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1 – 10 of 159Misagh Tasavori, Pervez N. Ghauri and Reza Zaefarian
The purpose of this paper is to shed light on the international market expansion of multinational corporations (MNCs) to the base of the pyramid (BoP). The authors employ the…
Abstract
Purpose
The purpose of this paper is to shed light on the international market expansion of multinational corporations (MNCs) to the base of the pyramid (BoP). The authors employ the corporate social entrepreneurship (CSE) perspective to reveal how MNCs can enter this market, the key enabling factors and the benefits they can gain. CSE is related to entrepreneurial and marketing strategies that are inspired by social responsibility.
Design/methodology/approach
An exploratory, qualitative multiple-case study has been employed. In-depth interviews were conducted with managers from three MNCs that have entered the BoP market in India.
Findings
The findings of this research confirm that successful entry into the BoP requires the pursuit of social responsibility and the adaptation of marketing strategies. In addition, MNCs should identify the key environmental factors (demand conditions and socio-political actors’ expectations) and develop organisational characteristics (management support, network orientation towards non-governmental organisations and availability of financial resources) to match. The findings of this research show that engagement in CSE in countries with considerable BoP populations can bring firms legitimacy and sustainable profitability.
Research limitations/implications
This research is based on interviews with a limited number of MNCs in India. Future studies could generalise the findings of this research to a larger number of corporations in other countries.
Originality/value
This research brings new insights to the field of international marketing by integrating the corporate social responsibility, marketing and entrepreneurship disciplines. The findings of this research offer empirical support for CSE and its role in international marketing strategies.
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Pervez Ghauri, Misagh Tasavori and Reza Zaefarian
The purpose of this paper is to explore how employing corporate social entrepreneurship and developing a network of relationships with non-governmental organisations (NGOs) can…
Abstract
Purpose
The purpose of this paper is to explore how employing corporate social entrepreneurship and developing a network of relationships with non-governmental organisations (NGOs) can support and contribute towards the internationalisation of service firms into the base of the pyramid (BOP) markets in emerging markets.
Design/methodology/approach
This research adopts an exploratory approach employing qualitative multiple case studies. Three service firms that have targeted the BOP markets in India were studied. In total, 25 in-depth interviews were conducted with multinational corporations (MNCs) and their NGO partners. Data analysis was facilitated through pattern matching and systematic case comparison.
Findings
The findings reveal that, by engaging in social entrepreneurship, these MNCs have focused on the neglected needs of the BOP population, developed sustainable solutions and empowerment, and started with social value creation and postponed value capturing. The pursuit of corporate social entrepreneurship has paved the way for them to establish relationships with NGOs. While the MNCs have mainly had the technical knowledge and financial resources required, collaboration with NGOs have allowed them to learn about the BOP’s specific needs and benefit from the NGOs’ knowledge, human resources and good relationships in this market.
Originality/value
This research unravels how service firms can seize opportunities at the BOP. The authors build on social entrepreneurship theory and bring new insights to the field of international business. In addition, the authors broaden the network view and show how networking with social actors such as NGOs enables the mobilisation of resources, actors and activities in emerging markets.
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Jakki J. Mohr, Sanjit Sengupta and Stanley F. Slater
This article aims to propose a continuum of strategic engagement approaches to base‐of‐the‐pyramid (BOP) markets ranging from non‐profit and government aid to corporate social…
Abstract
Purpose
This article aims to propose a continuum of strategic engagement approaches to base‐of‐the‐pyramid (BOP) markets ranging from non‐profit and government aid to corporate social responsibility (CSR) programs and social entrepreneurship. A framework is presented to identify which approach to serving the BOP market makes the most sense under certain conditions, depending on availability of consumer resources to participate in the initiative, the infrastructure available for the initiative to leverage, and whether the focus of the initiative is to be self‐sustaining over time.
Design/methodology/approach
This is a conceptual article based on literature review and synthesis.
Findings
Eight different approaches to engage with BOP markets are recommended under different combinations of three underlying conditions: consumer resources, infrastructure availability and self‐sustainability goals.
Originality/value
The paper presents a continuum of strategic engagement approaches to BOP markets.
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Robert L. Williams, Maktoba Omar and John Ensor
Much has been written concerning the value and validity of the bottom of the pyramid (BOP) model, as a strategy for multi‐national corporation (MNC) growth. The model presented in…
Abstract
Purpose
Much has been written concerning the value and validity of the bottom of the pyramid (BOP) model, as a strategy for multi‐national corporation (MNC) growth. The model presented in this paper adds to the discussion of strategic possibilities to tap the potential of emerging markets. This paper seeks to address these issues.
Design/methodology/approach
The paper first discusses trends in economic growth in emerging markets, global strategies, and the BOP market, then analyzes the blue ocean strategy (BOS) of value innovation.
Findings
The paper develops the Value Flame at the Base of the Pyramid (VFBOP) model by combining BOP and BOS strategies to potentially offer opportunities for MNC market entry as well as market supply, to drive revenues and expand global market share.
Research limitations/implications
As a concept, the model must be validated by empirical and case research to ascertain the shape and dynamics of the model. Future research can establish the parameters of the flame.
Originality/value
It is believed that the VFBOP model is the first to address some of the limitations of BOP strategy while profiting from the BOS model, in order to fully benefit from sourcing and selling to emerging markets.
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Stephen Mezias and Mohamad Fakhreddin
Over the last 15 years, articles about the base of the pyramid (BOP) have begun to appear in scholarly business journals. Although attention was driven initially by claims that…
Abstract
Purpose
Over the last 15 years, articles about the base of the pyramid (BOP) have begun to appear in scholarly business journals. Although attention was driven initially by claims that corporations could earn a fortune selling to these consumers, it became clear that this is difficult. The paper aims to discuss these issues.
Design/methodology/approach
To move beyond this difficulty, the authors emphasize the iterative boundary capabilities built by local, for profit enterprises as the key to creating markets at the BOP.
Findings
The authors argue that the evolution of the business models to permit firms to earn profits and have positive social impact requires building iterative boundary capabilities and support this claim by reviewing two cases of community based non-profits.
Research limitations/implications
Future research should demonstrate that the process the authors observed in these two cases applies in other contexts. Scaling social impact will require sharing knowledge about iterative boundary capabilities and developing best practices that can help effective allocation of patient capital to share best practice and guide public policy.
Practical implications
Social entrepreneurs can conceptualize their own enterprises in terms of iterative boundary capabilities. Social investors can use the framework to assess and advise enterprises in which they may or have invested. Policy makers can enact laws and other legal actions to facilitate the formation of iterative boundary capabilities.
Social implications
The authors see the framework as part of a broader move toward business models that pursue both positive social impact and profits.
Originality/value
The authors link a structuring approach with an institutional perspective to enhance business models that pursue profit and create positive social impact in BOP communities.
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James Lappeman, Kristin Ransome and Zach Louw
This paper aims to show that a generic bottom-of-the-pyramid (BoP) segmentation strategy does not represent a multi-country BoP consumer profile. A series of multinational entry…
Abstract
Purpose
This paper aims to show that a generic bottom-of-the-pyramid (BoP) segmentation strategy does not represent a multi-country BoP consumer profile. A series of multinational entry failures has clearly shown that a one-size-fits-all strategy is inappropriate for emerging markets, especially in Africa.
Design/methodology/approach
The study analysed literature defining and profiling BoP consumers at both a global and local level using South Africa as a case study. Being Africa’s largest economy, South Africa was an ideal subject. The findings were then independently triangulated with seven experts for validation.
Findings
The results show that the South African BoP has eight characteristics that align with definitions in global BoP consumer literature. An additional five characteristics were identified that were not general BoP characteristics, and that applied specifically to South Africa.
Practical implications
The findings add to the growing evidence that BoP markets are complex and heterogeneous, and they make a case to consider each BoP market individually. As there is yet to be a model to define BoP market differences systematically, this study provides a foundation for new developments in BoP segmentation in Africa and in other emerging markets.
Originality/value
While there is evidence that BoP markets are complex and heterogeneous, there is yet to be a model to begin the process of defining these differences systematically to improve strategic direction for multinational companies and regional decision makers. This study, therefore, provides a foundation for new developments in this field of segmentation in Africa and in other emerging markets globally.
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Abiodun Adegbile and David Sarpong
The authors aim to examine the potential opportunities and challenges multinationals operating in Africa are likely to encounter when they seek to pioneer disruptive innovations…
Abstract
Purpose
The authors aim to examine the potential opportunities and challenges multinationals operating in Africa are likely to encounter when they seek to pioneer disruptive innovations at the base of the pyramid (BoP) in African emerging markets.
Design/methodology/approach
Drawing on the extant literature on the BoP, disruptive innovation and the African business context, the authors explore the pioneering of disruptive innovations in the African socio-economic context.
Findings
This study develops various hypotheses to extend our understanding of disruptive innovations at the BoP. The authors also delineate potential managerial and institutional challenges multinational corporations (MNCs) are likely to encounter in their efforts to pioneering disruptive innovations for BoP customers in African emerging markets.
Practical implications
The authors develop some recommendations for MNCs on how to create and capture value from disruptive innovations in African emerging markets
Originality/value
The authors delineate African context-specific managerial and institutional challenges that MNCs might encounter when seeking to develop disruptive innovation at the BoP.
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May Nagy, Dag Bennett and Charles Graham
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…
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.
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Wendy L. Tate, Lydia Bals and Donna Marshall
The purpose of this paper is to compile a set of articles tackling supply chain issues in BOP contexts that address both demand and supply. Solutions are needed for global…
Abstract
Purpose
The purpose of this paper is to compile a set of articles tackling supply chain issues in BOP contexts that address both demand and supply. Solutions are needed for global sustainability problems from medical aid and food availability to the ability to participate in supply chains for the global poor.
Design/methodology/approach
The accepted articles in the special issue used a range of qualitative and quantitative methodologies to answer research questions in a variety of base of the pyramid (BOP) contexts. These approaches and results distinguish between demand (BOP market) and supply, or base of the chain (BOC), perspectives.
Findings
The findings in the eight accepted marticles are interesting and applicable across different BOP contexts. Compilation of the articles into the special issue and the accompanying editorial led to a comprehensive future research agenda that addresses demand-side issues by investigating the customers in BOP markets, and supply-side issues focusing on the suppliers and intermediaries (BOC) who supply BOP markets. Future research ideas include a focus on supply chain design issues situated at the intersection of the demand (BOP) and the supply (BOC) concerns that address the needs of the world’s poorest populations.
Research limitations/implications
All of the selected articleshave societal implications related to addressing the needs of BOP populations. Many of these articles also have economic and environmental implications, the other two pillars of the triple bottom line. The detailed future research agenda developed in this editorial presents implications for researchers working in emerging and BOP communities to push research forward and further develop the foundational literature in the BOP context.
Practical implications
From a practical standpoint, each of the eight articles presents ideas for businesses that help address the needs of the global poor while enhancing global sustainability performance. The editorial summarizes these implications and provides new directions and examples of success in the BOP context. Managers are provided with techniques to address the supply and demand side of these growing markets.
Originality/value
The overall conceptual framework and positioning of the final papers into the BOP market, BOC suppliers and a combination of the two is novel and helps provide guidance to both scholars and managers.
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Van R. Wood, Dennis A. Pitta and Frank J. Franzak
This paper aims to contend that four significant ideas must be comprehended, and their connection and interaction understood if successful marketing to the 4 to 5 billion…
Abstract
Purpose
This paper aims to contend that four significant ideas must be comprehended, and their connection and interaction understood if successful marketing to the 4 to 5 billion undeserved bottom of the pyramid (BOP) people in the world, by multinational firms is to be realized. These ideas are: the bottom of the pyramid (BOP) market itself; share of the heart versus consumer animosity; the nature and influence of global “umbrella” brands and responsible marketing as a guiding principle for all firms including those focusing on the BOP. Each of these ideas, in and of itself, represents an important dimension in today's global business environment, but taken together they offer a clearer understanding of how companies, particularly multinational companies, can do well (profit) and do good (improve humanity).
Design/methodology/approach
The paper briefly overviews the BOP literature, highlighting those parts most relevant to this work; expands upon the notion of “share of heart” and its twin components consumer affinity and consumer animosity; delineates the nature and impact of global “umbrella” brands in BOP marketing; synopsizes the notion of “responsible marketing” in the BOP context, and proposes a conceptual scheme of how these ideas are connected, how they interact in today's business world, and how they can lead to ongoing business success.
Findings
Mutlinational firms (MNFs) wishing to successfully pursue BOP markets need to blend their understanding of BOP uniqueness, with a clear understanding of the other three concepts, namely share of heart, gobal umbrella brands and responsible marketing. Tapping the potential of the BOP requires not only radicallly lowered priced products but also consumers with higher income. Marketers must address both parts of the problem since acting on either in isolation will not be effective.
Originality/value
Global umbrella brands of the rich world (BrandAmerica, EuroBrand, BrandNippon, etc.) must also play a part in successful BOP marketing. The future of such global umbrella brands lies to a great degree with BOP markets as these markets are still growing, and thus represent and will continue to represent either enormous partners or enormous rivals. MNFs that truly understand the nature, scope and potential of BOP markets, and act in concert to market responsibly to consumers in such markets, will not only garner the needed share of heart related to long‐term success in such markets, but will see their own global umbrella brand continue to thrive and prosper in the ever evolving global market arena.
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