Selling to the Bottom of the Pyramid
Setu has been working on our energy, water and sanitation sector strategies in India and recently participated in Everyday Barriers. During the Everyday Barriers exercise, we send team members into local communities without everyday luxuries such as phones or money, and encourage them to explore the surroundings as many without these resource do. Below, Setu reflects on his experience trying to access basic services during the exercise.
As a part of the Everyday Barriers exercise at Acumen, I visited a slum in the Bandra neighborhood of Mumbai to experience the ground realities as well as the everyday challenges faced by the poor. Not only did it turn out to be a humbling experience but it also made me realize how challenging it can be for entrepreneurs to sell to low-income customers. Contrary to popular beliefs, I feel that more than the willingness to pay or the income levels, it is the high degree of contentment and the pre-conceived notions that could offer greatest resistance to entry of products and services within this space.
Most of the slum-dwellers earned less than US 5$ a day, which is seemingly insufficient a sum to raise a family of 5, the average number of members in an Indian household. I tried to gauge the challenges that they faced in getting access to basic services like electricity, water, sanitation, healthcare and education and what I found was that although most had access to such services to some extent, they were certainly not at par with what I assume to be basic living standards.
I visited a pre-school that had no toilets and the kids had to use the one in a building 20 meters down the lane. The houses lacked drainage and dirty water flowed right through the narrow streets. While some households used traditional three-stone cook stoves to prepare food, others had gas cylinders that were bought from the black markets at a premium. Women queued up for hours near a hand-pump to collect water for their families, indicating unreliability in supply within their premises.
This may seem to be appalling, but what was most striking for me was that everyone seemed to be content in the way they were going about their lives. I realized that the entrepreneurs working to provide such people with access to critical services also have to fight through this contentment to make their target audience aware of the outreaching impact that these solutions can have on their lives. The awareness that an over-flowing drainage is a breeding-ground for mosquitoes or that the smoke from the traditional cook stoves can have an ever-lasting impact on health often does not exist at the ground level and needs to be conveyed to such consumers as the direct monetary benefits are not as apparent for some of these solutions.