As you might have noticed, we haven’t been very active with our blog recently. Not due to bad performance, but due to great performance in the past weeks. Things are changing very fast and the Iran hype won’t go away so soon. Internet penetration rate has risen by 29% (53% to 82%). Now that sanctions are removed, this trend will rise even much faster annually. The country’s GDP of 2014 stands at USD 425 billion, which is a USD 10 billion increase since 2013. The population has increased by 2 million, confirming Iran as an immigration country, mostly due to its social and economical stability compared to other countries in the middle-east. As a highly educated country, Iran will continue to confirm itself as the region’s powerhouse of educated people, with many of them going to the USA or other countries for a master’s degree, with many of them studying in the Ivy League (USA’s top 7 Universities).
The embargo removal has shown its positive impact within a single month following Implementation Day (16th January 2016), with hotel rooms being very hard to find for visitors within the next time. Business people have to calculate everything in early advance to visit the country and have meetings with potential business partners. Branding in Iran was not only an untouched market, but a place where “branding” meant imitating. The reason for this was that most international brands couldn’t do business in Iran and the effect was that people started disregarding copyrighting laws (because there really are none) The expertise in which Iranians became able to handle different kinds of computer software is unchallenged: When they all say they are not for sale in Iran, what happened was that IT enthusiasts started “cracking” them. You could literally buy the most expensive software for a couple of dollars, and they are not to blame.
In the past few years and especially now, brand awareness in Iran has finally seen some positive developments as well: New unique brands are created in Iran’s startup environment and the country is experiencing a digital boom: Digital marketing in Iran will soon be a force to be reckoned with, thanks to the rise of e-commerce growing from Tehran’s expensive real-estate, the high literacy rate, its creative people and the big need for digital advertising and communications for both domestic and international companies.
There are three important economical factors to be considered in this:
1. Iran is not only in the need of introducing international brands and companies to its economy. What is important is that it needs entire ecosystems for various products and services. Especially if it wants to elevate into a service-economy.
2. Copyrighting laws are poor and therefore this is a market that is very promising, now that international companies want to venture to Iran. In effect, this might mean that Iranians will have to pay much more since they need to buy licenses to use software. Though on the other hand, this will positively affect the economy in its entirety, which is a great thing from a macro-economical point of view.
3. From a micro-economical point of view, Iranian business leaders conducting business the old-fashioned way absolutely need to update themselves technologically if they want their business not get thrown out of the market and into bankruptcy by international competitors. In order to do so, they need better incentives, such as competition and brand awareness. Since if competition gets a boost, the economy will naturally become more healthy.
“A rising tide lifts all boats.”
John F. Kennedy