Provides an overview of the commercial importance of Asian economies and consumers, especially with reference to technology and e-commerce companies contemplating their specific Asian strategies.

1. “Forget about plastics.
Go East, young man!”
The unstoppable rise of
Asia and Asians
Presented by:
Leighton Peter Prabhu
Managing Partner, Interstice Consulting LLP
(Moscow & Singapore)
Moscow, 18 March 2014

2. Asia has the population

3. ... as well as the youth

4. ... which underpins its growth
GDP (2012) Population (2012)
GDP per capita
(2012)
Average annual GDP
growth (2001-2012)
USA $15.7 trillion 313.9 million $49,952 1.8%
China $8.3 trillion 1,351 million $6,090 10.2%
Japan $6.0 trillion 127.6 million $46,708 0.8%
Germany $3.4 trillion 81.9 million $41,519 1.2%
France $2.6 trillion 65.7 million $39,772 1.1%
UK $2.4 trillion 63.2 million $38,510 1.5%
Brazil $2.3 trillion 198.7 million $11,339 3.3%
Russia $2.0 trillion 143.5 million $14,042 4.8%
Italy $2.0 trillion 60.9 million $33,043 0.2%
India $1.8 trillion 1,237 million $1,489 7.1%
Canada $1.8 trillion 34.9 million $52,208 1.9%
South Korea $1.1 trillion 50.0 million $22,600 4.0%
Indonesia $878 billion 246.9 million $3,556 5.4%
South Africa $384 billion 51.2 million $7,507 3.5%
Thailand $366 billion 66.8 million $5,474 4.2%
Malaysia $304 billion 29.2 million $10,380 4.8%
Singapore $275 billion 5.3 million $51,713 5.3%
Hong Kong $263 billion 7.2 million $36,799 4.0%
Philippines $250 billion 96.7 million $2,588 4.8%
Source:World Bank

5. Rapid economic transformation

7. Large pockets of wealth
SAARC
ASEAN
NORTH
ASIA
HDI* world rank Index Population
#10. Japan 0.912 127.6 million
#12. South Korea 0.909 50.0 million
#13. Hong Kong 0.906 7.2 million
#18. Singapore 0.895 5.3 million
#22.Taiwan 0.890 23.3 million
#64. Malaysia 0.769 29.2 million
Russia = #55 (0.788)
*HDI = Human Development Index.
A comparative measure of life
expectancy, literacy, education,
standards of living, and quality of life.
Source: http://apac2020.thediplomat.com/
Human Development Ranking

8. Asia is already the most
attractive consumer market
“The explosion of Asia’s middle class is stunning.The size of this
group currently stands at 500 million and will mushroom to 1.75
billion by 2020 – more than a threefold increase in just seven years.”
“Asia-Pacific is poised to pass North America in 2013 as the
world’s leading region for online sales.”
“Chinese consumers now make half of the luxury purchases in all of
Asia, and nearly one third of those in Europe. Globally, one in four
purchases of personal luxury goods comes from Chinese
consumers.” [surpasses US consumers]

9. US tech giants increasingly rely
on Asia for growth
•368 million Monthly Active Users in Asia (Q4-2013) =
30% of total MAUs, even though FB is banned in China
•$17.4 billion in sales from Asia in Q4-2013, about 30% of
total sales, up 57% from the prior year
•China is the biggest smartphone market in the world
•130,000 apps from Chinese developers in Apple’s App
Store
•Amazon Marketplace launched in 2013 with over 12 million
listings in 15 categories
•Opening a 150,000 sq. ft. fulfillment centre near Bangalore
•Indian e-commerce sales reached $16 billion in 2013, up
88% yoy

10. Although Asia has its own
home-grown tech giants
Market cap (Feb-2014)
Apple $469.6 billion
Google $408.5 billion
Facebook $174.4 billion
Amazon $166.3 billion
Samsung Electronics $165.6 billion
Tencent $147.9 billion
Softbank $90.4 billion
eBay $76.1 billion
Baidu $59.8 billion
Twitter $29.9 billion
Naver $25.3 billion
Rakuten $19.2 billion
Lenovo $11.1 billion
upcoming IPO
$140 billion?

11. And $billion+ startups

12. Astute investors are moving now

13. ASEAN economic dynamism
•According to the IMF, the GDP of
the “ASEAN 5” (Philippines,
Indonesia, Malaysia,Thailand and
Vietnam) will reach US$2.436
trillion in 2014
•Combined, they will overtake the
Four AsianTigers (Hong Kong,
Singapore, South Korea, andTaiwan)
•As recently as 10 years ago,ASEAN
5’s GDP was only half of the Four
AsianTigers
•This is the biggest shift in the Asian
economies since China’s GDP
overtook Japan 3-4 years ago

14. Spotlight on Singapore
•Blk71 houses 100-200 startups - “World’s
most tightly packed entrepreneurial
ecosystem” (The Economist)
•National Research Foundation funds 5:1
top-up grants to accredited incubator
firms, up to SGD500,000
•Rent-free co-working space for startups,
up to 3 months
•About 800 Internet-based startup
companies island-wide
•Venture-capital tech investments in
Singapore last year outstripped those in
Japan, South Korea and Hong Kong
•15 accredited incubators

15. In today’s app-centric world,
you’re global from day one

16. Yandex vs. Google:
a tale of two outlooks?
Year launched 1997 1998
Employees 4,902 47,756
FY 2013 revenues $1.2 billion* $55.6 billion
% international 5%** 56%
First foreign office SiliconValley Tokyo
Year 2009 2001
First foreign language(s) introduced
Ukrainian (2007), English (2010),
Turkish (2011)
French, German, Italian, Swedish, Finnish,
Spanish, Portuguese, Dutch, Norwegian,
Danish, Chinese, Japanese and Korean
(2000)
Search languages offered now 5 (Russian, Belarussian, Ukrainian,
Kazakh,Turkish, English) 150+
Current international offices
Ukraine, Belarus,Turkey,
Germany, Switzerland, United
States
40+ countries
Market capitalization (17-Mar-2014) $9.8 billion $399.2 billion
*per 2013 financial statements, with Ruble converted at an exchange rate of 32.73
**for the year 2012, represents the share of revenues earned from advertisers based outside of Russia

17. Is Asia on the radar screen
of the new generation?

18. Thank you
Leighton Peter Prabhu
Managing Partner, Interstice Consulting LLP
(Moscow & Singapore)
lsp.prabhu@intersticeconsulting.com
Twitter @lsp_prabhu