Youth Capability Ecosystems and Strategic Business Models: Leveraging Market Segmentation for Sustainable Development in Emerging Economies

Abstract

As businesses increasingly seek to align commercial strategies with development goals in emerging markets, understanding the complex youth capability landscape becomes crucial for sustainable growth and impact. This research examines how businesses can align commercial strategies with sustainable development goals by understanding youth capability ecosystems in emerging markets, focusing on Bangladesh as a representative case. Through a mixed-methods approach with advanced data science techniques, we analyzed survey data from 400 youth respondents in Dhaka to identify distinct market segments based on capability profiles. Our methodological triangulation applying K-Means clustering (silhouette score: 0.670), Hierarchical clustering (0.778), and DBSCAN (0.782) revealed four robust youth segments with unique development potentials: high potential entrepreneurs, digital workforce, traditional employment seekers, and skill development candidates. Network analysis identified digital proficiency as the most central capability (betweenness centrality: 0.58), demonstrating strong correlations with career confidence (0.93) and entrepreneurial intent (0.92). Business model suitability analysis quantified segment-specific alignment patterns, with entrepreneurship incubators showing exceptional alignment with high potential entrepreneurs (score approaching 1.0) and digital workforce platforms strongly aligning with the digital workforce segment (0.85). SDG alignment analysis revealed that High Potential Entrepreneurs demonstrate strongest alignment with SDG 9: industry, innovation and infrastructure (0.77), while digital workforce shows substantial alignment with SDG 8: decent work (0.69). These findings provide a robust framework for strategic youth engagement in emerging markets, enabling businesses to create shared value while contributing to sustainable development. The study advances both theoretical understanding of youth capability ecosystems and practical approaches to inclusive business models in emerging economies experiencing demographic transitions.