Expanding services or product sales to Brazil is not exactly veering off the beaten path. Despite its economic woes, Brazil’s population of more than 200 million and expanding middle class (albeit slower than expected by experts back in 2010, when the country was riding high on 7.5% GDP growth) are a force to be reckoned with. But while Brazil may hold few surprises for foreign investors, the way in which eSky, an online travel service headquartered in Poland, reached the country is far from typical.
Although not created with international markets in mind, eSky pretty quickly looked to further itself internationally. In 2008, four years after the company was established, it opened a service centre in Bulgaria and, quickly after that, one in Romania, with plans to further increase its international client base. “Our expansion to Bulgaria and Romania proved to be an immediate success, fuelling our appetite for strengthening our foreign presence,” says Lukasz Neska, chief commercial officer and board member at eSky Group. “Therefore we were looking for interesting markets within our whole region.”
So how did eSky came across Brazil when looking for investment targets in central and eastern Europe? The answer is Google. “We worked with eSky on strengthening its online presence in Poland, Romania and Bulgaria. And in 2010, when it was looking for further markets for expansions, we got involved in helping,” says Joanna Nagadowska, export industry manager at Google Polska. “We did so by analysing keyword searches for travel-related issues across the world.”
The analysis revealed that the biggest markets with searches related to tourism are the US, Germany and the UK – which are already highly saturated and with very strong competitors. However, the analysis revealed another country: Brazil, the country where in 2013 more than 100 million people were already online. “On top of choosing the market, we also helped eSky with suggestions on what local clients are most interested in, be it in regards to certain connections or carriers,” adds Ms Nagadowska.
“Tools such as Google’s Global Market Finder definitely made our expansion easier,” says Mr Neska, although he admits the process was not entirely trouble free. After Google put Brazil on eSky’s radar, it decided to open its office in São Paulo. “It is a great city and all businesses are here – but that means it is very hard to attract and retain employees,” says Mr Neska. After a few months in Brazil’s largest city, eSky moved more than 1000 kilometres south to Porto Alegre, a city of 1.4 million people. “Porto Alegre proved to be a good match for us. It might be smaller [than São Paulo], but we have no problem finding employees here,” says Mr Neska, who adds that the company currently employs 73 people in the city (eSky's overall headcount is 516).
Despite the initial issues, betting on Brazil has paid off. In 2012, tnooz.com, a travel news service, named eSky the most popular travel website in Brazil and the company now plans to expand into other markets in Latin America. Asked if eSky plans to work with Google this time around, Mr Neska says: “Of course. Data-driven expansion pays off – even if it sometimes takes us places we would have never expected.”