a survey by Sebrae with data from the IRS. Throughout the year, 3.3 million new companies were opened, with approximately 3.2 million being made up of MEIs, micro, and small businesses.
According to Baleco, this transformation is likely to become even more pronounced. During the pandemic, 72% of Brazilians began to prioritize small businesses, and 80% stated that they will continue to support local establishments, according to Accenture.
“The future of retail lies in being close, agile, and, above all, connected,” he says, emphasizing that technology is no longer just a facilitator but a strategic differentiator for those seeking to stand out in this new market format.
And the ways to utilize this differentiator are countless. “We must not forget that the consumer is close, but also connected, and, despite being more prone to buy than being close, faces competition that is often overwhelming in the virtual universe. Therefore, local merchants need to leverage existing technologies today to excel,” says the CEO of IRRAH. He mentions emblematic examples, such as the case of the Swedish retailer Lifvs, for instance, which chose rural areas as the destination for its automated stores, offering more options to communities without access to supermarkets. The network has opened 19 container-shaped stores that are transported to the operating location, being unlocked via an app.
However, local businesses do not need to resort to such bold strategies to attract their audience and outperform the competition in the technological world. According to Baleco, there are accessible tools available in the market today that, for example, automate campaigns and customer service, and with a little creativity, can make a difference and ensure an unforgettable experience for customers.
“Imagine launching a digital campaign to attract people who are not yet familiar with your store. You can offer exclusive discounts to entice these individuals to visit your establishment, creating an opportunity to win them over. For customers who already frequent the location, the campaign can encourage them to subscribe to your online channel to receive updates, promotions, and news, stimulating more frequent purchases. The possibilities to increase engagement and sales are countless!”, explains.
Baleco shares that the IRRAH Group is present in over 70 countries, driving the hyperlocal retail concept. The company has helped businesses automate customer service and connect consumers with companies. Among the innovative solutions are GTP Maker, which uses AI to create virtual assistants; Dispara Aí, which develops campaigns to boost sales; E-vendi, an e-commerce optimized for WhatsApp, and KIGI, a strategic ERP that transforms retail management into a fully integrated ecosystem.
“These technologies not only optimize operations but also make retail more dynamic and competitive. The integration of innovation and proximity is undoubtedly the key to success in this new scenario”, concludes César Baleco.
