4 Industries Entrepreneurs Should Keep An Eye On
Leading U.S. industry research publisher IBIS World recently unveiled a study that identified the best industries for 2012. The IBISWorld report, which is based on expert analysts covering 700 different market segments, lists the top 11 industries based on projected revenue growth and forecast enterprise growth over five years, 2011 profit margins, low barrier to entry and capital required to start a business. Here's a quick guide on the industries you should keep an eye on in the coming years.
Ecommerce and online auctions
During 2011 ecommerce web sites recorded a 6.8% profit margin, and the report suggests that annual revenue will grow at 9.6% over the coming 5 years. More importantly, it suggested that niche startups have the best chance for success.
Regionally, commerce has been the most common business activity on the web. Local residents spend $1.1B a year online, a figure that bill double by 2016. Big companies like MarkaVIP and Souq have inspired countless other entrepreneurs to start e-retail and flash sales sites tackling niche territories including fashion, electronics, and airline tickets. More recently, ARMS Group launched Pioneer Auctions, the first online auction website in the region.
Social network game development
Projected to grow at an astounding 24.4% annually over the next 5 years in terms of revenue, online gaming has been the hottest trend regionally right next to ecommerce. The local markets have attracted several regional players, namely from Turkey, lured in by a healthy appetite for online gaming, local development talent, and a surge in social network penetration and mobile internet. Happy Farm, a farmville type game published by Peak Games has amassed 6.3 million MAU so far. Ultras on the other hand, the first social game that originates from the Middle East, is aiming to hit a similar number within the few coming months.
Internet publishing and broadcasting
Low barriers to entry and little labor input required have propelled this industry to profit margins of 17% in 2011, and it’s projected to have the third largest annual revenue growth at 9.9% up til 2016. The local scene is made up prominently of traditional newspapers gone online and pure-click tech/biz news and entertainement sites. Of the latter Zawya has been featured heavily in the news lately with an eminent sale estimated to generate around $40M.
Online survey software
High capital requirements may alienate investors, an average profit margin of 60% however should encourage local companies to invest in them. E-commerce players in particular should consider survey software as it provides a cheaper alternative to traditional market research firms the study notes. "(...) firms have utilized the services of online survey software companies as a low-cost way to engage their existing and potential customers at a fraction of the cost.”