1. ( Eradication of poverty through profit )
Prepared by-
Shivam jain
Raghvendra bhadoria
Udita madan
2. More than $20,000
$ 1500~ $20,000
$ 1500~ $20,000
Less than $1,500
Less than $1,500
Tier 1
Tier2
Tier 3
Tier 4
Tier 5
75~100 million people
1,500~1750 million people
4,000 million people
3. o Total population is divided into 5 tiers.
o Teir 4& 5 is bop.
o Very less purchasing power.
o 400 million people in India
o billions of people living on less than $2 per day
o Unable to fulfil basic needs.
o Huge unseen opportunities
4. REGION BOP POPULATION
(MILLIONS)
BOP POPULATION
(SHARE OF TOTAL
OPULATION
BOP INCOME
(BILLION $)
BOP SHARE
OF TOTAL
MARKET
AFRICA 486 95% 429 70.5%
ASIA 2858 83% 3470 41.7%
EASTERN EUROPE 254 64% 458 36%
LATIN AMERICA 360 70% 509 28.2%
GLOBAL 4000 72% 5000
5. Only GOVERNMENT and NGO’S will serve the bop .
Poor cannot afford our products.
Managers in MNCs, public policy makers, suffers from
division roles.
Huge opportunity is hidden behind bop which will eradicate
poverty as well profit for MNC’S.
6. Poor cannot be a profitable consumer..
Product is our focus, not functionality.
We focus on product and process innovations and not business
innovations.
We do not see the bottom of the pyramid forcing us to innovate
around sustainable development.
Bop is illusion .
Bop needs can not be profitable,
Bop market cannot afford innovation.
High cost and very less profit.
7. Size
Rapid growth
Less competitive environment
Opportunities for cost-saving
Opportunities for innovation
8. Cash poor consumers
Geographic, economic, and cultural distance
Limited product awareness
Working with longer time frames
9. A philosophy for developing products & services for
the BOP
- small unit packages
- low margin per unit
- high volume
- high return on capital employed
-Optimum quantity
11. An illustration of the successful execution of this strategy comes from
Hindustan Lever Limited (HLL), a subsidiary of Unilever, widely
considered the best managed company in India. Like most MNCs, for over
50 years it catered to the needs of the elite of India- the top of the pyramid.
A local firm, Nirma, challenged HLL in its detergent business, by creating
a new business system - a new product formulation, new manufacturing
process, distribution, packaging, and pricing. HLL like most MNCs,
initially dismissed Nirma as a low end producer.
As Nirma grew rapidly, HLL realized both its new opportunity as well as
its vulnerability. Nirma was attacking, in its detergent business, from the
bottom of the pyramid.
12. HLL responded with its own offering for this market - drastically altering
the traditional HLL business model.
HLL created a new product formulation which dramatically reduced the
ratio of oil to water in the detergent, thereby reducing significantly the
pollution associated with washing cloths in rivers and other public water
systems.
They decentralized the production, marketing, and distribution of the
product to take advantage of the abundant labor pool in rural India and
quickly penetrate the thousands of small outlets where people at the bottom
of the pyramid shop.
They reinvented the cost structure of the business, enabling the
introduction of the product at a price point affordable to those at the bottom.
13. Bottom of the pyramid can not be ignored because it is an
huge opportunity .
Outdated assumptions are resulting false and peoples can
pay for innovation and quality products.
Proper product and services should be designed to provide
the maximum satisfaction to bop
Marketing managers have to create awareness about product
and services in these markets.
The product should be available and affordable for the
people.1
NGO‘S and GOVERNMENT is not only to serve bop and
business organizations can also fulfill their needs.
