Case Study: The Fortune At The Bottom Of The Pyramid

One of the first usages of this term dates back to 1932 when the U.S. President Franklin D. Roosevelt was speaking about “The forgotten man at the bottom of the economic pyramid”. However, the concept of The Fortune at the Bottom of the Pyramid originally appeared in form of an article written by C. K. Prahalad and Stuart L. Hart in 2004. The article deliberated about new business models targeted at providing goods and services to the poorest of the world.
According to the World Resources Institute and the International Finance Corporation (IFC) study in 2007, BoP has about $5 trillion purchasing power parity around the world. It is thus evident that a large untapped market exists which is presently served by the inefficient and local monopoly

Marketplace (as income necessary for consumption) and education were acknowledged critical for the framework. Education is necessary not only for getting job, but to make informed decisions in other areas like how health education can improve food choices. In the e-Choupal example, it’s a means of providing employment as well as a place to get information and computer training. Figure 1: An integrated framework for BoP marketing
The ignoring of such a potential market by the established global firms can very translate into missed opportunity or threat due to other competitor’s entry in the long run. In 2009, Prof. C. K. Prahalad cited example of wireless industry. He stated that around four billion people around the world will be connected through wireless devices by 2010. India alone had around 10 million new subscribers per month in 2008 and early 2009. Rate of adoption of cell phone is just the start of the process of BoP-led growth and innovation.
Firms must understand this market and focus on the 4As of marketing illustrated as follows.
(i) Creating awareness of products and services to BoP consumers that are available in the market and how to use

(ii) Get access to rural markets at low cost.
(iii) Reduce costs of goods and services to make them affordable to BoP consumers.
(iv) Logistics challenges.

Case of the innovation sandbox (biomass stove for very poor in rural India)
Traditionally, rural women had to spend more than two hours per day to collect sticks, shrub, grass, cow dung and other biomass materials to use as fuel. This biomass produced acrid smoke which is health hazard not only for mothers but also for their kids. Now what is the solution to this problem?
Detailed and in-depth study was done to understand consumer’s need with the help of video-ethnography to know entire process from collecting biomass to delivering a finished meal. This was done with many families in different parts of the country. Content analysis and clustering of the results helped in designing and developing the project.
Constraints in developing innovation sandbox are as follows.
1. To build a modern, smokeless, easy-to-use stove.
2. To meet global safety standards.
3. Business must be scalable.
4. It must be affordable. (Rs 1000 say