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January 18, 2011 23:21:11 | in marketing

Value over cheap: How Bembos in Peru gives McDonald's a headache

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Don't bombard your customers with short-term offers, says Beatrice Ciabatti. Differentiate your company with a strong brand. (Illustration by LivinginPeru.com)


By Beatrice Ciabatti

The Peruvian market is experiencing buoyant economic growth in recent years driven largely by the local market. In our country, economic improvement in a general level is due to consumer’s rising confidence and a low, stable inflation, which has led customers to have more money to spend and thus to consume more and better products and services.

Companies today offer low-priced goods, and consumers subconsciously relate a product’s price with its quality. Logic tells us that the higher the price the better the quality and therefore consumers increasingly prioritize value. Therefore to differentiate and position products and services, it is vital for companies to strengthen the brand.

It is crucial to understand that the most valuable asset a company has is its brand and consequently it is important to have long term branding strategies to strengthen it, putting special emphasis in the construction of value. This in turn means that consumers look for brand loyalty and will avoid a purchase only decided by the low price.

Competing only for the lowest price without highlighting an attribute that truly differentiates your product will lead the consumer to link the product to a cheap price and as soon as another company enters with a lower price, will force you out of market.

We have heard so much lately of companies launching sales, deals, 2x1, etc. At the end of the day the consumer is really confused because of the continuous bombarding of offers with these type of short term strategies, up to the point that he hardly remembers which company is launching the bargain price. Short-term strategies may increase sales for a short period of time, but will leave no promotional inheritance to the company, so it is vital to identify the attribute that differentiates you from your competitors when planning the campaign. Thus, it is vital for companies to investigate and find out why the clients buy and pay close attention to the perception that current customers have of your brand. So, ask continually your clients what they like about your product but especially ask them about what could be improved.

The Bembos example 

Quality burgers such as thing one is how the Bembos, a Peruvian chain, beats out the American chains. (Photo: C-Monster/Flickr)
A Peruvian brand I think has done a wonderful job in this sense is Bembos, the local fast food restaurant that gives a hell of a headache to McDonald’s and Burger King in Peru. Bembos has positioned itself as the Peruvian hamburger targeting of young adults, in contrast to the American brands of fast foods whose target are children. Their differentiation not only lies in their target group but in the possibility of offering a real hamburger that can actually be served on a dish and is big, fat, juicy and full of Peruvian flavor — it doesn’t need to hide in between two big slices of bread!

The Bembos hamburger has it’s own personality and a rich Peruvian flavor: this point of differentiation and extra value is what enables the brand to charge more for its hamburger and thus avoid a price war with multinational companies.

In a marketplace where consumers purchase luxury products together with bargain products, it is important for companies to clearly communicate the reasons why they are selling expensive or cheap. The perception of a fair price occurs when the value is aligned with the price a consumer has in his mind and is willing to pay for this specific product or service. Therefore, it is easy to understand how fundamental it is for a company to know how to communicate that value to the customer and to do this one should start by getting to know the consumer and understanding if your competitive differentiation really matters to them.


Beatrice Ciabatti.


Beatrice Ciabatti is marketing director of ILARIA-PERU. Read more of her articles about business strategy and Peru.













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19 Comments

# Laura H says :
20 January, 2011 [ 10:18 ]
However. I just ate there (Bembos) and they served me an uncooked hamburger. I asked for it to be fixed and got another burger, definitely undercooked. Pink all the way through.....not going back.
# Ines Alvarez says :
21 January, 2011 [ 05:51 ]

im happy with this part of the online magazing peru. you are  making a good job, congratulations :D

# Fred Flongerburgerstein says :
21 January, 2011 [ 08:42 ]
I'm sorry, but Bembos hamburgers are awful.  The meat is more like Spam so it should really be called a Spamburger.  I'll take Mickey D's over Bembos every time.
# Richy Rich says :
23 January, 2011 [ 09:31 ]
I'm a Peruvian, born in the States, and I agree that the pictures of the Bembos hamburgers look great but are probably the worst I've ever had in my life! The meat is terrible .... I'd rather have a White Castle, Wendys, Burger King, or McDonalds ANY time..... In Chicago, Fuddruckers or 5 Guys is the best!!!!!!!
# Bruno says :
24 January, 2011 [ 09:11 ]
Yes they are bad (bembos) the only reason this chain works is because it offers the criollo sauces that peruvians like. It is nothing original just an adaptation. It seems to me that Peruvians do not accept other than their own way of things.
# Fernando Sarmiento says :
25 January, 2011 [ 06:29 ]
WOW! How can you even compare Bembos to McDonalds or Burger King? These companies do not use real meat, their burgers are like cardboard (paper thin and no taste)... Bembos has by far, the best quality burger in Peru...
# Joe Peluche says :
25 January, 2011 [ 07:57 ]
I like the analysis presented here. According to the comments, Bembo's could upgrade customer satisfaction by cooking a better burger, but the strategy seems sound for the target market. Value/price customers always go away when there is a better deal or the special price has ended- loyalty to the money, not so much the quality and atmosphere.

Peru is a growing economy and will strenghten it's domestic markets away from the multinationals if it keeps inflation under control relative to the rest of the world. Time will tell, but Peru is in a good position to increase it's wealth as the western markets and the dollar continue to fall.

Nice column Seniora Cabatti, I will continue to read your work.
# Carsten Korch says :
27 January, 2011 [ 12:52 ]
I really like Bembos and so do my kids. We seldom eat burgers, but if we do it is always at Bembos, whose burgers are seasoned and cooked just the way I like them.
# jimmyjames says :
27 January, 2011 [ 11:17 ]
Living here for two years now, I am on the streets daily and ABSOLUTELY LOVE discovering places to eat, near and far.
Hate the burger at Bembos, probably because I am accustomed to the Good Ol American taste. The Whopper is the best burger in the world. Gotta have a Mc cheese burger every once in a while. The Chicken sandwhichon the other hand, at Bembos is THE BOMB. No one competes with them. The hotdog also is great, only because I cant have the real thing at Costco with refillable COKE FOR $1.50,  which truely is the best deal in the word!!!!!
# cesar says :
28 January, 2011 [ 07:35 ]
Any non USA tourist that comes to Peru agrees that Bembos is much better. McDonald is a cultural thing for an american, which is fine: nations develop their own food fetiches; but you are blind and tasteless if you think that cardboard between two slices of bread is better. 
# james says :
1 February, 2011 [ 01:33 ]
Bembos burgers are probably 50% filler.  Before it goes on the grill it's white.  Other fast food chains at least use real meat.  But they have all the Peruvian ways of serving burgers like with fried egg on top so naturally the Peruvians go there.

Probably Kentucky Fried Chicken does as much business as anyone.  The KFC in jockey plaza always has a huge line.
# NY Country Girl says :
2 February, 2011 [ 09:03 ]
I was in Peru not long ago and I had to try Bembos, sorry to say... what a dissapointment. It was the first time I have ever seen our 14 year old son refuse to eat a hamburger. What is that stuff made of?? I did love thier aji though! My favorite palce was Pardos at Larco or even delivery....they know thier stuff! It was interesting to see how many American food chains are in Peru now and how much the Peruvian people love them. KFC, Pizza Hut, Mc Donalds, Burger King and a lot of Chili's. Even Subway is jumping on the food train. I really like Peruvian food but I was a bit dissapointed this time..all the places served the same stuff and and none of it blew me away other than Pardo's, we could eat that every day!
# Marco Nieto says :
3 February, 2011 [ 05:17 ]
...KFC in Peru is unlike any other KFC anywhere, and its simply delicious in Lima (can't say the same elsewhere, worst offender London KFC, that cant be chicken...), but this is after 20 years slightly adapting to the local market taste... 

Bembos and McDonalds cannot be compared, they are two very different types of hamburger and businesses. 

Burger: Possibly the biggest difference, and which explains the comments above, Bembos is a fat-rich hamburger (its meat, just that not processed, its directly grounded), while McDonalds has absolutely no fat in it (and is very processed to be able to be 100% beef). Add to that the peruvian sauces and the result is that Bembos will seem oily and too "strong" flavored for the american palate. 

Culture: McDonalds and most american franchises make everything the same, they dont want to adapt much to local culture, its about keeping uniform standards as much as possible. Bembos is meant to be a "localized" version of a hamburger fast food restaurant. India is going crazy over Bembos, and they have to make the burgers out of lamb there, pretty sure its a different taste. South Africans absolutely love the fatty meat as it is. Both countries have their own local sauces versions.

Very different models, very different burgers.   
# Marco Nieto says :
3 February, 2011 [ 05:28 ]
correction...McDonalds burgers do have fat, just fairly low fat.
# Rick Crosby says :
7 February, 2011 [ 08:56 ]
If it has to be a fast food hamburger, I will pick Burger King here in the US. But, if I am in Peru, hello Bembo's. The flavor stand out by far than any American fast food chain for hamburgers. The way a hamburger is prepared in Bembo's, that is the way it should be prepared here in the US. 
# Jeanet says :
23 February, 2011 [ 05:12 ]
Hi,

I think it is matter of taste. As a Peruvian I love Bembos, so when I came to the USA and tried what I was told the best burger, Burger King, I couldn't figure out what was good about it. I also tried Wendy's, McDonald's, and finally Fudruckers, which to me is the tastiest.
Americans don't add salt to their foods. An American, friend of mine, cooked the rice in a way that to us will be unacceptable; she put rice and water in a glass bowl and into the microwave! No salt or oil at all. When it was my turn to cook I made it Peruvian style and her boyfriend was glad to taste salt in the rice.
# Brian meagher says :
25 February, 2011 [ 11:27 ]
Great article.  I think most of the comments have been completely valid, personal opinions of the Bembos/McDonald's/Burger burgers.  But, I think you're missing the point of the article.  No matter what the product is - or if they use cardboard or spam or fillers to make it taste better (or taste worse if that's your preference) - the author is emphasizing the fact that you have to differentiate yourself in the market by building a brand, which leads to brand loyalty, which gets you away from the trap of offering the "lowest price" products or "2x1" deals (things that can only sustain for a short period of time). 

Stop arguing over whether or not you like Bembos versus McDonalds (or whatever), and start discussing the real point of the article.
# Alberto Del Solar says :
16 March, 2011 [ 08:19 ]

A relative of mine worked several years at Bembo's headquarters, he told me that the cow meat is mixed with a percentage of horse meat and seasoned with different spices, so it cannot be called 100% beef. I prefer Burger King, they have the regular Whopper which is 100% beef, that means there are no fillers or even condiments, and then there is the version with condiments, the Brava, which I don't really like. Anyway, Bembo's is liked by many Peruvians just because of the "it's national" kind of thing, but if you take national pride out of the picture, their burgers really suck, and would be nothing if it were not for the different sauces we Peruvians love. For a true burger taste, my choice is Burger King.

# Christopher Lama says :
17 July, 2011 [ 09:17 ]
I really don't understand all the fuss over hamburgers. Peru is a rich country on food, and if you want to pamper youself, you can do it with different Peruvian dishes. In North America, McDonald's, Burger King, Wendy, etc are meant for low income people - not to mention the obisity and other health issues related to it- and in Peru for American culture lovers who just want to show off.

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