Analyst Insight by Pavel Marceus - Technology, Communications and Media
Euromonitor International has identified the top three most prospective broadband Internet markets among emerging economies worldwide, based on fixed and mobile broadband growth since 2008, size of the Internet user base and prospects going forward. The standout markets are Iran, Nigeria and Indonesia, as these countries are witnessing a rapid connectivity programme that is allowing their large populations to become regular consumers of online services. As rural and underserved areas gain access to modernised broadband connections, these markets provide huge opportunities in the uptake of e-commerce, social media and digital subscription products.
Mobile and Fixed Broadband Subscriptions in Iran, Nigeria and Indonesia: 2014
Source: Euromonitor International from International Telecommunications Union/OECD/national statistics
Note: Figures are forecast
Continue reading "Top 3 Emerging Broadband Markets: Iran, Nigeria and Indonesia" »
by Caroline Bremner - Head of Travel and Tourism Research
Taking advantage of being in Uganda, I combined my speaker engagement at the Africa Travel Association's World Summit with a trip to local projects run by our global charity partner, Just a Drop. Just a Drop currently receive 1% of all our online sales. The experience was inspirational, humbling yet shocking and, despite the abject poverty, I came away with a sense of hope for the future of these communities.
Continue reading "Just a Drop Provides Much Needed Resources in Uganda" »
The bottom of the pyramid (BoP) has become overshadowed by the emerging middle classes but it remains an important consumer group; which taken as a whole, represents a huge market. Nevertheless, this segment remains underserved and so opportunities abound particularly for those who can innovate to offer original and aspirational products and services.
A sizeable market
In 2013, in the 85 countries for which we have data (which are home to 87% of all households globally) there were 401 million households earning less than US$5,000 per year, by 2030 that number will fall to 205 million (in constant 2013 prices). Nevertheless this remains a sizeable market, expected to account for 1-in-10 households across these 85 countries in 2030. To put this into context, this is a similar size in terms of the number of households, as Western Europe.
On an individual level these households of course have limited purchasing power – roughly US$14 per day or US$4 per household member per day - but that does not mean they should be overlooked. In India, the country with the largest number of sub-US$5,000 households, 52.3% of households fall into this category.
Continue reading "Reaching Consumers at the Bottom of the Pyramid" »
Analyst Insight by Media Eghbal - Head of Countries' Analysis
One of the biggest challenges facing global policymakers is how to feed the world’s growing population (expected to reach 8 billion by 2024) and expanding middle class, which has resulted in an accompanying increase in protein demand as consumer diets shift towards meat. The answer could be…insects, which are already being eaten in many parts of the world by an estimated 2 billion people according to the Food and Agriculture Organization of the United Nations (FAO). Food security is becoming more pressing as extreme weather cycles have played havoc with harvests and crops in recent years resulting in food price spikes, protectionist policies or crop hoarding.
Emerging markets are driving both global population growth and the expansion of the middle class, and demand for meat is growing:
In line with such trends, the FAO released a report in 2013 examining edible insects for the future of food, highlighting the fact that farming of such insects could provide a solution to tackling global hunger and food shortages.
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Euromonitor’s recently released Markets of the Future reports reveal the next eight Sub-Saharan African consumer markets with the brightest growth prospects – Angola, Côte d’Ivoire, Ethiopia, Ghana, Mozambique, Senegal, Tanzania and Uganda. These markets had a combined consumer spending of US$192 billion in 2013 and a combined population of 289 million. Between 2013 and 2030 their GDP will increase by 172% in real terms compared to 150% in Sub-Saharan Africa as a whole.
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One of the key strategies for success in emerging markets is to adapt to local conditions. This could mean redesigning products and services from the ground up or merely tweaking products or packaging to meet consumers’ needs. With an ever expanding list of big-name failures in emerging markets, and tighter economic conditions in some countries, a local strategy is crucial to safeguard success.
Generalise at your peril
The importance of this can be amply seen when comparing markets which on the face of it may seem to have lots in common. For instance Bulgaria and Romania are two emerging Eastern European countries, with almost identical per capita expenditure – but the data behind this headline figure reveals some interesting differences between the two countries. The same can also be said of Colombia and Peru, and many other not-so-similar markets.
Source: Euromonitor International from national statistics/Eurostat/OECD/ UN
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Women’s fragrances have traditionally ruled the market ahead of men’s, including in terms of product availability. However, absolute growth forecasts reveal that emerging markets like Mexico and Argentina will generate more value in men’s fragrances over 2013-2018. This indicates an opportunity for industry players to step up men’s variety, where prospects compare well with those of women’s. Middle Eastern markets, essentially Saudi Arabia and the UAE, will lead in premium unisex fragrances.
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Analyst Insight by An Hodgson - Income and Expenditure Manager
A comparison of all consumer markets in terms of their expected consumer expenditure annual real growth in 2014 reveals some interesting fast-growing markets that are not among the usual major emerging markets (such as the BRICS and the MINT). Of the top five fastest growing consumer markets of 2014, Malawi and Sierra Leone are somewhat surprising entrants while Turkmenistan and Saudi Arabia are fast-growing markets with sound fundamentals that can offer significant opportunities for consumer goods companies. Mongolia is also a market with promising prospects, but its small population restricts meaningful market expansion.
Top Five Fastest Growing Consumer Markets: 2014
Source: Euromonitor International from national statistics/Eurostat/UN/OECD
Note: Data are forecasts
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It’s dangerous to group all emerging markets into one convenient basket, even within a region their prospects vary dramatically. Not all are suffering from a slump, but equally not all are dynamic, fast-growing economies. In a time of heightened geopolitical tensions, and with risks to the global economy seeming to increase on a daily basis, the devil is in the detail.
Bright stars include smaller emerging markets such as Turkmenistan, Laos, Rwanda and Cambodia. India is also seeing something of a turnaround with growth expected to come in at 5.4% in 2014 and 6.7% in 2015 supported by an upturn in business confidence following the general election, lower commodity prices and policy reform. Bangladesh and Nigeria are also expected to put in strong performances.
Real GDP Growth in Selected Emerging Markets: 2014-2030
Source: Euromonitor International from national statistics/Eurostat/OECD/UN/IMF
Continue reading "Emerging Markets are not Shorthand for Doom or Boon" »
Analyst Insight by Oru Mohiuddin - Senior Beauty and Personal Care Analyst
The fact that its forecast 4% CAGR will make the Middle East and Africa the third fastest-growing region in percentage terms between 2013 and 2018, accounting for nearly 10% of global growth over this period, is good news for beauty manufacturers. However, the question is whether it will be better news for local businesses or multinational players, as we are now seeing a growing tussle between the two camps? Despite the attractiveness of the market, it is not a straightforward situation for Western beauty players as there are a number of inherent challenges that need to be grappled with to make their ventures a success.
Continue reading "Middle East and Africa - Local Beauty Players Set to Claim a Share of the Pie" »