Bottom of pyramid strategies in the Indian context

Abstract

Many MNC’s and Indian companies are now targeting the bottom of the pyramid for marketing their goods and services. The western models of serving the poor rely primarily on reducing the cost of the goods and increasing buying power of the consumers. These models however are not suitable for an Indian environment because and profile of an Indian poor differs from that of a western poor. An Indian poor typically operates on a daily wage bases, he has a significant cash constraint and there is no social security. That is why different models are applicable to the Indian Scenario. For example as opposed to the Walmart model of selling on huge quantities the MNC’s like HLL and P&G are focusing on smaller SKU’s, which are affordable to the poor. Even though there is an attempt to serve the bottom of the pyramid, the approach adopted is narrow-minded as it often neglects aspects as infrastructure, tailoring product itself to the local needs and providing integrated solutions for a problem that will upgrade the customer. There is a need to find out what factors that determine a successful attempt at serving bottom of pyramid. Bottom of the pyramid is a very important market, and most of the organizations are making a dash for it, however this needs to be done with help of business models that have been contextualized to the Indian environment. This is what this study aims to explore.