Hong Kong(CNN) Apple launched a web-based retailer in Vietnam this week, in one other nod to the rising significance of rising markets for the iPhone maker.

The opening on Thursday, which adopted the high-profile launch of its first physical shops in India, means customers within the fast-growing Southeast Asian economic system will be capable of purchase any Apple product straight for the primary time.

Markets like Vietnam, India and Indonesia have gotten extra essential for Apple as its progress in developed markets, together with China, slows down, prompting the corporate to concentrate on locations the place it is historically been much less energetic.

For many years, China was central to Apple’s extraordinary ascent to develop into the most valuable company on Earth, serving as a spine for each its manufacturing and consumption. While the nation stays key to Apple’s operations, the tech big is now hedging its bets.

Apple (AAPL) CEO Tim Cook has pointed to the corporate’s prospects in rising economies, calling them brilliant spots within the firm’s monetary outcomes. On an earnings name this month, Cook mentioned he was “particularly pleased” with the efficiency in these markets through the first three months of the yr.

Apple “achieved all-time records in Mexico, Indonesia, the Philippines, Saudi Arabia, Turkey and the UAE, as well as a number of March quarter records, including in Brazil, Malaysia and India,” he informed analysts.

That got here because the California-based big additionally reported its second straight drop in overall quarterly revenue, prompting considerations a couple of broader slowdown in demand amid financial uncertainty.

“Clearly, growth has slowed globally and thus put more pressure [on Apple] to aggressively go after emerging markets,” mentioned Daniel Ives, managing director of Wedbush Securities.

A ‘mega-market’

Ives predicts that “over the coming years, Indonesia, Malaysia and India will comprise a bigger piece of the pie for Apple, given its efforts in these countries.”

The begin of on-line gross sales in a rustic normally precedes the launch of brick-and-mortar shops for Apple, he informed CNN. This was true of India, as an illustration, which bought its first physical outlets final month and a pledge from Cook to further invest within the nation.

Thursday’s launch confirmed how Apple was “further cementing” its presence in rising markets, in response to Chiew Le Xuan, a analysis analyst who covers smartphones in Southeast Asia for Canalys.

He mentioned the tech big had been “actively increasing” its presence within the area in latest months, ramping up its distribution and community of licensed resellers, particularly in Malaysia.

Apple has ample room to run in these markets.

Currently, the corporate solely operates its personal shops in additional developed regional economies, corresponding to Thailand and Singapore, in response to Canalys.

Even Indonesia, an unlimited archipelago that’s the world’s sixth-biggest smartphone market, does not have a bodily Apple retailer but, mentioned Chiew. Apple’s market share there may be tiny, at simply 1% in 2022, in response to Canalys information.

“We’re putting efforts in a number of these markets and really see, particularly given our low share and the dynamics of the demographics … a great opportunity for us,” Cook mentioned throughout Apple’s outcomes name.

Apple joins a rising listing of world companies which have develop into bullish on Southeast Asia, the place extra funding is being poured into manufacturing.

The area’s client base additionally holds promise, with the variety of middle-income and prosperous households in economies corresponding to Vietnam, Indonesia, and the Philippines projected to develop by round 5% yearly by 2030, according to the Boston Consulting Group.

The consultancy has called this group of customers “the next mega-market.”

The attract of Southeast Asia’s rising center class “has changed the dynamic in these countries, which previously Apple stayed away from,” in response to Ives.

“This is a golden opportunity for Apple,” he mentioned.

Challenges stay

For years, premium manufacturers like Apple have have struggled to compete in rising markets due to the value of their merchandise, selecting as a substitute to depend on native resellers.

iPhones, which value between $470 and $1,100, are costly for customers in much less developed Southeast Asian economies, the place the majority of smartphone shipments are priced underneath $200, in response to Chiew.

He mentioned Apple’s absence from locations like Cambodia or Vietnam was sometimes extra obvious across the launch of a brand new iPhone, as consumers from these nations typically flew to Singapore or Malaysia to buy units and take them again for resale.

This might change within the coming years, significantly as Apple continues to extend its firepower within the area.

Ives predicted that Apple might “further expand its ecosystem and tentacles to emerging markets using its China playbook,” that means it might attempt to hook prospects by “various pricing strategies and building out from there.”

Once these customers have transformed to Apple’s working system, iOS, they have an inclination to stay round and develop into loyal prospects, he added.

This has “been the core part of its success in China that now can be replicated in India, Indonesia, and Vietnam, among others,” mentioned Ives.

But Apple might face hurdles in Southeast Asia, the place a number of nations have positioned stringent necessities on international companies, in response to Chiew.

For instance, at the very least 35% of the parts of digital items offered in Indonesia should made regionally, a threshold Apple has needed to meet by working with companions, he added. Similar guidelines prevented Apple from organising store in India for years till the relief of rules in 2019.

And whereas customers have gotten extra prosperous, the corporate’s value factors are nonetheless thought of excessive in lots of rising markets, famous Ives. “Growth will be choppy we believe.”