Accessibility to smartphone at lower prices are driving a digital revolution in emerging markets and transforming online buying, banking, government participation, agriculture, education, health, energy,  farming, water management and more. Posts are at a crossroad. They must choose between irrelevance or transformation.

Mobile technology continues to affect industrialized and emerging markets equally. Smartphones fuel m-commerce and affect all Posts. Letter mail will continue to decline, competition in the lucrative segments will increase and online shopping will grow dramatically. Post Offices in emerging markets are at a crossroad.

The Myanmar telecoms market opened up in 2013. At that time only 2 million of its 57 million population were Internet users. After only 3 years (2017), there are 42 million users and they access the news on the Internet via FaceBook, mainly by their mobile smartphone. A 2009 study in India illustrated that every 10 percent increase in mobile penetration leads to a 1.2 percent increase in GDP.

The emerging world has an increasing usage of smartphones

According to 100 People: A World Portrait, 75 % of the world’s population, of 7 billion, have cell phones, 30% are active Internet users and 22% own or share a computer. The mobile phone is changing communication, business practices, medical service and so much more.

Smartphones account for some 40 percent of global mobile-phone sales, and they are increasing fast. Smartphone users now expect that any information or service they desire be easily available to them, personalized and where and when they need it. They want continuous connectivity, access to information, communication, friends, products and entertainment.

Add to that the innovations and investments in mobility (fast, low latency 4G LTE mobile data networks, broadband and secure cloud storage); the growing number of the tech-savvy, info-hungry, 16 to 34 Millennials; as well as the fact that the majority of people in emerging markets are accessing the Internet largely if not exclusively through smartphones and you can see the striking impact of Mobile.

For many people smartphones are replacing wallets, bank books, keys, home security system controls, ID and membership pass cards and credit cards. There are apps for almost anything and they are forcing industries to reengineer themselves.

mobiles

eMarketer states that 2 billion consumers worldwide had smartphones in 2016 and over half of mobile phone users globally will have smartphones in 2018.

eMarketer_Smartphone_Users_and_Penetration_Worldwide_2013-2018

eMarketer_Top_25_Countries_Ranked_by_Smartphone_Users_2013-2018The availability of affordable smartphones and tablets will facilitate Internet access. Money transfer and mobile banking will be facilitated and will benefit the emerging world. Online education will grow. Social media and new apps will fuel m-commerce by making online ordering much easier. A growing middle class in emerging markets will access the Internet almost exclusively through smartphones and will fuel product demand. People will realize that they can buy products that are not available locally and have them delivered through the Post.

Posts in these countries must prepare and adapt if they hope to benefit.

Greater availability of affordable smartphones

The leaders in the smartphone space are Samsung, Apple, Nokia, Blackberry, LG, Huawei, HTC, Motorola and others. Nokia and Blackberry already offer smartphones at less than $200 (USD). However, China’s contenders (Lenovo, ZTE, Xiaomi, Quad Core, etc.) are selling smartphones for as low as $47 (USD).

According to Statista, China is set to dominate about one third of the world’s smartphone market by 2017 when an estimated 34% of the world’s population will have a smartphone, a figure that was at less than 10% in 2011.

By 2018, Indonesia will pass 100 million smartphone users, firmly established as the fourth-largest smartphone user population.

Emerging markets will dominate smartphone growth

GfK’s market research forecasts show that, “Worldwide, the smartphone continues to grow strongly, in terms of volume of sales, increasing by 18% for 2015. But there is significant shift in which countries will see those growth opportunities, with the emerging markets dominating.” At the top of the list are India, China, Indonesia, South Africa and Brazil because of low prices.

Internet access in emerging markets is mainly through mobiles

The proliferation of affordable smartphones creates an enormous audience that accesses the Internet exclusively through mobile technology.

According to Dezan Shira and Associates’ China Briefing, there are over 600 million Internet users and over 500 million mobile Internet users in China. The Chinese government has a target to connect 1.2 billion people (85 percent of the population) to mobile Internet by 2020. Clearly this is an enviable market. Internet access has allowed buyers in lower-tier cities to shop for international luxury brands. Around 55% of China’s smartphone users have made a mobile payment and a KPMG study found that respondents said that the last item bought cost an average of $243 (USD).

Chinese people use the web differently than U.S. consumers do. Compared with U.S. people, Chinese people prefer engaging with others through social media and mobile,” says Sun Baohong, a professor at the New York City campus of Beijing-based Cheung Kong Graduate School of Business.

China Smartphones

Internet access is growing dramatically

We have already covered the fact that emerging markets are the greatest growth area for smartphones. Social Media giants like Facebook are working to expand Internet access. Facebook’s Internet.org wants to make Internet more widely available in emerging markets to improve quality of life: “Imagine the difference an accurate weather report could make for a farmer planting crops, or the power of an encyclopedia for a child without textbooks. Now, imagine what they could contribute when the world can hear their voices. The more we connect, the better it gets.

Smartphones are changing people’s lives

In fact, as smartphones spread through the population, they are already changing how people handle money, participate in government, policing, conduct agriculture, educate children, improve health and facilitate m-commerce.

Mobile Money

  • M-Pesa first launched in 2007 in Kenya. It lets users transfer money through text messages. Now over 60% of Kenyans, over 40% of Ugandans, 40% of Tanzanians, 10% of Haitians and many more around the globe, make or receive payments on their cell phones.
  • In Haiti, NGO’s use T-Cash and Mon-Cash to pay people.

Government Participation

  • UNICEF’s UReport program, in over 15 countries, polls its members via text message. Through it, Uganda received feedback on its entrepreneurship grant program, made changes and improved the program.
  • Such polling can also be used to track disease outbreaks and violence.
  • Quezon City in the Philippines uses mobile money for payroll, welfare benefits and to collect fees.
  • Libya set up a mobile voter registration system in 2014.

Policing

  • The Nigerian Police has deployed  a mobile app called Hawk Eye which allows users to report crimes anonymously to the Police by video, voice or text.

Agriculture

  • USAID Pakistan worked with local government and a local mobile carrier to create a mobile program that sends peach and potato farmers text or voice messages about crop prices, market access and disease prevention. In Ghana, farmers in Tamale send text messages to learn corn and tomato prices in Accra, over 1,000 kilometres away.

    Agriculture GPS Mapping

  • USAID encourages Mozambique farmers to use mobile money to save during the harvest’s bounty so they can afford fertilizer in the next season.
  • Turkey’s Vodafone’s Farmers’ Club gives out information and notifications to over 1 million members.
  • An Ideo.org smartphone, GPS mapping app tells Myanmar farmers total acreage, divides up land by crop type, and gives recommendations for different inputs like seeds and fertilizer.

Education

  • Pakistan provides educators with teaching method videos.
  • Uganda’s Ministry of Education and Sports uses EduTrac able to reach teachers and check on attendance, facilities and supplies.
  • In Bangladesh parents make school payments via mobile phone.
  • UNESCO conducted surveys,  “Reading in the Mobile Era, in seven emerging markets and found that mobile devices can be an important factor in fostering literacy around the world.
  • In Niger, mobile phones are being used as a means to promote literacy for adults by using voice calls – learners are taught where to find letters and numbers on a mobile phone and how to send and receive text messages.

Health

  • The Grameen Foundation’s Mobile Midwife program sends women daily texts and weekly voicemails with advice, in their language, during pregnancy and the first year of the child’s life.
  • UNICEF’s 1000 Days program provides similar support for mothers with a focus on nutrition through pregnancy and the first two years of a child’s life.
  • Mobile is used in Mozambique, Kenya, Malawi, and South Africa to fight against HIV and AIDS by reminding patients of appointment dates and to take their medication.
  • Over 30,000 front-line health workers at 3,700 health centers in Uganda submit weekly reports electronically UNICEF’s mTrac and are able to receive surveys, alerts and other communications.
  • Mobile phones are used to assess and improve sight:

M-Commerce

New Mobile Apps, Social Networks and Online Marketing will Grow M-Commerce. Tesco has set up virtual grocery stores in metro stations in Korea. People use smartphones to grocery shop by capturing QR codes on a poster, while waiting for the train, and have it all delivered. Other apps (RedLaser, ShopSavy, BuyVia, etc.) allow users to do price comparison and manage loyalty programs.

Tesco virtual grocery stores in metro stations, Korea

Finally, there are numerous smartphone electronic payment apps (Google Wallet, Apple Pay and CurrentC).

Mobile “Buy Buttons” on Twitter, Facebook and Instagram make it very easy for smartphone users to buy goods or make donations directly from their smartphone.

Twitter - Facebook

The market is saturated with techniques such as flash sales, deal-of-the-day and mid-day-dash used by Gilt Groupe, Neiman Marcus, Groupon, LivingSocial and more. However, some players, like Zulily, have succeeded by concentrating on a niche market and focusing on customer service, loyalty and a sense of community.

Tomorrow, retailers, e-retailers and social networks will know so much about our interests that they will increasingly suggest new products to us through our smartphones. We will go to brick-and-mortar stores to showroom (see a product) and will increasingly use smartphones to scan the UPC code and get instant comparison pricing. We will increasingly make use of digital coupons. The product will be ordered and paid-for online; we will track the delivery progress on our phone app. and it will be delivered to our desired location within 24 hours.

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