DKSH and Roland Berger Digitization Report

By / 4 years ago / News /

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Petaling Jaya, Malaysia (5 September 2014) – The digitization trend has become a key driver of growth for Market Expansion Services (MES) providers, according to Roland Berger Strategy Consultants and DKSH’s fourth Global Market Expansion Services report.

According to Roland Berger’s independent research, the global MES volume grew up to USD 2.7 trillion in 2013. This growth dynamic is expected to continue until 2018, when the forecast volume will stand at USD 3.8 trillion with an average annual growth of 7.4%.

The new report focuses on digitization, the transformation of business processes through digital technologies and how it is impacting corporate business models. Digitization is moving up the agenda on companies’ list of business priorities and the report forecasts 450 billion of B2B and B2C daily business transactions on the internet in 2020.

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Multimedia Development Corporation (MDeC)’s Vice President, Michael Warren said: “Malaysia’s digital economy is at a good position with the ICT sector contributing 12% of the national GDP. The healthy contribution amounting to RM 113 billion represents a significant share of the national GDP of RM 941 billion.”

He continued, “To further accelerate this growth, MDeC’s Digital Malaysia 354 Roadmap will game-change Malaysia’s digital landscape and undoubtedly sow the seeds to grow Malaysia into a high-income country driven by innovations of the digital economy by 2020.”

The three digitization trends – mobile commerce, business intelligence and smart infrastructures – will have a meaningful impact on companies within the next five years. Although digitization is not changing the fundamentals of doing business, it enables new business opportunities and opens up possibilities for growth and efficiency gains. These trends will affect the ways business transactions are conducted and how companies interact with their suppliers, customers and other stakeholders.

Opportunities for companies mainly come in the form of new communication, interaction and sales channels, access to and analysis of market intelligence data and innovative models to rejuvenate the sales process.

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As highlighted in the report, digitization is expected to grow strongly – yet from a low base – in emerging markets and especially in the Asia Pacific region. Leading market research institutes forecast that, as of 2018, Asia Pacific is set to become the region with the busiest e-commerce activities and transactions in the world.

The report reveals that many companies – whether based in developed or emerging markets – have realized that future business success as well requires an active digital expansion to cope with changing shopping behaviors. However, only a few market players have yet successfully implemented a digital strategy. As companies often lack the key resources and capabilities to drive a digital initiative through omni-channeling, they are turning to cross-regional MES providers for their digital market expansion.

“At DKSH Malaysia, we are supporting clients like Clinique and MAC cosmetics, as well as our own Famous Amos brand in their digital development. With our local presence, expertise and know-how, we are able to offer our clients superior services along the entire value chain and combine both online and offline services for market expansion and market development,” said John Clare, Head of Country Management & Group Finance Director of DKSH Malaysia.

The report not only presents the latest trends and robust data on promising growth of the MES industry, but also explores how companies need to adapt their business models and strategies when it comes to digital market expansion. Finally, the report provides insights into the market potential of these services for both MES providers operating in Asia and their clients.

“To capture opportunities, Market Expansion Services providers’ expertise is increasingly needed by all types of companies when it comes to digital market expansion,” said Chanchai Tanatkatrakul, Project Manager of Roland Berger Strategy Consultants. “MES are gaining popularity because they allow these companies to pursue an integrated omni-channel approach and to offer a consistent customer experience across offline and online channels.”

“I am excited about the promising findings of the latest market study. I strongly believe that DKSH with its strong capillary distribution network as well as long-standing local knowledge has the ability to meet the increasing demand for digital Market Expansion Services. DKSH is optimally positioned not only to benefit from these trends, but also to support its clients and customers in implementing a successful omni-channel approach,” Clare concluded.

The study can be downloaded at www.marketexpansion.com