Market Entry Strategy and Growth Foundations for RV Market in Chile

Issue Analysis | Group 9

Chiara Boschini – 59862 | Verena Luisa Epp – 61683 | Lily Gaertner – 58101
Julius Nikolaj Hofmann – 58832 | Teresa Sande Lemos – 32057 |
Executive Summary

To successfully enter the small but promising Chilean RV rental market, decisions in 4 strategic
categories need to be taken
Deductive Reasoning: WHY

External Factors Internal Factors

The latest data regarding the Chilean tourist market show a strong recovery after the
effects of the Covid-Pandemic in several categories: The Tourism, Camping and Rental
markets have grown with more then 30% since 2021.
While being a niche at the moment, the RV rental market does show big potential,
mostly because of the country's overall attractiveness as a travel destination, its
infrastructure and the regulatory environment.
Indie Camper can capture this potential i.a. through its first mover advantage as well as
its strategic alignment with the country’s focus on eco-friendly tourism.
Expanding to the Chilean market fits well into Indie Campers strategic goal of becoming
the No 1° road trip provider in the world.
Additionally, the company’s advanced online presence, combined with the established
foothold in the US provide Indie Campers with the operational capacity necessary for an
expansion.
Finally, an expansion into the South American market diversifies the company’s revenue
streams and helps mitigating seasonality effects.

Inductive Reasoning: HOW

Strategic Pillars
To deep dive into how Indie Campers should unlock the Chilean market we look for 4 Strategic Pillars:

1) We focus on the extend of the Local Presence, mainly driven by the identification of the business model used for the entry, the necessary tailoring of the fleet and the establishment of
support systems.

2) We look at Strategic Partnerships, e.g., collaboration with tourism partners, building supplier and campground connections and partnering with governmental functions.

3) We aim to understand Marketing and Pricing in the local industry by identifying an initial target group as well as understanding the use of promotional discounts and dynamic pricing.

4) We take the Regulatory Compliance into consideration by understanding legal requirements, necessary permits & licenses and the monitoring of compliance related factors.

Strategy Consulting | Issue Analysis | Group 9 2

 Agenda

1 Deductive Reasoning

2 Inductive Reasoning

3 Analysis of Initial Hypothesis

4 Next Steps

5 Project Team

Strategy Consulting | Issue Analysis | Group 9 3

 Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Assessment of external and internal factors influencing RV market entry in Chile

Should Indie Campers expand its market to Chile?

YES

External Factors WHY Internal Factors

Reasoning
Deductive

Market Competitive Regulatory Operational Revenue

Strategic Fit
Demand Landscape Environment Capacity Growth

Local Presence Strategic HOW Marketing & Regulatory

Partnerships Pricing Compliance
Reasoning
Inductive

Collaborate with Understand Legal

Identify Business Model Identify Target Group
Tourism Partners Requirements
Form Supplier and Offer Promotional Secure Permits and
Tailor the Fleet
Campground Ties Discounts Licenses
Establish Rental and Monitor Compliance
Partner with the Government Implement Dynamic Pricing
Support System continuously

Strategy Consulting | Issue Analysis | Group 9 4

Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Unlocking Chile: External forces shaping the path for Indie Campers’ market entry

Should Indie Campers expand its market to Chile? Yes!

External Factors WHY

Market Demand Competitive Landscape Regulatory Environment

Robust Market Revenue First-mover advantage Trade Agreement Benefits
In 2022, revenues of camping grounds, RV and trailer The campervan and RV rental market in Chile is No import duties under the Chile-U.S. Free Trade
parks in Chile amounted to approximately 105 million still developing, with only three established players. Agreement implies duty-free import advantage for
U.S. dollars. 4 U.S. Campers. 2

Expansive Rental Market Niche market with less competition

Market Legal Framework
In the commercial year 2021, the transport equipment The growing interest in outdoor tourism with Chile as
Legality of selling campers in Chile implies legal
rental market size (all motor vehicles) for tourism winner of the World´s Best Adventure Tourism
compliance in campervan sales operations. 2
increased to 1.7 billion U.S. Dollars, reflecting a growth Destination (2016-2021) offer potential for strong
rate of approximately 34% from 2020. 6 brand recognition and loyalty. 3
Addressable Market Projection Aligning with sustainable tourism trends Trending Travel Lifestyle
By applying the 2023 campervan booking percentages Chile's sustainable tourism trend matches Indie Increasing popularity of the legal overlanding
to the respective visitor counts from each country, Campers' eco-friendly focus, offering leadership enhances market viability. 2
we've calculated an addressable market size of potential in an underexplored segment attractive to
roughly 24,000 RV bookings in the Chilean market. 5, 6 eco-conscious travelers. 1

Considering the dynamic competitive landscape and favorable regulatory conditions, Indie Campers is poised to capture market share in Chile's RV market.
The strategic alignment with sustainable tourism trends and first-mover advantage in a developing market
set the stage for potential growth and a stronghold in the region.
Sources: 1 IMF, 2 International Trade Administration, 3 Ministerio de Economia, Fomento y Turismo, 4 Statista, 5 Statista, Strategy Consulting | Issue Analysis | Group 9 5
6Subsecretaria de Turismo Chile
 Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

The Chilean tourist, camping and rental markets are rebounding towards pre-pandemic levels,
with a projected TAM of 24.000 RV bookings
// Number of International Tourists in Chile (2017-2022) 4 // Robust Market Revenue, in $m (2012-2022) 1
2017: 6.5 Mio
+68%
-75%
Prior to the pandemic, the Chilean camping market had
2022: 2.0 Mio 3 seen constant growth to revenues of camping grounds,
- 75.2% 315 RV and trailer parks of around $343m in 2018.
2020: 1.1 Mio After a significant drop during Covid, revenues from
+35%
187 camping activities are now rebounding at a growth rate
of ~35% to around $105m in 2022.
International tourist number in Chile are expected to
105*
bounce back in 2024 to pre-pandemic levels in 2024 in 78*
part due to a governmental ”reactivation plan” that *Note: Due to the unavailability of data beyond 2018, we have utilized the
includes subsidies of around $7m to the tourism CAGR of general tourists' growth to project the revenue growth of
industry. 4 2012 2017 2020 2022 camping grounds, RV, and trailer parks in Chile for 2023.

// Expansive Rental Market, in $m (2017-2021) 3 // Total Addressable Market Projection (2022) 2, 3

+47%
-75%
Similar to the camping market, revenue from rental
6.9 motor vehicles had seen a drop during the pandemic
Foreign Tourist % of people
~ 24.000
Projected RV
but are now rebounding at a significant growth rate. Arrival in Chile X booking RVs = bookings in RV bookings
4.7 Prior to commercial year 2019, which included the first per Country 3 per Country 2 Chile per Year
from
+34% 9 months of the pandemic, revenues from rental
equipment had seen a 47% growth to around $6.9bn international
in CY2018. tourists in Chile
1.5 1.3 1.7* Assumptions:
• % of people renting RVs from Country A in general holds true
when people from A visit Chile
*Note: The periods are ‘Commercial Years (CY)’ starting in October • An average of 2 persons book one RV together
2017 2018 2019 2020 2021 and ending in September of the following year.

Sources: 1 Statista, 2 Statista, 3 Subsecretaria de Turismo Chile, 4 OECD Strategy Consulting | Issue Analysis | Group 9 6
Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Unlocking Chile: Internal forces shaping the path for Indie Campers’ market entry

Should Indie Campers expand its market to Chile? Yes!

Internal Factors WHY

Strategic Fit Operational Capacity Revenue Growth

Following the mission Established Office in the US Sustainable Revenue Streams

Aiming to be the top van marketplace drives the need With an established office in the US, Indie Campers is Establishing early market dominance in South America
to tap into South America, particularly Chile, where its well-positioned to manage and expand into the to ensure long-term revenue streams from a loyal
evolving infrastructure offers key advantages for Chilean market and could leveraging the Chile-US Free customer base.
establishing regional leadership.1 Trade Agreement to foster growth in this territory.1

Environmental commitment Advanced Online Presence Optimizing Costs for Revenue Growth
Indie Campers' commitment to sustainable The platform, with its multi-language options including Leveraging the US-Chile Free Trade Agreement, Indie
practices aligns perfectly with the growing ecotourism Spanish, is fully equipped to serve the Chilean market.2 Campers could reduce operational expenses, thus
movement in Chile.2 enhancing profitability.

Harnessing Indie Campers' strategic commitment to leading the van marketplace, its operational process with a strong online platform and US foothold,
alongside the potential for boosted revenue through market expansion and cost optimization via trade agreements,
it is recommended to consider to pursue growth in Chile's burgeoning RV sector.

Sources: 1 Kickoff Document Indie Campers, 2 Indie Campers Website Strategy Consulting | Issue Analysis | Group 9 7
 Agenda

1 Deductive Reasoning

2 Inductive Reasoning

3 Analysis of Initial Hypothesis

4 Next Steps

5 Project Team

Strategy Consulting | Issue Analysis | Group 9 8

 Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Assessment of external and internal factors influencing RV market entry in Chile

Should Indie Campers expand its market to Chile?

YES

External Factors WHY Internal Factors

Reasoning
Deductive

Market Competitive Regulatory Operational Revenue

Strategic Fit
Demand Landscape Environment Capacity Growth

Local Presence Strategic HOW Marketing & Regulatory

Partnerships Pricing Compliance
Reasoning
Inductive

Collaborate with Understand Legal

Identify Business Model Identify Target Group
Tourism Partners Requirements
Form Supplier and Offer Promotional Secure Permits and
Tailor the Fleet
Campground Ties Discounts Licenses
Establish Rental and Monitor Compliance
Partner with the Government Implement Dynamic Pricing
Support System continuously

Strategy Consulting | Issue Analysis | Group 9 9

Deductive Reasoning Inductive Reasoning
Four strategic pillars pave the way for a successful entry into the Chilean RV market
Local Presence
Identify Business Model
Focus on the 3P rent part business model
to get a feel for the market and minimize
risk until there is a clear picture
Focus on partnering with RV providing
companies inside the 3P model to avoid
large investments and financing needs
Tailor the Fleet
Offer a range of vehicle sizes from
compact campervans for solo travelers to
larger vans for families or groups
Provide options for different budgets,
from basic for cost-conscious travelers to
luxury vehicles with premium amenities
Establish Rental and Support System
Carefully choose local rental stations to
make use from tourist traffic, enhance
service quality and operational efficiency
Establish local support systems to provide
repair stations, maintenance, cleaning and
road assistance
Analysis of Initial Hypothesis
Should Indie Campers expand its market to Chile? Yes!
Strategic Partnerships
Collaborate with Tourism Partners
Partner with local tourism boards to gain
insights into popular travel destinations
and trends in Chile
Collaborate with adventure travel
companies to offer bundled packages that
include outdoor activities
Form Supplier and Campground Ties
Establish partnerships with local vehicle
suppliers for favorable procurement terms
and reliable maintenance support
Forge partnerships with key local
campgrounds, leveraging their scarcity to
establish exclusive agreements
Partner with the Government
Identify strategic locations for
campground development and propose
governmental infrastructure funding
Establish eco-friendly incentives and
obtain government support to position IC
as a leading sustainable travel solution
Next Steps Project Team
Marketing & Pricing
Identify Target Group
Identify target group both from their
country of origin as well as their travel
style to tailor marketing indicatives
Adjust operations to local consumer
preferences and support tourists during
planning to assure satisfaction
Offer Promotional Discounts
Provide introductory discounts for first-
time customers to incentivize trial and
build a customer base
Create special promotions for returning
customers to encourage loyalty and
repeat business
Implement Dynamic Pricing
Implement a dynamic pricing algorithm
that adjusts rates to real-time factors like
booking lead time and vehicle availability
Monitor competitor pricing and market
trends to ensure competitiveness and
adjust pricing strategies accordingly
Strategy Consulting | Issue Analysis | Group 9
HOW
Regulatory Compliance
Understand Legal Requirements
Familiarize with and adhere to Chilean
regulations related to vehicle rentals
Consult with local legal experts to ensure
all business practices follow local laws
Secure Permits and Licenses
Obtain all necessary permits and licenses
for operating a rental business in Chile
Ensure that all vehicles in the fleet are
registered and comply with Chilean
emissions and safety regulations
Monitor Compliance continuously
Establish a compliance team responsible
for staying updated on regulatory changes
and implementing adjustments
Develop a system for regular audits and
checks to ensure ongoing compliance with
all legal requirements
10
 Agenda

1 Deductive Reasoning

2 Inductive Reasoning

3 Analysis of Initial Hypothesis

4 Next Steps

5 Project Team

Strategy Consulting | Issue Analysis | Group 9 11

Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Establishing a local presence fosters risk mitigation, caters to diverse customer needs, and
enhances accessibility and customer support, driving market penetration
Main Issue Sub Issue Hypotheses Analysis Tool
Should IC consider YES. Considering to focus on the 3P rent model in the beginning is a strategic move • SWOT Analysis
focusing on the 3P rent to achieve growth while mitigating risks. This model allows IC to build rental • Cost-Benefit Analysis
business model? offerings without massive upfront investment, therefore minimizing financing needs. • Competitor Analysis
Identify Business
Model Should IC focus on YES. As partnering companies and other rental stations are crucial for the 3P • Supplier Analysis
partnerships to leverage model to work, IC should focus its resources on finding and collaborating with • Risk Analysis
the 3P model? fleet providing partners in Chile until the market situation becomes clear. • PESTEL & Porters 5F

YES. Offering a range of vehicle types and sizes attracts a wider customer base by • Market Research
Should IC offer a range of
catering to diverse travel styles and budgets. It also allows the company to cater • Industry Benchmark
vehicle sizes?
to the specific requirements of Chile’s vast and adventurous nature • Competitors Analysis
Tailor the Fleet
YES. Offering options for different budgets allows IC to attract a wider audience, • Industry Benchmarks
Should IC provide options
like how a diverse fleet caters to various travel styles. This broader customer base • Research Chilean Tourism
for different budgets?
can lead to increased revenue and market share for IC sector

YES. Strategically placed stations in Chilean tourist hubs can increase accessibility • Border crossing data &
Should IC consider the
and convenience for customers, leading to a larger customer base and potentially Location Analysis
location of rental stations?
increased revenue and market share for IC. • PESTEL Analysis
Establish Rental and
Support System YES. Establishing local support systems is essential for IC to build trust, loyalty and • Industry Benchmarks
Should IC establish local
to provide necessary services. Local support teams can provide a more secure • Tourism Trends Analysis
support systems?
and enjoyable experience for customers, also leading to a larger customer base. • Internal Analysis

Strategy Consulting | Issue Analysis | Group 9 12

Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Strategic partnerships with local tourism boards, vehicle suppliers, and the government are
pivotal to widen market reach, enhance travel experiences, and ensure robust operations
Main Issue Sub Issue Hypotheses Analysis Tool

Should IC partner with
local tourism boards?
Collaborate with
Tourism Partners Should IC collaborate with
adventure travel
companies?
YES. Partnering with Chilean tourism boards allows IC to tap into established • Market Research
marketing channels and local expertise, potentially reaching a wider audience • Local expert interviews
and offering more attractive travel options.
YES. Collaborating with adventure travel companies allows IC to offer adventure • Market Research
packages with activities that are typical for Chile, going beyond just RV rental and • Customer Interviews
potentially attracting a wider audience seeking unique travel experiences. • Local expert interviews

Should IC establish
partnerships with local
vehicle suppliers?
Form Supplier and
Campground Ties
Should IC partner with
local campgrounds?
YES. Partnering with local vehicle suppliers allows IC to use its 3P model, • Supplier Analysis
reducing upfront costs and offering regionally-suited vehicles. A broad selection • Porters Five Forces
and potentially lower costs can attract a wider audience, while reducing risks. • Market Research
YES. As the number of RV supporting campgrounds in Chile is limited at the • Existing Campground
moment, actively collaborating and lobbying with existing campsites will be crucial Analysis
to offer an attractive camping experience for future IC customers. • PESTEL Analysis

Should IC advocate for
governmental
infrastructure funding?
Partner with the
Government Should IC obtain
governmental support for
eco-friendly incentives?
YES. IC should advocate for governmental infrastructure to improve RV-related • Infrastructure Analysis
infrastructure in the country. For example, IC could lobby towards infrastructure • PESTEL Analysis
development close to UNESCO sites that often attract significant tourism. • Market Research
• Overview of government
YES. By offering, with government support, eco-friendly incentives to consumers, IC
can offer sustainable travel while strengthening its relationship with the government. support options
• Competitors Analysis

Strategy Consulting | Issue Analysis | Group 9 13

Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Targeted marketing and dynamic pricing strategies are essential for enabling tailored
customer engagement and relevance, optimizing revenue across varying demand periods
Main Issue Sub Issue Hypotheses Analysis Tool
Should IC make effort in YES. Just like offering different vehicle sizes caters to diverse travel styles, • Tourist Origin Analysis
identifying the target understanding their ideal customer allows IC to tailor their marketing, products, and • Customer Segmentation
audience? services, attracting a more relevant audience and increasing their chances of success. • Top-Down Market Sizing
Identify Target Group
Should IC adjust their YES. By understanding local needs and preferences, IC can tailor their offerings • Industry Analysis
operations to consumer and marketing to Chile’s different regions, creating a more relevant and enjoyable • Competitor Analysis
preferences in Chile? travel experience for customers. • IC Best Practices

Should IC provide
discounts for first-time
customers?
Offer Promotional
Discounts Should IC create special
promotions for returning
customers?
YES. Discounts can incentivize potential customers who might be considering • Promotional Benchmarks
campervan travel for the first time. This can lower the initial barrier to entry and • A/B Testing
encourage them to try out IC's services • Cost Analysis
YES. Creating special promotions for returning customers aligns with IC strategy • Promotional Benchmarks
for customer retention and loyalty building. Special promotions show appreciation • A/B Testing
for returning customers and incentivize them to choose IC again • Competitor Positioning

Should IC implement a
dynamic pricing
algorithm?
Implement Dynamic
Pricing Should IC monitor
competitor pricing and
market trends?
YES. Dynamic algorithms adjust prices based on real-time factors like seasonality or • IC Best Practices
rental demand. This allows IC to maximize revenue during peak seasons and offer • Pricing Benchmarks
competitive rates during slower periods, attracting more customers. • Evaluation Pricing model
YES. By keeping a close eye on competitor pricing strategies and market trends in • Pricing Benchmarks
the Chilean market, IC can make informed decisions about their own pricing, • Marketing Benchmarks
vehicle offerings, and marketing campaigns. This allows them to stay competitive. • SWOT of Competitors

Strategy Consulting | Issue Analysis | Group 9 14

Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Regulatory compliance is vital as it safeguards operations, aligns with environmental

standards, and builds customer trust by adhering to local laws and regulations
Main Issue Sub Issue
Should IC familiarize and
adhere to Chilean
regulations?
Understand Local
Requirements
Should IC consult with
local legal experts?
Hypotheses Analysis Tool
YES. Operating within the legal framework is essential to avoid fines, penalties, or • PESTEL Analysis
even business closure. Familiarization with Chilean regulations ensures IC functions • Legal Analysis
smoothly and avoids legal roadblocks. • Legal Expert Interview
YES. Chilean laws and regulations can be intricate, especially for foreign • PESTEL Analysis
businesses. Local legal experts can provide guidance on navigating these • Legal Analysis
complexities, ensuring IC operates within the legal framework . • Legal Expert Interview

Should IC familiarize with
all necessary permits and
licenses?
Secure Permits and
Licenses Should IC familiarize with
with Chilean emissions and
regulations?
YES. Permits and licenses act as legal authorization for IC to function as a • Legal Analysis
campervan rental business in Chile. Operating without them can lead to fines, • IC Best Practices
penalties, or even business closure • PESTEL Analysis
YES. Understanding Chilean emissions regulations demonstrates IC's commitment • Legal Analysis
to environmental responsibility and sustainable tourism practices. This aligns with • Environmental Analysis
the growing trend of eco-conscious travel and can attract customers • PESTEL Analysis

Should IC establish a
compliance team?
Monitor Compliance
continuously Should IC develop a
system for regular audits
and checks?
YES. A dedicated compliance team can proactively monitor regulations, identify • Compliance Analysis
potential risks, and implement strategies to ensure IC remains compliant across • IC Best Practices
various areas (legal, environmental, safety) • Industry Analysis
• Compliance Analysis
YES. Regular audits and checks can identify potential compliance issues, safety
hazards, or inefficiencies within IC's operations before they escalate into • IC Best Practices
problems. This proactive approach minimizes risks. • Industry Analysis

Strategy Consulting | Issue Analysis | Group 9 15

 Agenda

1 Deductive Reasoning

2 Inductive Reasoning

3 Analysis of Initial Hypothesis

4 Next Steps

5 Project Team

Strategy Consulting | Issue Analysis | Group 9 16

 Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

The timeline details a phased approach for Indie Campers' market expansion, highlighting milestones

Project Timeline
March April May
Calendar Week 10 11 12 13 14 15 16 17 18

Diagnosis Issue Analysis (11.03)

Market Research
Fleet Benchmarking
Operational & Sales Evaluation

Hypothesis Testing
Formulation of Hypothesis
Data Collection & Analysis
Fact Pack (08.04)
Interpretation & Conclusion

Recommendations Client Questions (11.04)

Report on Key Findings
Go-To-Market Plan Final Report (06.05)

Roadmap for Implementation

Milestones (Date) Duration

Strategy Consulting | Issue Analysis | Group 9 17

Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Assessing the Chilean Market for Indie Campers' Expansion from data collection until recommendations

1 Data Collection & Research

• Market research
• Fleet benchmarking
• Operational & sales evaluation

2 Stakeholder Engagement
Develop survey questionnaires and interview guides specifically
designed to explore target audience preferences and perception
regarding Indie Campers' expansion into Chile.

3 Hypotheses Testing
Testing our assumptions: 4 Recommendation Formulation.
• Evaluating Initial Hypotheses
• Data Analysis through Relevant Frameworks Our recommendations will encompass:
Monitoring progress effectively.: • Final Report on Key Findings and necessary adaption to CHL Market
• Regular Milestone Reviews • Go-to-Market Plan and Roadmap for Implementation
• Adherence to Project Timeline

Strategy Consulting | Issue Analysis | Group 9 18

 Agenda

1 Deductive Reasoning

2 Inductive Reasoning

3 Analysis of Initial Hypothesis

4 Next Steps

5 Project Team

Strategy Consulting | Issue Analysis | Group 9 19

Deductive Reasoning Inductive Reasoning Analysis of Initial Hypothesis Next Steps Project Team

Your guide to success: a resource-rich team for every step of the journey

Teresa Sande Lemos Lily Gaertner Julius Nikolaj Chiara Boschini Verena Luisa Epp
Hofmann B.Sc. in
International Economics
B.Sc. in Management B.Sc. in International B.Sc. in International B.Sc.
and in Economics
Development B.Sc. in
at Nova SBE Business Administration Economics and at University
and Managementof Bayreuth
at Management and
at BSP Business & Law Development at Università Cattolica Technology at TUM
M.Sc. in Management
School Campus University of Bayreuth delatSacro Cuore
Nova SBE
School of
Hamburg Management

M.Sc. in Management M.Sc. in Management M.Sc. in Management International M.Sc. M.Sc. in Economics
at Nova SBE at Nova SBE at Nova SBE in Management at Nova SBE
at Nova SBE

Strategy Consulting | Issue Analysis | Group 9 20

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