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1、intermediaries were bypassed, and ITC gained a direct contact with the farmers, thus improving the effi ciency of ITCs soy- bean acquisition. To achieve this goal, it had to do much more than just distribute PCs. It had to provide equipment for man- aging power outages, solar panels for extra electr
2、icity, and a satellite-based telephone hookup, and it had to train farmers to use the PCs. Without these steps, the PCs would never have worked. The complex solution serves ITC very well. Now more than 10,000 villages and more than 1 million farmers are cov- ered by its system. ITC is able to pay mo
3、re to farmers and at the same time cut its costs because it has dramatically reduced the ineffi ciencies in logistics. The vast market for cell phones among those at the BOP is not for phones costing $200 or even $100 but for phones cost- ing less than $50. Such a phone cannot simply be a cut-down v
4、ersion of an existing handset. It must be very reliable and have lots of battery capacity, as it will be used by people who do not have reliable access to electricity. Motorola went thorough four redesigns to develop a low-cost cell phone with battery life as long as 500 hours for villagers without
5、regular electricity and an extra-loud volume for use in noisy markets. Motorolas low-cost phone, a no-frills cell phone priced at $40, has a standby time of two weeks and conforms to local languages and customs. The cell-phone manufacturer says it expects to sell 6 million cell phones in six months
6、in markets including China, India, and Turkey. BOP MARKETING REQUIRES CREATIVE FINANCING There is also demand for personal computers but again, at very low prices. To meet the needs of this market, Advanced Micro Devices markets a $185 Personal Internet communicatora basic computer for developing co
7、untriesand a Taiwan Company offers a similar device costing just $100. For most products, demand is contingent on the customer having suffi cient purchasing power. Companies have to devise creative ways to assist those at the BOP to fi nance larger pur- chases. For example, Cemex, the worlds third-l
8、argest cement company, recognized an opportunity for profi t by enabling lower-income Mexicans to build their own homes. The com- panys Patrimonio Hoy Programme , a combination builders “club” and fi nancing plan that targets homeowners who make less than $5 a day, markets building kits using its pr
9、emium- grade cement. It recruited 510 promoters to persuade new customers to commit to building additions to their homes. The customers paid Cemex $11.50 a week and received building materials every 10 weeks until the room was fi nished (about 70 weekscustomers were on their own for the actual build
10、- ing). Although poor, 99.6 percent of the 150,000 Patrimo- nio Hoy participants have paid their bills in full. Patrimonio Hoy attracted 42,000 new customers and is expected to turn a $1.5 million profi t next year. Marketing to the Bottom of the PyramidCASE 33 Professor C. K. Prahalads seminal publ
11、ication, The Fortune at the Bottom of the Pyramid , suggests an enormous market at the “bottom of the pyramid” (BOP)a group of some 4 billion peo- ple who subsist on less than $2 a day. By some estimates, these “aspirational poor,” who make up three-fourths of the worlds population, represent $14 tr
12、illion in purchasing power, more than Germany, the United Kingdom, Italy, France, and Japan put to- gether. Demographically, it is young and growing at 6 percent a year or more. Traditionally, the poor have not been considered an important market segment. “The poor cant afford most products”; “they
13、will not accept new technologies”; and “except for the most basic prod- ucts, they have little or no use for most products sold to higher in- come market segments”these are some of the assumptions that have, until recently, caused most multinational fi rms to pay little or no attention to those at t
14、he bottom of the pyramid. Typical market analysis is limited to urban areas, thereby ignoring rural villages where, in markets like India, the majority of the population lives. However, as major markets become more competitive and in some cases saturatedwith the resulting ever-thinning profi t margi
15、ns marketing to the bottom of the pyramid may have real potential and be worthy of exploration. One researcher suggested that American and European busi- nesses should go back and look at their own roots. Sears, Roe- buck was created to serve the lower-income, sparsely settled rural market. Singer s
16、ewing machines fashioned a scheme to make con- sumption possible by allowing customers to pay $5 a month instead of $100 at once. The worlds largest company today, Walmart, was created to serve the lower-income market. Here are a few examples of multinational company efforts to overcome the challenges in marketing to the BOP. Designing products for the BOP is not about making cheap stuff but about making technologically advanced products af- fordable. For example, one company
