Why include the BOP in your international marketing strategy

Abstract

Purpose The purpose of this paper is to test the premise that brand growth can come from targeting the poorest consumers at the bottom of the economic pyramid (BOP). This study is the first that uses quantitative marketplace data covering BOP consumer purchase records. Design/methodology/approach The study uses newly available panel data from Egypt covering 15 months and 35 categories of frequently bought consumer goods. Brand penetration rates for socio-demographic tiers are established to explore brand purchasing. The metrics are: penetration, the number of buyers a brand has; and loyalty as measured by purchase frequency and share of category requirements. Findings Buyer behaviour patterns for the poorest consumers do not differ much from those in advanced economies; all brand performance metrics vary according to brand penetration – a double jeopardy effect, and the biggest brands are those that target the whole market, including the base. Research limitations/implications Data are from one country only and while the results confirm that patterns of brand buying in this BOP segment are like those in other markets, more research needs to be done to confirm the finding. Practical implications The biggest brands are those with the most customers, even if those customers are poor and do not buy very often. Growth can therefore be based on marketing interventions that appeal to the largest possible customer base. Social implications There are 2bn BOP consumers worldwide. This research shows that they may already be marginal members of modern economies and consumer culture. Originality/value This paper extends previous research on brand buying behaviour for the first time to the vast base of poor consumers who make up around half of the world’s population. This research shows that strategic approaches that emphasise increasing penetration are most likely to result in brand growth.

Marketing at the bottom of the pyramid: Literature review and future research agenda

“…Scholarly inquiries categorized under the sub‐theme of marketing‐mix revisit the concept for BoP, with major thrust areas being product (development and strategy), pricing, and distribution. Many scholarly inquiries (Agarwal et al., 2018; Jun et al., 2013; Nagy et al., 2019; Nakata & Weidner, 2012; Viswanathan & Sridharan, 2012) propose novel product development and product selection strategies for the BoP market. To this end, Viswanathan and Sridharan (2012) advocated for product development strategies to look beyond infrastructural deficiencies.…”

“…Moreover, Nagy et al. (2019) found that BoP consumers also prefer similar products as other income tier consumers, hence the need to introduce these products in BoP markets. Such strategic push may result in brand growth as well.…”

Same, same but different! New service development in the context of emerging markets: a review

“…While some propose a more charitable approach or not-forprofit provision (Berger and Nakata, 2013;Gupta et al, 2013;Venugopal and Viswanathan, 2019), others turn to social enterprises, i.e., approaches to support self-help like micro-lending, or even for-profit models (Bhatt et al, 2016;Galak et al, 2011;Vassallo et al, 2019). While the BOP seems widely explored (Nagy et al, 2020), developing further insights into adjacent segments, especially the burgeoning middle class, may prove promising. Initial research such as Diallo et al (2018) and Narayan et al (2015) provides evidence of the diversity and specific needs of the middle classes and the upmarket services, such as shopping malls or supermarkets, that they demand.…”

Sustainable value co-creation at the Bottom of the Pyramid: using mobile applications to reduce food waste and improve food security

“…This view corresponds with the Bottom (or Base) of the Pyramid (BoP) concept, which considers the 4 billion global population enduring per capita incomes beneath US$2 per day (Prahalad, 2012). From this perspective, BoP consumers represent not only socially disadvantaged people requiring help, but also a potential mass market for which businesses could target profitably and with a positive social impact (Nagy, Bennett & Graham, 2019;Prahalad, 2012). Scholars have further developed the BoP concept, from viewing BoP merely as consumers in the value chain, to engaging them as partners in the co-creation of new products and services (BoP 2.0) and even collaborators in efforts to transform the market and alleviate poverty (BoP 3.0) (Chmielewski, Dembek & Beckett, 2020;Simanis & Hart, 2008).…”

“…According to existing studies, BoP consumers continue to deal with issues relating to food insecurity, high food prices, malnutrition and poor food quality (Chikweche, Stanton & Fletcher, 2012;Nagy, Bennett & Graham, 2019). Nevertheless, the increasing accessibility and adoption of digital platforms and mobile technology by BoP communities can enable BoP consumers to enhance their quality of life (Dey et al, 2013;Lappeman, Ransome & Louw, 2019).…”