- Elgar original reference
Edited by Subhash C. Jain and David A. Griffith
Chapter 19: Bottom of the Pyramid Market: Theory and Practice
19 Bottom of the pyramid market: theory and practice Subhash C. Jain This chapter deals with the bottom of the pyramid (BOP) market, a term introduced by Prahalad and Hart (2002). According to them, BOP market comprises 4 billion people who manage on less than $2 a day. Since its articulation, a number of studies have been conducted on the subject (London and Hart, 2004). Most of these studies conclude that global firms have not used their capabilities to reach most of the 4 billion people who live in relative poverty at the base of the economic pyramid. They suggest there are significant opportunities for MNCs to use market-based approaches to serve the needs of the poor profitably. Although some researchers (e.g., Karnani, 2007) question the viability of the BOP market, a consensus has emerged that much of the BOP represents a fast-growing consumer market and a source of untapped entrepreneurial energy (Pitta et al., 2008). Most of the BOP studies, however, have been done at the macro level, demonstrating the size of the market and advancing anecdotal evidence to recommend strategies for profitably harnessing the market. To the best of my knowledge, the BOP market has not been examined from marketing perspectives. Such questions remain unanswered: How big is the market? Can it be segmented? What are the typical buying behavior characteristics of the market? What kind of marketing mix would work in a particular segment? What sort of information is needed to serve the market? And so on....
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