CASE STUDY CHAPTER 9NOVICA OPENS DOORS ACROSS NATIONAL BOUNDARIESOne of the longest-surviving online businesses in the world recently celebrated its 16thanniversary. This business provides a unique online experience, and, at the same time, isattempting to change the world. No, the company is not Google, Facebook, eBay, or Amazon.It’s Novica, an online retailer of beautiful handmade items from Brazil, Ghana, India,Indonesia, Mexico, Peru, and Thailand. Novica’s founders were Armenia Nercessian deOliveira, a Brazilian and longtime United Nations human rights worker; Roberto Milk, her23-year-old son-in-law; and Roberto’s brother, Andy. Roberto and Andy are sons of a PeaceCorps volunteer. Their business plan, launched in 1997, was based on direct sales betweenartisans in developing countries and customers in the United States. Together, the foundershad lived in or traveled to dozens of countries, spoke a number of languages, and had strongmanagement and financial experience. But despite their obvious qualifications, “everyonesaid it couldn’t be done: simultaneously establish offices in countries all over the world, payartists more than they have ever made before, and ship purchases directly to customersworldwide from countries all over the world with no U.S. warehousing,” says de Oliveira.“But we did it! Novica.com [is now] the leading online world style marketplace.” Althoughsome companies choose globalization to reduce costs or to respond to competitive pressure,Novica is more concerned about building global communities that share products and ideas.The main goal of Novica is not “merely selling products,” de Oliveira emphasizes. “We areactively working to disseminate cultures and restore the importance and appreciation oftraditional cultures and skills.” Moreover, it is important for the company that both culturesbenefit and are not harmed by the exchange. “Novica has broken down the traditionalinternational barriers to direct trade between individuals,” says Catherine Ryan, Novica’sVice President for Communications. “Our goal is to help usher in a second, positive era ofglobalization that moves away from both the consolidation of the marketplace and thehomogenization of culture.” Novica’s business model shows a close fit with the culturalcharacteristics of both the United States and developing nations. Americans tend to want tobuy luxury goods for themselves and their homes.
