Market Expansion and All the Jazz

We all know to be successful as a software vendor, you need profitable growth, and this translates to growing share in your existing markets or going to new markets. US vendors go to the UK, then Europe; EU companies go to the UK, then the US and so on. Oh yes and after we have got these markets working, we will go to Asia.

It’s wonderful that we are now seeing so many innovative solutions applying AI and other technologies to areas such as customer and employee satisfaction, employee benefits, sustainability, better pipeline and forecasting, supply chain management, financial management and many more areas. What is interesting is that it seems many of the Asian economies are embracing the need for these solution areas more rapidly than traditional markets. According to Mr Jan Metzger from Citi Bank, “Citi estimates Asia to be 8-12 years ahead of the West in terms of technology adoption.” Why? ?Because of the growth in the region, the accelerated need to develop and compete on a global basis with significant incentives being provided by governments.

So why then race to go and try their luck in the already congested traditional markets? True, the US is a big market, but getting a much bigger share of a smaller market is far better and, I dare say, profitable than a small share of a big market where competition is fierce and deep pockets are needed to sustain the necessary contested investment.?

Many companies are apprehensive about expansion in APAC, believing it may be too much effort for little return.?We have all read the head-spinning statistics on the size of the APAC market, but I decided to go a little deeper and do some Google searches to try and put this into context. Interestingly, the markets of Australia, NZ, Singapore, Philippines and Malaysia are comparatively easy as they are mostly English Business Language, certainly for international companies (MY not quite as much) and have similar legal and commercial systems. The total GDP for the five countries is U$3.2t, comparable to the UK at U$3.1t GDP. The population of the 5 countries is 190m as opposed to the UK at 67.3m, although the demographics are somewhat different in PH and MY. Furthermore, the UK has about 200 companies with a market Cap of >U$1b, these 5 countries have 215, and this doesn’t cover the various global company tails, government agencies, banks and other entities that each country has as part of the infrastructure.?

So look at this less competitor-congested space (for now) with the opportunity to grab significant market share; the investment will pay dividends in return. Bring your innovative solution to a market that thirsts for new products and really be successful with profitable growth.?