A presentation on the 'Bottom of the Pyramid'.
This was done for our International Business Environment course. Inspiration from RIM's visual strategies and the constant struggle between bullet points vs wall of text.
2. “ The real source of market promise is not the wealthy few in the
developing world, or even the merging middle-income consumers;
It is the billions of aspiring poor who are joining the
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market economy for the first time.
C.K. Prahalad
10. “ The term was coined by the management guru to describe the
Poor and the underserved section of the market. The BOP market in India is about
$1.205 trillion, in PPP terms, makes up 84.8% of the total $1.42 trillion
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National household market. ”
C.K. Prahalad
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BOP
8
COSMPOLITON MIDDLE AND UPPER INCOME
DEVELOPING ELITESTOP$20,00080 MILLION
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BOP
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POOR CUSTOMERS RISING MIDDLE CLASS
DEVELOPING DEVELOPINGMIDDLE$15,0001600 MILLION
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4000 MILLION
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BOP
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HALF OF THE WORLD
LEAST DEVELOPED DEVELOPING$3,000
BOTTOM
AGGREGATE POWER OF $5 TRILLION
27. CHARECTERIZATION
YOteaLmOR
22
SIGNIFICANT UNMET DEMANDS
MAJORITY BANK ACCOUNT ACCESS TO FINANCIAL SERVICES
MANYLIVE WITHOUT ACCESS TO SANITATION ELECTRICITY
28. CHARECTERIZATION
YOteaLmOR
23
DEPENDENCE ON INFORMAL LIVELIHOOD
SUBSISTENCE LACK ACCESS TO PROPER MARKET
EXPLOITED ON MIDDLEMEN VULNERABLE TO WEATHER
29. CHARECTERIZATION
YOteaLmOR
24
PROBLEMS OF BEING IN A BOP
PAYS MORE THAN WEALTHEIR NATIONS LOW QUALITY
LOAN SHARKS EXUBERENT INTERESTS
30. CHARACTERIZATION
YOteaLmOR
25
DEMOGRAPHIC OF AN AVERAGE BOP
LITTLE OR NO EDUCATION PREDOMINANTLY RURAL
70% WORKING IN THE INFORMAL SECTOR
31. S UNTAPPED 4000 MILLION
W
RESILIENCE
FAST TECHNOLOGCAIL ADAPTATION
SWOT ANALYSIS
UNFAVORABLE COST STRUCTURE
VERY HIGH MARKET PENETRATION REQUIRED
32. S UNTAPPED 4000 MILLION
W
FAST TECHNOLOGCAIL ADAPTATION
UNFAVORABLE COST STRUCTURE
VERY HIGH MARKET PENETRATION REQUIRED
26
RESILIENCE
33. O DEMAND FOR BASIC NEEDS
T
LACKS LOW COST, GOOD QUALITY ACCESIBLE GOODS
POLITICAL INSTABILITY
ENVIRONMENTAL HAZARDS
27
HIGH PURCHASING POWER
CULTURAL DISSENTION
34. ASIA
CHARACTERIZATION
MARKET SIZE
2.86 BILLION PEOPLE $3470 BILLION AGGREGATE INCOME
83% OF POPULATION
42% OF AGGREGATE PURCHASING POWER
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35. LATIN AMERICA
CHARACTERIZATION
MARKET SIZE
360 MILLION PEOPLE $509 BILLION AGGREGATE INCOME
78% OF POPULATION
28% OF AGGREGATE PURCHASING POWER
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36. AFRICA
CHARACTERIZATION
MARKET SIZE
486 MILLION PEOPLE $429 BILLION AGGREGATE INCOME
95% OF POPULATION
71% OF AGGREGATE PURCHASING POWER
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37. 2%
CHARACTERIZATIONWHERE DOES THE INCOME GO?
4%
IN BILLION USD
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4%
8%
11%
WATER ICT
FOOD
HEALTH
TRANSPORATION
HOUSING
ENERGY
38. CHARACTERIZATIONHOW DO BOP HOUSEHOLDS SPEND
USD PER YEAR
AFRICA ASIA EASTERN EUROPE LATIN AMERICA
ICT 34 54 56 107
HEALTH CARE 154 131 152 325
TRANSPORATATION 211 211141 521
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FOOD 2087 2643 3687 3050
39. CHARACTERIZATIONTHE BOP PENALTY
WEALTHIER MARKETS HAVE 7 TIMES
MORE ACCESS TO PIPED WATER
24% OF BOPLACK ELECTRICITY
HIGHER COST OR LOWER QUALITY TRAP
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BOTTOM HEAVY BOP AND RURAL AREAS LOW ICT AND PHONE ONWERSHIP
41. “ In an informal suburb of Guadalajra, Mexico, a growing family is
struggling to expand their small house. Help arrives from a major industrial
Company in the form of construction designs, credit, enabling rapid completion
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of the project at less overall cost ”
SCENARIO 1
42. “ In Maddhya Pradesh, an Indian farmer gains access to soil testing
Services, to market price trends that help him decide what to grow and when to sell,
And to higher prices for his crop than he can obtain in
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”
the local auction market.
SCENARIO 2
43. “ In a small community outside Tianjin, China, a small merchant
Whose children have been repeatedly sickened by drinking water from a heavily -
Polluted river is distraught. He finds help not from the local government but from
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A new, low-cost filtering system developed by an
”
entrepreneurial company.
SCENARIO 3
44. YtOeamLOR
SECTOR MARKET
HEALTHCARE INDUSTRY
34
$183 A YEAR UGANDA
HALF IS SPENT ON SELF MEDICATION
OVERLOOK
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SECTOR MARKET
35
ASIA
HEALTHCARE INDUSTRY
SPENDING
2.9 BILLION
AFRICA 486 MILLION
L.A. 360 MILLION
E.E. 254 MILLION
46. HEALTHCARE INDUSTRY
WHERE IS THE MARKET?
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SECTOR MARKET
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ASIA RURAL 2.4 TIMES LARGER THAN URBAN
AFRICA URBAN AND RURAL ROUGHLY SAME
L.A. URBAN IS 3.5 TIMES THE RURAL
E.E. URBAN IS 61% LARGER THAN RURAL
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SECTOR MARKET
37
MORE THAN
HEALTHCARE INDUSTRY
WHAT DO THEY BUY?
50% SPEND MONEY ON
PHARMACEUTICALS
48. YtOeamLOR
SECTOR MARKET
38
IT MAY SEEM OBVIOUS BUT THOSE IN BOP
JOIN THE GLOBAL ECONOMY
ICT INDUSTRY
OVERLOOK
CAN’T
UNLESS THEY ARE CONNECTED
49. YOLOR team
SECTOR MARKET
39
ASIA
SPENDING
2.9 BILLION
AFRICA 486 MILLION
L.A. 360 MILLION
E.E. 254 MILLION
ICT INDUSTRY
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SECTOR MARKET
40
LARGELY CENTERED
WHERE IS THE MARKET?
URBAN
ICT INDUSTRY
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SECTOR MARKET
41
PHONE
WHAT DO THEY BUY?
V COMPUTERS
AVERAGE PHONE $30 MSRP
PREPAID SERVICES
ICT INDUSTRY
52. SECTOR MARKET
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WATER INDUSTRY
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MORE THAN LACKS CLEAN WATER
POLLUTED WATER SOURCES
OVERLOOK
1 BILLION
URBAN WATER NETWORKS AGING
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SECTOR MARKET
43
ASIA
SPENDING
2.9 BILLION
AFRICA 486 MILLION
L.A. 360 MILLION
E.E. 254 MILLION
WATER INDUSTRY
54. WATER INDUSTRY
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SECTOR MARKET
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AFRICA VARIED FROM COUNTRY TO COUNTRY
ASIA URBAN SPENDING DRIVES MARKET
E.E. MAJORITY URBAN REGION
WHERE IS THE MARKET?
L.A. MAJORITY URBAN REGION
55. YtOeamLOR
SECTOR MARKET
ENERGY INDUSTRY
OVERLOOK
45
LACK OF AFFORADABLE ENERGY
HARMFUL FUELS USED IN COOKING
POLLUTION
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SECTOR MARKET
46
ASIA
SPENDING
2.9 BILLION
AFRICA 486 MILLION
L.A. 360 MILLION
E.E. 254 MILLION
ENERGY INDUSTRY
57. ENERGY INDUSTRY
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SECTOR MARKET
47
ON AN AVERAGE
WHERE IS THE MARKET?
RURAL BOP USES 45% LESS ENERGY THAN URBAN
58. HALF
YtOeamLOR
SECTOR MARKET
FOOD INDUSTRY
OVERLOOK
48
MORE THAN OF BOP BUDGET
% SPENDING ON FOOD DECREASES
AS INCOME RISES
59. YOLOR team
SECTOR MARKET
49
ASIA
SPENDING
2.9 BILLION
AFRICA 486 MILLION
L.A. 360 MILLION
E.E. 254 MILLION
FOOD INDUSTRY
60. FOOD INDUSTRY
WHERE IS THE MARKET?
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SECTOR MARKET
50
AFRICA RURAL 1.6 TIMES LARGER THAN URBAN
ASIA RURAL MARKET IS 2.5 TIMES THE URBAN
L.A. URBAN IS 2.4 TIMES THE RURAL
E.E. PREDOMINANTLY URBAN
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SECTOR MARKET
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NECESSITIES
WHAT DO THEY BUY?
NOT ENSURING NUTRITION
FOCUSED MORE ON LOCAL SUSTENANCE
FOOD INDUSTRY
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STRATEGIES
52
FOCUSING ON THE BOP UNIQUE PRODUCTS AND SERVICES
OFTEN REQUIRE REIMAGINING OF ORGANIZATIONAL RESOUCES
GENERIC
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STRATEGIES
53
LOCALIZING VALUE CREATION THROUGH FRANCHISING
TREATING COMMUNITY AS A CUSTOMER
GENERIC
USUALLY INVOLVE SUBSTANTIAL INVESTMENT
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STRATEGIES
54
ENABLING ACCESS TO GOODS AND SERVICES
FINANCING
GENERIC
PREPAID
PACKAGING INNOVATIONS
72. CAPITALIZING THE BOP
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STRATEGIES
60
INCREASING BUYING POWER
MICROCREDIT
MOBILE BANKING
VENTURE CAPITALS
JOINT VENTURE
73. CAPITALIZING THE BOP
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STRATEGIES
61
IMPROVE ACCESS
INFRASTRUCTURAL DEVELOPMENT
COMMUNICATION LINKS
COUNTRY COLLABORATIONS
74. SHAPE ASPIRATIONS
- INCLUSIVE GROWTHPRODUCTS
- SUSTAINABLE DEVELOPMENT
- VALUE CREATION
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STRATEGIES
62
TAILOR LOCAL SOLUTIONS
- MARKET SPECIFIC PRODUCTS
- CO CREATION
- BRANDING
- INNOVATION
INCREASE BUYING POWER
- MICROCREDIT
- MOBILE BANKING
- VENTURE CAPITALS
- JOINT VENTURE
IMPROVE ACCESS
- INFRASTRUCTRUAL DEVELOPMENT
- COMMUNICATION LINKS
- COUNTRY COLLABORATION
- PUBLIC PRIVATE PARTNERSHIP
80. DIGITIZATION
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STRATEGIES
67
UNLOCK UNTAPPED MARKET CURRENTLY LEGACY MODEL
CAN’T SERVE THE BOP ALSO FACE HIGH TRANSACTIONAL COST
NOT BEING ABLE TO ACCESS REMOTE LOCATIONS