Business Strategies at the Base of Pyramid

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Business Strategies at the Base of Pyramid

• World Economic Congress May 16, 2008
• Arlington. Virginia
• Sean Collins University of Alberta

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Overview
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Base of Pyramid - Definition

• Collection of individuals living at income levels
  of 3,000 or less.
• Estimated total the market size of over 4 billion
  people.
• Concentrated in developing nations with nearly
  have of BoP consumers living in India and China

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Base of Pyramid - Size
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Case Studies
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Consumer Challenges
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Poverty Premium

• Demonstrates difficulty in using average prices
  for economic purposes

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Returns to Scale

• Modification of business models have the
  potential to open up huge new markets
• Likened to Henry Ford and the Model T
• New Market
• New production method
• New business model
• High costs to overcome barriers to entry
• Lack of infrastructure
• Significant efforts required to establish brand
  and corporate reputation Aguas del Tunaris
  privatization of Cochabambas water show drastic
  consequences of not establishing a reputation in
  a developing nation.
• Language and cultural barriers exist from region
  to region.

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Cemex Patrimonio Hoy
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Future Research
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Contact Information