This is the second publication of a series of five. The series is based on experiences and insights from the implementation of three seperate innovation pilots. These pilots form the Three Pilot for Pro-Poor Innovation (3P4PPI) program. Together with our partners, we capture learnings from the pilots, to improve the quality and enabling environment for future pilots.
Market research is essential whenever you develop products or services. Understanding the local BoP system and individuals within this system - consumers, producers, entrepreneurs - is fundamental to ensuring the successful development of âInclusive Innovationsâ. BoP insights guide the development of Inclusive Innovations by understanding daily tensions, coping strategies and the decision-making processes.
In most cases, traditional marketing tools fail to provide useful market/consumer insights. The novelty of the subject means specific BoP marketing theory and models are yet to be developed.
This publication covers the main challenges and aims to discover and understand new ways to research the BoP market.
This is the first publication of a series of five. The series is based on experiences and insights from the implementation of three seperate innovation pilots. These pilots form the Three Pilot for Pro-Poor Innovation (3P4PPI) program. Together with our partners, we capture learnings from the pilots, to improve the quality and enabling environment for future pilots.
This first publication sets the scene on inclusive innovation. It highlights latest insights both in theory and in practice. It introduces main challenges we encoutered in the pilots
Five business interventions to achieve social impact, financial sustainability and scale
BoP Innovation Center & Global Alliance on Improved Nutrition (GAIN)
This report serves as a starting point for the business interventions developed in the 2SCALE program.
Improving food and nutrition security through better availability,accessibility, and utilization of food and food products is a complex challenge. After all, 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. Involved as consumer, producer or entrepreneur, for the Base of the Pyramid (BoP) population, interventions by the privatesector in the food value chain can increase the income of the actors in the chain, increase the availability of food products, make food products more affordable, or increase the â nutritious â quality of food. Interventions will ultimately contribute to improving the availability of and access to nutritious food and food products.
Hystra, Aqua for All, BoP Innovation Center
Scaling-up access to safe water and reaching out to the 2.1 billion people without this common good is possible, and can even be profitable. For the fast growing urban population in developing countries (expected growth: almost 70% by 2030) piped distribution networks seems to be the most appropriate. Good opportunities lay ahead for utility operators (public and private), especially if they join forces and create hybrid water utilities which focuses exclusively on serving fast growing communities in towns and slums of large cities. These urban areas could be served with relatively low capital investments. For different reasons, such hybrid utilities could not be purely public or private, but rather require a blend of both, in terms of governance and financing.
Chicago Council on Global Affairs
Catherine Bertini (chair)
The Chicago Council announced an initiative to bring attention to the role of girls in rural economies of developing countries and identify opportunities to increase investment in women and girls as a tool for economic growth and social stability.
To succeed, youâll need to link your commercial interests with your constituenciesâ well-being
Harvard Business Review
V. Kasturi Rangan, Michael Chu, and Djordjija Petkoski
The bottom of the economic pyramid is a risky place for business, but decent profits can be made there if companies link their financial success with their constituencies' well-being.
Innovative business models in education, health, agriculture and financial services
This report presents the conclusions of the study âLeveraging ICT for the BoPâ sponsored by AFD-Proparco, Ericsson, ICCO, France Telecom-Orange, and TNO and conducted by Hystra and Ashoka from October 2010 to June 2011.
Wageningen University - LEI
Sertse, Y., M. de Ruyter de Wildt, Y Dijkxhoorn and M. Danse
LEI Memorandum 11-005
The ministry of Economic Affairs, Agriculture and Innovation, through the BOCI Programme (International Policy Support Research) requested LEI to portray alternative business models that increase inclusiveness, improves competitiveness and enhance food safety and security in the Ethiopian oilseed sector. The BoP Innovation Cycle was used to identify accessible, acceptable and affordable innovations.
International Institute for Environment and Development (IIED)
A report by the International Institute for Environment and Development (IIED) argues that international initiatives on agricultural investments should go beyond trying to minimize the negative impacts of large-scale land acquisitions and, instead, promote investment models that maximize opportunities for local smallholder.
World Resources Institute
WRIâs business case studies go deeper into some of the most promising projects represented in the Digital Dividend Clearinghouse, providing detailed description and analysis of each business model, the market segment in which it operates, its successes and challenges, potential replicability and scalability. If possible, the study also documents the social impact of the venture.
Harvard Business Review
Ashish Karamchandani, Mike Kubzansky and Nishant Lalwani
February 22, 2011
The market for products and services aimed at the bottom of the pyramidâpeople living in poverty in developing economiesâis vast, with 4 billion people representing $5 trillion in purchasing power. However, succeeding in this market is far from easy, write Ashish Karamchandani, Mike Kubzansky and Nishant Lalwaniâwho lead Monitor's Inclusive Markets practiceâin this article for the March issue of Harvard Business Review.
Design for Social Wellbeing: A Case Study of Normative Design Thinking in Industrial Design
Edan Weis -University of Melbourne
This study investigates industrial design practice which aims to contribute to poverty alleviation and economic development in poor nations. The practice of âDesign for Social Wellbeingâ (DSW) generally operates in three capacities: 1) Commercial product/service development for low-income markets through social enterprise; 2) Technical assistance and capacity building with local artisans or micro-enterprises; 3) Product, service and infrastructure development assistance for communities and organizations.
For further reading, download the article here.
This document presents a âmappingâ of key publicly-available tools and resources that support the initiation, development and scaling of inclusive business models. It is primarily aimed at practitioners but will also be of use to other actors in the inclusive business domain, including donors, investors, business associations and communities.
Download the article here.
ICCO & OXFAM Novib
This paper explores the possibility of aligning the goals of poverty reduction and economic profit through the marketbased approach of the BoP. In other words, can this approach be as much a development strategy as a business strategy? Can the productive capacity of the poor be leveraged in creating products and services that ultimately raise their own incomes and not only those of the companies involved? What does it take to work in BoP markets, combining profit with cultural appropriateness and environmental sustainability?
Dowload the article here.
Access to Energy for the Base of the Pyramid
A study by Hystra, in collaboration with international network of social entrepreneurs Ashoka, on projects allowing energy access to poor sections of the population from developing countries.
Meet the consumer todayâs business needs to target: A Special Report in association with The United Nations Development Programme
Various authors (2008)
Set by world leaders in 2000 to provide time-bound, measurable targets to fight extreme poverty, hunger, and gender inequality, while improving the health, environment
and education for all, the Millennium Development Goals (MDGs) provided a common vision for a better 21st Century. Today, with just seven years to go to the MDGs 2015 deadline, and despite impressive progress on a number of fronts, the challenges we face are significant.
Poverty Alleviation through Sustainable Strategic Business Models: Essays on Poverty Alleviation as a Business Strategy
Klein, H. (2008)
This dissertation contains four essays on poverty alleviation as a business strategy.
A co-design innovation methodology: towards efficient delivery of mobile services in developing regions
De Boer, J. & Chevrollier, N. (2010)
The rapid growth of telecommunication infrastructures in Africa has created a favourable environment for mobiles services to emerge, especially the ones aiming at social impact. While a number of successful pilots have been reported, few of these services have achieved scale and significant impact. In this paper, we describe a co-design innovation methodology that takes into account the specificities of developing regions in Africa and the particularities of the mobile industry favouring successful mobile services development and deployment. The co-design innovation methodology has been validated partially in two case studies in Namibia and Uganda.
Dowload the article here.
Business and Human Development in the Base of the Pyramid: Exploring Challenges and Opportunities with Market Heat Maps
Pablo Acosta, Namsuk Kim, Illana Melzer, Ronald U. Mendoza and Nina Thelen. Article published in Journal of World Business, Volume 46, Issue 1, Pages 50-60, January 2011.
Roughly a little under half of the world's population is mired in poverty, most in the developing worldâabout 3 billion people constitute the global base of the economic pyramid. Building on earlier work by Banerjee and Duflo (2007), this paper uses survey data from three countries in order to provide a clear visualization of the spatial dimension of the economic lives of the poor and their access to markets. It develops a framework that could be used to map market inclusiveness, and then applies this to a number of markets that are critical to reducing poverty and increasing human welfare: water, credit and telecommunications. These âmarket heat mapsâ help to illustrate the extent of the challenges and in some cases reveal potential opportunities in growing more inclusive markets for the poor.
To dowload the article, go to Science Direct.
Base of the Pyramid Protocol 2nd Edition (2008)
Co-authors: Erik Simanis & Stuart Hart
Contributing authors: Justin DeKoszmovszky, Patrick Donohue, Duncan Duke, Gordon Enk, Michael Gordon, and Tatiana Thieme
This article contains the most recent version of the BoP Protocol, a pioneering business incubation process that enables multinational corporations (MNCs) to generate new business opportunities at the Base of the Pyramid.
Reinventing strategies for emerging markets: beyond the transnational model
Ted London & Stuart Hart, Journal of International Business Studies, 1â21 (2004)
With established markets becoming saturated, multinational corporations (MNCs) have turned increasingly to emerging markets (EMs) in the developing world. This article focusses on the opportunities and challenges to MNCs while developing and executing their EM strategies.
Emerging Markets; Emerging Models: Market-based Solutions to the Challenges of Global Poverty
Ashish Karamchandani, Michael Kubzansky & Paul Frandano
âEmerging Markets, Emerging Models,â from Monitor Group is a first-of-its-kind report analyzing the actual behaviors, economics, and business models of successful âmarket-based solutionsâ; financially-sustainable enterprises that address challenges of global poverty. Compiled in an effort to use fact-based research to move beyond stereotypes, anecdotes, and common assumptions about the potential of market-based solutions, Monitorâs findings highlight actual data from global working models.
The report provides strong evidence that engaging the poor as customers and suppliers presents an exciting and significant opportunity to establish new paradigms to bring genuine social change in economically sustainable ways. During the course of its research, Monitor conducted more than 35 field investigations, primarily in India and supplemented with research covering 19 countries across the world, but focused the research on India, which offers an advanced laboratory of social enterprise approaches and proved to be an especially fertile source on model effectiveness. Conclusions were based on more than 600 in-person interviews with low-income customers and small suppliers, and detailed interviews with, and research on, over 270 social enterprises in India.
Download the article here.
Microfranchising: How Social Entrepreneurs are Building a New Road to Development
Nick Sireau (edited by), December 2010
Recently, social entrepreneurs have turned to the franchise model as one of the responses to Africaâs endemic economic stagnation. And the results have been inspiring...
It is increasingly clear that 50 years of international development have done little to reduce poverty in Africa. Indeed, more and more academics and practitioners are highlighting the detrimental effect of traditional development â as carried out by international agencies and NGOs â which often leads to dependency, inefficiency, waste and poor governance.
Yet there is a new movement that is surging ahead in its attempt to reduce poverty and generate wealth in Africa: microfranchising.