Politics and ecommerce in emerging markets.


E-commerce is a booming business. It provides hundreds of thousands of jobs and is estimated to be worth $22.049 trillion in 2016. Whilst e-commerce is a big part of the consumer markets in developed countries, in emerging markets, it is still trying to gain a sizeable foothold. However, the largest emerging markets such as Brazil and India can develop huge markets for e-commerce due to their population size and growing consumer income.

You have to know how to adjust the selling price for ecommerce sites to outperform competitors ie keep a competitive pricing on the market.

E-commerce is becoming more popular and affordable in emerging markets.

 

This is because of a variety of reasons, such as increased consumer income and increased foreign investment. Internet access is also becoming more readily available. This makes access to e-commerce easier for the general population and opens a market for others to invest in. Companies such as Amazon are desperately trying to enter markets such as India, which has a population of over 1 billion and is the fastest growing large economy. Jeff Bezos has even said that he wants India to be Amazon’s second-biggest market after the US.

E-commerce seems to be thriving in India.

 

However, it may not the same for other emerging markets. Russia’s e-commerce has been stalled by the countries politics. Its annexation of the Crimea brought it many sanctions and this negatively affected the country’s e-commerce market. Russia is an example of when a countries’ politics is affecting its economy and in this case, it is negatively affecting its e-commerce. This scenario is the opposite of India, which is encouraging investment and its foreign relations are at an all-time high. Although, due to the election of Trump, relations between Russia and the US may become warmer and sanctions may be lifted in the future.

Smaller economies such as Nigeria and Turkey have seen a boost in e-commerce businesses, even if it is on a smaller scale. These countries the government has invested in infrastructure and as a result internet access has become more accessible. In developed countries, the governments often help tech companies and entrepreneurs. However, in emerging markets, with the exception of some, there is little help from the government. In order for e-commerce to grow in emerging markets, the governments should help tech companies by increasing access to the internet. Most developing markets have poor infrastructure and landlines, making the internet access difficult or when the access is available, it is slow.

Although one area where emerging markets seem to be doing well in e-commerce is mobile transactions. This is due to the popularity of smartphones and tablets. Ghana even announced plans to abolish import duty tax on smartphones in 2015. In emerging markets, it seems the mobile sector is growing rapidly due to the easy acquisition of smartphones. It seems that the governments are helping e-commerce businesses in this regard.

There is no doubt that e-commerce is growing in emerging markets. Whilst politics may hinder the growth of e-commerce businesses such as in Russia, in the majority of other countries, the governments are helping the growth of e-commerce businesses. Russia will likely also join this list of nations over time. The future looks bright for those in the e-commerce markets.

Learn more : 

The battle for India’s e-commerce market is about much more than retailing.

Politics and e-commerce in emerging markets: Three things to watch.

 

 

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