It hits as soon as you land in Myanmar…
While travel is getting easier in most parts of the world, Myanmar brings you back to your inner backpacker. The wall of heat and moisture; you need to buy a local sim card to get your phone working; you need to deal with money changers. So imagine your surprise when your driver says, “Let’s keep in touch on Viber”. As I was soon to discover, the trademark sound of a Viber message – buzz buzz – is a frequent reminder of Viber’s dominance in the tea houses around Yangon, the commercial hub of Myanmar.
In February this year, Viber had 2 million users in Myanmar. By July, it had grown to 5 million. This growth is incredible in a market of 50 million people, where mobile penetration is below 10%. The data suggests that mobile users have multiple accounts, which almost all users confirm is the case.
So where has it all gone right for Viber?
Put simply, Viber has been the right product at the right time. Through a mix of commercial and regulatory barriers, short message service (SMS) texts have not been available in Myanmar. By contrast, data services and availability have grown exponentially, as a Government priority. So app-based messaging services have had a natural pool of eager consumers.
But it is Viber’s dominance over its much larger messaging rivals – such as WeChat, WhatsApp and Facebook – that presents a stark lesson in tapping into emerging markets. A June 2014 audit by OnDevice found that Viber holds a 79% market stranglehold, compared to Facebook’s 27% (see below).
Viber’s installation process, which does not require validation through international text message, left WeChat and WhatsApp in its wake. And Viber’s simplicity, its focus on an interface that replicates the concept of the SMS, allowed it to gain early traction among young users just wanting to overcome the text message deficit.
The massive upswing in users has now grabbed Viber’s attention. It has quickly brought out Myanmar-language support tools, and is finalising partnerships with local firms to promote its premium sticker services. Monetization in Myanmar will have additional challenges, including low credit card penetration and non-availability of other online payment services. But at present, Myanmar is Viber’s market to lose.
So what are the lessons for those seeking to grow in emerging consumer markets?
- Regulation is not your enemy: in Viber’s case, the fact that the market did not support text messaging allowed its installation process to dominate the market. Foreign firms tend to analyse emerging market regulation as an obstacle, when in fact it often presents opportunities for innovation to solve market failures.
- Customisation creates sticky consumers: Viber has grown rapidly (from 2 to 5 million) since its launch of customised support tools. Customisation across multiple markets can be costly for start-ups, but even minor investments can pay big dividends.
- In-market support is the only way to grow: much like the unique success of BlackBerry in Indonesia, Viber sees the only path to further growth in Myanmar through a presence on the ground, through local partners. Myanmar – or any emerging consumer market – will not grow by remote control.
Will Viber survive the introduction of text messaging into Myanmar? Can it successfully monetize in a market with very little payment support? Stay tuned.