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Customer-centricity at the Base of the Pyramid

Key insights from inclusive business practitioners

Transforming energy access using trusted networks

Transforming energy access using trusted networks

Interview with Katherine Lucey, Solar Sister

Introduction  

Solar Sister is a social enterprise dedicated to providing rural communities in sub-Saharan Africa with solar lighting solutions. With the aim to eradicate extreme poverty, it empowers women entrepreneurs through a direct-sales network that is key in its customer-centric approach.    

What does customer value mean to you? 

At Solar Sister, we work with women entrepreneurs and train them to build businesses in rural communities to sell clean energy to their customers. We have two levels of customers. We have the women-entrepreneurs who we serve and help to build businesses and then we help them serve their customers, who are the individuals and the families, who are buying solar lights, home systems, and clean cook stoves.  

For Solar Sister, customers are the most important part of our whole system. We exist to benefit the customer. Everything we do comes from that. Everything that we do as far as what products we choose is because it is what the customer demands. We make sure to choose quality products, because that provides the customer with the best value. We provide after-market services, because we want to make sure that the customers benefit from this new technology and learn to trust it. It is absolutely transformative, but it is only useful if it works. If anything goes wrong with the technology after they receive it, it is important to have that customer service mentality and to provide them with after-market services. Whether it is replacement or warranty, repair or maintenance or even just helping the customer to use the product. Everything we do comes from that focal point: Who is our customer? How do we best serve them? How do we make sure that the products and services that we are providing suit them? 

How do you make sure that your value proposition reaches the customer?  

We looked at energy access and saw that in rural areas in sub-Saharan Africa people are still not connected to the grid. They are using candles and kerosene for lighting. It is inefficient, expensive, and unhealthy. Yet, there is an existing technology that is simple, appropriate, and affordable: solar lighting. It is economical, because once you buy the solar light you do not have to continue to invest in kerosene every week. Solar actually saves people money and is a superior product.  

There were all these reasons why solar products should be really taking off, and yet they were not. We asked: Why aren’t people switching from kerosene to solar? It really came down to distribution and the fact that the products were not there in the communities where the people most need them. To close that gap, we needed a distribution company. We built a prototype; we can do this on a market basis, because it is affordable and it is replacing the customer’s existing expense. They are already spending money on kerosene, and if they don’t spend the money on kerosene, they could buy the solar lamp and actually save money. There is an economic justification value for it, as well.  

You can only be successful if you are actually reaching the customers, satisfying them, and meeting their demand. Therefore, we looked at: Who is the customer? Who uses the type of the energy that we are talking about? Who is managing the energy at the household level? When we looked at that, we saw that: It´s the women who walk to the market every day with their cola bottle and fill it up with kerosene at the petrol station. They come back home and they fill up their lamps with it, or they walk miles to collect wood for their cook stoves. When you think of who is managing household energy, and basically any household utilities, including water, it is the woman of the household.  

The gap here is that we are trying to introduce a transformative, new technology. In the communities where we are working, the women are not going to take on a new technology easily, because they are not going to trust it. They have used kerosene their whole life, they know how it works and how expensive it is. They know everything about it. Then you show up with this new technology of solar lamps, they are like: “Oh, maybe not.” We had to figure out how to bridge that trust gap. We decided to bridge that gap by having one woman sell to another woman. That is how we recruited local women. We gave them the training and experience and let them use the products themselves, so that they became not just sales people, but basically evangelists for this new technology. With their own experience, they could go and sell through their families, friends, neighbours, and social network. By selling through that social network, that trust mechanism is already built in. You have to build trust. How do you build trust? It is a woman-to-woman-connection. It is their own social networks that are already in place. That is how we can spread this new product virally.  

Ladies
For  Solar  Sister,  building  trust  via  women  ́s  social  networks  represents  a  crucial  step  in establishing  good  customer  relations.  Copyright:  Solarsister 

Do you have any other suggestions for companies that aim to reach people, not just at the BoP-level, but particularly women?  

You have to build in the intention of reaching the BoP and of reaching women. It does not just happen by accident. Solar Sister has ‘women’ even in its name. From the start, we realised that this is central to our model and to how we operate. Then you have to hold on to that and live it out. We have seen many organisations talking about reaching the last mile in rural Africa with energy. They start with good intentions, but they don’t hold on to them. They get pressured. As they seek to raise money, to bring in capital. That brings a certain profit requirement because they have to pay back their investors. That pulls them away from the harder-to-reach market, the furthest market, the women´s market. They start to pull back towards what is more commercial, what is more profitable.  

We have been operating since 2010. Over the past eight years, we have seen increasing activities and investment in energy access overall. At the same time, we have seen less investment in the more rural and harder-to-reach areas. We used to be one of several organizations working in rural sub-Saharan Africa, reaching these very-last-mile customers. Now we are one of very few, and it is because others have pulled back. When you put mission and profit side by side, many are leaning towards profit. This is a choice to make, but it means that there is going to be a gap at this hardest-to-reach-customer. Anyone who wants to put their mission at the centre has to recognise that you need to have patience, you need to have intention, and you need to recognise that you have to make those decisions. Will you then go towards profitability and step away from that mission? Or are you going to hold on to your mission and maybe have some more patience?  

Donor partners have their own metrics. Do you have suggestions on how to overcome the pressure of the donors? 

We see this all the time. The best thing to do is to be really clear about your own goals and objectives. Be very transparent about what you are trying to do so that you can attract others who want to join that journey, rather than trying to shape yourself to fit the latest request for proposal or the latest investor trend. It can be tempting to go after the money when all the money is going towards pay-as-you-go systems or some other new idea. You can easily find yourself thinking: “If we just became a pay-as-you-go company we could get lots of money and then we could do what we wanted,” but if that is not what your mission is and not who you are, then you lose your soul in that process. You have to be clear.  

For Solar Sister this means: We are non-profit, we are a social business, and we will always put the impact first. Our goal is to maximise impact and at the same time try to achieve a financially sustainable model. But it is always impact first and then financial sustainability. Many other organisations have chosen a different path. They are choosing profit. They try to earn the profit while also being impactful. They put profit first and then consider the impact.  

I think there is room in this world for both, and we need both kinds of organisations. In some cases, we need even purely philanthropic efforts. Whether it is refugees or a humanitarian crisis, some of these things do not have a private market solution for them. They do still need public support. I think there is room and need for all kinds of capital, from traditional investment, to impact investment, to blended capital, to philanthropic creative capital, to more traditional philanthropic capital. I think we need all of that, but for any organisation to navigate their way through that: You have to know who you are, what you are doing, and then, find the right fit. 

Do you have something to add on customer-centricity? 

The final thing is that with customer-centricity you have to listen to your customer. That means you need to go out there, collect data, pay attention and really think deeply about what is the data telling you. Test it, retest it, and be humble. We all come to the market with our own biases, backgrounds, experiences, and expectations. We are working in multiple communities and cultures. Sometimes, you have to look at the data, but you also have to try to break through your own biases to hear what that data is telling you. It takes a lot of listening.  

 

Katherine Lucey

Katherine Lucey is the Founder and Chief Executive Officer of Solar Sister, an innovative last mile distribution solution for clean energy technologies in rural Africa that taps into the power of women entrepreneurs. Katherine is a Schwab Foundation Entrepreneur of the Year, an Ashoka Fellow, and a Draper Richards Kaplan Foundation Entrepreneur. She has received recognition and awards for her work with Solar Sister including Clinton Global Initiative, Social Venture Network, C3E, and International Center for Research on Women (ICRW) Champion of Change Award. She holds an M.B.A. from Georgia State University and a Bachelor’s Degree in Journalism from the University of Georgia. Prior to becoming a social entrepreneur, Katherine spent over 20 years as an investment banker on Wall Street providing structured finance solutions to the energy sector.

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