Why Economic Growth in 2020 Actually Matters to Every Marketer in T&T and Guyana?
86% real GDP growth. 1.9% real GDP growth.
Guyana and Trinidad and Tobago (T&T): Two countries reported in the IMF's latest projections are positioned to be experiencing turning tides. And for two very different reasons.
2020 is a time of change.
T&T, a matured economy built on a foundation of oil and gas and entering a political year for national elections, will be looking to jump start its economy with favourable oil prices and promised diversification of industries.
In 2019, T&T had a year of moderate growth, mainly against the background of an uncertain international environment and energy, and economic development factors. One example of growth was in the local construction sector, where, at 2.9%, public-sector projects for 2019 was the biggest driver.
Guyana, a relatively small economy by international standards, is now invigorated by the new discoveries of deep offshore Oil and Gas reserves. A 2019 projection of 4.6% grew to an 86% projection. For an economy heavily dependent on gold and bauxite, among others, the introduction of oil and gas to the mix is quite a boost.
So if 2019 was considered moderate, would 2020 be a year of greater opportunities for marketers in both Trinidad and Tobago and Guyana?
With similar cultures, albeit at different stages of maturity, marketing strategies which have yielded success in Trinidad and Tobago can be applied to Guyana.
Major opportunities for marketers in the evolving space include a growing middle class and advancement in new technologies. These opportunities influence a variety of industries in both countries, from energy and construction to tourism and creative industries.
But you'll need to take into account some major differences before jumping in or engineering any new strategy. In this article, we'll set the stage by exploring these differences followed by sharing those opportunities we envision you can leverage in 2020 within your marketing strategies.
Varying Levels of Consumerism
T&T is an already-established state with complex levels of consumerism. This complexity ranges multiple industries built by online and offline spending habits. Our local society is already able to sustain unpredictable levels of spending - spending which fluctuates month-to-month or year-to-year with changing economic performances.
For a country with a large middle class, the expectation of an increased income will positively affect spending. An improving economy instils buyers with more confidence on the back of projected increases in income.
Guyana, with relatively low experience in unpredictable growth, is in a position to dictate their own economic and consumer path. Their impending level of consumerism is still unknown for their level of inexperience. As such, marketers will need to test the market with a level of trepidation.
Economic maturity is globally understood as a state economy with a stable population and slowing economic growth.
Our Trinbagonian society's spending power is already matched by our level of infrastructure and our spending habits.
Yet, one area that provides a major challenge in an economically mature society is our ability to diversify. Local industries like tourism and the creative sector, while considered a natural resource and cultural staple, are not yet effectively optimized. Tourism and cultural spending remains seasonal and continues to provide a challenge for our population’s local and regional growth.
Guyana's economy is at a new beginning. Their focus is about leveling up. The need to develop new infrastructure to match the potential oil and gas exploration and its after-effects must be carefully planned. This staged planning can create new opportunities for new markets, especially the indirect markets created from an energy sector boom. Think commodity products and human services for a growing population.
It's clear where Guyana's focus should be. With oil and gas, they need to harness this new resource to create and generate sustainable wealth for their population. Although multiple products and services will come from the energy boom (products like upholstery, rubbing alcohol, life jackets, lipstick, etc.), their success will depend on how effectively they can initially exploit and leverage these resources.
For T&T, the rebound within the oil and gas sector, the development of new infrastructure and government support growth and diversification, can lead to a slow and steady increase in spending. This spending allows improvements in public sector projects. And that's according to a recent First Citizens' Report on the economy for 2020.
Add to that a tax reform for the agricultural and creative industries, and you can clearly see the government’s intent to grow spending power and to support farmers and creatives.
“The Minister of Finance indicated his intention to incentivize the industry further by removing all taxes and duties on all inputs and resources for farmers that are registered for agricultural purposes.”
- Focus on Trinidad and Tobago Budget 2020, EY Report.
This statement alone is a positive sign for marketers who are hesitating to enter the agricultural market, as marketers formulate a key resource for players in the agriculture industry.
These 3 major differences impact how you, as a marketing strategist, analyze and manage expectations for 2020.
It takes data-driven marketing, understanding the environment and the culture for any market. This is something we take seriously and tell our clients for every project.
So what key opportunities exist in a mature local and an emerging Guyanese market for you in 2020?
- Location-based Marketing Strategy
Locally, an increased minimum wage, solidified on December 1st, 2019, moving from $15 TTD to $17.50 TTD, will enable more spending power to the lower and middle class.
But given the new projects outlined by the government, location-based marketing becomes relevant to capture new market segments.
With the reboot of oil and gas and construction in certain parts of T&T, these locations bring new opportunity.
2 major locations come to mind.
Both located in south Trinidad, expect the creation of direct and indirect jobs in the area. An estimate of the impact to the La Brea Dry Dock Project, for example, will attract 3,500 direct and 5,700 indirect jobs.
The opportunity to use location-based online marketing for products and services help you drive your brand in the areas previously under-served.
In Guyana, it’s a playground. Or should we say - it’s about to be. It’s like the Pizza Hut Playpark you take your kids, nephews or nieces - an active, vibrant but young environment. You don’t know what is really going to happen. Yet, there are opportunities in this wild west to explore, especially by targeting new products to their specifically inhabited locations.
- A Growing Middle-Class Opportunity
Economic growth affects the middle class - the largest consumer base for any population. This increased middle class develops into a marketplace hungry for new products and services.
In Trinidad and Tobago, the diversification of industries, the rebound of oil and gas and the tax incentives allowed to creative and agricultural industries and businesses allow marketers to take advantage of a new market for motivated sellers and buyers.
For example, a focus on building strategies for agri-companies to attract consumers who are willing to spend a little more for healthier and locally-produced food options can reap significant dividends, especially when riding the wave of low to non-existent taxes and sensitive market buyers.
- New Technological Advancements and Skilled Human Resources
And we're not just talking about oil and gas technology. We're talking about huge leaps in computer software and infrastructure.
With this computer software and infrastructure comes technology and marketing experts. A deeply talented and highly-skilled pool of human resources in these areas can help set up both economies to last the next 10 years.
Consider Singapore as a prime example for sustainable real GDP growth. Their insistence on creating an inclusive and open environment for new entrants allow skilled workers to easily adapt and integrate despite cultural differences. Their growing standard of living and improved infrastructure helped draw technological experts from around the world.
For both T&T and Guyana, this tech investment and advancement not only provides a direct opportunity for you to sell your tech-based products or services, but it allows access to experts and tools never accessed before.
So what can you do to capitalize on these two markets occupying difference landscapes?
Leverage Proactive Thinking and Knowledge of Culture.
We mentioned the similarity of culture between Trinidad and Tobago and Guyana. Use this to your advantage. What do we mean by that?
If you understand how the economy and consumer will grow (and you’ve been reading this article) then you can position your product or brand ahead of the curve. Preheat the oven well-before you put in the Christmas ham.
In Trinidad and Tobago, knowing where the government is positioning themselves gives you the opportunity to test the market in your location. Start by using low-cost advertising strategies and sound feasibility studies in the area.
The same can be done for Guyana. Their 2020 year of exponential growth, while volatile, can be a great place to sift out low-cost strategies to test the market. Focus on understanding consumer reaction to marketing strategies and general consumer behaviour. Keep in mind that Guyana's population is only 750,000 people, a fraction of Trinidad and Tobago's. So, keep in mind how you measure success for testing.
Incorporate Feedback Loops into your Testing Strategy.
Being proactive is one thing. But making sure you get accurate feedback is another. Gather intel on product tests and responses in the best way possible
Where does your product rank in specific locations within Trinidad and Tobago versus your competitors? Where can it rank in this emerging Guyanese market?
Using feedback from market testing can create massive upside for brand awareness and product sales insight.
Take Gillette's razor foray into the emerging Indian Market. Gillette tested the market using product feedback and on the ground marketing strategies to uncover how their product fit. They surveyed 1000 Indian men about their shaving habits for over 3000 hours.
So don't be afraid to get dirty in the process.
With both economies moving in a positive direction, it’s safe to say that marketers will play a significant role in discovering and impacting new trends. Products can be better tailored to match the needs of new and growing markets.
Manage expectations in 2020. It's not only a year for growth but measured testing and understanding of market changes and consumer expectations.