Redefining BOP : in pursuit of sustainable opportunity at the base of the economic pyramid

Abstract

The 2002 publication of “The Fortune at the Bottom of the Pyramid” by Prahalad and Hart posed a proposition to multinational companies (MNCs) stating that huge profits can be made whilst simultaneously eradicating poverty by selling to the poor at the base of the economic pyramid (BOP) which is an untapped market consisting of more than four billion potential customers that earn less than $2 per day. Although very few researchers and authors actually dispute the reality of the opportunity presented by the BOP proposition, most are quick to point out discrepancies in some of the arguments, discussions, assumptions and conclusions made from the early publications. Most of these differences of opinion can be clarified by refining the definition of the BOP proposition. This study reviews previous literature to identify key attributes of BOP before utilising a meta-analysis of 43 cited BOP case studies to identify and describe two distinctly different market segments within BOP. BOP1 was defined as the bottom part of the BOP with a total population 2.8 billion customers earning less than $2 per day while BOP2 would be the reminder of the BOP market segment. Finally the BOP1 and the BOP2 segments of BOP are compared and contrasted with a South African case to draw conclusions on BOP in SA and Africa. Copyright