By ROB GEAR, PA DIGITAL expert
I’ve always liked William Gibson’s oft-quoted maxim that “the future is already here, it’s just not very evenly distributed”. I think it captures the fact that things are not the same everywhere and that values, governance, culture, economics, etc. will combine in many different ways. In some markets and regions, and amongst early adopters (whether of technology, ideas, or systems of behaviour and governance) we can see glimpses and pockets of the future embedded in the present.
The Gibson quote popped into my mind whilst reading a recent article in the Harvard Business Review looking at where the Digital Economy is moving fastest. What the article makes clear is that, in digital terms, the greatest opportunities are shifting south and east and into emerging markets, with Asia and South American countries experiencing the most rapid rates of change in their digital evolution.
In many of these countries this growth is being driven by rapid urbanisation and large numbers of new consumers coming online via mobile (and leapfrogging to some extent in technological terms the longer-established digital economies of Western Europe and North America). This reflects not just a technological difference, but one of consumer culture and values as well.
For established businesses this poses both opportunity and threat. Opportunity to reach the vast, new markets of customers coming online, and the threat that agile and highly innovative competition will emerge from these new Digital Economies. What makes the challenge greater is that many of these new market opportunities will be in unfamiliar territory. The rapidly growing cities in emerging economies represent the new powerhouse markets of tomorrow, and very few established global brands and businesses have a presence there.
In China for example, we are familiar with Shanghai and Beijing, but many would be less so with cities such as Dongguan, Suzhou, Tangshan, and Foshan – just some of the Chinese cities that are projected to exceed the 2010 GDP of Singapore within the next decade. (Source: McKinsey Global Institute, CityScape database). We can find similar examples across Central and South America and Africa where the productivity of individual cities is forecast to exceed that of some European countries in the years to come.
These rapidly expanding cities in Asia, South America and Africa not only represent massive new potential markets but they are also hotbeds of innovation and creativity that will be looking to contribute as well as consume digital products and services. Forward looking organisations would do well to start to think about their strategy for engaging in these emerging digital markets, which will look and feel very different to those of they operate today. Witness for example the growth and innovation in digital payment technologies in Africa and the “jugaad”-style of flexible and frugal innovation practiced in India and other geographies, but growing in popularity elsewhere.
Being able to adapt to local preferences, culture and values will be critical to success. For example, when we researched car sharing applications some years ago we discovered that whether or not the concept was supported depended on how different cultures viewed their cars – a utility in some geographies and something more personal and linked to status elsewhere.
When considering expansion into emerging markets, the greatest opportunities may well lie in the cities and regions that are the most unfamiliar today. That means there will be a real need to look beyond technology and explore the cultural anthropology and ethnography of those new markets.
How will your organisation address the emerging Digital Economies and do you have the necessary skills to adapt to this changing world?