I could go on, but I won’t. Chances are you’ve already heard it one too many times. No reminder required!
We all know the barriers to entry have lowered immensely – whether it means starting a business from scratch or branching out into new markets with an existing business – thanks to this wonderful little thing called the internet.
So, considering just how easy it is to ‘go global’ these days, how come international companies are still a minority in the larger scheme of business today?
Well, for starters, going global isn’t easy. It’s easier than it used to be, yes, but leaving one with the impression that it’s a piece of cake would be deceiving. From a lack of resources to logistics to legal issues to language and culture barriers (and on the list goes), there may be myriad reasons deterring, and in some cases even preventing, companies from making the leap into international markets.
Yet from where I sit, tasked with keeping abreast of developments in the global marketplace, it seems clear that the ones who will emerge victoriously in this great unknown future of ours will be those companies which confront and embrace the challenges inherent in expanding operations internationally. In fact, I’d go as far as to say that playing it safe (i.e. staying in your domestic market) might be one of the most dangerous things you could do.
In my session ‘Maximising Global Opportunities’ at the International Search Summit in Seattle on June 10th, I will be shedding a lot more light on why that is so. In the meantime, here are three key global developments that should help show why marketers with a global mindset are poised to become the stars of tomorrow.
Internet user growth will be driven almost entirely by emerging and developing markets
Once upon a time – in fact, we need to go as far back as the ancient times of 1996 – two out of every three internet users globally were based in the United States. While I probably don’t have to tell you that a lot of water has run under the bridge since then, how exactly does the once so dominating U.S. fare today?
Half? Nope. A third? Nope. A quarter then? Sorry, no.
Today, U.S. internet users make up a paltry 10% of the global internet population. That is some change over the course of less than two decades, and it of course implies that the internet has evolved into a truly global phenomenon in that time span.
That said, if you think that more or less everyone is connected these days, you’re wrong. As it happens, ‘infancy’ seems like a more fitting label for the current state of the global web, with a whopping two thirds of our 7.1 billion strong world population having yet to come online.
This, of course, leaves enormous room for the continued expansion of the global web, the vast majority of which will be driven by developing and emerging markets (in Asia and Africa in particular) as internet penetration levels still significantly trail those of North America and Western Europe.
Deep demographic divide will accelerate shift
By now it’s clear that Asia, Africa and Latin America will act as the main catalysts for internet user growth over the near-term. While this may not be surprising to you, there’s an astounding (and not so well-known) demographic development set to take place over the next three decades and half that will not only accelerate this trend over the near-term but also guarantee continued high growth for many years to come in these regions.
Allow me to explain.
By 2050, according to the Population Reference Bureau, the world population is expected to reach 9.7 billion, up 2.6 billion from today’s figure. That’s a huge increase in such a short time span, but what’s truly puzzling is the regional demographic divide of this population add-on.
Of the 2.6 billion mentioned above, a tiny 100 million will come from what the Population Reference Bureau classifies as ‘More Developed Countries’. The regional close-up below will give you an idea of just how deep and significant this demographic divide really is, ranging from a population contraction in Europe to well above a doubling on the African continent between now and 2050.
Couple huge populations with fast improving living standards in especially Asia (and Africa looking set to be the next industrial powerhouse as China and other countries in Asia evolve into ‘knowledge economies’) and it shouldn’t take a genius to figure out that we’re dealing with an explosive cocktail.
It goes beyond ‘a lot of people’
Whether we like it or not, the centre of gravity online is rapidly shifting. And here’s the really interesting part: The shift is no longer just showing in terms of the raw number of internet users but also in actual ecommerce value. In other words, many emerging markets are quickly evolving from merely having large internet populations to having large internet populations with significant purchasing power.
But don’t take my word for it.
According to research from Common Sense Advisory, “English enables you to reach 21.6% of people on the web, and represents 36.3% of online spending power.” The latter figure is down from 48% in 2009, meaning that the English slice of the pie is getting smaller each year.
What’s more, eMarketer expects the Asia-Pacific region ($501 billion) to overtake North America ($469 billion) this year by B2C ecommerce sales value – marking a first ever – as exponential growth rates show little to no signs of slowing down.
You can check out the full agenda for the International Search Summit Seattle, which runs alongside SMX Advanced, here. Use code WS-ISS10 to save 10%.
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