Marketing to the Bottom of the Pyramid: Text and Cases

Subsistence marketplaces or 'Bottom of the Pyramid' (BOP) markets consist of consumers who live at subsistence levels, especially in developing countries including Brazil, India, and Sub-Saharan Africa. Such markets are believed to be ecologically, economically, and socially sustainable in the long term. Since India has a large-sized bottom of the pyramid market, it makes sense to understand how marketing practices can be tailored using innovative approaches to serve the lowest strata of consumers in our society.

However, marketing to BOP consumers has its unique set of challenges. Low levels of literacy and education, high levels of ignorance, low purchasing power, and a constant struggle to make ends meet characterize such markets. According to experts, BOP markets consist of approximately three billion people with less than $2 income per day. But there are paradoxes to consider. For example, one of the world's poorest nations, Rwanda, has 92% of the nation covered under health insurance for the last 11 years, and premiums cost only about $2 a year. On the contrary, one of the world's richest nations, the United States has in comparison the most expensive healthcare system, and almost half its people are either uninsured or under-insured.

Given the context of subsistence marketplaces, many scholars have emphasized the need for development of the BOP markets in terms of creation of the capacity to consume, development of new goods and services, dignity and choice for the poor, and the importance of developing trust between buyer and seller. Several principles have been suggested including finding sustainable solutions, understanding functionality, innovating with process and deskilling work, educating low-literate consumers, designing for hostile infrastructure, and designing innovative distribution chains.