7 Ways to Identify Emerging Markets?

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Businesses across sectors are grappling with a world characterized by constant change, from supply chain bottlenecks to inflationary pressures. In this volatile market scenario, doing business as usual is insufficient to ensure survival or long-term success.

Because of the COVID-19 epidemic, business bankruptcies in the United States hit their highest level in ten years in 2020, and we’re still in the woods. Companies must adapt or risk becoming obsolete, but how can you locate the promising possibilities for company development in a loud, adrenaline-filled environment?

Based on our expertise in offering emerging market analysis to over 10,000 customers each year throughout the world, including top management consulting firms, investment banks, and Fortune 500 companies including international payment gateways in India, we’ve established seven ways to assist you in identifying new market prospects for your company.

Emerging Markets Meaning

An emerging market economy is a developing country’s economy getting increasingly involved in global markets as it expands. Emerging market economies have some but not all of the features of established markets.

Strong economic development, high per capita income, liquid equities, and debt markets, accessibility to international investors, and a trustworthy regulatory structure are all characteristics of developed markets.

As an emerging market economy grows, it often integrates more fully into the global economy. That implies improved liquidity in domestic debt and stock markets, higher trade volume, and more foreign direct investment. It has the potential to create contemporary financial and regulatory companies. India, Mexico, Russia, Pakistan, Saudi Arabia, China, and Brazil are currently noteworthy developing market economies.

A critical transition for a growing market economy is from a low-income, less developed, typically pre-industrial economy to a modern, industrial economy with a better quality of life.

Challenges of Doing Business in Emerging Markets

To enter developing markets, you must consider the following problems and possibilities.

New customers and a diverse talent pool

Major developing economies have seen population growth during the last several decades. Sixteen of the world’s twenty most significant cities, including Jakarta, Delhi, Manila, Shanghai, Beijing, Sao Paolo, and Mexico City, are classified as developing markets.

International commerce emerging markets analysis has several benefits in terms of international trade. In Latin America, for example, nations such as Brazil, Mexico, Chile, and Argentina have accounted for more than 70% of total exports and imports to foreign markets during the last fifteen years.

Instability in the economy, politics, and culture

Emerging economies face a variety of hazards as they strive to improve their economic and political stability. Some of these nations provide varying degrees of difficulty.

Seven methods for identifying developing markets

Below are the 7 strategies for doing business in emerging markets:

1. Keep an eye out for changes in consumer behavior.

First, learn how your consumers use your product. Is it being used differently today than it was previously? This is how makeup removal wipes and toilet paper substitute wipes were created. Companies discovered various ways individuals used baby wipes by talking to their consumers.

Consumer goods and food firms widely use this method to develop new product lines. To start, search the internet and social media sites for individuals discussing “hacks” for your product or creatively improvising to utilize your product in a new manner.

2. Consider where waste is present.

Most demographics, including your customers, are now concerned about sustainability. Can you create new ways to decrease waste during manufacturing, transportation, packing, and disposal?

3. Look into the sources of suffering.

Understanding pain points is a natural place to start for most firms, but these holes must fill since they may give your rivals a competitive advantage.

A pain point may provide physical discomfort or additional friction in a labor process. Inquire about what causes probable harm or stoppage with the product or the working environment surrounding it. Professional users, for example, started to embrace cordless tools at a greater rate after learning that they decreased work site accidents (no cords to trip over).

Another strategy is to determine where consumers desire to save time. Robots and automation appear where repetitive work may be eliminated, enabling humans to do other things. Many individuals, for example, dislike or do not have time to mow their lawns, yet they desire trimmed grass—enter robot lawnmowers.

4. Monitor market developments.

Keep track of broad cultural trends in your sector and see if you can adjust a product line to capitalize on client interest in that trend.

A recent example regarding emerging markets analysis is significant improvements in food packaging. Bowl dinners appeared on food blogs some years ago, particularly in health food circles. Bowls of grains Bowls of vegetables for dinner, combine all ingredients in one dish. It quickly expanded to eateries, which were often healthful or Asian-themed. Famous eateries, including fast food chains like KFC, created their versions.

As the fad gained traction, it eventually made its way into retail food, with several firms releasing frozen meals in bowls. Bowls are already making their way into other culinary items.

Make a more significant trend in your industry or an adjacent market work for your consumers by incorporating it into your offering.

5. Get inspiration from a comparable industry.

Instead of copying your competition, examine what the most successful firms in a functionally relevant sector are doing and see if you can apply similar tactics to your company.

Wearable technology like Fitbit has taken traction among customers, and pet firms have responded with devices such as FitBark and Whistle. Similarly, with the success of 23andMe and AncestryDNA, various at-home DNA testing kits for dogs have been developed to offer information on a dog’s breed and genetic ancestry.

6. Consider your target customer in a broader sense.

Take a comprehensive approach to product creation and sales by addressing your consumer base, not just the apparent or conventional ones.

How does your product suit the demands of your prospective client base, not just one kind of organization or job title inside a firm (for example, purchaser versus end user versus decision-maker)?

Concentrate on the overall value of your goods to the organization rather than one specific consumer group, and convey this to individuals engaged in purchasing choices.

To market new equipment, machinery manufacturers may mainly work with buying departments. They might, however, increase their outreach efforts by focusing on users and senior executives:

Engineers and production managers might target to offer supporting evidence on how new equipment could enhance workflow and efficiency.

Targeting executives like chief financial officers to advocate long-term cost savings for new equipment may aid in the approval of new machinery investments.

7. Look for complementary items or services for your current company.

What are your consumers doing that necessitates your product, and what do they do after purchasing it? Are there any services you can provide to make the process easier for your customers?

Movie theatres, for example, offered in-seat eating with restaurant-style meals because they saw that many consumers ate out before going to the movies. Because clients were already bringing their automobiles to the spot, several parking garages introduced car washes or detailing services.

Bottom Line

Here we are wrapping up our emerging markets analysis. In a nut shell the COVID-19 epidemic and the resulting changes have spurred a significant rethinking of many previously held beliefs. Take advantage of the shifts that have sparked so many movements, propelled others onward, and snuffed out others. One of the benefits of the epidemic was the opportunity to identify new prospects and customers in unexpected areas.

Reach Tyke Investments via email (email here) to get similar information regarding emerging markets and similar investment ideas.