MEXICO CITY — Mexico’s leading department stores have launched a series of aggressive marketing campaigns and efforts to bolster sales as growth in Latin America’s second-largest economy turns sluggish.

“They [the department stores] have always launched seasonal advertising campaigns, but this year they are more intense,” said Marisol Huerta, a retail analyst with brokerage Banorte-Ixe in Mexico City. “Point-of-sale campaigns are also more aggressive, and the department stores are definitely going to increase their marketing investment this year and next.”

According to Huerta, 2014 looks even gloomier as consumers curtail purchases on the back of a prolonged slowdown that is expected to stretch until 2015.

In 2013, Mexico’s gross domestic product is forecast to grow 1.8 percent compared with earlier predictions of 3.5 percent. Next year, Huerta predicts growth will hover around 2 percent.

Amid this backdrop, department store sales are set to grow 8 to 10 percent this year, down from annual average growth of 10 to 15 percent since 2008. In 2014, they could grow below 10 percent, Huerta forecast.

“We don’t see a clear economic growth dynamic for next year, and Mexico is going to suffer from higher taxes,” Huerta noted, referring to Congress’ approval of a fiscal reform that capped personal income taxes at 35 percent from 28 percent.

Edgar Smolensky, Sears de Mexico’s marketing director, agreed the promotional efforts are highly ambitious, including those launched by the 80-strong department store network owned by Mexican billionaire Carlos Slim.

“The latest campaigns are indeed more aggressive than last year, and we can see the competition doing very strong and unprecedented promotions,” Smolensky said, adding that Sears has also jumped into the fray, albeit with a differentiated approach.

Luxury chain El Palacio de Hierro launched a fall-winter marketing blitz in late August that featured an unprecedented social media effort. At the same time, Sears deployed its “Falling in Fashion” initiative, which has a strong TV component. Liverpool, Mexico’s largest department store network, aired a celebrity-inspired campaign featuring actress Milla Jovovich.

“We feel very confident about digital,” said El Palacio’s communications director Françoise Lavertu, adding that the campaign’s digital component received 3.4 million views in the first three weeks of airing on YouTube, Facebook, Twitter and other social media platforms. The initiative also ran on TV, print, outdoor and a broad range of media.

Lavertu would not disclose the campaign’s cost but said it didn’t require additional investment over last year as the retailer shuffled its budget to spend more on digital and less on TV.

Peruvian-Polish photographer Alexi Lubomirski is the face of the campaign, called “Libera Tu Estilo” (“Free Your Style” in English), which pictures him describing how the brand meets his style and fashion requirements in TV spots and other ads.

“We call him the prince because he acts like a prince and is stylish the moment he wakes up,” Lavertu enthused, adding that Lubomirski’s style and elegance were behind the 125-year-old retailer’s decision to choose him.

TV spots show the New York-based fashion photographer narrating his life and career as he goes about his work. He concludes the spots with the chain’s “I am totally Palacio” overarching marketing slogan. In print ads, Lubomirski is featured saying, “My skin is my history or “I am wearing this life.”

 

According to Lavertu, El Palacio read through fashion blogs and conducted other research to find Lubomirski and Carmen Dell’Orefice, the 82-year-old model who appeared in its spring campaign.

“We try to find true and credible characters that live in a stylish way,” Lavertu explained.

Unlike Sears or Liverpool, she added, “We don’t want to use a model or celebrity. We want uniquely stylish people to be discovered through us, to tell their story so that they are relevant to our customers.”

Sears’ multimedia Falling in Fashion autumn campaign, launched in late August, presented a love story in a sumptuous setting “to communicate beautiful clothing at affordable prices,” Smolensky noted, adding that Mexico City’s historic Spanish Casino site was chosen to film the spot.

Explaining why he chose love as the main theme, Smolensky said, “We are a young country and these are hard times.”

“Love always triumphs above it all and has a happy and positive connotation. We are all motivated by our feelings, despite materialism.”

Smolensky said the campaign has been very successful, boosting Sears’ social media fan base by 100,000, though he would not provide additional result statistics.

According to Smolensky, Sears’ spring 2014 campaign will likely feature a Mexican state (most likely flood-hit Guerrero), following a similar spring strategy to publicize crime-ridden Michoacan.

“A lot of states have bad press that is not entirely true or fair,” Smolensky said. “A lot of these states are beautiful and have a lot to give. We are a Mexican company that loves Mexico. Mexico has given us a lot, and we want to give back.”

Asked if Sears will follow Liverpool to launch a celebrity-inspired advertising campaign, Smolensky said, “We are in talks with three Mexican actresses, but this is still in early negotiations.”

Liverpool’s fall-winter marketing campaign, dubbed Fashion Fest, ran on all media platforms from August until late October.

Executives at the 100-store network were not available for comment. However, a spokeswoman said the ethos behind the campaign was to communicate Liverpool’s strategy of selling “accessible fashion for young consumers.”

Fashion Fest featured Jovovich modeling Liverpool’s fall apparel in a luxury mansion and gardens setting. It used scripts such as “Discover your fashion side” or “We celebrate fashion” as part of the retailer’s efforts to lure young consumers to buy brands such as Aéropostale or American Eagle, which Liverpool recently began selling exclusivity.

 

The spokeswoman would not disclose Liverpool’s marketing spending or provide a 2013 sales forecast. However, she acknowledged the company — which operates a joint venture with Spanish peer El Corte Inglés to run the expanding Sfera chain in Mexico— has and will deploy aggressive below-the-line promotions, both at stores and through its Liverpool Monedero pay-back store card and credit cards.

Smolensky said Sears will engage in similar actions, though not as strongly as rivals.

“When times get tough, everyone extends the ‘months without interest terms’ on their credit cards, so much so that this cheapens the market and spoils consumers,” he noted. “At Sears, we will focus on promoting our value-added fashion through smart content and not pushy marketing.”

Despite efforts to stand out from the pack, Sears’ sales are unlikely to match last year’s 10 percent increase, Smolensky conceded, adding that they are set to rise around 5 percent this year.

Like competitors, Sears, operated by the Sanborns holding that also runs Saks Fifth Avenue in Mexico, will strive to lift sales through product launches.

For instance, The Kardashians Clothes & Style collection will arrive for spring, Smolensky said. Currently, Sears carries Benetton, Elle, 7 For All Mankind and Joe’s Jeans exclusively in Mexico, Smolensky said.