GUARDIAN LIVE CHAT: BOP Markets: Learning From Successes and Failures
Serving base of the pyramid markets is not easy. Multinational companies, often headquartered in the west, cannot simply expect to replicate traditional business models in developing countries. A bespoke and considered approach is required and finding the right business model can be a difficult and expensive trial-and-error process.
Novartis, for example, has managed to achieve scale with its Arogya Parivar healthcare initiative in India. Through the scheme the company sells affordable medication in small packets (around $1.25) to base of the pyramid markets, as well as providing healthcare education to communities and training to doctors. But it is an expensive approach - it took 30 months for the company to break even.
Failure is very common in base of the pyramid markets, but companies have altered their business models in response. Building company Cemex set up an initiative to address housing issues among low income communities called Patriminio Hoy. Initially using a door-to-door sales force it quickly found this didn't work. Instead it created migrant clubs to market its products and experienced better success.
Operating in base of the pyramid markets is complex. Businesses need to be prepared to spend time understanding what customers want and need, be prepared to fail and be in it for the long haul. So, where do companies start? How do they map markets and create workable business models? And what lessons can be learned from successes and failures of those companies already operating in base of the pyramid markets?
Join the experts for a live chat:
Join a panel of experts on Thursday 10 July at 3pm BST/ 10am ET to discuss the challenges businesses face when working with base of the pyramid markets and what can be learned from the successes and failures so far. Topics under discussion will include:
What kinds of business models appeal to base of the pyramid customers?
What can be learned from successes and failures of business? What are the common mistakes, what has worked well and what are the constraints to bear in mind?
How do businesses earn and maintain trust in low income communities?
Where is the evidence that inclusive business aimed at the world's poorest markets can have any role in alleviating poverty?
How can businesses respond to criticism that they are exploiting low income markets?
Panel:
Tatiana Bessarabova - consultant to Business Call to Action
Olivier Kayser - is the founding manager of Hystra, a former VP of Ashoka and for 18 years he was a senior partner at McKinsey
Erik Simanis - managing director of market creation strategies at the Center for Sustainable Global Enterprise at Cornell University's Johnson School of Management
How to Join:
The live chat is completely text based and will take place on this page in the comments section below, kicking off on Thursday 10 July, from 3pm (BST)/10am (ET). You can submit any questions in advance using the form below, or tweet them to @GuardianSustBiz using #askGSB and we'll put them to the panel on the day.