Marketing challenges for BOP markets:
BOP or Bottom of pyramid is a socio economic term given for the strata of low income people in the income pyramid (used to approximate the distribution of a country’s income). Thus obviously Bottom of Pyramid constitutes the market made of country’s poorest people. In India approximately 6 Lacs villages and 72% of country’s population constitutes BOP. The great majority of men and women of this BOP cluster work in agriculture, animal husbandry, factories or own rural shops and their income levels less than Rs.1.5 Lacs/year. Most companies have not traditionally considered people at bottom of pyramid as potential customers due to their low level of their individual incomes. It is a common belief that poor do not have any significant purchasing power and therefore do not represent an attractive market. However this assumption ignores the volume of the market and thus there are tremendous benefits for companies if they choose to serve the highly underserved and less comparatively markets at BOP. Over the past few years, business leaders and strategists around the world have increasingly been focusing their attention on the challenges of intense competition and slowing growth in high income markets. This has led many of them to reconsider the potential of emerging and low income markets. Rising purchasing power, changing consumption patterns, increased access to information and communication technology, improving infrastructure and government initiatives to boost the main constituent of Indian BOP market I, e Rural/Rur-ban markets. Shifts in occupation towards more predictable income streams have led to creation of new consuming class. There is increased need for products and services to reach these consumers spread across a wider geography and higher disposable incomes. We will see how mobile handset giant, Nokia is aggressively targeting BOP as one of its most important pillars to regain its position in the mobile handset...
Please join StudyMode to read the full document