A Reason Mexico is Cheaper That You Don’t Know Yet
Updated November, 2023
Mexico doesn’t have a lower cost of living merely because of less expensive healthcare, housing and food. Another aspect of saving money in Mexico is rarely mentioned. Mexico is cheaper because its culture is not driven by the most advanced, sophisticated marketing machine in the world like yours is.
The Top 10 most admired retailers in the U.S. aren’t admired for their level of service. They are admired because they sell a boat load of product.
Mexicans are ingenious in many things, they clearly are not as as good at selling as we are. According to all published lists, the top ten retailers are American companies. In 2017, based on revenue, out of the top 50 worldwide, not one was Mexican. To illustrate why they aren’t, I will tell you my favorite story about Mexican marketing.
An expat friend of mine often went to the same store to buy an item she needed. Often they were out. She remarked to owner that she loved the product. He told her he quit carrying it because he kept running out. He didn't like to disappoint his customers. (That story, by the way, tells you a great deal about Mexico and Mexicans on many levels, not just their marketing).
In contrast, it seems that Americans often carry what seems like a genetic mutation, one that culminated into the frenzied promoting hominids we are today. It’s not much of an exaggeration to say that most of us get off the plane in Mexico and immediately see an opportunity to create and sell something. Germans are efficient. Italians are emotional. Americans are capitalists.
Mexico is still more of a cash country.
Another aspect of living in Mexico that saves you from your crazy spending self is that Mexico is still largely a cash country. Paying cash makes you more aware of you’re spending. Many of my friends back in Denver have started carrying a set amount of cash with them when they go out at night so that their expenditures will register after a few gin and tonics.
Until pretty recently, Mexicans still paid their electric and water bills in person and in cash. Credit cards are harder to get. All this lends itself to a culture where only 37% of people have bank accounts. In the first five places I lived in Mexico, I paid my pay rent in cash.
Online purchasing in Mexico
Online purchasing is growing among Mexicans, but it’s still nothing like the craziness you find in the U.S. Amazon is making inroads but still not the best option for expensive purchases and choices are far fewer, the other major online store being Mercado Libre. Online shopping from many sites is fraught with hazards such as not receiving merchandise due to Mexico inferior mail service, not being able to return an order as easily, and fewer refunds.
You’re less likely to be a victim of online scams
One year just before leaving the U.S. to come back to Mexico, I got scammed online. Not by any of the top online scams like the emotional message from Nigerian prince or the fake antivirus software alert, but rather by an anti-aging face cream company (probably serves me right, but in my defense, I had one purchased a sample in a similar fashion that was completely legit).
The company runs ads on the internet to send you a free sample, saying you only need to pay the shipping. That’s how they get your credit card number. When you check the box thinking you’re agreeing to the shipping cost, you are actually agreeing to let them send you their expensive product monthly at the end of the “trial period.”
Somewhere in that shipping information it says you have 15 days to cancel. Of course you don’t cancel because you don’t know you ordered anything. I would never have have ordered that face cream had I been surfing the web while in Mexico. I would have just assumed it was a scam from the start because that’s not how legit Mexican companies market.
Customer service in Mexico is still people driven
Bots have generally described as a positive development; answering routine inquiries and saving time (money) for companies. People won’t be able to abuse the poor $15 an-hour customer service people anymore.
The bad news is that they add a whole new layer between the consumer and the companies we are giving our money to, including companies that seek to fleece us. We won’t be able to talk to any real people period, anywhere in the loop. at any point of the purchasing cycle.
Bots are much less part of your life as a consumer in Mexico. Mexico remains very people-intensive. You will notice how many more people serve you at the car wash, the coffee kiosk, or the department store. Mexico is all about employing as many people as possible. Mexico throws people, not technology, at its points-of-sale.
You’re not likely to being able to pull your own draft of beer in a bar in Mexico anytime soon.
A more personal relationship with our money
Using cash and developing a more personal relationship with my money and those I buy from in Mexico has made me more aware of how I spend your money. I have found myself practically immune to impulse purchases …no matter how much I want my skin to look like Natalie Portman.
Related links:
Bots and the Future of Customer Service - TechCrunch
You can still live a good middle-class American life…in Mexico [blog] - Ventanas Mexico on how is looks from a rear-view mirror.
About the author:
I'm Kerry Baker, a partner for Ventanas Mexico and the author of "If Only I Had a Place" for aspiring expats planning their first long-term stays in Mexico. My third book is “The Mexico Solution: Saving your money, sanity, and quality of life through part-time life in Mexico.” Most recently I co-authored The Lazy Expat: Healthy Recipes That Translate in Mexico for expats, snowbirds and travelers seeking to eat healthy in Mexico.