#ExpansionIndex: Making It Work in Evolving Nations
We’ve already taken a couple of deep dives in Hyperwallet’s 2018 Marketplace Expansion Index, examining some of the unique challenges and opportunities presented by countries in our Established and Emerging categories. In this post, we want to cover our third and final market segment: the Evolving category.
What’s an Evolving Country?
Evolving countries, ranked #25-36, are often overlooked by marketplaces that have focused their attention on better developed, more obvious expansion targets. The countries in our Evolving category do present more challenges that their higher-ranked counterparts—however, if your marketplace’s strengths align with the unique opportunities in these regions, what might appear a risky gamble could actually be a savvy expansion maneuver.
Challenges you might face in Evolving countries include:
- Undefined Regulations
Nations in our Evolving category have often not yet determined how to regulate digital marketplaces. In many ways, that’s an advantage—companies can operate without the same level of scrutiny they might face in other regions. However, if or when regulations come into effect, marketplaces could find themselves uncomfortably exposed.
- Political Instability
Many of these countries lack the sort of stable governance you’d find in more developed markets. Whether its economic hardship, corruption, or outright violence, political turmoil can make it difficult to get operations started and establish trust with consumers in Evolving regions.
- Infrastructure Issues
Evolving countries tend to have poor logistics and payments infrastructure: undeveloped road and rail networks, large unbanked populations, and so on. Some marketplaces—particularly delivery and ride- or bike-sharing platforms—might find infrastructure challenges actually increase demand for their model. Others will need to find innovative ways to overcome these hurdles.
Don’t let the potential challenges listed here dissuade you. Despite their flaws, Evolving regions can yield hidden value for companies willing to take a chance. Higher unemployment in places like Spain and South Africa can help service-based marketplaces attract supply-side users to their platforms. Switzerland, dwarfed on all sides by its larger European neighbors, offers a strongly pro-startup business environment and large ecommerce market. Mexico has a population that is highly receptive to sharing economy models with a wide acceptance of products and services from the United States.
Quit fighting the crowd. Evolving countries offer huge benefits that often go unnoticed—your marketplace can be the one to find them.
Download Hyperwallet’s full, 133-page 2018 Marketplace Expansion Index and check out our interactive expansion map here.