Bcg's paper the internet economy in the g 20
Upcoming SlideShare
Loading in...5
×
 

Like this? Share it with your network

Share

Bcg's paper the internet economy in the g 20

on

  • 9,450 views

The Internet economy is growing more than 10 percent a year in the G-20 nations. No one—no individual, business, or government—can afford to ignore its ability to deliver more wealth to more ...

The Internet economy is growing more than 10 percent a year in the G-20 nations. No one—no individual, business, or government—can afford to ignore its ability to deliver more wealth to more people more broadly than any economic development since the Industrial Revolution. This report quantifies the Internet’s economic impact

Statistics

Views

Total Views
9,450
Views on SlideShare
9,312
Embed Views
138

Actions

Likes
6
Downloads
651
Comments
0

7 Embeds 138

http://www.scoop.it 55
http://misterthibodeau.posterous.com 38
http://copgaz.tistory.com 14
http://gruugruu.tistory.com 12
http://flavors.me 11
https://twitter.com 6
https://si0.twimg.com 2
More...

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

CC Attribution License

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

Bcg's paper the internet economy in the g 20 Document Transcript

  • 1. R T C WThe $4.2 Trillion Opportunity The Internet Economy in the G 2 he G-20
  • 2. The Boston Consulting Group (BCG) is a global managementconsulting firm and the world’s leading advisor on business strategy.We partner with clients from the private, public, and not-for-profitsectors in all regions to identify their highest-value opportunities,address their most critical challenges, and transform their enterprises.Our customized approach combines deep insight into the dynamics ofcompanies and markets with close collaboration at all levels of theclient organization. This ensures that our clients achieve sustainablecompetitive advantage, build more capable organizations, and securelasting results. Founded in 1963, BCG is a private company with75 offices in 42 countries. For more information, please visit bcg.com.
  • 3. T C WTHE $4.2 TRILLIONOPPORTUNITYTHE INTERNET ECONOMY IN THE G20 DAVID DEAN SEBASTIAN DIGRANDE DOMINIC FIELD ANDREAS LUNDMARK JAMES O’DAY JOHN PINEDA PAUL ZWILLENBERGM  | T B C G
  • 4. CONTENTS  INTRODUCTION  THE INTERNET’S ECONOMIC IMPACT  THE INTERNET’S FURTHER ECONOMIC IMPACT  CONSUMERS EVERYWHERE KNOW A GOOD DEAL WHEN THEY SEE IT  FROM HIGHWEB TO NOWEB: OPPORTUNITIES FOR SMALL AND MEDIUM ENTERPRISES  DON’T BLINK: THE FUTURE IS RUSHING STRAIGHT AT US  COUNTRY PROFILES  NOTE TO THE READER | T . T O
  • 5. INTRODUCTIONT  J   in our Connected World series examined how companies and countries can win in the digital economy. This follow-upreport provides a more comprehensive analysis of how the scale and speedof Internet-driven economic growth is changing countries, cultures, andcompanies around the world. It includes national snapshots capturing theeconomic impact of the Internet as well as in-depth looks into consumerand business usage in the G-20 countries.1 A forthcoming report willdiscuss how companies and countries can best build up their digitalbalance sheets and create digital advantage.Since the day the first domain was registered in 1985, the Internet hasnot stopped growing. It has sailed through multiple recessions andone near-collapse and kept on increasing in use, size, reach, and im-pact. It has ingrained itself in daily life to the extent that most of usno longer think of it as anything new or special. The Internet has be-come, quite simply, indispensible.By 2016, there will be 3 billion Internet users globally—almost halfthe world’s population. The Internet economy will reach $4.2 trillionin the G-20 economies. If it were a national economy, the Interneteconomy would rank in the world’s top five, behind only the U.S.,China, Japan, and India, and ahead of Germany. Across the G-20, it al-ready amounted to 4.1 percent of GDP, or $2.3 trillion, in 2010—sur-passing the economies of Italy and Brazil. The Internet is contributingup to 8 percent of GDP in some economies, powering growth, and cre-ating jobs.The scale and pace of change is still accelerating, and the nature ofthe Internet—who uses it, how, and for what—is changing rapidly too.Developing G-20 countries already have 800 million Internet users,more than all the developed G-20 countries combined. Social net-works reach about 80 percent of users in developed and developingeconomies alike. Mobile devices—smartphones and tablets—will ac-count for four out of five broadband connections by 2016.The speed of these developments is often overlooked. Technology haslong been characterized by exponential growth—in processing speed,bandwidth, and data storage, among other things—going back to Gor-don Moore’s observation nearly five decades ago. The Intel 80386 mi-croprocessor, introduced in the same year as that first domain name,held 275,000 transistors. Today, Intel’s Core i7 Sandy Bridge-E proces-sor holds 2.27 billion transistors, or nearly 213 times as many. As thegrowth motors along, it is easy to lose track of just how large the ex-ponential numbers get. T B C G | 
  • 6. The power of exponential growth is illustrated by an ancient fable, re- popularized by Ray Kurzweil in his book, The Age of Spiritual Machines. It tells of a rich ruler who agrees to reward an enterprising subject starting with one grain of rice on the first square of a chessboard, then doubling the number of grains on each of the succeeding 63 squares. The ruler thinks he’s getting off easy, and by the thirty-sec- ond square, he owes a mound weighing 100,000 kilograms, a large but manageable amount. It’s in the second half of the chessboard that the real fun starts. Quickly, 100,000 becomes 400,000, then 1.6 million, and keeps growing. By the sixty-fourth square, the ruler owes his sub- ject 461 billion metric tons, more than 4 billion times as much as on the first half of the chessboard, and about 1,000 times global rice pro- duction in 2010. The Internet has moved into the second half of the chessboard. (See Exhibit 1.) It has reached a scale and level of impact that no business, industry, or government can ignore. And like any technological phe- nomenon with its scale and speed, it presents myriad opportunities, which consumers have been quick and enthusiastic to grasp. Business- es, particularly small and medium enterprises (SMEs)—the growth en- gine of most economies—have been uneven in their uptake, but they are moving online in increasing numbers and with an increasingly in- tense commitment. There are threats too, some misunderstood, and policymakers and regulators alike are challenged to make the right choices in a fast- moving environment. As is often the case with fast-paced change and E  | Evolution of the Internet From developed to developing markets From fixed to mobile From basic content to a Internet users in the Consumer broadband data explosion G-20 countries (millions) connections (millions) Global Internet traffic (exabytes per year) 238 2005 746 total 508 30 167 Fixed connections Developed markets Mobile connections Developing markets 573 672 2015 2,062 total 2,707 total 966 1,390 2,134 Sources: Economist Intelligence Unit; Cisco; Ovum; BCG analysis. Notes: While the European Union is a member of the G-20, the figures include only the independent European members: France, Germany, Italy, and the U.K. The developing nations are Argentina, China, India, Indonesia, Mexico, Russia, Brazil, Saudi Arabia, South Africa, and Turkey. The developed nations are Australia, Canada, France, Germany, Italy, Japan, South Korea, U.K., and U.S. | T . T O
  • 7. complex issues, many governments are still trying to determine whattheir role should be.Meanwhile the rice pile on the next square keeps getting bigger.This report assesses the far-reaching economic impact of the Internet.It shows how the benefits are large and getting larger, identifies thedrivers behind them, and examines their clout. It quantifies gains—economic growth, consumer value, and jobs—in the context of theeconomies of the G-20. It demonstrates that no one—individual, busi-ness, or government—can afford to ignore the ability of the Internetto deliver more value and wealth to more consumers and citizensmore broadly than any economic development since the IndustrialRevolution.N1. The Group of 20 major economies comprises Argentina, Australia, Brazil, Canada,China, the EU, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, SaudiArabia, South Africa, South Korea, Turkey, the U.K., and the U.S. T B C G | 
  • 8. THE INTERNET’S ECONOMICIMPACT T     the Internet is getting bigger—just about everywhere— and it already has an enormous base. In the The growth is being fueled in large part by two factors: more users and faster, more ubiq- uitous access. The number of users around U.K., for example, the Internet’s contribution the globe will rise to a projected 3 billion in to 2010 GDP is more than that of construc- 2016 from 1.9 billion in 2010. Broadening ac- tion and education. In the U.S., it exceeds the cess, particularly via smartphones and other federal government’s percentage of GDP. The mobile devices, and the popularity of social Internet economy would rank among the top media are further compounding the Inter- six industry sectors in China and South Korea. net’s impact. In the developing world in par- ticular, many consumers are going “straight Policymakers in developed countries cite with to social.” (See Exhibit 2.) envy the GDP growth rates of 5 to 10 percent per year being achieved in China and India, particularly in today’s troubled economic en- vironment. At the same time, they can often The Internet economy of the look past similar, or even higher, rates close G-20 will nearly double to home. between 2010 and 2016. The Internet economy in the developed mar- kets of the G-20 will grow at an annual rate of 8 percent over the next five years, far out- National levels of Internet economic activity pacing just about every traditional economic generally track the BCG e-Intensity Index, sector, producing both wealth and jobs. The which measures each country’s level of en- contribution to GDP will rise to 5.7 percent ablement (the amount of Internet infrastruc- in the EU and 5.3 percent for the G-20. ture that it has in place), expenditure (the Growth rates will be more than twice as amount of money spent on online retail and fast—an average annual rate of 18 percent— online advertising), and engagement (the de- in developing markets, some of which are gree to which businesses, governments, and banking on a digital future with big invest- consumers are involved with the Internet). ments in broadband infrastructure. Overall, Big differences are apparent among the 50 the Internet economy of the G-20 will nearly countries examined, with five clusters emerg- double between 2010 and 2016, when it will ing according to their performance on the in- employ 32 million more people than it does dex in absolute terms and relative to per cap- today. ita GDP. (See Exhibit 3.) | T . T O
  • 9. E  | Developing Markets Are Going “Straight to Social”Users Are Adopting Social Networking Quickly as They Come Online Social networking penetration among Internet users (%) Size of Internet population = 50 million 100 Social networking is strong Argentina among the connected elite Turkey South Africa Mexico Australia 90 Brazil Indonesia Canada India Russia U.K. Italy 80 France Germany U.S. 70 Chinese social network growth is exploding South Korea 60 China Heavy users of 50 Japan is experiencing more traditional Straight Social– Focus on dramatic social growth conversational to social mainstream traditional Japan media and mature Web 0 20 40 60 80 100 Internet penetration (%)Sources: Economist Intelligence Unit; comScore; Google; Trendstream; eMarketer; local telco reports; BCG analysis.Note: Data reflect 2011 figures; where unavailable, 2010 figures were used; Saudi Arabia not included.E  | Developed Markets Score Significantly Higher in BCG’s e-Intensity Index BCG e-Intensity score 200 South Korea Denmark Netherlands Sweden U.K. Iceland 150 Japan Finland Norway Hong Kong Gemany U.S. Luxembourg Switzerland France Singapore Australia Canada New Zealand Belgium 100 Czech Republic Slovenia Austria Ireland Estonia Spain Poland Portugal United Arab Emirates Russia Hungary Israel Italy Turkey Brazil Slovakia Greece Malaysia 50 Argentina Saudi Arabia Colombia Chile China Venezuela Morocco Mexico Egypt South Africa Nascent natives Natives Players Laggards Aspirants India Indonesia 0 20 40 60 80 2010 GDP per capita ($thousands)Sources: Economist Intelligence Unit; International Monetary Fund, ITU; Speedtest.net; Gartner; Ovum; World Bank; Pyramid Research; United Nations;World Economic Forum; comScore; Magnaglobal; Euromonitor; BCG analysis.Note: The scores of several countries are estimates based on incomplete data. T B C G | 
  • 10. Consumption is the principal driver of Inter- Retail represents almost one-third of total net GDP in most countries, typically repre- GDP in the G-20, and online retail contributes senting more than 50 percent of the total in a significant and increasing share in many 2010. It will remain the largest single driver countries. (See Exhibit 6.) Nowhere is the im- through 2016. Investment, mainly in infra- pact more apparent than in the U.K. Thanks structure, accounts for a higher portion of the in part to high Internet penetration, efficient total in “aspirant” nations as they are in the delivery infrastructure, a competitive retail earlier stages of development. market, and high credit-card usage, the U.K. has become a nation of digital shopkeepers, Several “natives” on BCG’s e-Intensity In- to paraphrase Adam Smith. dex—the U.K., South Korea, and Japan—are among those nations with the largest Internet Several European economies—Denmark, the contributions to GDP. China and India stand Netherlands, Sweden, and the U.K.—to name out for their enormous Internet-related ex- but four—perform strongly on BCG’s e-Inten- ports—China in goods, India in services— sity Index. But various barriers hold back the which propel their Internet-economy rank- EU as a whole, the world’s biggest single mar- ings toward the top of the chart. Mexico and ket, when it comes to cross-border e-com- South Korea have also developed significant merce. In January, the European Commission Internet export sectors. announced plans to catch up, removing these impediments and creating a “digital single Among G-20 “players,” the United States ben- market.” The commission believes that e- efits from a vibrant Internet economy, while commerce can double its share of overall re- Germany and France tend to lag. The picture tail sales by 2015. will change by 2016 as, for example, the In- ternet economies of India and the EU-27 grow rapidly to move into the top five. (See Exhibits 4 and 5.) E  | The Internet Currently Accounts for 4.1% of GDP in the G-20 Countries Internet economy as a percentage of 2010 GDP GDP GDP ($trillions) (%) U.K. 2.3 8.3 South Korea 1.0 7.3 China 5.9 5.5 Japan 5.5 4.7 U.S. 14.5 4.7 G-20 54.9 4.1 4.3 Developed market average India 1.7 4.1 EU-27 16.2 3.8 Australia 1.2 3.3 3.6 Developing market average Germany 3.3 3.0 Canada 1.6 3.0 France 2.6 2.9 Mexico 1.0 2.5 Brazil 2.1 2.2 Saudi Arabia 0.4 2.2 Italy 2.1 2.1 Argentina 0.4 2.0 South Africa 0.4 1.9 Russia 1.5 1.9 Turkey 0.7 1.7 1.3 Natives Players Laggards Aspirants Indonesia 0.7 Sources: Economist Intelligence Unit; Organisation for Economic Co-operation and Development (OECD); country statistical agencies; BCG analysis. | T . T O
  • 11. E  | The Internet Economy Will Account for 5.3% of GDP in the G-20 Countries in 2016 Internet economy as a percentage of 2016 GDP GDP GDP CAGR ($trillions) (%) 2010–16 (%) U.K. 2.8 12.4 10.9 South Korea 1.4 8.0 7.4 China 12.4 6.9 17.4 EU-27 20.0 5.7 10.6 India 4.3 5.6 23.0 Japan 6.6 5.6 6.3 5.4 5.5 Developed market average U.S. 18.6 6.5 G-20 79.9 5.3 10.8 Mexico 1.5 4.2 4.9 Developing market average 15.6 Germany 3.9 4.0 7.8 Saudi Arabia 0.8 3.8 19.5 Australia 1.7 3.7 7.1 Canada 2.1 3.6 7.4 Italy 2.4 3.5 11.5 France 3.1 3.4 6.1 Argentina 0.8 3.3 24.3 Russia 2.7 2.8 18.3 South Africa 0.6 2.5 12.6 Brazil 3.7 2.4 11.8 Turkey 1.3 2.3 16.5 Natives Players Laggards Aspirants Indonesia 1.5 1.5 16.6Source: Economist Intelligence Unit; Organisation for Economic Co-operation and Development (OECD); country stastical agencies; BCG analysis.E  | Online Retail Is Expected to Account for Up to 23% of Total U.K. Retail in 2016 Online retail as a percentage of total retail, 2016 Online retail (%) U.K. 23.0 Germany 11.7 Australia 8.9 South Korea 8.1 8.5 Developed market average Saudi Arabia 8.0 Italy 8.0 U.S. 7.1 Japan 6.8 France 6.7 G-20 1 6.0 Canada 5.3 India 4.5 Brazil 4.3 China 2 3.4 Russia 3.2 3.2 Developing market average Argentina 2.9 Mexico 1.6 South Africa 1.5 Turkey 1.1 Natives Players Laggards Aspirants Indonesia 0.3Sources: Economist Intelligence Unit; Organisation for Economic Co-operation and Development (OECD); country stastical agencies; BCG analysis.1 This figure does not include the EU-27.2 This figure reflects business-to-consumer retail only. T B C G | 
  • 12. THE INTERNET’S FURTHERECONOMIC IMPACT A     GDP figures are, they capture only part of the story. In retail alone, G-20 consumers researched penetration and security concerns over on- line payments hold back online commerce, Mexican consumers without credit cards can online and then purchased offline (ROPO) pay for their online purchases at 7-Eleven more than $1.3 trillion in goods in 2010—the stores. Like the U.S., Japan has a busy online equivalent of about 7.8 percent of consumer retail market, which totaled $89 billion in spending, or more than $900 per connected 2010. ROPO added $139 billion because consumer. Japanese consumers still prefer the experi- ence of shopping in stores. Across the G-20, ROPO is a bigger factor in developed econo- ROPO would add an additional 2.7 percent if mies, as one would expect, but consumers ev- it were counted as part of Internet GDP. erywhere research a wide variety of products online before purchasing them elsewhere. In China, groceries are a popular ROPO pur- chase; in the United States, cars; India, tech- Consumers everywhere nology products; Brazil, electronics, applianc- research a wide variety of es, and travel packages. Multiple factors affect e-commerce and ROPO. In addition to regula- products online before pur- tory barriers like those cited above, the state chasing them elsewhere. of infrastructure for online and bricks-and- mortar retail plays a big role, as do Internet penetration, credit-card use, and consumer Mobile shopping—using a smartphone to confidence in online payment systems, deliv- identify deals, compare products and prices, ery, and fulfillment. and “seal the deal” while on the go—is grow- ing in popularity worldwide. As device prices ROPO spending is higher than online retail in fall, especially in developing markets, in- virtually all the nations we studied. (See Ex- creased smartphone penetration will have a hibit 7.) In the U.S., online retail sales totaled dramatic impact on both retail commerce $252 billion in 2010, and ROPO added anoth- and e-commerce—further blurring the lines er $482 billion. ROPO dwarfs online retail in between online and offline buying. Mobile Turkey—$37 billion compared with $2 bil- apps such as RedLaser, Google Shopper, and lion—owing in large part to poor delivery in- Amazon Remembers make it ever easier for frastructure and consumer concern over ful- consumers to research products, compare fillment. In Mexico, although low credit-card deals, and make purchases as they see fit at | T . T O
  • 13. E  | ROPO Greatly Amplifies the Internet’s Impact on Retail Online retail and ROPO (research online, purchase offline), 2010 Value ($) U.S. 252 482 734 Japan 89 139 228 U.K. 102 87 189 Germany 38 88 126 China¹ 10 96 106 France 27 78 105 Canada 18 58 76 Italy 20 48 68 South Korea 23 44 67 Australia 20 38 58 Russia 12 33 45 Turkey 2 37 40 Brazil 15 19 34 Mexico 2 27 29 India 7 6 13 Argentina 2 9 11 Saudi Arabia 3 5 8 South Africa 2 24 Online retail ROPO Indonesia 0 11 ($billions) ($billions) 2 Sources: Euromonitor; Google-TNS; BCG analysis. Note: Figures exclude real estate for some countries; the figures for online retail and ROPO do not add up to the total due to rounding. 1 This figure reflects business-to-consumer retail only. 2 Total ROPO (auto and nonauto).any given moment. Retailers of all stripes Taobao in 2010 than at China’s top-five brick-face an especially fast-changing and increas- and-mortar retailers combined.ingly competitive environment in the yearsahead. With the rapid growth of e-commerce The Internet is having a big impact on howand its potential to disrupt both the top and enterprises do business and interact with onebottom lines, retail may be ripe for a transfor- another, too. Cloud-based data storage, inte-mation similar to the one seen in media. A grated procurement systems, and “enterprisemultichannel offering that captures sales social networks” that facilitate communica-wherever they occur will become a “must tion within and among organizations in realhave” for most businesses. time are helping companies address a host of procurement, coordination, communication,Online advertising, a $65 billion business in and fragmentation issues. With spending inthe G-20 in 2010, is forecast to grow 12 per- the $3 trillion range, both the U.S. and Japancent a year to almost $125 billion in 2016. In lead the world in business-to-business e-com-countries with more developed Internet econ- merce, but penetration is picking up in otheromies, 15 to 30 percent of advertising spend- countries. South Korea’s percentage of busi-ing has migrated online. Online advertising ness-to-business e-commerce is approachingspending in the U.K. overtook spending on 50 percent, as is Japan’s.television advertising in 2011—and it nowexceeds spending on all other media cate-gories.Consumer-to-consumer Internet commerce isa big factor in China, facilitated by websitessuch as Taobao, a marketplace for goods ofall sorts. More products were purchased on T B C G | 
  • 14. CONSUMERS EVERYWHEREKNOW A GOOD DEAL WHENTHEY SEE IT C     consid- erable value on the Internet. In the G-20 economies, this “consumer surplus”—the online. Demographics play a role in the last factor: in many markets, the heaviest users of the Internet are the young—no surprise perceived value that consumers themselves there—and those over 55, whose ranks will believe they receive, over and above what swell as the population ages. (See Exhibit 8.) they pay for devices, applications, services, All these factors are on the rise, which points and access—amounts to $1,430 a person.1 to continued growth in the consumer surplus. Consumer surplus varies vastly across countries, depending in part on the impact of Various aspects of consumer surplus are illus- the drivers shaping each nation’s Internet trated in the country profiles at the end of economy. For example, it’s $323 per person in this report. These profiles also show the In- Turkey, $1,215 in South Africa, $1,287 in ternet’s impact on GDP and on the retail Brazil, and $4,453 in France. The aggregate market in each country. Most significantly, consumer surplus across 13 of the G-20 they highlight how deeply the Internet has countries is $1.9 trillion, or about 4.4 percent ingrained itself in daily life around the world, of the GDP. by showing what consumers are willing to give up—from satellite navigation to sex—in It is interesting to note that in countries such order to keep their Internet access. as France and Germany, which have relative- ly low levels of Internet GDP, consumers’ per- ceived value of the Internet is very high. Fur- thermore, although the consumer surplus figures are lower for many developing mar- N kets, they are actually quite high relative to 1. In our analysis, we took into consideration the value derived from communication, content (entertainment, local incomes—lower-income people get rela- news, and social media), search, commerce, and job tively more benefit from the Internet than searches. We used a “loss aversion technique” to avoid wealthier people do. Closing the digital di- anchoring the data to the current prices of goods and services—many of which are free—and to determine vide can have a meaningful impact for the the true value that people place on them. To measure less well-off. “consumer surplus,” we subtracted from this value what people currently pay to access the Internet and the cost of the devices, content, and applications. Our analysis Consumer surplus has multiple drivers, found that consumers receive a “surplus” equal to among them the quality of online content, the about 80 percent of value, or 4 to 5 percent of personal number of devices in use, the ease and fre- income. quency of access, and the number of people | T . T O
  • 15. E  | Youngest and Oldest Consumers Tend to Value the Internet the Most Perceived Internet value per user ($) (€) (¥thousands) USA France Japan 4,000 6,000 400 3,506 5,174 316 3,000 2,926 2,363 300 244 4,000 3,701 1,953 2,978 3,062 2,000 1,456 2,324 200 172 178 158 2,000 1,000 100 0 0 0 18–24 25–34 35–44 45–54 55+ 18–24 25–34 35–44 45–54 55+ 18–24 25–341 35–44 45–54 55+ (€) (KRW (Rp thousands) Germany thousands) South Korea India 4,000 3,000 60 55 3,226 3,060 3,000 2,722 2,130 2,478 2,000 40 2,578 1,807 2,000 24 24 936 22 22 1,000 782 20 1,000 494 0 0 0 18–24 25–34 35–44 45–54 55+ 18–24 25–34 35–44 45–54 55+ 18–24 25–34 35–44 45–54 55+ Age categoriesSource: BCG survey.Note: Value comparisons are weighted by income (excluding the highest and lowest levels by country) to minimize bias.1 The figure for Japan’s 25–34 category is estimated (base size). T B C G | 
  • 16. FROM HIGHWEB TO NOWEBOPPORTUNITIES FOR SMALL AND MEDIUM ENTERPRISES G     ability to innovate, one would expect SMEs—long the engine of economic growth in many low or no use of the Web over the last three years. (See Exhibit 9). In the U.K., sales at high-Web companies increased six times as economies—to grasp the power of the fast as revenues at firms with no Internet Internet to build their businesses. Indeed, presence. many have, and these companies have helped turned the Web into an important vehicle for Many U.S. SMEs have integrated the Internet revenue growth and job creation. But a into their businesses. They are much more surprising number have not—or have ven- aggressive online than low-Web companies, tured online only to a limited extent. These particularly in activities such as search en- companies are leaving an enormous opportu- gine optimization, social networking, buying nity untapped. from and paying suppliers. They are even managing their business finances and recruit- In our view, every business needs to “go ing staff online. digital”—and fast. Policymakers, too, should pay heed. Given SMEs’ track record in job cre- In many developed and developing markets, ation, policies that encourage more of these high-Web companies are twice as likely as companies to develop an online presence their low- or no-Web counterparts to have a could help address the lingering unemploy- national and international customer base, as ment that currently characterizes the recov- opposed to selling only locally. In the U.S., ery in many countries. high- and medium-Web businesses expect to grow by 17 percent over the next three years, Over the last 18 months, BCG has surveyed compared with 12 percent for low- and no- workers at more than 15,000 companies that Web companies. operate in the world’s biggest economies and that employ fewer than 250 people (in the High- and medium-Web SMEs generate U.S., the cutoff was 500). We grouped the more jobs. In Germany, 93 percent of high- companies into four categories: high-Web, Web and 82 percent of medium-Web compa- medium-Web, low-Web, and no-Web.1 nies increased employment over the past three years, compared with only 50 percent The results are compelling. Across 11 of the of the no-Web firms. Japan experienced simi- G-20 countries, high-Web SMEs have experi- lar results. In South Korea, employment in- enced revenue growth that was up to 22 per- creased at 94 percent of high-Web SMEs and cent higher than that achieved by SMEs with at 60 percent of no-Web companies. | T . T O
  • 17. We’ve identified five value levers that explain enhance a wide range of functions,the “Internet advantage” of High-Web SMEs: including customer relationship manage- ment, information management, and• Geographic Expansion. The Internet creates customer payments. As a result, these a borderless world for many SMEs, companies can grow quickly without enabling them to compete with much requiring large investments in infra- larger, multinational companies by structure. accessing markets that were previously out of reach. • Easier and Quicker Staff Recruitment. The recruiting options available today are• Enhanced Marketing. Online marketing more powerful and less expensive than delivers expanded reach and measurable ever before, and they enable SMEs to tap returns. It also yields valuable data about a global talent market. consumers and their preferences, enabling expressly targeted advertising and offers. The most powerful lever may be improved customer interaction, which is achieved prin-• Improved Customer Interactions. Social cipally by exploiting the participatory nature media make it possible for companies to of today’s Internet. Nearly two-thirds of high- engage in real-time dialog with customers Web SMEs are moving quickly to match their not only to boost sales but also to build customers’ engagement in social networks. loyalty and even to help create, refine, and The impact can be seen in such developing enhance products and services. markets as Brazil and China. (See Exhibit 10.) Despite high barriers impeding SME adoption• Leveraging the Cloud. SMEs can access of online activities (e.g., lack of infrastructure sophisticated, oen cloud-based, tools to and computer penetration), these countries E  | SMEs That Make Extensive Use of the Web Grow Faster Historical three-year sales growth (%) China Brazil India Turkey 30 20 15 8 5 25 10 20 19 13 17 22 9 12 0 –5 (%) Germany U.S. France South Korea 30 20 10 18 14 3 10 10 7 4 15 6 11 0 –5 –5 Source: Survey of approximately 4,700 SMEs; BCG analysis. High-Web SMEs1 Low-Web and No-Web SMEs1 Note: Figures for some countries may not add up to the totals due to rounding. 1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Web businesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. T B C G | 
  • 18. E  | More SMEs in Developing Markets Are Using the Internet to Engage with Consumers Brazil and China have higher percentages of ...and generally higher percentages of SMEs High-Web SMEs... engaging consumers online Percentage of SMEs by Web involvement Percentage of SMEs using Internet activity to engage consumers 53 Website 51 China 35 8 30 27 72 71 Online 61 advertising 71 41 Brazil 27 8 36 29 Blogging 38 22 56 Social 43 networking 39 66 U.K. 23 7 54 16 57 E-commerce 49 No-Web Low-Web Medium-Web High-Web Brazil China U.K. Sources: Survey of approximately 1,500 SMEs; IDC; Organisation for Economic Co-operation and Development (OECD); Brazilian Internet Steering Committee; China Network Information Centre; Internet & Mobile Association of India; Zinnov; MARS Indonesia. Note: Values were adjusted for Internet penetration rates in each country and weighted to reflect an equal distribution of company sizes. not only boast higher percentages of high- Most of these barriers must be hurdled by the Web SMEs than their developed-market SMEs themselves. But policymakers should counterparts, but their SMEs are also substan- take note that access issues and government tially more adept at moving beyond Internet regulations were cited as impediments by marketing to exploit the Web’s facility for one in five SMEs in developed markets—and driving sales through more intensive custom- by two in five in developing economies. er interaction. These are areas where governments may have opportunities to lend a hand and can The barriers keeping SMEs from engaging reap the benefits of increased economic more broadly or deeply online fall into five growth and job creation. general categories: poor access to the requi- site technology, lack of capabilities, lack of re- sources, doubt over the potential returns, and an unfavorable business environment. Not surprisingly, access problems and an unfavor- N able business environment were cited far 1. High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact more often by SMEs in developing markets with suppliers, and empower employees; medium-Web than by their developed-market counterparts. businesses market or sell goods or services online; Almost half of SMEs in India and Indonesia low-Web businesses have a website or a social network- ing site; no-Web businesses do not have a website. cited “local business culture” as a significant impediment; one-third of Chinese SMEs said that they are held back by lack of access to computers. Inadequate staff knowledge and time were named the biggest barriers in Ja- pan, and about one-quarter of U.S. and U.K. firms reported a lack of necessary financial resources. | T . T O
  • 19. DON’T BLINK THE FUTURE IS RUSHING STRAIGHT AT UST  I   even more in the next five years than it has in its firsttwenty-five. It will have more users (especial- Companies that have not yet developed an online strategy for themselves need to build their digital assets while reducing digital lia-ly in developing markets), more mobile users, bilities (which are often organizational) thatmore users using various devices throughout might prevent them from tapping opportuni-the day, and many more people engaged in ties. This topic will be the subject of the nextan increasingly participatory medium. On the forthcoming report in BCG’s Connectedsecond half of the chessboard, as the rice pile World series.starts to rival Mount Everest in magnitude(the size it would reach on the sixty-fourth Governments also face challenges and oppor-square), the rapidly evolving Internet has the tunities—and many of these are increasinglypotential to both enrich and overwhelm. complex. Fifteen years ago, as the commercial Internet was beginning to make its potentialBusinesses in particular need to make a apparent in the U.S. and elsewhere, Presidentchoice. They can rise to the challenge of a Bill Clinton outlined five principles constitut-new Internet-driven marketplace—and ben- ing a “framework for global electronic com-efit from the expanded capabilities and high- merce”:er growth rates that high-Web SMEs are al-ready achieving throughout the G-20 nations. 1. The private sector should lead.The alternative is following in the footstepsof such industries as music and publishing, 2. Governments should avoid undue restric-which held on to outdated business models tions on electronic commerce.for too long and are now dealing with com-petitive environments that have been re- 3. Where governmental involvement isshaped around them. needed, its aim should be to support and enforce a predictable, minimalist, consis-For those willing to think big, embrace tent, and simple legal environment forchange, move quickly, and organize different- commerce.ly, there are countless opportunities to reapthe rewards of the Internet’s creative destruc- 4. Governments should recognize the uniquetion (as defined by economist Joseph Schum- qualities of the Internet.peter rather than by Karl Marx) in industriesranging from health care to retail and con- 5. Electronic commerce on the Internetsumer goods. should be facilitated on a global basis. T B C G | 
  • 20. The Internet is a very different, much bigger, On a national level, policies that promote in- and more complex place now than it was vestment—especially in the infrastructure in then. New, important, and difficult issues the developing world—and emphasize educa- have moved to the fore, among them privacy, tion, training, and skills-building everywhere piracy, protection, security, “net neutrality,” are essential. Perhaps even more than the in- and taxation. They are already causing con- dustrial era and information age, the Internet flict and contention as different players with economy requires a well-educated and skilled distinct interests choose sides. The recent de- workforce. Countries that fall behind in pro- bate over SOPA—the proposed Stop Online viding educational opportunity are also likely Piracy Act—in the U.S. is one example of how to lose out to others in Internet-driven eco- fractious such issues can be. In February, nomic growth. street protests in several European cities against an antipiracy agreement seen as lim- iting the freedom of online speech showed that citizens are paying attention and have Policies that promote invest- strongly held points of view. ment and emphasize educa- In the best of all worlds, with the Internet be- tion, training, and skills-build- ing a global phenomenon, governments ing are essential. would act in a coordinated manner, working toward international standards when they are called for and toward cross-country agree- Different countries will take different ap- ments to limit intervention when it is better proaches, but the overarching challenge fac- to let the free market do its own work. This is ing those empowered to do the people’s busi- a high bar, to be sure, and we may need an ness is the same—ensure ready and updated framework with some new princi- affordable access, a level playing field, and an ples, but those put forth by President Clinton open competitive environment that enables offer a still-valid structure for engaging the everyone to tap the economic benefits of the debate. Internet.COUNTRY PROFILES I   ,  feature a series of detailed profiles illustrating Internet economic activity across the G-20. For each GDP, an illustration of how consumers are using the Internet and what they value, and an assessment of use by—and impact economy, we have provided information on on—small and medium enterprises. the impact of the Internet on commerce and | T . T O
  • 21. Argentina’s Internet Economy Comparison of Internet economy with 2016 traditional industry sectors (percentage of GDP) GDP contribution 5 Manufacturing ($billions) Wholesale and retail trade Real estate 8 Government Agriculture, forestry, and hunting 2010 spending TOTAL 28 Education and health services Logistics and communication Public administration 2 18 Financial transactions TOTAL 3 Investment Construction 8 5 Consumption Community services Mining Net exports --3 --1 Hotels and restaurants Percentage of GDP Utilities Argentina Argentina Fishing 2.0 3.3 4.1 5.3 2.0 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; INDEC; CACE; IEMR; company reports; World Bank; World Trade Organization; AméricaEconomía; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in Argentina $9 Research online, billion purchase offline $2 (2.9%) 2010 billion (1.4%) $568 $9 per Online 2016 billion online user retail 2010 (5.9% of total retail) Total retail Percentage of total advertising expenditures in 2010 45.8 2016 32.2 6.7 7.7 10.0 4.5 3.1 $0.3 40.0% $1.9 billion billion CAGR Television Newspaper Out-of-home Magazine Radio Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; INDEC; CACE; IEMR; company reports; World Bank; World Trade Organization; AméricaEconomía; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 22. Australia’s Internet Economy Comparison of Internet economy with traditional industry sectors (percentage of GDP) GDP contribution Real estate ($billions) Government 2016 Financial services and insurance Wholesale and retail trade spending 14 Manufacturing 2010 17 Mining Construction Professional, scientific, 9 and technical services Health care 15 Investment TOTAL Logistics 61 Public administration TOTAL 50 Education and training 41 29 Consumption Information and telecommunications Administration –12 Net exports --19 Hotels and restaurants Agriculture Percentage of GDP Utilities Australia Australia Arts, entertainment, and recreation 3.3 3.7 4.1 5.3 3.3 G-20 G-20 Internet Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Australian Bureau of Statistics; Forrester Research; IEMR; Australian Communications and Media Authority; company reports; National Broadband Network; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in Australia $38 Research online, $20 billion purchase offline (8.9%) 2010 billion (5.8%) $2,302 $38 per Online 2010 2016 billion online user retail (10.9% of total retail) Total retail Percentage of total advertising expenditures in 2010 2016 31.5 30.2 34.0 18.4 7.5 4.5 $5.3 7.9 $2.1 16.4% billion billion CAGR Television Newspaper Radio Magazine Out-of-home Online Online Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Australian Bureau of Statistics; Forrester Research; IEMR; Australian Communications and Media Authority; company reports; National Broadband Network; BCG analysis. Note: Percentages may not total 100 due to rounding. | T . T O
  • 23. Brazil’s Internet Economy Comparison of Internet economy with 2016 8 traditional industry sectors (percentage of GDP) GDP contribution Public and personal services ($billions) 21 Government Manufacturing 2010 4 spending Wholesale and retail trade, hotels, and restaurants Real estate and business services TOTAL 14 Investment 76 89 Public administration Financial services and insurance TOTAL 46 34 Agriculture Consumption Construction --6 Net exports Logistics --16 Mining Percentage of GDP Brazil Brazil Electricity, gas, and water 2.2 2.4 4.1 5.3 2.2 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Brazilian Census Bureau (IBGE); EC; IMRG; ITU, U.K. Office for National Statistics (ONS); IE Market Research; CETIC; Teleco; CGI/ICT;Faraban; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in Brazil $36 Research online, billion purchase offline $15 (4.3%) 2010 billion (3.1%) $260 $19 per Online 2016 billion online user retail 2010 (4.0% of total retail) Total retail Percentage of total advertising expenditures in 2010 60.3 2016 10.1 15.6 17.4 7.5 2.9 3.5 $1.7 14.2% $3.7 billion CAGR billion Television Newspaper Magazine Radio Out-of-home Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Brazilian Census Bureau (IBGE); EC; IMRG; ITU, U.K. Office for National Statistics (ONS); IE Market Research; CETIC; Teleco; CGI/ICT;Faraban; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 24. Brazil’s Consumers Benefit from the Internet $154 Annual value What do E-mail consumers value? $1,287 $152 General search $1,472 Consumer surplus Perceived value $131 $185 Online banking Cost and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 78 76 72 60 59 43 24 12 8 Satellite Alcohol Fast food Coffee Chocolate Exercise Car Sex Shower navigation Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Brazilian Census Bureau (IBGE); EC; IMRG; ITU, U.K. Office for National Statistics (ONS); IE Market Research; CETIC; Teleco; CGI/ICT; Faraban; BCG analysis. Note: Due to rounding, perceived value does not total consumer surplus plus cost. The Internet’s Impact on Small and Medium Enterprises (SMEs) in Brazil SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage) 1 jobs during the last three years 1 employment 98 95 High-Web 20 77 dium-Web Medium-Web 6 20 53 Low-Web and No-Web 12 SMEs’ percentage of GDP High- Medium- Low-Web and Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 86 74 73 60 50 70 54 3 26 24 3 38 1 3 3 0 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimization Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Brazilian Census Bureau (IBGE); EC; IMRG; ITU, U.K. Office for National Statistics (ONS); IE Market Research; CETIC; Teleco; CGI/ICT; Faraban; BCG analysis. 1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium- Web businesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. | T . T O
  • 25. Canada’s Internet Economy Comparison of Internet economy with traditional industry sectors (percentage of GDP) GDP contribution ($billions) Government 2016 Financial services, insurance, and real estate Manufacturing spending 13 Wholesale and retail trade 2010 29 Health care and social services Public administration Construction 11 Education services TOTAL Professional, scientific, and technical services 22 Investment 73 TOTAL Logistics 51 48 Mining, oil, and gas extraction 27 Consumption Information and cultural industries Administrative and support --12 Net exports --20 Utilities Hotels and restaurants Percentage of GDP Agriculture, forestry, and fishing Canada Canada Arts, entertainment, and recreation 3.0 3.6 4.1 5.3 3.0 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; eMarketer; Statistics Canada; Retail Council of Canada; Industry Canada; AXCO; IEMR; H2; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in Canada $33 Research online, $18 billion purchase offline billion (5.3%) 2010 (3.4%) $2,082 $58 per Online 2010 2016 billion online user retail (11.3% of total retail) Total retail Percentage of total advertising expenditures in 2010 2016 32.6 21.8 28.8 20.0 5.5 5.3 14.7 $3.8 $2.1 10.6% billion billion CAGR Television Newspaper Radio Magazine Out-of-home Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; eMarketer; Statistics Canada; Retail Council of Canada; Industry Canada; AXCO; IEMR; H2; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 26. China’s Internet Economy 2016 27 Comparison of Internet economy with traditional industry sectors (percentage of GDP) GDP contribution 92 Manufacturing ($billions) Agriculture, forestry, and fishing Wholesale and retail Government Mining spending 2010 321 TOTAL Construction Logistics Financial intermediation 12 852 Real estate Public and social organizations 55 Investment Education 62 Consumption Electricity, gas, and water TOTAL 412 Information and communications technology (ICT) 326 Hotels and restaurants 197 Net exports Leasing and business services Health care, social security, and social services Services to households Percentage of GDP Scientific research and technical services China China Arts, entertainment, and recreation 5.5 6.9 4.1 5.3 5.5 G-20 G-20 Internet Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Chinese government; iResearch; China Information Almanac; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in China $176 billion $246 Research online, (3.4%) purchase offline billion (4.7%) 2010 $10 billion $62 (0.4%) billion Online (2.5%) $213 retail (C2C) $96 per 2016 billion online Online user retail (B2C) 2010 (4.2% of total retail) Total retail Percentage of total advertising expenditures in 2010 45.8 2016 25.4 11.9 18.0 7.9 2.4 6.6 $10.9 $2.8 25.1% billion billion CAGR Television Newspaper Out-of-home Radio Magazine Online Online Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Chinese government; iResearch; China Information Almanac; BCG analysis. Note: Percentages may not total 100 due to rounding. | T . T O
  • 27. China’s Consumers Benefit from the Internet $53 Instant messaging Annual value What do consumers value? $451 $47 $598 Consumer Online shopping surplus Perceived value $147 $46 Cost Online banking and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 86 85 82 79 78 56 45 37 36 Alcohol Coffee Chocolate Satellite Fast food Car Exercise Shower Sex navigationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Chinese government; iResearch; China Information Almanac; BCG analysis.The Internet’s Impact on Small and Medium Enterprises (SMEs) in China Historical three-year sales growth Percentage of SMEs that added SMEs’ percentage of of SMEs (percentage)1 jobs during the last three years 1 employment 97 91 High-Web 90 25 dium-Web Medium-Web 20 59 80 Low-Web and No-Web 9 SMEs’ percentage of GDP High- Medium- Low-Web and Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 89 100 100 12 76 77 12 46 64 62 59 64 3 0 6 3 0 3 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimizationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Chinese government; iResearch; China Information Almanac; BCG analysis.1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Webbusinesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website.2 This percentage reflects fewer than 10 responses from no-Web SMEs. T B C G | 
  • 28. France’s Internet Economy 2016 Comparison of Internet economy with traditional industry sectors (percentage of GDP) 16 GDP contribution Real estate ($billions) Manufacturing 33 Government Wholesale and retail trade spending Health care and social services 2010 TOTAL 105 Public administration Construction 14 Logistics 67 28 Investment Education TOTAL Financial services 73 Consumption 42 Hotels and restaurants Agriculture --10 Net exports --12 Food, beverages, and tobacco Percentage of GDP Metals France France Utilities 2.9 3.4 4.1 5.3 2.9 G-20 G-20 Internet Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; EC; H2; IE Market Research; IDS; INSEE; company reports; Eurostat; Forrester Research; AXCO; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in France $46 Research online, $27 billion purchase offline billion (6.7%) 2010 (4.5%) $1,682 $78 per Online 2010 2016 billion online user retail (12.9% of total retail) Total retail Percentage of total advertising expenditures in 2010 2016 32.2 19.4 19.7 15.3 15.1 11.1 7.0 $3.2 $2.3 5.6% billion billion CAGR Television Newspaper Magazine Out-of-home Radio Online Online Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; EC; H2; IE Market Research; IDS; INSEE; company reports; Eurostat; Forrester Research; AXCO; BCG analysis. Note: Percentages may not total 100 due to rounding. | T . T O
  • 29. France’s Consumers Benefit from the Internet $597 Annual value What do E-mail consumers value? $4,453 $570 General search $4,788 Consumer surplus Perceived value $420 $335 Online banking and investing Cost Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 86 77 69 66 61 42 23 16 5 Fast food Satellite Alcohol Chocolate Coffee Exercise Car Sex Shower navigationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; EC; H2; IE Market Research; IDS; INSEE; company reports; Eurostat; Forrester Research; AXCO; BCG analysis.The Internet’s Impact on Small and Medium Enterprises (SMEs) in France SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage)1 jobs during the last three years 1 employment 96 High-Web 10 87 dium-Web Medium-Web 65 6 56 60 Low-Web and No-Web 7 SMEs’ percentage of High- Medium- Low-Web and private-sector turnover Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 43 78 63 61 10 49 8 4 7 32 49 9 38 5 38 5 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimizationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; EC; H2; IE Market Research; IDS; INSEE; company reports; Eurostat; Forrester Research; AXCO; BCG analysis.1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Webbusinesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. T B C G | 
  • 30. Germany’s Internet Economy Comparison of Internet economy with traditional industry sectors (percentage GDP contribution 2016 15 of GDP) Real estate ($billions) Manufacturing Government 2010 14 spending 39 Wholesale and retail trade Health care and social work TOTAL Public administration 31 Investment 157 95 Logistics TOTAL 100 Education 59 Consumption Construction 8 Financial services --5 Net exports Utilities Percentage of GDP Hotels and restaurants Germany Germany Mining 3.0 4.0 4.1 5.3 3.0 G-20 G-20 Internet Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; EC; Eurostat; Forrester Research; H2; IE Market Research; AXCO; DB Research; FBS; GfK; IDC; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in Germany $68 Research online, $38 billion purchase offline (11.7%) 2010 billion (7.1%) $1,330 $88 per billion online Online retail 2010 2016 (16.2% of user total retail) Total retail Percentage of total advertising expenditures in 2010 2016 34.3 22.9 26.4 20.7 13.3 4.8 $7.1 $5.0 6.2% billion 4.0 billion CAGR Newspaper Television Magazine Out-of-home Radio Online Online Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; EC; Eurostat; Forrester Research; H2; IE Market Research; AXCO; DB Research; FBS; GfK; IDC; BCG analysis. Note: Percentages may not total 100 due to rounding. | T . T O
  • 31. Germany’s Consumers Benefit from the Internet $438 Annual value What do E-mail consumers value? $3,487 $389 General search $3,857 Consumer surplus Perceived value $362 Online banking $370 and investing Cost Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 89 77 77 70 55 45 23 16 10 Fast food Satellite Alcohol Chocolate Coffee Exercise Car Sex Shower navigationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; EC; Eurostat; Forrester Research; H2; IE Market Research; AXCO; DB Research; FBS; GfK; IDC; BCG analysis.The Internet’s Impact on Small and Medium Enterprises (SMEs) in Germany SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage)1 jobs during the last three years 1 employment 93 High-Web 82 18 dium-Web Medium-Web 8 57 54 61 Low-Web and 4 No-Web SMEs’ percentage of High- Medium- Low-Web and private-sector turnover Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 67 75 12 45 49 50 49 72 2 3 7 7 39 22 0 0 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimizationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; EC; Eurostat; Forrester Research; H2; IE Market Research; AXCO; DB Research; FBS; GfK; IDC; BCG analysis.1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Webbusinesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. T B C G | 
  • 32. India’s Internet Economy 2016 11 2 Comparison of Internet economy with traditional industry sectors (percentage of GDP) GDP contribution Agriculture 32 forestry, and fishing ($billions) Financial services, real estate, insurance, and business services 2010 Government spending 108 TOTAL Hotels and restaurants 242 Manufacturing 2 Social and personal services 12 Investment 14 Consumption Construction TOTAL 8 91 70 41 Net exports Logistics and communications Mining Percentage of GDP India India Utilities 4.1 5.6 4.1 5.3 4.1 G-20 G-20 Internet Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; H2; Reserve Bank of India; Indian government; Telecom Regulatory Authority of India; NASSCOM; MediaNama; Trendstream; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in India $84 Research online, billion purchase offline (4.5%) 2010 $7 billion (0.9%) $78 $6 per Online 2016 billion online user retail 2010 (0.8% of total retail) Total retail Percentage of total advertising expenditures in 2010 41.7 39.8 2016 7.7 3.4 4.6 3.5 4.0 $0.1 $0.6 billion 25.3% billion CAGR Television Newspaper Out-of-home Radio Magazine Online Online Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; H2; Reserve Bank of India; Indian government; Telecom Regulatory Authority of India; NASSCOM; MediaNama; Trendstream; BCG analysis. Note: Percentages may not total 100 due to rounding. | T . T O
  • 33. India’s Consumers Benefit from the Internet $48 Annual value What do E-mail consumers value? $414 $46 General search $494 Consumer surplus Perceived value $44 $80 Cost Online banking and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 71 70 67 64 63 44 38 36 33 Satellite Alcohol Fast food Chocolate Coffee Exercise Car Shower Sex navigationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; H2; Reserve Bank of India; Indian government; Telecom Regulatory Authority of India; NASSCOM; MediaNama; Trendstream; BCGanalysis.The Internet’s Impact on Small and Medium Enterprises (SMEs) in India SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage)1 jobs during the last three years 1 employment 100 98 High-Web 19 83 dium-Web Medium-Web 19 17 25 Low-Web and No-Web 13 SMEs’ percentage of GDP High- Medium- Low-Web and Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 86 74 79 75 55 51 60 12 50 5 17 35 7 3 1 1 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimizationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; H2; Reserve Bank of India; Indian government; Telecom Regulatory Authority of India; NASSCOM; MediaNama; Trendstream; BCGanalysis.1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Webbusinesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. T B C G | 
  • 34. Indonesia’s Internet Economy 2016 Comparison of Internet economy with traditional industry sectors (percentage of GDP) 2 GDP contribution Manufacturing ($billions) 10 Agriculture Government 2010 spending TOTAL Hotels and restaurants 22 Mining 1 Construction 13 5 Investment TOTAL Services 9 3 Consumption Financial services, real estate, and business services Net exports --2 --1 Logistics and communications Percentage of GDP Indonesia Indonesia Electricity, gas, and water 1.3 1.5 4.1 5.3 1.3 G-20 G-20 Internet Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Magnaglobal; CCB; APEC; PTIK; Nielsen; IDC; Statistics Indonesia; H2; Indikator TIK 2010; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in Indonesia $2 Research online, billion purchase offline $0.4 (0.3%) 2010 billion (0.1%) $16 $1 per Online 2016 billion online user retail 2010 (0.3% of total retail) Total retail Percentage of total advertising expenditures in 2010 52.6 35.1 2016 7.0 0.6 2.1 3.9 0.8 $0.03 39.3% $0.2 billion CAGR billion Television Newspaper Out-of-home Magazine Radio Online Online Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Magnaglobal; CCB; APEC; PTIK; Nielsen; IDC; Statistics Indonesia; H2; Indikator TIK 2010; BCG analysis. Note: Percentages may not total 100 due to rounding. | T . T O
  • 35. Indonesia’s Consumers Benefit from the Internet $46 General search Annual value What do consumers value? $364 $43 $459 Consumer surplus E-mail Perceived value $36 $94 Cost Online banking and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 89 78 78 76 75 73 52 34 34 Alcohol Chocolate Shower Satellite Coffee Fast food Exercise Car Sex navigationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Magnaglobal; CCB; APEC; PTIK; Nielsen; IDC; Statistics Indonesia; H2;Indikator TIK 2010; BCG analysis.Note: Due to rounding, perceived value does not total consumer surplus plus cost.The Internet’s Impact on Small and Medium Enterprises (SMEs) in Indonesia SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage)1 jobs during the last three years 1 employment 95 High-Web 87 16 69 ium-Web Medium-Web 14 57 97 Low-Web and No-Web 7 SMEs’ percentage of GDP High- Medium- Low-Web and Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 76 79 75 65 60 56 64 63 10 7 3 7 22 16 0 0 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimizationSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Magnaglobal; CCB; APEC; PTIK; Nielsen; IDC; Statistics Indonesia; H2;Indikator TIK 2010; BCG analysis.1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Webbusinesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. T B C G | 
  • 36. Italy’s Internet Economy Comparison of Internet economy with traditional industry sectors (percentage of GDP) Real estate GDP contribution and business services ($billions) Government spending 2016 7 Manufacturing Wholesale and retail trade Public administration and defense 2010 14 Health and social work Construction 7 Financial services TOTAL 14 Investment 83 Education 70 Travel and tourism TOTAL 43 31 Consumption Restaurants Agriculture --9 Net exports --9 Utilities Logistics Percentage of GDP Communications Italy Italy Mining 2.1 3.5 4.1 5.3 2.1 G-20 G-20 Internet Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Italian National Institute of Statistics (Istat); Politecnico di Milano (Polimi); Confindustria; Forrester Research; company reports; Assinform; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in Italy $50 Research online, $20 billion purchase offline billion (8.0%) 2010 (3.4%) $1,499 $48 per 2016 billion online Online retail 2010 user (8.4% of total retail) Total retail Percentage of total advertising expenditures in 2010 2016 56.1 13.3 26.6 11.3 10.1 3.9 5.4 $3.8 $1.3 20.8% billion billion CAGR Television Newspaper Magazine Radio Out-of-home Online Online Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Italian National Institute of Statistics (Istat); Politecnico di Milano (Polimi); Confindustria; Forrester Research; company reports; Assinform; BCG analysis. Note: Percentages may not total 100 due to rounding. | T . T O
  • 37. Japan’s Internet Economy Comparison of Internet economy with traditional industry sectors (percentage of GDP) GDP contribution 2016 36 Public and personal services ($billions) Manufacturing 2010 32 Government spending 88 Real estate and business services Wholesale and retail trade, hotels, and restaurants 80 TOTAL Public administration 372 TOTAL Investment 271 Logistics and communications 258 163 Construction Consumption Finance and insurance Net exports Electricity, gas, and water --16 --23 Percentage of GDP Agriculture Japan Japan Mining 4.7 5.6 4.1 5.3 4.7 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Japanese government; IDC; FCR; Nomura Research Institute; Nielson; Japan External Trade Organization ( JETRO); Dentsu; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in Japan $158 $89 billion Research online, (6.8%) purchase offline billion 2010 (4.3%) $1,387 $139 per Online 2010 2016 billion online user retail (6.7% of total retail) Total retail Percentage of total advertising expenditures in 2010 50.4 2016 13.8 21.6 26.3 8.1 4.1 $7.0 3.7% $8.7 2.0 billion CAGR billion Television Newspaper Out-of-home Magazine Radio Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Japanese government; IDC; FCR; Nomura Research Institute; Nielson; Japan External Trade Organization ( JETRO); Dentsu; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 38. Japan’s Consumers Benefit from the Internet $148 Annual value What do E-mail consumers $679 value? Consumer $142 surplus General search $1,446 Perceived value $767 $104 Cost Online banking and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 86 86 85 74 70 60 56 44 17 Satellite Chocolate Fast food Coffee Alcohol Exercise Sex Car Shower navigation Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Japanese government; IDC; FCR; Nomura Research Institute; Nielson; Japan External Trade Organization ( JETRO); Dentsu; BCG analysis. The Internet’s Impact on Small and Medium Enterprises (SMEs) in Japan SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage)1 jobs during the last three years 1 employment 94 –3 High-Web 73 –4 Medium-Web 54 20 57 –10 Low-Web and No-Web SMEs’ percentage of private-sector turnover High- Medium- Low-Web and Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 57 88 56 68 12 9 56 7 51 31 7 19 28 2 2 17 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimization Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Japanese government; IDC; FCR; Nomura Research Institute; Nielson; Japan External Trade Organization ( JETRO); Dentsu; BCG analysis. 1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Web businesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. | T . T O
  • 39. Mexico’s Internet Economy 2016 Comparison of Internet economy with traditional industry sectors (percentage of GDP) 2 GDP contribution Manufacturing ($billions) 18 Hotels and restaurants Government 2010 spending TOTAL Financial services, insurance, real estate, and business services 0 24 61 Mining 9 Investment Construction TOTAL 26 9 Consumption Logistics and communications 18 7 Net exports Public and personal services Agriculture, forestry, and fishing Percentage of GDP Mexico Mexico Electricity, gas, and water 2.5 4.2 4.1 5.3 2.5 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Banco de México; INEGI; company reports; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in Mexico $10 Research online, billion purchase offline $2 (1.6%) 2010 billion (0.3%) $706 $27 per Online 2010 2016 billion online user retail (5.8% of total retail) Total retail Percentage of total advertising expenditures in 2010 74.6 2016 6.7 4.0 3.1 5.6 2.6 9.1 $0.1 14.9% $0.2 billion CAGR billion Television Radio Out-of-home Newspaper Magazine Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Banco de México; INEGI; company reports; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 40. Russia’s Internet Economy 2016 3 Comparison of Internet economy with traditional industry sectors (percentage of GDP) GDP contribution Wholesale and retail trade ($billions) 21 Processing Real estate Government spending Mining 2010 TOTAL 75 Logistics and communications Public administration 2 63 Construction 12 Investment Financial services TOTAL Energy, gas, and water 27 18 Consumption Agriculture Net exports Health care --5 --12 Education Percentage of GDP Hotels and restaurants Russia Russia Fishing 1.9 2.8 4.1 5.3 1.9 G-20 G-20 Internet Sources: Economist Intelligence Unit (EIU); Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Central Control Directorate (GKU); ITU; Datamonitor; HSE; InSales; IDC; TNS; company reports; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in Russia $43 Research online, billion purchase offline $12 (3.2%) 2010 billion (1.7%) $670 $33 per Online 2016 billion online user retail 2010 (4.8% of total retail) Total retail Percentage of total advertising expenditures in 2010 53.8 2016 9.2 10.8 19.0 13.3 8.6 4.2 28.1% $4.0 $0.9 billion billion CAGR Television Out-of-home Newspaper Magazine Radio Online Online Sources: Economist Intelligence Unit (EIU); Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Central Control Directorate (GKU); ITU; Datamonitor; HSE; InSales; IDC; TNS; company reports; BCG analysis. Note: Percentages may not total 100 due to rounding. | T . T O
  • 41. Russia’s Consumers Benefit from the Internet What do $138 General search consumers Annual value value? $102 $1,002 Social networking $1,197 Consumer Perceived surplus value $89 $196 News Cost Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 88 85 80 76 70 50 36 15 14 Fast food Satellite Alcohol Chocolate Coffee Exercise Car Sex Shower navigationSources: Economist Intelligence Unit (EIU); Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Central Control Directorate (GKU); ITU; Datamonitor; HSE; InSales; IDC; TNS; company reports; BCG analysis.Note: Due to rounding, perceived value does not total consumer surplus plus cost. T B C G | 
  • 42. Saudi Arabia’s Internet Economy Comparison of Internet economy with 2016 traditional industry sectors (percentage of GDP) GDP contribution 4 Mining ($billions) Public administration 7 Nonoil manufacturing Government spending Wholesale trade and restaurants 2010 TOTAL 29 Construction Financial services and real estate 2 21 Financial services nondwellings 5 Investment Logistics and communications TOTAL 10 5 Consumption Oil manufacturing Agriculture, forestry, and fishing –2 Net exports --4 Social services Percentage of GDP Electricity, gas, and water Saudi Saudi Arabia Mining and quarrying (nonoil) Arabia 2.2 3.8 4.1 5.3 2.2 G-20 G-20 Internet Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); CCB; Saudi Arabia Central Department of Statistics and Information; Arab Advisors Group; Pyramid Research; IEMR; company reports; World Bank; BCG analysis. Note: Some columns may not add up to total contributions due to rounding. The Internet’s Impact on Commerce in Saudi Arabia $15 Research online, billion purchase offline $3 (8.0%) 2010 billion (2.9%) $424 Online retail $5 per 2016 billion online user 2010 (4.7% of total retail) Total retail Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); CCB; Saudi Arabia Central Department of Statistics and Information; Arab Advisors Group; Pyramid Research; IEMR; company reports; World Bank; BCG analysis. | T . T O
  • 43. South Africa’s Internet Economy Comparison of Internet economy with traditional industry sectors (percentage GDP contribution 2016 of GDP) Financial services, real ($billions) 2 estate, and business services Manufacturing Government 2010 1 spending 6 TOTAL Public administration Wholesale and retail trade, hotels, and restaurants 14 Logistics and communication 4 Investment 9 Personal services TOTAL 7 4 Consumption Mining Construction Net exports --3 --2 Agriculture, forestry, and fishing Percentage of GDP South Electricity, gas, and water South Africa Africa 1.9 2.5 4.1 5.3 1.9 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Statistics South Africa; IEMR; Pyramid Research; World Wide Worx; company reports; World Bank; World Trade Organization; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in South Africa $4 Research online, billion purchase offline $2 (1.5%) 2010 billion (1.2%) $339 $2 per Online 2016 billion online user retail 2010 (1.2% of total retail) Total retail Percentage of total advertising expenditures in 2010 45.6 2016 23.2 5.8 3.9 8.0 9.0 12.5 $0.2 24.2% $0.6 billion CAGR billion Television Newspaper Radio Magazine Out-of-home Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Statistics South Africa; IEMR; Pyramid Research; World Wide Worx; company reports; World Bank; World Trade Organization; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 44. South Africa’s Consumers Benefit from the Internet What do $222 consumers E-mail Annual value value? $211 General search $1,215 $1,615 Consumer Perceived surplus value $211 Online banking $400 and investing Cost Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 81 80 77 74 63 49 22 13 10 Satellite Fast food Alcohol Chocolate Coffee Exercise Sex Shower Car navigation Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Statistics South Africa; IEMR; Pyramid Research; World Wide Worx; company reports; World Bank; World Trade Organization; BCG analysis. | T . T O
  • 45. South Korea’s Internet Economy Comparison of Internet economy with traditional industry sectors (percentage GDP contribution 2016 9 of GDP) Manufacturing ($billions) Public and personal services 16 2010 6 Government spending Real estate and business services Wholesale and retail trade, hotels, and restaurants 13 Investment 58 TOTAL Finance and insurance 114 Construction TOTAL 75 35 Consumption Public administration Logistics Net exports 31 20 Agriculture Percentage of GDP Electricity, gas, and water South South Mining Korea Korea 7.3 8.0 7.3 4.1 5.3 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Korea National Statistics Office; IE Market Research; Bank of Korea; Korea Internet Security Agency (KISA); company reports; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in South Korea $39 Research online, billion purchase offline $23 (8.1%) 2010 billion (6.6%) $1,099 $44 per billion online Online 2016 user retail 2010 (13.0% of total retail) Total retail Percentage of total advertising expenditures in 2010 2016 41.5 26.0 27.0 17.9 6.9 5.4 15.2% $3.1 2.2 $1.3 CAGR billion billion Television Newspaper Out-of-home Magazine Radio Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Korea National Statistics Office; IE Market Research; Bank of Korea; Korea Internet Security Agency (KISA); company reports; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 46. South Korea’s Consumers Benefit from the Internet $96 General search Annual value What do consumers $453 value? $87 Consumer $824 surplus E-mail Perceived value $372 $74 Cost Online banking and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 84 83 74 70 69 50 43 41 25 Chocolate Fast food Satellite Coffee Alcohol Exercise Car Sex Shower navigation Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Korea National Statistics Office; IE Market Research; Bank of Korea; Korea Internet Security Agency (KISA); company reports; BCG analysis. Note: Due to rounding, perceived value does not total consumer surplus plus cost. The Internet’s Impact on Small and Medium Enterprises (SMEs) in South Korea SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage) 1 jobs during the last three years 1 employment 94 91 High-Web 6 70 dium-Web Medium-Web 13 51 88 Low-Web and –5 No-Web SMEs’ percentage of High- Medium- Low-Web and gross industrial output Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 18 70 78 75 17 48 49 6 49 43 62 27 1 4 2 0 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimization Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Korea National Statistics Office; IE Market Research; Bank of Korea; Korea Internet Security Agency (KISA); company reports; BCG analysis. 1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Web businesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. | T . T O
  • 47. Turkey’s Internet Economy 2016 2 Comparison of Internet economy with traditional industry sectors (percentage of GDP) GDP contribution Manufacturing ($billions) 10 Logistics Government Ownership and dwellings spending 2010 TOTAL Wholesale and retail Agriculture and fishing 1 31 Real estate 23 Public administration 4 Investment Construction TOTAL Financial services 12 8 Consumption Education Hotels and restaurants --1 Net exports --4 Electricity, gas, and water Percentage of GDP Health care and social work Turkey Turkey Mining 1.7 2.3 4.1 5.3 1.7 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Turkish Statistical Institute; Turkish Telecommunication Authority; World Economic Forum; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in Turkey $9 Research online, billion purchase offline $2 (1.1%) 2010 billion (0.6%) $1,212 $37 per Online 2016 billion online user retail 2010 (8.5% of total retail) Total retail Percentage of total advertising expenditures in 2010 2016 17.8 52.2 22.0 13.0 $0.9 7.7 2.4 billion 17.9% 2.7 CAGR $0.3 billion Television Newspaper Out-of-home Radio Magazine Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; Turkish Statistical Institute; Turkish Telecommunication Authority; World Economic Forum; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 48. Turkey’s Consumers Benefit from the Internet $68 General search Annual value What do consumers value? $323 $67 $540 Consumer surplus E-mail Perceived value $61 $217 Cost Online banking and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 82 74 71 66 65 59 32 23 19 Satellite Alcohol Fast food Chocolate Coffee Exercise Car Sex Shower navigation Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Turkish Statistical Institute; Turkish Telecommunication Authority; World Economic Forum; BCG analysis. The Internet’s Impact on Small and Medium Enterprises (SMEs) in Turkey SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage) 1 jobs during the last three years 1 employment 95 88 High-Web 17 78 dium-Web Medium-Web 10 66 78 Low-Web and –5 No-Web SMEs’ percentage of High- Medium- Low-Web and private-sector turnover Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 76 57 55 59 11 67 50 15 6 40 7 11 42 30 25 1 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimization Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; Turkish Statistical Institute; Turkish Telecommunication Authority; World Economic Forum; BCG analysis. 1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Web businesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. | T . T O
  • 49. The U.K. Internet Economy 2016 Comparison of Internet economy with traditional industry sectors (percentage of GDP) 26 Real estate and 47 business services GDP contribution ($billions) Government Wholesale and retail spending Manufacturing 2010 26 Financial services Health care and social work TOTAL 257 347 Construction 36 Investment Education TOTAL 187 Public administration Consumption Logistics 120 Utilities 18 Hotels and restaurants Net exports 4 Communications Percentage of GDP Mining U.K. U.K. Agriculture 8.3 12.4 8.3 4.1 5.3 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Eurostat; Organisation for Economic Co-operation and Development(OECD); Magnaglobal; CCB; U.K. Office for National Statistics (ONS); H2; IMRG; IDC; GfK; IE Market Research; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in the U.K. $230 Research online, billion purchase offline $102 (23.0%) 2010 billion (13.5%) $1,641 $87 per 2016 billion online Online user retail 2010 (11.5% of total retail) Total retail Percentage of total advertising expenditures in 2010 2016 37.3 29.1 23.3 28.9 8.0 7.6 $8.4 $5.4 7.7% billion billion CAGR 3.0 Television Newspaper Magazine Out-of-home Radio Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Eurostat; Organisation for Economic Co-operation and Development(OECD); Magnaglobal; CCB; U.K. Office for National Statistics (ONS); H2; IMRG; IDC; GfK; IE Market Research; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 50. U.K. Consumers Benefit from the Internet $407 Annual value What do E-mail consumers value? $3,372 $377 General search $3,753 Consumer surplus Perceived value $359 $381 Online banking Cost and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 91 84 78 76 65 47 25 21 17 Fast food Satellite Chocolate Coffee Alcohol Exercise Sex Car Shower navigation Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Eurostat; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; U.K. Office for National Statistics (ONS); H2; IMRG; IDC; GfK; IE Market Research; BCG analysis. The Internet’s Impact on Small and Medium Enterprises (SMEs) in the U.K. SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage) 1 jobs during the last three years 1 employment 85 High-Web 75 12 ium-Web Medium-Web 7 51 49 59 Low-Web and No-Web 4 SMEs’ percentage of High- Medium- Low-Web and private-sector turnover Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 53 80 23 22 78 42 9 50 9 40 39 20 10 3 3 28 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimization Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Eurostat; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; U.K. Office for National Statistics (ONS); H2; IMRG; IDC; GfK; IE Market Research; BCG analysis. 1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Web businesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. | T . T O
  • 51. The U.S. Internet Economy Comparison of Internet economy with traditional industry sectors (percentage of GDP) GDP contribution 2016 Public administration Real estate ($billions) 129 Manufacturing 2010 Government spending 289 Wholesale and retail trade Finance and insurance 128 Health care Professional, scientific TOTAL Information and technical services 236 Investment 1,000 TOTAL Construction 684 596 Logistics Waste management 330 Consumption Accomodation and food services Mining Utilities --11 Net exports --15 Business services Education Percentage of GDP Agriculture U.S. Arts, entertainment, and recreation U.S. 4.7 5.4 5.3 4.7 4.1 G-20 G-20 InternetSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; U.S. Bureau of Labor Statistics; U.S. Small Business Administration; PC; Forrester Research; H2; Fitch; World Economic Forum; BCGanalysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in the U.S. $252 $456 Research online, billion billion purchase offline (5.0%) (7.1%) 2010 $1,926 $482 per billion online Online 2010 2016 user retail (9.6 % of total retail) Total retail Percentage of total advertising expenditures in 2010 2016 40.3 25.6 15.9 18.2 10.9 4.3 10.5 10.5% $47 $26 CAGR billion billion Television Newspaper Magazine Radio Out-of-home Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; U.S. Bureau of Labor Statistics; U.S. Small Business Administration; PC; Forrester Research; H2; Fitch; World Economic Forum; BCGanalysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 52. U.S. Consumers Benefit from the Internet $321 General search Annual value What do consumers value? $2,528 $318 $3,000 Consumer surplus E-mail Perceived value $291 $472 Online banking Cost and investing Percentage of people willing to give up a key lifestyle habit instead of the Internet for a year 84 83 77 73 69 43 21 10 7 Satellite Fast food Chocolate Alcohol Coffee Exercise Sex Car Shower navigation Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; U.S. Bureau of Labor Statistics; U.S. Small Business Administration; PC; Forrester Research; H2; Fitch; World Economic Forum; BCG analysis. The Internet’s Impact on Small and Medium Enterprises (SMEs) in the U.S. SMEs’ percentage of Historical three-year sales growth Percentage of SMEs that added private-sector of SMEs (percentage) 1 jobs during the last three years 1 employment 24 High-Web 10 18 ium-Web Medium-Web 8 13 45 48 Low-Web and –5 No-Web SMEs’ percentage of High- Medium- Low-Web and private-sector turnover Web Web No-Web Intensity of Web usage (percentage of SMEs using the Internet for a business activity) High-Web Low-Web 100 100 100 100 46 74 63 10 52 3 39 6 12 33 49 6 42 5 27 1 Website Online Search Blogging Social E-commerce Recruitment Finance Paying E-procurement advertising engine networking suppliers optimization Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; U.S. Bureau of Labor Statistics; U.S. Small Business Administration; PC; Forrester Research; H2; Fitch; World Economic Forum; BCG analysis. 1 High-Web companies use a wide range of Internet tools to market, sell, and support customers, interact with suppliers, and empower employees; medium-Web businesses market or sell goods or services online; low-Web businesses have a website or a social-networking site; no-Web businesses do not have a website. | T . T O
  • 53. The Internet Economy in the EU-27 Top ten national contributions to 2016 Internet GDP (percentage of the Internet GDP of the EU-27) 121 U.K. 30.0 GDP contribution ($billions) 223 Government Germany 16.1 2010 spending France 11.8 98 TOTAL 171 1,133 Italy 7.1 Investment 810 TOTAL Netherlands 5.7 619 385 Consumption Spain 5.7 --34 Net exports --22 Sweden 5.0 Percentage of GDP 3.0 Denmark EU-27 EU-27 5.7 Poland 2.4 3.8 4.1 5.3 Belgium 2.0 G-20 G-20Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; BCG analysis.Note: Some columns may not add up to total contributions due to rounding.The Internet’s Impact on Commerce in the EU-27 Top ten national contributions to online retail (percentage of total online retail for the EU-27) $650 $289 billion U.K. 35.1 billion (10.8%) Germany 13.3 (5.7%) France 9.3 Sweden 6.8 Italy 6.7 Spain 5.1 Online retail 2010 2016 Netherlands 5.0 Denmark 4.0 Total Finland 2.4 retail Ireland 2.3 Percentage of total advertising expenditures in 2010 2016 33.3 23.9 27.1 19.1 11.5 6.8 $34 5.4 $20 9.2% billion billion CAGR Television Newspaper Magazine Out-of-home Radio Online OnlineSources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD);Magnaglobal; CCB; BCG analysis.Note: Percentages may not total 100 due to rounding. T B C G | 
  • 54. BCG’s e-Intensity Index Highlights Internet Prowess Across the EU-27 Economies Denmark Sweden U.K. Netherlands Finland Luxembourg Germany France Belgium Austria Ireland Spain Slovenia Czech Republic Estonia Portugal Poland Italy Hungary Greece Natives Players Nascent Laggards natives Slovakia 0 50 100 150 200 BCG e-Intensity score Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; BCG analysis. Note: The index is scaled so that the geometric mean is 100 for the 34 OECD member countries. The scores of several countries were derived due to lack of complete data. The categories of Internet intensity--nascent natives, natives, players, and laggards--are illustrated in Exhibit 3 of this report. Graph excludes Bulgaria, Cyprus, Latvia, Lithuania, Malta, and Romania. How the EU-27 Economies Stack Up on the Components of BCG’s e-Intensity Index Natives Players Nascent Laggards natives Enablement Expenditure Engagement (a measure of Internet (a measure of spending in online (a measure of Internet involvement infrastructure) retail and online advertising) by businesses, the governments, and consumers) Sweden Denmark U.K. Denmark U.K. Netherlands Luxembourg Sweden Denmark Netherlands Netherlands Sweden Finland Germany Germany U.K. Finland Finland Germany France Austria Austria Czech Republic Ireland France Luxembourg Estonia Belgium Poland France Ireland Belgium Spain Portugal Hungary Belgium Spain Slovenia Luxembourg Slovenia Spain Slovenia Estonia Ireland Czech Republic Italy Austria Hungary Czech Republic Italy Portugal Greece Slovakia Poland Slovakia Portugal Greece Hungary Estonia Slovakia Poland Greece Italy 0 50 100 150 200 0 100 300 0 50 100 150 BCG e-Intensity score Sources: Economist Intelligence Unit; Ovum; Gartner; Euromonitor International; Organisation for Economic Co-operation and Development (OECD); Magnaglobal; CCB; BCG analysis. Note: The indices were scaled so that the geometric mean is 100 for the 34 OECD members. The scores of several countries were derived due to lack of complete data. Graph excludes Bulgaria, Cyprus, Latvia, Lithuania, Malta, and Romania. | T . T O
  • 55. NOTE TO THE READERAbout the Authors Suruj Dutta, Ana Carolina Freire, Hay- James O’DayDavid Dean is a senior partner and wood Ho, Chip Horne, Tom Hussey, Project Leadermanaging director in the Munich of- Taantee Karmakar, Joe Lee, Brandon Londonfice of The Boston Consulting Group. Miller, Matt Pan, Lisa Robinson, Christ- +44 207 753 5353Sebastian DiGrande is a partner and offer Rutgersson, Stevenlie Satryapu-managing director in the firm’s San tra, and Marta Szczerba for their assis- o’day.james@bcg.comFrancisco office. Dominic Field is a tance.partner and managing director in John PinedaBCG’s Los Angeles office. Andreas The authors would like to thank PrincipalLundmark is a principal in the firm’s David Duffy and Mark Voorhees for San FranciscoStockholm office. James O’Day is a their help in writing this report andproject leader in BCG’s London office. +1 415 732 8000 Angela DiBattista, Gary Callahan, KimJohn Pineda is a principal in the Friedman, Angela Goldberg, Sara pineda.john@bcg.comfirm’s San Francisco office. Paul Zwil- Strassenreiter, and Mary DeVience forlenberg is a partner and managing di- contributions to its editing, design, Paul Zwillenbergrector in BCG’s London office. and production. Partner and Managing Director LondonAcknowledgments For Further Contact +44 207 753 5353This report is a product of BCG’s Tech- If you would like to discuss this report,nology, Media & Telecommunications please contact one of the authors. zwillenberg.paul@bcg.compractice. David Dean For Further ReadingThe authors are indebted to multiple The Boston Consulting Group publishes Senior Partner and Managing Director extensively on topics related to marketingBCG partners and colleagues for theircontributions and insights during the Munich in the digital economy. Recent examples +49 89 2317 4150 include those listed here:preparation of this report: Marcos Agu-iar (Sao Paulo), Jorge Becerra (Santia- dean.david@bcg.com Digital Manifestogo), Jeffery Bernstein (Tokyo), Julio A Focus by The Boston Consulting Group,Bezerra (Sao Paulo), Vladislav Bouten- Sebastian DiGrande January 2012ko (Moscow), Ethan Choi (Seoul), Ola- Partner and Managing Directorvo Cunha (Sao Paulo), Tenbite Ermias Turning Local( Johannesburg), Yucel Ersoz (Istan- San Francisco A Focus by The Boston Consulting Group,bul), Philip Evans (Boston), Patrick +1 415 732 8000 September 2011Forth (Sydney), Tawfik Hammoud (To- digrande.sebastian@bcg.comronto), Susumu Hattori (Tokyo), Joerg The Connected KingdomHildebrandt (Dubai), Nimisha Jain Dominic Field A report by The Boston Consulting Group,(New Delhi), Carl Kalapesi (London), October 2010David Michael (Beijing), Vaishali Ras- Partner and Managing Directortogi (Singapore), David Rhodes (Lon- Los Angelesdon), Hermann Riedl (Abu Dhabi), +1 213 621 2772Ryoji Kimura (Tokyo), Henri Salha field.dominic@bcg.com(Paris), Kanchan Samtani (Mumbai),Just Schuermann (Munich), Shigeki Andreas LundmarkIchii (Tokyo), Marc Vos (Milan), SarahWillersdorf (New York), Yukimasa PrincipalUchida (Tokyo), and Yvonne Zhou Stockholm(Beijing). +46 8 402 4400 lundmark.andreas@bcg.comThey are also grateful to Gaby Barrios,Patrick Böert, Jonathan Colclough, T B C G | 
  • 56. © The Boston Consulting Group, Inc. 2012. All rights reserved.For information or permission to reprint, please contact BCG at:E-mail: bcg-info@bcg.comFax: +1 617 850 3901, attention BCG/PermissionsMail: BCG/Permissions The Boston Consulting Group, Inc. One Beacon Street Boston, MA 02108 USATo find the latest BCG content and register to receive e-alerts on this topic or others, please visit bcgperspectives.com.Follow bcg.perspectives on Facebook and Twitter.3/12 T B C G | C
  • 57. Abu Dhabi Chicago Kiev New Delhi StockholmAmsterdam Cologne Kuala Lumpur New Jersey StuttgartAthens Copenhagen Lisbon New York SydneyAtlanta Dallas London Oslo TaipeiAuckland Detroit Los Angeles Paris Tel AvivBangkok Dubai Madrid Perth TokyoBarcelona Düsseldorf Melbourne Philadelphia TorontoBeijing Frankfurt Mexico City Prague ViennaBerlin Geneva Miami Rio de Janeiro WarsawBoston Hamburg Milan Rome WashingtonBrussels Helsinki Minneapolis San Francisco ZurichBudapest Hong Kong Monterrey SantiagoBuenos Aires Houston Moscow São PauloCanberra Istanbul Mumbai SeoulCasablanca Jakarta Munich ShanghaiChennai Johannesburg Nagoya Singapore bcg.com