News - All Eyes on Brazil
If, like us, you’re lucky enough to have spent some time in Brazil, recently, you can’t have failed to be touched by a growing sense of positivity. Yes, there are and will be ups and downs - this summer’s loss at the World Cup was difficult for such a proud country to process - but in many ways there has rarely been a more exciting time to experience and invest in Brazil and the surrounding region.
Cynics play down the potential positive impact of the Olympics, and it's important not to overestimate the long-term benefits of this flash-in-the-pan profile-booster. Both Rio de Janeiro and Sao Paulo have their negative associations. High crime levels and deforestation have for many years dominated thoughts of these locations and their surrounds. But finding yourself in either of these cities, with their jostling tower blocks and clamouring street art, the more potent impression is one of vibrancy and progress - the lifeblood of Latin America.
Local Sao Paulo and Rio de Janeiro street art
Change is happening. Today, if the mood takes you, you can rent yourself a favela in Rio for the princely sum of $50 per night. It’s called the Favela Experience - a comfortable 5-bed apartment with a stunning view of Ipanema beach, wifi, and the chance to tour the neighbourhood. Organisations like this are increasing local income and bringing tourism to corners of the city that might not previously have benefited.
Favela Painting via Haas Hahn
With a characteristic emphasises on energy, eclecticism and local soul, YOO has long felt an affinity with the region. Recently our ongoing fascination has led us to announce alliances with two big players in the Brazil hospitality and residential markets. On the residential side, YOO and Cyrela Brazil Realty, the largest homebuilder and real estate company by revenue and market value in Brazil, have developed an ongoing partnership that will span across several years. Meanwhile, Intercity, with 26 hotels in South America, will manage YOO2 on behalf of YOO Hotels with strict guidelines in terms of service and standards, and YOO Hotels will provide interior design for each YOO2 property. YOO2 Botafogo is slated to open in Rio de Janeiro in 2016 with a further five more YOO2’s rolling out in Brazil over the next 10 years. We’re not alone. The majority of global hotel players of note are building a presence in the region, although YOO’s specialism, branded hotels and residences, still represents an exciting novelty.
Perhaps it seems a counter-intuitive move, in a country where the Ministry of Tourism was only founded in 2003. However, the breakthroughs keep coming. A dearth of affordable land has developers looking to newer markets; secondary and tertiary cities that present solid growth, and are improving infrastructure. This year in Sao Paulo, mixed use developments, which previously were not permitted are being gradually encouraged, domestic tourism is increasing among the burgeoning middle classes, and by 2024 it’s expected that 10,684,000 Brazilians will work in the tourist industry (Sleeper Magazine)
With a young, aspirational population, open to new experiences, Brazil’s demographics are ripe for exciting new luxury brands and concepts to make their mark. It’s a country with the 5th largest population of billionaires in world (Forbes Magazine), afterall, and what’s more, Brazilians are tech savvy. According to Sleeper Magazine, wifi is the number one requested amenity and there are 135 active mobile subscriptions per 100 people.
Luxury consumption in Brazil is set to be a complex question. In retail, for example, so claims the FT, Brazilians are more in the habit of seeking luxury goods abroad than at home, due to high import duties. “The Brazilian luxury customer can be on a plane to Miami tomorrow and buy for considerably less,” says Antonio Haslauer da Costa, an independent business development consultant specialising in the luxury market. “The reason they will buy at home is because they feel they belong to a club. Companies need to understand that mechanism and create an exclusive environment, with prestigious events.”
It’s important to consider how these attitudes shape what the terms ‘branded’ and ‘luxury’ mean to Brazilians. Whilst in China, according to a study by Luxury Living, it’s is a means of conveying a trendy lifestyle, a unique personality and social distinction. In India it can be an expression of both status personality, whereas in Brazil it is a more experiential or even emotional concept. “Brazilians like to establish instinctive and affectionate relationships including with luxury brands. They are at the crossroads of three cultures: European roots, a lifestyle marked by the American Dream, and local cultural values amplified by a comeback of patriotism. They display a characteristically cool spirit and they are in close proximity to nature and expect brands to seek inspiration from nature. As opposed to Europeans who tend to be defiant towards brands, Brazilians display empathy and confidence.”
With improvements to infrastructure and investments gradually driving economic growth, it’s clear Brazilians are ready to embrace luxury enthusiastically, with a sense of vibrant style, and a desire for high quality. The luxury goods market, though seemingly a tough nut to crack, is nonetheless buoyant. The advent of greater middle class wealth and the increased exposure and reach offered via development in ecommerce has attracted international brands. With the Olympics around the corner - which again and again has proved to be a remarkable debut for cities on the cusp - all eyes will soon be on Brazil and its close neighbours as it steps further into the 21st Century. And really, who wouldn't want to be at that party?