Market-Based Strategies Serving Low-Income Populations
15 Pages Posted: 24 Apr 2007
Date Written: August 31, 2005
Abstract
The market dynamics of low-income market segments defy the traditional business logic that is applied to mid- and high-income segments: pricing strategies aim at the lowest possible price, the delivery infrastructure must be capable of handling a significant number of small transactions, promotion strategies require a considerable amount of consumer education, and even the needs and values of consumers are, in many senses structurally different. Business, particularly those whose products and services address basic human needs, can enter low-income market segments more effectively and with deeper social impact through partnerships with highly innovative citizen sector organizations. Also, CSOs can scale their impact significantly by learning to leverage the infrastructure and experience of businesses while advancing their social missions. Communities would be better served if an increasing number of new actors compete and collaborate to deploy soluctions that maximize the value added to the poor.
Keywords: social entrepreneurship, ashoka, full economic citizenship, hybrid value chain, corporate social responsibility, bottom of the pyramid
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