The Bottom Of The Pyramid

1284 Words6 Pages
In marketing, the term “bottom of the pyramid” is used to distinguish the largest, but poorest socio-economic groups. According to Global Issues , this is the 3 billion people who live on less than $2.50 per day. There were a lot of debates around the BoP markets – whether they are fast-growing markets or should global companies not waste their time and money on serving them. But today most organizations realize that targeting low-income markets can be profitable. Global companies, such as Siemens, GE, Nestle, and Procter & Gamble continue to pursue profits at the bottom of the pyramid. The biggest challenge in targeting the “bottom of the pyramid” is the fact that consumers buy in very small quantities. To cover costs a company needs to attract a lot of customers. But it is not the only problem. “It is not enough to simply launch a low-cost product: markets for that product must be created” (Keegan). Unilever business illustrates how to get positive results generating more than half of its sales from developing markets, with much of that coming from the emerging middle class (The Guardian). The global uptake of mobile phones has proven that poor people will buy cell service if it 's available at low prices (The Guardian). Global companies that target low-income countries know that it is wise to look beyond per capita GNP, as these figures may hide the existence of a huge middle class (for example, India). Moreover, low-income markets are collectively becoming more
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