Moving beyond Facebook: Future trends for advertisers in Myanmar

When you’re in Myanmar you’ll hear the phrase “Facebook IS the internet” a lot. And you’ll see and experience it too. It really is used for everything online: searching, shopping, sharing. Meanwhile Messenger is often the first point of call for any consumer wanting to engage with a brand or business.

But a few recent developments should make us ask whether this will continue.

How Facebook became Myanmar’s internet

Until very recently, you would rarely see businesses advertise a website on their print or billboard marketing. Similarly, I have also had personal experiences where big-brand clients couldn’t see the value in creating the simplest website to provide basic info to potential customers.

Instead, if a business was going to have and advertise an owned* digital space at all, it would only be a Facebook page (* okay, it’s not really an owned media space, but close enough…).

(Equally, paid media spend would be focused on acquiring vanity metrics of Page Likes and post likes. But getting beyond these to more useful paid media metrics is a topic worthy of a later post…)

So how did Facebook become the internet?

Of course, the usability and social hooks of Facebook was one factor. However, a few other things have contributed:

  • a scarcity of Myanmar-based web agencies, developers and Myanmar-language website services to build an online ecosystem
  • a lack of credit cards for payment of website building services
  • Myanmar’s age demographics – past government policies led to a ‘youth bulge’, with 30% of the population aged 15-34.
  • Facebook’s support for Zawgyi – the naughty non-standard font that shouldn’t really exist, but does, with most people using it
  • Facebook being pre-packaged on phones…
  • …  and access being offered free, without data charges
  • A lack of IT infrastructure within organisations.
    (Seriously. Facebook and Messenger have filled the void left by internal server setups and paid-for cloud storage. They are used heavily for internal work comms and file sharing. This has led to a professional culture of Facebook usage (file management and version control be damned), which has reinforced its uptake amongst the general public.)

The state today? Ask someone to search for something and they won’t open Google or another search engine, they’ll open Facebook and search, search, search within it.

Why Facebook may start losing its grip

Although this state of play is looking strong for Facebook, soon it will stop being synonymous with the internet.

More and more Myanmar web service companies are launching, offering web design and other services

Increasing numbers of companies are appearing in Yangon, some with venture backing. And all of these are going to help increase digital literacy and expand the online ecosystem.

Myanmar’s youth demographic is shrinking

The following image from the United Nations Population Division shows the diminishing numbers of young people. See that bulge in the 15-34 year-old bracket? The decrease in the birth rate in recent years means that, proportionally, the percentage of Myanmar citizens in this age group is going to shrink.

And as more brands look to grow in Myanmar, competition for the decreasing number of youth eyeballs is going to increase.

The introduction of credit cards, for within-Myanmar use

The recent announcement that credit cards will now be able to be issued and used within Myanmar is going to kickstart the digital economy. We’ve written about this over here.

Facebook saturation

Whilst its growth has been phenomenal – 50% of Myanmar Facebook users have joined in the last 6 months – Facebook is going to experience a serious slowdown in new users, especially as we reach almost 90% internet and smartphone penetration.

And together with that will come…

Social network fatigue

At the moment Facebook engagement rates on content are very, very high (compared with, say, the UK) but as the networking experience matures and grows old, this will drop.

Other platforms are looking at Myanmar and licking their lips

Viber may have 260 million monthly active users, with 18 million in Myanmar alone. And if it’s to be belied, Vietnam’s Zalo platform has just announced 2 million users in only 4 months of operation in the country.

Facebook is reducing the Messenger experience with new ads

Just this week Facebook announced that it is testing new ad locations within Messenger’s UI. And not just discrete ads, but walloping great big cards that sit below your Favourites and your list of friends Active Now.

Although these are great for brands and advertisers, it’s one more negative chip in the Facebook & Messenger experience.

What this means for brands and advertisers

Start looking now for new ways to advertise and reach consumers online

As new Myanmar websites proliferate, search engines will gain traction. Google Search Ads, CPC, are important to start considering now.

Pay attention to and exploit Facebook’s new ad spots before others do

Facebook is trailing the new Messenger ads in Australia and Thailand, and with the typical high usage patterns in Myanmar, we can assume it will be a rolled out here too.

(Excitingly, Facebook has also recently announced mid-video ad spots too, with ads appearing in videos longer than 90 seconds.)

Get more creative

Static, branded images aren’t going to cut it any more. They’re feeling tired and Myanmar’s Facebook is looking cluttered with brand imagery.

Look to GIFs, video and other content types as quickly as you can to distinguish yourself and combat fatigue.

What do you think will happen in the next 6 months in Myanmar? Let us know in the comments!

 

 

Have online payments just got one step closer for Myanmar’s digital startups?

Fantastic news this month for Myanmar’s startups and entrepreneurs: The Central Bank of Myanmar has finally removed restrictions on the use of domestically issued Visa cards.

But what does this mean for startups?

Until recently, domestically issued cards couldn’t be used for purchases within the country. This meant that anyone who held a card could only use it to make payments overseas, or through overseas-based online platforms. (On top of this, if you were using one of the pre-paid cards, you often faced the situation of reaching a checkout page only to find that a pre-paid card wouldn’t be accepted, and all your previous form-filling efforts were for naught.)

In a country where internet access has gone from 2 million to an estimated 39 million in just 3 years, over half of Facebook’s Myanmar 15+million users joined in the last 6 months, and mobile phone penetration has equally zipped up from 6% to a (possibly disputed) 90% since 2012, this was a major problem for startups looking at generating online revenue.

Non card-based payment channels for Myanmar digital startups

As a solution, for revenue many online startups relied on cash-in-hand payments, such as handing cash to delivery drivers or payments made in person direct to business representatives (esp. in the case B2B businesses).

Some (including myself) have also experimented with revenue models that rely on transferring phone credit – a complicated scenario when factoring in the three (soon to be four) different, incompatible operators. Others still have relied on printing their own scratch card vouchers which are stocked by local partners and redeemed online or by phone (actually, this can be quite a good solution when you consider the low cost of printing, low financial literacy and the cash based economy).

These recently announced changes herald a new era where online payments are increasingly possible and revenue at last flows directly from individual customers to startups via online payment gateways.

Slow or fast? The adoption of a digital economy in Myanmar

However, it’s not the answer to the startup entrepreneur’s prayers just yet: we must accept that true change will take time.

Like others, I’ve been excited to see the appearance of ATMs around Yangon in the past year, but the card-carrying culture is not yet established. The country still only has an estimated 1,500 ATMS for a population of 54million. That’s 1 ATM for every 36,000 people. Meanwhile neighbouring Vietnam has a much healthier ratio of 1 ATM for every 5,200 people.

On top of this, cash is in Myanmar is something special. Of course physical currency everywhere is something tangible and known, however within Myanmar it is also associated with mighty levels of distrust, trust and authenticity.

The Myanmar Kyat – emerging from a turbulent history

Myanmar’s Kyat has gone through two horrendous currency demonetisations in recent years – the 1987 demonetisation of a range of notes without warning or compensation made 75% of the currency worthless overnight. The Kyat does not feel inherently stable.

Additionally, as Myanmar returns to the world stage, Myanmar people are eager to help restore the previously-hobbled country to the powerful economic status it once enjoyed and deserves.

Could these be push factors that encourage an explosion in card uptake and which fuel a growth in Myanmar’s digital economy, to mirror that of smartphones and internet penetration?

And yet, and yet… go into any Myanmar bank today and you will see people withdrawing bricks upon bricks of notes. And, where they are collecting US dollars, still inspecting each and every note with a close eye, ready to reject them upon detecting the slightest blemish. This is despite these notes being handed to them by the bank itself, and in blatant rejection of recent decrees that it is no longer acceptable to refuse blemished dollars.

With so much energy and scrutiny going into the printed currency, can we imagine that Myanmar’s people will so readily embrace the opaque world of cards and digital transactions?

So, how should startups view the opportunities in Myanmar’s digital economy?

We must lean to the optimistic; online card payments are the future, but will be just one amongst multiple payment mechanisms.

The case for card payments:

Despite the Kyat’s turbulent history, and despite the physical comfort of cash-in-hand, there is an internal, undeniable drive to restore Myanmar to the world stage that is remarkable in its pressure. This will quickly overcome caution and reticence about cards and card payments.

Plus, significant numbers of Myanmar’s digital startup entrepreneurs have experience working or studying overseas, and are looking to opportunities in their country of birth. Returning to Myanmar, integrating online payment gateways into their platforms is a normal practice to them, and these digital entrepreneurs will help drive a wider uptake of cards and online transactions.

So startups that begin building for and strategizing for online payments now will be in pole-position as card uptake soars. Those that don’t will be quickly left behind.

Support card payment with other payment channels

However, to succeed into the immediate future, startups should a) provide Myanmar’s citizens as much support and transparency as possible to encourage online card payments; and importantly b) remember to still invest in other payment channels.

ATM rollout – and therefore card uptake – isn’t going to be instantaneous in a country the size, geography and economy of Myanmar. Meanwhile, competition between the Telcos is going to become increasingly fierce and in an attempt to solidify their market shares it is only a matter of time handling fees are cut and deals are struck that allow transfers of credit between different operators. Such moves will advance mobile payments in a significant way.

In short: The future looks good. Startups should build strategies and channels for accepting card payments in Myanmar now, but also recognise that payments via phone credit is going to increasingly become another viable channel. Both must be explored and accounted for.

What do you think about Visa’s announcement, and about how to handle online payments in Myanmar? Let us know in the comments!