The Fortune at the Bottom of the Pyramid

C.K. Prahalad

The Economic Pyramid

Purchasing power parity in U.S. dollars $ 20,000
$ 1,500-$ 20,000

Tier 1 75 -100 m

Tiers 2-3 1,500-1,750

$ 1,500

Tier -4 Tier 5 4000

< $ 1,500

Dominant Logic of the MNCs

Assumptions

Poor cannot afford our products and services Poor do not have use of products used in DC Only DC appreciate technology and innovation and pay for it. BOP market is not critical for long term Intellectual excitement not there

Implications With our cost we cannot serve BOP. There is no market in BOP BOP does not need advanced technology BOP are at best distraction We cannot assign our best people.

Introduction/assumptions

How to fight Poverty with Profitability Poverty how to look at it with hope. The responsibility of the Private sector to look at poverty using creative capitalism Co-creation with NGOs and Private sector CSR Respect the individuals are the BoP Convert poverty as an opportunity

Five questions

The role of Private Sector to alleviate Poverty

Financial resource Discipline Organization Accountability Entreprenual drive Co-creation with NGOs

The lessons learnt about people from BoP

4-5 billion consumers living under less than $1-2. Status of BOP is not the same Choose the next billion Different Approach may be required

What are the market opportunities

Innovation sandbox( embrace constraints) Build an ecosystem Co-create solutions A new concept of scale( Amul) Use technology Sustainability Market development

Is their new social impact?

Creative capitalism Make profit but also look for recognition

What are the rules of engagement?

Democratization of commerce Benefit of Globalization to micro consumers, micro producer, micro innovators, micro investors, and micro entrepreneurs.

Core propositions

Respect for the rights of the individuals The use of transparent transactions or a focus on market based solutions Scalability to solutions Reducing the rural-urban, rich-poor divide through information technology Focus on entrepreneurship and innovation Focus on ecologically sustainable solutions.

Private enterprise

Civil society and local Govt.

Economic development and social transformatio n

Developmen t and aid agencies

BoP Consumers BoP entrepreneur s

Nature of the BOP Market

There is money at Bop Access to BOP market BOP markets are brand-conscious The BOP market is connected BOP markets accept advanced technology readily

The market development imperative

Create the capacity to consume The need for new goods and services Dignity and choice Trust is prerequisite Benefits to the Private sector.