The next frontier in ICT for Development: Mobile Force for Agri-businesses!

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I recently came back from a trip to Vietnam where I met with our business partners Fresh Studio and The Fruit Republic. We worked on developing a new line of business; selling fresh vegetables produced by small holder farmers in Northern Vietnam.

Safety and quality are important features of products to be able to attract new customers in Hanoi. Fresh Studio with its team of agronomists ensures that, by certifying every farmer producing vegetables. As in many developing countries, all records of these certification processes are done on paper in a rather inefficient way. Key agricultural information is in printed books. Here comes Information and Communication Technologies (ICT) and especially mobile technologies to make this process more efficient.

Success of ICT for Development (ICT4D) in the financial sector

ICT can support the work of companies at the BoP, nothing new about that. Several studies based on real cases already showed just that:

However, deployment at scale is rare. In the financial sector, M-PESA in Kenya is the best known example facilitating money transfer via SMS throughout the country. FINO in India has also reached millions of customers providing a full portfolio of financial services like insurance.

Mobile force for Agri-businesses

Early successes of using ICT for BoP agri-business are also emerging. Companies like Esoko in Africa provide a technology platform that helps organizations profile people and manage the information flows between them, especially targeted farmers. A virtual market place is part of the Esoko solution.

Mobile technologies are extremely powerful when many actors or a lot of information are at play. This is the case in most BoP agri-businesses that have to reach a force of small holder farmers, but also a sale or distribution force often composed of BoP people. A new report on marketing for the poor highlights that “it is worth investing in mobile sale force for the BoP”. There lies the next major opportunity for ICT for Development: to enable the efficient implementation of BoP mobile forces. In our business pilot in Vietnam, we apply this concept by using mobile technologies to link small holder farmers, a team of agronomists from our partners and a pool of small vegetable shops in Hanoi that will buy the produced goods.

1/3, 1/3, 1/3

To successfully implement our mobile solution in Vietnam, to get the technology right (1/3) (which mobile platform, which user interface …) is surely key. But it appears to be the easy part of the equation in a country where 3G access is almost guaranteed everywhere. What is actually much more challenging, is to get the soft part of the equation solved: BoP forces need to be aware (1/3) of the power of mobile technology and they need to be empowered (1/3) to use it. Often taking for granted, this soft element makes implementation successful or not. In our business pilot in Vietnam, we rely on a trained task force of agronomists, who are able to use new technologies and make the link to small holder farmers. We also involve BoP farmers and agronomist in the design of the solution, to ensure maximum acceptance and relevance.

The real test will be in June during the first vegetable harvest. But in the meantime let’s get mobile! May the digital force at the BoP be with you.

Nicolas Chevrollier is program manager at the BoP Innovation Center.

Pictures: Sigrid Wertheim, Fresh Studio

How to market innovative products at the Base of the Pyramid?

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On March 7th, Wendy van der Klein – marketing expert at BoPInc – joined Hystra’s Marketing for the BoP Conference at Shell Centre in London.

Early in the morning, at a hidden side entrance of the Shell centre at the heart of London City, over 200 people gathered to join the Marketing for the BoP conference. I was pleasantly surprised with so many organizations being interested in the topic. In the first half an hour, already many business cards were swopped and people started to discuss the topic as if ‘there is no time to waste’.

At this conference I realized there is momentum NOW to get involved in inclusive business at the BoP. ‘What brings you here?’, I asked several participants. And the answers were as diverse as the group of people that attended. Someone from a large multinational stated: ‘I am just curious, I need to stay up-to-date with what is happening around the world’ to an angel investor who replied: ‘I am searching for social entrepreneurs with a sound business case in which I can invest my money’.

suraj wahab

Let me introduce to you Suraj Wahab, CEO of Toyola Energy, an African Social Enterprise providing energy efficient cook stoves and solar energy products to over 250,000 families at the BoP in West Africa. His general advice:

Don’t tell your customers why they should buy the product, show them and be prepared to answer all, and that means all, of their questions.

What makes it interesting is that Suraj does two things different from business-as-usual. First, he allows customers to test drive the product. This is the ultimate risk for an entrepreneur but optimizes risk avoidance for the customer. He gives potential customers a Toyola branded tin next to the cook stove in which money can be put they save on charcoal while test driving the product. When he comes back, people are surprised how much they saved by using the energy efficient cook stove that they can make the calculation themselves and are convinced they should buy the product (because it’s about economics!). Secondly, Suraj knows that word of mouth from satisfied customers is the best marketing tool. He asks them to bring in new customers and if they do so successfully they get their initial money paid for the cook stove back. Soon, some of the customers realize they can make a living out of these efforts et voilà a sales force has come into play.

At the conference, 15 global pioneers shared 10 key lessons that challenge conventional sales & marketing approaches to successfully serve the poorest were presented. These conclusions are based on best practices from 15 organizations that have a lot of experience in marketing life-changing devices to the BoP in Asia, Africa and Latin America. Examples of such devices are: solar lanterns, improved cook stoves and home improvement packages.

In summary these 10 key lessons are:

  1. It’s about economics!: marketing innovative products for the BoP should focus on concrete short-term cost benefits.
  2. BoP customers want risk-free solutions, not cheap products: offer best value for money, which can include a price premium if that takes away certain risks.
  3. Financing is best done in house: if possible apply in-house financing as opposed to work with Micro Finance Institutions (MFI’s)
  4. Below the line marketing works better: use village-level marketing approaches to win over customers at the BoP instead of traditional ‘above the line’ marketing campaigns
  5. Word of mouth matters most: ensure that your customers are satisfied users of the device
  6. Serving the BoP is a high gross margin business: ensure relatively high gross margin to cover for field resources and expect to become financially sustainable when targeted volumes are reached.
  7. Sales force churn can and must be avoided: provide sufficiently attractive compensation to reduce sales force turnover to a manageable level.
  8. Four direct sales force models are emerging: ‘Farming’ (package of services and equipment through local branches), ‘Hunting’ (simple, low-cost products through full time mobile sales agents) , ‘Shifting cultivation’ (more complex products through specialized teams per region) and ‘Gardening; (part-time sales force reaching limited number of households).
  9. It is worth investing in a modern sales force for the BoP:  combine four elements: 1) a mobile, full-time sales force, 2) a local network of lead generators, 3) good coaches as managers, 4) a mobile technology platform
  10. The overhead curse: too much or not enough!: five types of organizations can be distinguished ranging from an ‘overhead heaven’ model at 10%  to a ‘big bet’ model that is for the most part donor-dependent.

Source: adapted from the new report on marketing from Hystra hybrid strategies consulting.

I left this conference with a vibrant energy of many inclusive business initiatives real-time happening at the BoP. Organizations – large and small – are lined up. More and more of key lessons learned by pioneers are shared across the world. A range of innovative devices with life change benefits have been designed and manufactured. With insights from this conference we now know better how to approach the marketing of such products; it is time to get things done.

Collective learning: Stretching the pre-competitive phase

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On December 10 and 11 2012, I attended the yearly business forum of GAIN in London, which also marked the launch of the SUN Business network. The SUN (Scaling Up Nutrition) movement was launched in 2010 to support collective action and join forces to scale up nutrition under leadership of governments in developing countries. It brings together UN-, public-, private- and civil society parties to develop sustainable market solutions that give marginalized people in developing societies better and more access to nutritious food.

These types of international conferences are fantastic for networking, lobbying and for overall inspiration. Great business leaders give convincing speeches, setting the scene. People like Paul Polman (CEO Unilever), who clearly inspired the audience in his inaugural speech by referring to recent research showing that 1 dollar investment in fighting malnutrition, can – in the long run- actually save 30 dollar on health care and other related social support: “Well, ladies and gentlemen, that’s what I call an interesting return on investment!”….

It appears to me that the level of consensus in these types of conferences is very high. We - ‘the global nutrition community’ – confirm that we have knowledge and technology available (however, still scattered) and that – TOGETHER – we have already build up the evidence that we can make it work. All parties seem to accept a shared responsibility to build more and robust evidence, so that eventually the necessary changes can indeed be made to the global food system: a system that, unfortunately, still fails to address the needs and demands of billions of people at the BoP.

So yes, we all know what the emerging issues are and that established systems still fail to serve the poor, and yes, we also even know now what we need to do, and, as a result of these insights, we have even managed to mobilize some resources to get things going. Still, many stories pop up that stress complexity, which puts things in perspective. As Dr. Wibald Lorri  (presidential advisor for nutrition) of Tanzania states: “Let’s be realistic, it’s not just one single formula that works…”

…My thoughts dwell on the belief that time has come to have discussions that go beyond the ‘Yes, but’, and that the same WE, likewise, should make a joint global effort focusing on building sustained capabilities. Capabilities that give answer to all of us to tackle the ‘how to’. Time to make a consolidated effort to build a state-of-the-art research and support system that both addresses and spreads the ‘how’, a system that ensures that the right parties actually cán build up the right skills and knowledge to make the change. To achieve this, we, parties involved in pro-poor market based approaches, will need to create time to reflect, learn and be brave enough to openly disperse our learnings. But here again, easier said than done…


“Is there a true willingness to share?”, Caroline Ashley (Business Innovation Facility) dares to provoke the business audience. Later, this was picked up by other participants, acknowledging the need for the food industry to share more and create the space for that, generally referred to as ‘the pre-competitive space’ of industry. In the evening, Fokko Wientjes from DSM stressed the issue again. He made a clear appeal to further explore those intrinsic barriers that so far have prevented businesses of same industries to exchange their experiences. He even pointed out various areas in which the international food industry could stretch the pre-competitive space: sharing local distribution models, exchanging methodologies to do BoP marketing research, or taking joint action in campaigning for behavioral change. Creating space that will serve us all: tackling malnutrition and eradiate the stunting of young children through sustainable, inclusive and innovative business development. We all clapped, of course…

Mayke Harding is responsible for Learning & Alliance Building at the BoP Innovation Center. She holds a master’s degree in International Development Studies and has worked as learning expert for a Dutch umbrella organisation for peer learning amongst development NGOs.

How we learn: 5 publications on inclusive innovation

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The idea of inclusive innovation is not often easy to grasp. At the BoP Innovation Center, we try to gather interesting initiatives, lessons learned and main challenges. We can do so through the combination of three levels we operate in.

We provide an incubator space for organizations to develop inclusive innovations, business models, form partnerships and create test pilot.

From those initiatives, pilots and projects we capture lessons and develop tools that can improve the quality of the initiatives in our incubator space. We closely follow what works and what doesn’t work and create tools to fill the gaps in the process. We call this our center of excellence. It provides us with knowledge we can add to other initiatives facing the same kind of challenges.

But these learnings are not only useful in a practical sense, they are extremely valuable at macro-level. The expertise we develop allows us to change the landscape and take away some barriers companies face when trying to enter low-income markets. With insights in BoP markets, partnerships, co-creation efforts, the innovation process and inclusive business development, we can accelerate the field on a strategic, higher level.

That last list of topics is what we learn about in our ‘three pilots for pro-poor innovation’ (3P4PPI) program. In this program we facilitate the development of three separate pilots, together with our partners.

Based on these pilots, we will publish a series of five publications:

  1. Inclusive Innovation: To set the scene, introduce the pilots and formulate the challenges (download here)
  2. BoP Insights: On finding the BoP market and individuals, to understand the context (download here)
  3. Developing BoP Partnerships: On finding and connecting with the right partners for an inclusive innovation
  4. Co-creating Inclusive Business: On the process of including the BoP in your business model
  5. The Inclusive Innovation Cycle: A specific approach to develop innovations at the Base of the Pyramid

The first two publications were presented today during our event and now available on our website. It is experience based, we are learning by doing. We appreciate any comments or additional insights, it is our aim to facilitate an open discussion.

Laurens Collee is communication manager at the BoP Innovation Center.

Gaining BoP Insights in Ghana

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I’m currently researching 9 Sub-Saharan African countries to find opportunities for product/market combinations serving the local BoP market. This research is part of the 2SCALE project which aims to improve the rural livelihood and food & nutrition security in Africa.

The beginners mind advantage in a research context is that small experiences come across as a big surprise. This was my first time travelling to the African continent, to build assumptions for Base of the Pyramid (BoP) marketing research. In our first discussion with the business manager of the Savanna Farmers Marketing Company, the first question was: “Can you please explain what you mean by Base of the Pyramid consumers?” “Who are they?”.

Good point. In an African country like Ghana around 52% of the population have a poverty headcount ratio at $2 a day (PPP). In BoP context, ‘BoP’ is not a very distinctive term…

Later that day we visited a local semi-urban market to meet consumers and observe/research current usage, attitudes and aspirations related to the commodities of soya, citrus and vegetables. Being prepared with a long list of – in my view – very relevant questions, I soon discovered my inquiry did not come across as expected. Either the question was interpreted in a different way or people were not very willing to answer without me buying their products.

My colleague Hélène Mancheron had the following conversation with a women selling small pieces of wood:

“Are these pieces of wood for cooking?”
“No”, she answered.
“Are these pieces of wood for making fire?”
“Yes”, she said.
“Is the fire used for cooking?”
“Yes”, she replied with a smile.

The rest of the week I practiced asking simple, straightforward and most importantly OPEN questions. Followed by at least 3 times “Why?”, “Why?”, “Why?”. For example, to discover the benefits of orange juice:

Why do you drink orange juice?”
– “Because it is good for me.”
“Why do you think it is good for you?”
– “Because it gives me energy.”
“Why does it give you energy?”
– “Because of the vitamins in the orange.”

In focus groups with farmers and processors of soy this resulted in interesting group conversations that gave insights in both the production, processing and consumption aspects of soy. A great help in this respect was the Ghanaian translator who made it possible to include non-english speaking women in the conversation. And he decoded our questions in a way that aligned with the cultural context.

A few days later we entered the impressive building of the Food Research Institute to meet the director and some staff for a discussion. Slowly more and more people entered the meeting room, highly exceeding the optimal amount for a productive discussion group. Our lesson learned: communicate very clearly how many people you want to have in a meeting, or everyone with the slightest interest will show up.

In preparation before our visit to Ghana, we conducted extensive desk research. I must say we were quite disappointed with the quality and quantity of output. It seemed data was either outdated or contradicting other sources. In Ghana, we noticed high quality research studies do exist: asleep in drawers of top experts, not available on the internet. If possible, start your desk research locally and be prepared to copy the pages locally.

Luckily, we have the opportunity to work with local marketing research agencies to help us validate our assumptions. Most of them have trained field staff available all over the country. These researchers know exactly how and what to ask, because of their own Ghanaian background. Issuing the draft research brief, one of the first questions asked by email:

“Dear Mrs.

Can you please explain your target group ‘the BoP’..?”

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Wendy van der Klein is marketing expert at the BoP Innovation Center. She will write regular blogs on her developing understanding in gaining BoP Insights.

Learn more about gaining BoP Insights during the Implementing Inclusive Innovation event on November 29th. Read more in our upcoming publication on this topic, available on the BoPInc website end of November 2012.

Managing Inclusive Innovation: Yes we can!

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Nicolas Chevrollier

Inclusive Innovation: something new with impact for and with the Base of the Pyramid. Challenging task? For sure, and while there is still some debate on whether innovation could help solving challenges in development, I think that the main question resides in the “how”, not in the “why”.

Can we manage inclusive innovation?
Any company, international organization or NGO embarks at some point in creating something new to solve the problems they encounter. The main challenge is then on how to optimize the outcome of an innovation trajectory towards development. This is also where the biggest misconception about innovation lies, as often it is reduced to the spark of intelligence from a genius leading to a transforming product or service. Creativity and talent are part of the process of innovation, but ultimately it is only part of a process that can be managed.

At the BoP Innovation Center, we develop processes to manage inclusive innovation, based on learning experiences of different pilot trajectories we are leading or supporting. The core principles we use to support inclusive innovation include:

  1. Early identification of the type of innovation under development.
    ‘Sustaining innovation’ (building on existing products, like developing an improved cookstove) or ‘disruptive innovation’ (bringing a new value proposition at the fringe of existing markets, like the mobile payment system M-PESA in Kenya) will need different processes as the level of uncertainty is different.
  2. Design a plan to learn and test hypothesis rather than planning for execution.
    Especially in the case of inclusive innovation, implementation planning is virtually impossible as uncertainty is too high. Learning milestones should lift question marks around product definition, market size, partners to engage or business models to use. Especially while product features are often the focus of hypothesis testing, market hypothesis are usually the ones that make or break an innovation. In fact – as nicely put by Eric Ries in “The lean start-up” – nowadays we can build almost everything, even what people don’t want. In our pilots in the agriculture sector for instance, instead of building the perfect product, it is as important to test whether the possible paying customers of a given innovation might be cooperatives or dairy investors rather than individual farmers. The learning goal should be to assess this market hypothesis by early cooperative adopters. (The Innovator’s Dilemna, Clayton M. Christensen)
  3. Fail early but accept to fail
    By building Minimum Viable Product (MVP) one can dedicate the minimum effort to test a given hypothesis. In the non-for-profit world, planning is often based on verified hypothesis that impose success of the outcome of the process, hence leaving limited room for the acceptance of failure. ‘Valuing failed innovation’ is the required new mind set.
  4. Use innovation metrics to measure learning outcomes
    TNO and SNV, two of our strategic partners, are currently developing a socket that would produce electricity by using the flame of biogas digesters in Rwanda and Bangladesh. Is the pilot a success if the product is ready after 2 years of work? Or if a number of customers have bought it? In an innovation phase, knowing if many people have bought a product is only interesting if it validates a learning hypothesis. For TNO, what matters is whether a biogas digester owner sees value in the socket or whether biogas digester distributors would be willing to bundle the socket with their existing products.

One could argue that these principles would apply to any type of innovation being inclusive or not. In essence this is true. However, the inclusive innovation process differs in the context they occur. Innovation structures in developing countries are far less developed than in industrialized economies, leading to additional complexity. Furthermore, inclusive innovations requires hybrid partnerships to be created (business with NGO for instance) implying finding a common ground of resources, values and processes to work with. For the development work, it implies to profoundly change its DNA of development towards learning (often by failing) in a lean manner.

Ultimately, it is possible to manage inclusive innovations in a rigorous way by creating adequate processes, values and resources to increase the impact of these innovations, and this is one of the raison d’etre of the BoP Innovation Center.

This topic will be addressed during the event “Implementing Inclusive Innovation” on November 29th 2012 in Amsterdam.

Ubora wa Dawa: ‘Yes, but…’ or ‘no, unless…’

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Together with DSM, ICCO and EPN, we are developing Ubora wa Dawa (Swahili for ‘quality of medicine’) that allows pharmacists in poor and rural communities to check the quality of medicines. I’m currently in Kenya with our partners to evaluate the pilot. These stakeholder Insights should shape our understanding of the first results and how to continue.


Gathering stakeholder insights is extremely valuable when you develop an Inclusive Innovation, especially when existing market information is incomplete or unreliable. Observing every aspect during the piloting phase and keeping close conversation with local stakeholders might reveal unexpected insights.

We have now come to a stage where we want to get the opinion of key professionals in the pharmaceutical sector. We want to understand if the actual performance of the medical test kit – after local field trial – is acceptable for the market or if we need to invest substantially more. The feedback we are particularly looking for is on:

  • capabilities – whether the testkit can identify a sufficient level of low active ingredients in medicines
  • the procedure to test the medicines in terms of ease and speed
  • the target group we would like to focus on for the distribution of the kit

Thanks to our partner EPN, we could gather in a breakfast session with a very diverse and interesting audience. Attendees represented knowledge institutes (University of Nairobi), regulatory bodies (Pharmacy and Poison Board), the Ministry of medical services, associations (Kenya Pharmaceutical Association), NGOs (Medecins Sans Frontieres, Global Antibiotic Resistance Program), distributors (MEDS), and the National Quality Control Lab.

Our challenge was to ensure that it would not turn out as a nice gathering where everyone would politely participate and not give their honest opinion.

To prevent this potential threat, we concentrated on designing an agenda that would allow all participants to share their views. After the general presentation, we planned break out sessions in which the first questions were closed (yes or no) to force people to express an opinion. The follow-up questions were open (how and why), to capture the argumentation. I still expected people to hide away their true feelings, but that didn’t happen. Apparently this set up triggers very interesting discussions. The other challenge was to ensure that all questions would be answered and that time would be kept. So, in one group I played the White Rabbit from Alice in wonderland and in another group, one of the participants took the ownership of that mission.

The result was a very dynamic and energetic session. All participants stayed until the end and only one left the room to answer a call!

We ended up with various views that could be articulated in between “Yes, you should continue if…” and “No you should not continue, unless…..”. This is of course not black and white feedback. Nevertheless, because of the interaction, we could identify the most important issues versus the less important, and consider the reaction of crucial players in the audience. It gave a very important signal about the priorities to address and the challenges to overcome.

Helene Mancheron (sparring partner of the Medical test kit project), inspired by Nelleke van der Vleuten

On November 29th, we organize the ‘Implementing Inclusive Innovation’ event. Purpose of this interactive event is to share things we learned about inclusive innovations, based on the medical testkit pilot and two other innovations. If you are interested in inclusive innovation, or if you have experience and would like to share, please visit the event website for more details.

Cattle microinsurance in Rural India

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Guest contribution by Kim ‘t Hart.

Princess Maxima, advisor “inclusive finance” at the United Nations, opened in the beginning of April the first Dutch microinsurance conference at the University of Twente where she stressed the importance of research in the microinsurance field in order to gain more insight in the complex and fragmented market. In collaboration with the BoP Innovation Center and MART Consultancy, I have done research to the supply of and demand for cattle microinsurance at the Base of the Pyramid in rural India.

Demand for Cattle Microinsurance at the BoP in Rural India

Today, India is one of the most exciting emerging markets in the world. The country has a population of over one billion people and it belongs to the largest economies in the world. India is an agriculture-based economy with a substantial cattle market; the country leads the world in cattle population and milk production. Nearly 90% of the cattle market in India is owned by small and marginal farmers in the rural areas. However, these households face high risks due to poor veterinary services, various prevailing diseases and fluctuating supply of feed. I have found that the potential loss of cattle is one of the biggest concerns for cattle-holders at the base of the pyramid (BoP) as it leads to a substantial fall in their income.

Currently, there exist few risk mitigation mechanisms for the cattle-holders at BoP in the rural areas. According to ICICI Lombard, the cattle industry offers `substantial market potential for microinsurance.´ However, the market is still untapped and underdeveloped; less than 7% of the total cattle population is insured in India. One of the key issues pertinent to the weak market is the mismatch between the supply of and the demand for cattle microinsurance at the BoP. Therefore this research study focuses on discovering how the existing cattle microinsurance products differ from the demand at the BoP in rural India in terms of product design and product distribution.

Research Findings

I have discovered that the biggest challenge within the cattle microinsurance market lies in reaching the potential beneficiaries effectively. The awareness of microinsurance amongst the cattle-holders is very low, there is a lack of trust in insurance companies and application and claim settlement processes are inefficient. Therefore more emphasis should be put on innovative distribution methods. Second, product features of cattle microinsurance need to be improved and adapted to the conditions of the farmers. In general, the cattle microinsurance market is plagued by predetermined misperceptions and an inadequate effort of insurance companies to understand the market better. Cattle-holders demand a broader risk coverage, innovative bundling possibilities and better risk-mitigation techniques. It has become evident that there are too many gaps in the product design and product distribution of cattle microinsurance for it to become a successful product in its current state. It is crucial that these gaps are closed in order to increase the uptake amongst cattle-holders at the BoP in rural India and realize growth in the business.

Innovative Distribution Model

I have developed a distribution model which is a hybrid between a partner-agent model and a community-based model; insurance companies distribute cattle microinsurance through group-heads within well-established and operationally sustainable organizations such as SHG Federations and Dairy Co-operatives. The insurers are responsible for educating the group-heads, developing the microinsurance policy together with the group-head and carrying the financial risk. Group heads of communities are in charge of educating the farmers, leading the application and claim settlement procedures and scheduling appointments with paravets for risk-mitigation measures. Paravets act as a link between the group head and the beneficiaries, supplying all the necessary health, valuation and ear-tagging services. Within this distribution model I would recommend insurance companies to implement the RFID-technology and compulsory risk-management packages in order to decrease the fraudulent and moral hazard behavior of beneficiaries. After a sustainable and transparent distribution model has been established, insurance companies should customize the cattle microinsurance policy to the needs of the cattle-holders in terms of premium payments, risk coverage and bundling possibilities.

Significance of Cattle Microinsurance at the BoP in Rural India

There are significant investment opportunities at the BoP in rural India – both in providing the cattle insurance cover itself and because having cover against the unexpected is a vital component in economic growth. I have found that with the appropriate innovations in distribution channels and product features, cattle microinsurance at the BoP in rural India could become a profitable business model for insurance companies. It is an interesting market to invest in as today’s low-income policy holder is tomorrow’s middle class, a promising market for insurance companies. Further, the growth of the cattle microinsurance market could lead to a decline in the vulnerability to poverty for BoP households in rural India. Therefore penetrating the Indian cattle microinsurance market is not only valuable for insurance companies, cattle-holders at the BoP but also for the country as a whole.

Eline Kim ‘t Hart, 2012

Download the report “Understanding the gap between the supply of and demand for cattle
microinsurance at the Base of the Pyramid in Rural India”

For more information please contact: info@bopinc.org

Innovation at Rio+20

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Brazil, country of samba, carnaval, color and caiparinha. But also the country known for the international sustainable development convention in 1992. This convention actually marked my career.

I was studying in those days and became triggered by the question how the private sector could contribute to international sustainable development. Mr Pronk, former Minister of Development Cooperation, decided after the convention to create an innovative way to work on sustainable development. In 1993 the sustainable development treaties were signed with Costa Rica, Benin and Bhutan. All segments of society should become active, and the main principles were participation, reciprocity and equality. In 1994 and 1995 I led student exchange programs between Costa Rica and the Netherlands. We analyzed and discussed each others models of sustainable development. And we wondered how the private sector could become more engaged and leading change. Twenty years later, a new convention on the same topic, in the same nation. I was told 50.000 people will be here for the negotiation. I will join the corporate convention ‘Compact 4 Rio‘, organized by the Global Compact and the WBCSD, which will attract around 3.000 people.

Rio+20 Corporate Sustainability Forum

First Day – June 15
On Friday June 15 the launching event took place. The chairman clearly called upon the corporate participants to be pragmatic, reach clear agreements and provide new insights on how to reach scale. Ideas for new ways to match sustainable development ambitions with core business objectives are needed. Of course there will be a lot of attention to reaching scale in protecting the natural resources (energy, water, biodiversity). But, already there is one full morning session on the Base of the Pyramid (BoP). The corporates I talk to understand what I mean with ‘BoP’, and show interest in our visions and experiences. I wonder what really comes out of these meetings. I understand that we should not expect real change, but one positive thing I can already observe, is that people get new energy and hope being with like-minded people. They feel they are not the only ones searching for new business models. A feeling that most managers of big companies often may have. And creating a specific platform for corporate players also helps to obtain practical examples of what works and what doesn’t. That may lead to a concrete impact of this big meeting, but we will never be able to measure nor prove it. We can only hope that the carbon footprint and resource investment made to be here, may lead at the end to a better world and more wealth at the Base of the Pyramid. I believe that spreading our ideas and experiences at this strategic level, can have as much impact as a concrete meeting or training in the poor communities in the initiative that we are running in the north of Brazil. As long as we keep on doing both, develop in practice, learn from it, and accelerate change by sharing these experiences at a strategic level.

2nd Day – Saturday June 16
Good and inspiring start of the conference. The first session I attend is about accelerating business engagement in the BoP, organized by Business Call to Action and WBCSD. Kick off was by Jane Nelson of Harvard Univeristy. She emphasized on the importance of;

  1. Linking new business strategies with core business operations and value chain activities. Companies should be more strategic, creative and innovative about values of business creation.
  2. The need for fundamental new models of operating; new business models; social business models inside ofthe companies. Also there is a need for new financing models and new incentive models, within companies and external market incentives from financial sector.
  3. Need for more collective platforms, f.e. companies in the agro food sector that create a platform in order to have impact at a systemic level.

This conceptual introduction was immediately followed by an inspiring presentation of the Brazilian cosmetic company Natura. One of the interesting and inspiring challenges they have put themselves up to is to set up an open innovation platform in Manaus. The vision is to convert the Amazon area into a ‘silicon valley’ for local sourcing and sales of natural ingredients based cosmetics.

From the multinational enterprise examples mentioned it was good to hear SAB Miller mentioning their cooperation with DADTCO as being an exciting and successful initiative. DADTCO is one of the companies BoP Inc. works together with as part of our collaboration with IFDC and ICRA in the 2SCALE project. DADTCO brings the processing factory of cassava into the field so farmers can sell the root to the processing industry for all kind of use.

Stuart Hart also added his insights to the meeting. He explained that the first ten years of working on BoP business development provided 5 important learnings;

  1. Embedding; stripping cost and introduce is a non starter. Mentality at ToP doesnt work in bop. Importance of participatory approach.
  2. Converging; 10 years ago focus on selling, but how generate economic activities in order to lift the bop? There tends to be the risk to loose out of sight the environmental side of bop business development, while the Bop is actually the incubator for tomorrow clean tech solutions.
  3. Enabling: it has to be more than CSR. Most innovations end up crushed by existing structures. How to create new innovation white space in companies.
  4. Scaling; most efforts get stuck in pilots. It is clear that parties involved need to be more imaginative in order to make this work. One interesting way is to add the dimension of trickle up. While starting in the BoP, this can very well move up to the MoP and ToP market. This reverse innovation process helps to scale both on volume as well as profit margins.
  5. Measuring; BoP business interventions. Is about creating mutual value. Not about splitting up share, but creating new share for everybody.

The session provided enough food for thought. But also made clear that at least an incipient but growing number of companies are triggered by the BoP proposition. At least 120 people attended the meeting, and contributed actively to the discussions.

Access to Food and Improved Nutrition at the Base of the Pyramid

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5 Business InterventionsFive business interventions to achieve social impact, financial sustainability and scale

Improving food and nutrition security through better availability, accessibility, and utilization of food and food products is another complex challenge. It involves a sector where key activities – such as the production, distribution and consumption of food and the identification of food markets – are largely in the hands of private enterprises. Interventions by the private sector in the food value chain can increase the income of the actors in the chain by involving the Base of the Pyramid (BoP) as consumer, producer or entrepreneur. It can increase the availability of food products, make food products more affordable, or increase the quality of food in the BoP.

In collaboration with the Global Alliance for Improved Nutrition (GAIN) and supported by the Dutch Ministry of Foreign Affairs, we have identified five different business interventions for BoP ventures in a new publication. These interventions achieve social impact, financial sustainability and, potentially, scale:

  1. Interventions focusing on smallholders to improve quality and volume of production. For example, DADTCO, a social enterprise, develops mobile small-scale cassava processing units in Nigeria allowing first processing close to farms.
  2. Commercial buyers to assure access to a supply of  produce that meets specific volume.
  3. Interventions focusing on BoP intermediaries between (smallholder) producers and consumers. For example, Hariyali Kisaan Bazaar is a rural retailer selling agri-inputs and consumer goods through its chain of centres, which also serve as a common platform for providers of financial services or health services.
  4. Adaptation of existing products, services, processes to serve BoP consumers.
  5. Innovative strategies that seek to create new markets at the BoP, through the introduction of new (specialized) products. For example Danone has ventured with Grameen in Bangladesh to create a business Grameen Danone Food Ltd that produces an ultra low cost fortified yoghurt for small children distributed by entrepreneurial Bangladeshi ladies.

5 Business Interventions

The five business interventions are an entry point for companies and other stakeholders to develop products and services to improve access to food and better nutrition with and for the BoP. They are based on extensive study and analysis of existing projects and venture worldwide.

Deliberately choosing one of these strategies, implementing a suitable governance structure and leveraging existing elements in specific models not only enables companies to become more effective in the food value chain, but also to interact and partner with the BoP.

By broadening our understanding of the options available for private sector engagement in providing better access to food and improved nutrition, this report provides key challenges and lessons to scale BoP ventures to be used by the private sector and its partners, be they NGOs or public authorities. Especially in the 2SCALE (Towards Strategic Clusters in Agribusiness through Learning in Entrepreneurship) programme, the BoP Innovation Center will use these insights to develop market based innovation trajectories.

Building blocks BoP Venture

You can download the report here.