Challenges faced by South African companies when serving low-income markets : a market orientation perspective

Abstract

The purpose of this research was to enrich our understanding of why large organisations have not performed in low-income markets relative to middle- to high-income markets through an understanding of their market orientation in these markets. The research sought to establish whether an organisation can have more than one instance of market orientation in its chosen markets. The literature asserts that the bottom-of-the-pyramid approach to earning corporate profits has gained considerable attention and has awakened managers to the potential of serving an underserved market and alleviating the level of global poverty while still earning a profit (Pitta et al. 2008). South African companies have heeded the call to play a role and have targeted low-income markets, but, disappointingly, have achieved limited success. Contrary to the situation in relation to low-income markets, South African firms serving middle- to high-income markets have achieved market success through effective business models and orientation towards their markets. The qualitative study showed that an organisation indeed can have more than one instance of market orientation, as managers responsible for low-income markets experience challenges across all market orientation activities, relative to their middle- to high-income market counterparts.