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Fortune at The Bottom of The Pyramid: or How To Make Profit by Iradicating Poverty

The document discusses the concept of the "fortune at the bottom of the pyramid", which refers to the large untapped market potential among the billions of poor people around the world. It outlines the size and income levels of different segments in the global financial pyramid. The bottom of the pyramid presents opportunities for profitable business models that can provide goods and services to the poor in ways that are affordable and suitable to their needs. Examples are given of companies innovating products and distribution methods to successfully serve bottom of the pyramid markets.

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Abhkn krishna
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37 views

Fortune at The Bottom of The Pyramid: or How To Make Profit by Iradicating Poverty

The document discusses the concept of the "fortune at the bottom of the pyramid", which refers to the large untapped market potential among the billions of poor people around the world. It outlines the size and income levels of different segments in the global financial pyramid. The bottom of the pyramid presents opportunities for profitable business models that can provide goods and services to the poor in ways that are affordable and suitable to their needs. Examples are given of companies innovating products and distribution methods to successfully serve bottom of the pyramid markets.

Uploaded by

Abhkn krishna
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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FORTUNE AT THE BOTTOM

OF THE PYRAMID
OR HOW TO MAKE PROFIT BY IRADICATING POVERTY
INTRODUCTION
• The following presentation is about how the few people in the top
of the financial pyramid make use of the people in the bottom of
the pyramid which is quadruple in their size, to make profit and
also helps in raising standard of living of poor.
Without any further ado let’s take a look at so called fortune.
WHAT IS THIS PYRAMID (FINANCIAL PYRAMID)?
In the previously depicted diagram we can see;
• The top of the pyramid consists of the rich people, who earns a
total of more than 20,000$ p.a. Numbering in 70-100 millions
• In the middel, earning more than 1500$ p.a. and less than
20,000$, the middle class people reign with a total number of
1500-1750 millions.
• At the bottom, we can see the poor people who makes the most
number i.e. 4000 millions. Who earns lesser than 1500$ p.a. i.e.
Approximately 2-4$ per day.
FORTUNE AT THE BOTTOM OF THE PYRAMID
• The concept of The Fortune at the Bottom of the Pyramid originally appeared
as an article by C. K. Prahalad and Stuart L. Hart in the business
journal Strategy+Business.
• The article was followed by a book with the same title that discusses new
business models targeted at providing goods and services to the poorest
people in the world.
• It makes a case for the fastest growing new markets and entrepreneurial
opportunities being found among the billions of poor people 'at the bottom of
the [financial] pyramid’.
• It makes a case for the fastest growing new markets and entrepreneurial
opportunities being found among the billions of poor people 'at the bottom of
the [financial] pyramid'.
PRINCIPLES OF B.O.P (BOTTOM OF THE PYRAMID)
• Focus on price performance.
• Hybrid solutions, blending old and new technology.
• Scaleable and transportable operations across countries, cultures and languages.
• Reduced resource intensity: eco-friendly products.
• Radical product redesign from the beginning: marginal changes to existing Western products will not
work.
• Build logistical and manufacturing infrastructure.
• Deskill (services) work.
• Educate (semiliterate) customers in product usage.
• Products must work in hostile environments: noise, dust, unsanitary conditions, abuse, electric
blackouts, water pollution.
• Adaptable user interface to heterogeneous consumer bases.
• Distribution methods should be designed to reach both highly dispersed rural markets and highly dense
urban markets.
• Focus on broad architecture, enabling quick and easy incorporation of new features.
OPPORTUNITIES IN BOTTOM OF PYRAMID
The consumers in Bottom of the pyramid suffers from
• Lack of access to competitively and efficiently provided goods and services
• Higher price for most of the goods and services
• Poor quality goods and services
At the same time they are;
• Brand concious
• Well connected community
• Ready to accept advanced technology
• Collectuvely have purchasing power
• Always trying to upgrade their way of living
4 KEYS TO UNLOCK B.O.P MARKETS TO MNCS
EXAMPLES OF B.O.P MARKETS

• Microcredit :One example of "bottom of the pyramid" is the growing microcredit market in
South Asia, particularly in Bangladesh. With technology being steadily cheaper and more
ubiquitous, it is becoming economically efficient to "lend tiny amounts of money to people
with even tinier assets".
• Market-specific products : One of many examples of products that are designed with needs
of the very poor in mind is that of a shampoo that works best with cold water and is sold in
small packets to reduce barriers of upfront costs for the poor.
• Innovation :BOP consumers are using PC kiosks, Mobile phone, Mobile banking etc. which
significantly influence the adoption of an innovation in the Bottom of pyramid market
• Brand :BOP market is brand conscious. For instance, brand influences the new product adoption in the
bottom of pyramid market. brand may positively influence the relative advantage of an innovation and
it leads to adoption of innovation in the BOP.
• Business and community partnership :As Fortune reported on November 15, 2006, since 2005 the SC
Johnson Companyhas been partnering with youth groups in the Kibera slum of Nairobi Kenya. Together
SC Johnson and the groups have created a community-based waste management and cleaning
company, providing home-cleaning, insect treatment, and waste disposal services for residents of the
slum.
CONCLUSION
Therefore we can conclude at the fact that;
• BOP is simply the poor people in the society who seeks better technology and lifestyle and they’re
being taken advantage by the MNCs
• There are opportunities in the bottom of the pyramid which helps MNCs to establish business.
• There’s more scope in BOP market.

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