5 Reasons why you should start and grow early in emerging markets
1. Technology
As technology become the center for modern countries, technology also is a core sector for developing countries. The developing countries are getting transformed, and a huge market gaps show up giving that a lot of opportunities for brands who are ready to expand internationally, and allow companies to find ways for growth that may not be available in their home regions because of high competition.
“As a region undergoing great change, the Middle East presents a wealth of opportunity for innovation through technology” BCG Read more about The Future of Technology in the Middle East
2. Competitions
The opportunities in emerging markets are huge. The success these endeavors brought to business owners inspired them to seek out more fertile grounds to grow their brands.
Being the unique solution for your customers in a low competitive market gives your Brand many advantages and makes you the dominant for that market as a first mover and increases the barrier gap for new entrants even for big companies.
One of amazing examples for competition is when Amazon bought souq.com. Amazon decided after more than 20 years of its establishment in July 5, 1994 to explore new markets. Amazon acquired Dubai-based souq.com in a deal estimated at around $580m in March 2017. Once Amazon started to focus on emerging markets, they found a giant copycat for them which can’t be overcome on their ground. The acquisition was the right solution for such competitions.
Another example is how Spotify still struggling versus anghami in the middle east. Read more about WHY ANGHAMI, WITH OVER 1M PAYING USERS, DOESN’T FEEL THREATENED BY SPOTIFY IN THE MIDDLE EAST.
3. Revenue on Low-cost
Small businesses and startups face many challenges like (high labor cost, high production cost, taxes, etc.) when deciding to expand from Europe to America and Vice versa which make it difficult to sustain the business in the highly competitive markets.
International expansion can be made wisely by choosing the right region with low competition and low operational cost which fits with early stages startups to build connections and use their resources wisely and gain revenue as early as possible.
4. Covid19 & emerging markets
While Covid19 affects the whole world's behavior in how to do business differently which increases the demand in The E-Commerce industry. Many online companies tried hardly to find their ways in the USA, and Europe which is already dominated by companies like Amazon. At that time others find a new opportunity to grow in emerging markets and build their presence there.
Now after Covid19 we can see disruptive companies with disruptive teams. In a conversation with one of leading Tech. recruiters mention that some of their clients request for office-based employees, and most of time requests for remotely employees with only one day presence a year.
As the world changed during Covid19, emerging markets changed also leaving more opportunities to appear on the surface even for an online business model.
Disruptive companies around the world are targeting emerging markets and gaining revenues online without even have an office in those countries.
5. New opportunities:
While GDP and population growth of a region are important factors defining an emerging market, also the growth level of country engagement to technology, real state, education, and banking are other important factors to consider.
As an example, for companies focusing on emerging markets: Reckitt as one of the leading companies in the world indicate that (in their 2019 financial report) 50% of health care products revenue (like Dettol, Durex, etc.) came from emerging markets.
Expansion decision should be built on the available resource and how to use it to grow the business wisely.
