Marketing to the Bottom of the Pyramid

Until recently, the least important market segment has been the most poor, lower-income individuals and families. According to Professor C.K. Prahalad, the “bottom of the pyramid”, also referred to as the BOP, is made up of nearly 4 billion people who survive on $2 a day or less. Making up approximately a quarter of the world’s population, these four billion people hold $14 trillion in purchasing power and this group is growing each year. In the past, this market segment couldn’t afford to purchase most products and were definitely not looking at the latest and greatest technologies. However, with some markets becoming more and more competitive, potential for making more profit from bottom of the pyramid consumers began to grow. Today, more and more stores such as Wal-Mart specifically cater to low-income families, just as Sears Roebuck had. Companies such a Singer offering payment plans for consumers who purchased their sewing machine led the way in marketing to this group. It seems that as time goes on, the BOP seems to have access to more and more higher end products that they once couldn’t afford. While the process of marketing to the BOP has proven to turn a profit, marketers need to keep in mind the challenges that they face in regards to offering advanced technology, financing, distribution, and packaging.
One challenge that many companies faced was being able to create technologically advanced products that could be made affordable to the bottom of pyramid consumers. Marketing to the BOP was also a challenge. Not only did companies need to create technologically advanced products that were affordable to lower income families, but they needs to create a support system around the product, whether it be a training program or providing additional equipment. For example, a company called ITC brought personal computer