LatAm waiting: a few lines about the present and future of the app economy in Latin America
A few months ago, Uber, the famous online transportation company finally launched its actions in Argentina. Thirty one cities in LatAm are now part of the app’s service grid. So far, just a regular expansion tale…with the exception of a strong taxi driver protest which filled with cabs the streets of Buenos Aire’s downtown after the official kickstart. A black and yellow Arab Spring on wheels began that day. Convulsion was huge and the story hit the headlines Worldwide. That day, many people in the IT industry discovered that Argentina was part of South America.
Looking to find a way out of this syndicate and free enterprise crossroads, the City Hall decided to develop its own app called “BA Taxi”.
Walking away from these convulsed streets and last minute government apps, I believe the real story here is that Argentina, and mainly Latin America are becoming the scenario of a silent IT company invasion. To be honest, this is not an ancient super secret. Anyone with Google near his index finger could check the numbers and trends backing up this spontaneous revelation. The challenge is to look at the whole picture and understand why this expansion is happening. So let’s dive a little deeper and find out together what’s going on in the Hispanic South.
It seems that Silicon Valley companies are starting to look down here not only for soccer stars to include in their next PS4 game cover. They simply have discovered some potential in this evolving market. This huge piece of land below the Equator called “The South Cone” is destined to emerge as one of the most important sections in the global Economy. Our markets are expanding minute after minute, just like the universe.
By 2020, smartphones are expected to comprise 68% of all connections in the region and it is estimated that 50% of the population will be using their cellphone devices to access mobile Internet. This evolving adoption is also providing a boost for the development of quick broadband mobile networks, crowning South America as the fastest growing market for such connections in the world.
Latin America has the fastest rate of smartphone adoption in the world.
If Latinos are such heavy users of social media it is obvious that eCommerce sales will also keep growing at a rapid pace. It’s estimated that this tendency will still be in double digits by 2019. With these numbers in mind we could glimpse a slight idea why this IT invasion is taking place.
There are plenty case studies that support this theory. Let`s take Yelp for example. The crowd-sourced review website and app celebrated its second birthday in Argentina a few months ago and they had plenty reasons to throw this great party. Since it launched back in 2014, its growth has been exponential. Same story for Spotify or Netflix, in both cases with an explosion of premium users all over LatAm. It is no surprise why Cabify decided to follow Uber’s trail in the region. Latin America market is working.
Professional urban middle classes are experiencing better incomes, this basically translates in longer working hours and a whole new bunch of options in the consuming choices available. Latin America is home to a robust mobile market and social networking is a major driver of mobile internet use. These smartphone-toting consumers will seek new ways to power through their lives and make the most of the enticing choices available to them.
Now that we are all on the same page about LatAm market and its bright future is easy to understand why this 5 letters acronym has become an essential part of any IT business plan and expansion strategy. So get ready pioneers because translating websites, tutorials, and Marketing Content will be a must during the following years. Finding a place in this new market will be a whole new challenge and my best piece of advice is to encourage all the IT companies embarking on this quest to hire locally. There is no better assets than local workforce plus you will contribute with the booming “App Economy” in the South Cone. A dream win-win situation.
The App Economy has grown from nothing to a powerful economic force that rivals existing industries.
Since 2007 when the first Iphone appeared in the global market, little did we know that this device will affect the whole economy. Apps gained a vital importance in the IT world and this changed the Worldwide Economy, and in particular Latin America. The production and distribution of mobile applications affected this market heavily as a source of growth and job creation. Just to give you an idea, Argentina, the second largest economy in the region, already generated 33.250 jobs thanks to this phenomenon. Let`s face it, the South Cone is an attractive low cost option for offshore development. Buenos Aires is only one hour ahead of NYC and 4 to Silicon Valley plus, it ranks as the most english proficient country in LatAm. Maybe that’s why “Computer Weekly” and The Huffington post named Argentina as the “Top Outsourcing destination to watch”.
If you are still here, to summarize and synthesize all this information I think there are two natural indicators in Latin America that could paint a clearer vision of its future. High individual technology usage rates and a robust information and communication technology infrastructure that will help support this exponential growth predicted for the following years. So if you are planning to plant your flag in this south lands, now is the time. LatAm is waiting for you.
If you want to find out more about the app economy in Argentina, take a peek at this interesting article by Michelle Di Ionno & Michael Mandel.