Bottom of the Pyramid
The quest for the fortune at the bottom of the pyramid: potential and challenges
Dennis A. Pitta
The University of Baltimore, Baltimore, Maryland, USA, and
Rodrigo Guesalaga and Pablo Marshall
´
Pontificia Universidad Catolica de Chile, Santiago, Chile
Abstract
Purpose – The purpose of this article is to examine the bottom of the pyramid (BOP) proposition, where private companies can both be profitable and help alleviate poverty by attending low-income consumers.
Design/methodology/approach – The literature on BOP was reviewed and some key elements of the BOP approach were proposed and examined.
Findings – There is no agreement in the literature about the potential benefits of the BOP approach for both private companies and low-income consumers. However, further research on characterizing the BOP segment and finding the appropriate business model for attending the BOP can provide some answers to this issue.
Practical implications – The article provides some guidelines to managers as to how they need to adapt their marketing strategies to sell to the BOP market, and what type of partnerships they need to build in order to succeed.
Originality/value – The article presents a thorough analysis of the key elements involved in the BOP initiative: companies’ motivations, characterization of the BOP consumers, and the business model to attend the BOP.
Keywords Private sector organizations, Emerging markets, Consumers, Poverty, Disadvantaged groups
Paper type Research paper
underpin the concept, and refutes its basic premises. Instead of a market of untapped potential, this literature stream sees a financial desert that BOP principles may harm more than help. The BOP may be a less a source of significant profits than a source of serious losses. Karnani’s analysis posits that the poor may want the same products as the rich do but by virtue of being poor, they cannot afford them. The poor spend most of their income on food, clothing, and fuel. For
the
Dennis A. Pitta
The University of Baltimore, Baltimore, Maryland, USA, and
Rodrigo Guesalaga and Pablo Marshall
´
Pontificia Universidad Catolica de Chile, Santiago, Chile
Abstract
Purpose – The purpose of this article is to examine the bottom of the pyramid (BOP) proposition, where private companies can both be profitable and help alleviate poverty by attending low-income consumers.
Design/methodology/approach – The literature on BOP was reviewed and some key elements of the BOP approach were proposed and examined.
Findings – There is no agreement in the literature about the potential benefits of the BOP approach for both private companies and low-income consumers. However, further research on characterizing the BOP segment and finding the appropriate business model for attending the BOP can provide some answers to this issue.
Practical implications – The article provides some guidelines to managers as to how they need to adapt their marketing strategies to sell to the BOP market, and what type of partnerships they need to build in order to succeed.
Originality/value – The article presents a thorough analysis of the key elements involved in the BOP initiative: companies’ motivations, characterization of the BOP consumers, and the business model to attend the BOP.
Keywords Private sector organizations, Emerging markets, Consumers, Poverty, Disadvantaged groups
Paper type Research paper
underpin the concept, and refutes its basic premises. Instead of a market of untapped potential, this literature stream sees a financial desert that BOP principles may harm more than help. The BOP may be a less a source of significant profits than a source of serious losses. Karnani’s analysis posits that the poor may want the same products as the rich do but by virtue of being poor, they cannot afford them. The poor spend most of their income on food, clothing, and fuel. For
the
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