SAN FRANCISCO (PRWEB) October 02, 2017
The gig economy is on the rise—and shows no signs of slowing down anytime soon. An estimated 9.2 million Americans will work in the gig economy by 2021, up from 3.8 million in 2016, according to combined research from Intuit and Emergent Research. The more than 200 percent increase presents a significant opportunity for marketplaces, both in the US and beyond. Gig economy startups, ecommerce marketplaces, and social selling companies are looking for new ways to extend their reach globally and better accommodate this growing segment of consumers.
The 2018 Marketplace Expansion Index helps them do just that.
Hyperwallet, a leading global payouts provider to millions of independent workers, conducted a macro-level analysis of 209 different countries across a wide range of metrics. A closer look at the data then enabled Hyperwallet analysts to narrow the field to just 55 countries of interest.
Finally, analysts used a set of four key expansion readiness categories on a scale of one to 10 (infrastructure, workforce, ecommerce activity, and foreign competition)—along with 10 sub-parameters on a scale of one to 100—to help cap the Index at the top 36 countries and assign each country to one of three tiers: Established (countries 1-12), Emerging (countries 13-24), and Evolving (countries 25-36). Digital marketplace platforms can use the Index to better inform their expansion decisions.
“Over the past few years, we’ve talked directly with marketplaces operating within the collaborative, gig, and sharing economies about the importance of approaching expansion differently,” said Brent Warrington, CEO of Hyperwallet. “Whether it’s highlighting the availability of freelance workers in a specific country or sizing up the competition, our Index helps marketplaces bring their platform to scale in a variety of diverse global markets.”
Top findings from the 2018 Marketplace Expansion Index include:
Seamless payment infrastructure sets the stage for success
The Index’s Established category represents the most favorable environments for marketplace expansion. In fact, most countries within this category boast a high level of market dominance, impressive payment infrastructure, and exceptional logistical networks—not to mention the opportunity for further growth. The average infrastructure score for the category is an eight out of 10, while the US specifically features a foreign marketplace dominance score of 100 out of 100. Such a high level of acceptance for foreign goods and services makes these markets an especially appealing choice for expansion.
For marketplaces interested in paying their sellers or freelancers at a moment’s notice, Established countries are worth considering. In fact, 10 of the Index’s Established countries have a payment infrastructure rating of at least 75 out of 100. That same level of convenience can also be found within logistical networks that help ensure deliveries are both reliable and affordable.
Intense local competition slows marketplace entry
Emerging countries serve as middle-of-the-road expansion destinations. While they offer plenty of opportunity, Emerging countries also introduce challenges that don’t often pop up in areas that are more accommodating to marketplaces.
From smaller market sizes to weaker ecommerce retail growth, marketplaces must be prepared to work with consumer bases that may not be as sophisticated as those found in countries identified as Established. Only one of the 12 Emerging countries (Indonesia) features a retail ecommerce growth score above 35 (out of 100).
Similarly, the presence of dominant local incumbents may hinder a marketplace’s ability to quickly capture market share. Although staying one step ahead of local competitors might prove difficult, marketplaces can get the job done by combining a strong approach with top notch service. Companies aiming to find success in Emerging countries should also take the time to develop an entry strategy that enables them to sidestep strict employment regulations as well as unstable governments.
Large freelancer pool may support development
When it comes to accommodating marketplace expansion, Evolving countries still have plenty of room for improvement. Infrastructure is just one of the many areas in which Evolving countries lag behind other expansion options. The average infrastructure score for countries within this category is only five out of 10.
While such countries may not fit into a traditional growth approach, that doesn’t mean they’re worth ignoring. Marketplaces that take advantage of unique opportunities presented within Evolving countries—such as a large freelancer pool—may enjoy a first-mover advantage. First though, marketplaces must consider the challenges that may impact their ability to enter and operate within Evolving countries.
Vague boundaries, for example, present a double-edged sword for marketplace platforms. While scaling operations can be easier, there’s no telling whether future regulations could thwart such plans. That’s a big reason why the average category score for ecommerce activity among Evolving countries sits at just six out of 10.
Marketplace platforms are also likely to come across political instability within Evolving countries. Corruption, coupled with violence and economic hardships, can quickly derail expansion efforts. By planning accordingly based on the specific opportunities and challenges within a country, marketplace platforms can give themselves the best chance at expansion success.
To learn more about the 2018 Marketplace Expansion Index, explore an interactive map of the top 36 countries, or download a full copy of the report, visit expansion.hyperwallet.com.
The 2018 Marketplace Expansion Index was developed to assist digital marketplace platforms operating in the collaborative, gig, and sharing economies gauge the expansion readiness of 36 countries. A final review of data gathered from a diverse collection of two-sided marketplaces enabled Hyperwallet analysts to cap the Index at 36 countries and assign each country to one of three tiers: Established, Emerging, and Evolving. The first report of its kind, the 2018 Marketplace Expansion Index, aims to provide a data-driven approach to global expansion by accounting for factors that are unique to this newly evolved business model.
Hyperwallet’s payout platform provides growing organizations with a frictionless, transparent, and reliable way to manage payments and enhance the payee’s experience almost anywhere in the world. Trusted by enterprise, ecommerce, and on-demand platforms, Hyperwallet makes it easy to pay up to 7 billion people in a singular payment environment. Put your payees in control with enhanced financial management tools, integrated payment tracking technology, and user-friendly compliance and identity verification. Hyperwallet has offices in San Francisco, Austin, London, Sydney, and Vancouver. You can learn more at http://www.hyperwallet.com.