Expanding into emerging markets can significantly boost your global eRetail strategy by accessing a large customer base, creating new revenue streams, and increasing brand awareness globally. Early entry can provide a competitive advantage and foster innovation and adaptation to meet diverse market needs.
Let’s explore the potential of key regions:
a. Latin America:
With a rising middle class and increasing internet penetration, the region offers substantial opportunities.
The payment landscape is characterized by a mix of cash dominance, high smartphone penetration, and a growing fintech sector. Cross-border remittances play a significant role, and regulatory challenges exist across different countries. Having a relatively lower Credit card penetration, Latin America is fragmented with varying preferred payment methods, leading to broad variety of APMs.
Despite challenges, the market is dynamic with significant growth opportunities, making it an area of interest for businesses and fintech startups aiming to tap into the region’s evolving ePayments landscape.
To give an example, Walmart, the American retail giant, has achieved significant success in expanding into emerging markets. Walmart’s entry into Mexico began in 1991 through a joint venture with Cifra, a local retailer. Through strategic acquisitions and localization efforts, Walmart Mexico grew to become one of the country’s leading retailers, capitalizing on the growing middle class and expanding its footprint across the region.
Rapidly growing economies and a burgeoning young population make Africa an attractive market. Mobile payments and innovative fintech solutions play a pivotal role in catering to the unique needs and limited banking infrastructure of various African countries.
Spar’s, the Netherlands-based supermarket, entry into the African market involved adapting its store formats and product offerings to cater to the preferences and needs of African consumers. By incorporating local products and brands alongside their international assortment and offering local payment methods (mobile money), Spar has created a unique shopping experience that resonates with African customers.
c. Eastern Europe:
Countries like Poland, Russia, and Ukraine exhibit a strong appetite for eRetail. Offering localized payment options, understanding local regulations, and leveraging popular marketplaces can be key strategies for success in this region.
As a reference, Carrefour embarked on an expansion strategy in countries such as Poland, Romania, and Bulgaria. By tailoring its product offerings to suit local tastes and preferences, Carrefour was able to resonate with consumers in these markets. The brand also focused on developing an extensive network of hypermarkets and supermarkets, establishing a strong physical presence.
d. Southeast Asia:
Boasting a vast and digitally connected consumer base, Southeast Asia presents immense potential. Embracing popular e-commerce platforms, providing local payment methods, and navigating cultural nuances are vital to capturing market share in countries like Indonesia, Thailand, and Vietnam.
Alibaba, the Chinese e-commerce giant, has experienced remarkable success in emerging markets. With its flagship platform, Taobao, and payment solution Alipay, Alibaba established itself as the leader in China’s e-commerce market. Additionally, Alibaba expanded its influence in Southeast Asia by investing in local e-commerce platforms like Lazada, capturing the fast-growing consumer base in countries such as Indonesia, Thailand, and Vietnam.