1

Customer-centricity at the Base of the Pyramid

Key insights from inclusive business practitioners

Story highlights 

Customer-centricity at the base of the pyramid is not straightforward; it’s difficult, it’s different and it requires thinking “forward” about risk-free solutions that the customer wants 

Entrepreneurs have different strategies from defined tools that capture problem context and feedback to best practices, like knowing when to slow down and retest your value proposition  

Customer-centricity alone is not enough; having ‘impact’ requires innovative distribution networks and strategic financing to alleviate customer pains  

Scaling impactful, customer-centric, inclusive businesses takes co-creating value propositions, user-centred design, and cross-sector partnerships with multiple stakeholders  

According to Rama Bijapurkar, “consumers at the Base of the Pyramid (BoP) demand innovative, forward-looking products and services that meet their varying and complex needs.” And yet, to use Caroline Ashley’s words, it is “difficult” and “different” to actually implement customer-centricity in the “large” and “heterogenous” markets of the BoP.  

People with fish

The large and heterogenous markets of the BoP. Photo credit: GIZ / Dirk Ostermeier

Lucie Klarsfeld McGrath and Yasmin AlKhowaiter offer three lessons to help entrepreneurs to actually practice customer-centricity, like “understanding and responding to people’s aspirations” through products and services that are high quality and risk-free.  

Lady in pharmacy

BoP customers are looking for products and services that are high quality and risk-free. Photo credit: © GIZ / Dirk Ostermeier

Chandrima Das and Akshay Kohli point out that there is a disconnect between market-ready, financed energy solutions and customer adoption. But these issues aren’t limited to the energy sector; Vaneshi Manuturi echoed this sentiment, explaining that “well-intentioned solutions that turn out to be ineffective are a dime a dozen across all sectors.”  

People with bottles

Across all sectors, well-intentioned solutions for the BoP too often turn out to be ineffective. Photo credit: RegencyFoundationNetworx

According to Alexis Bonnell, the key for the entrepreneurs at Evidence Action was “getting in their customer’s shoes to identify the key drivers of adoption,” which required the courage to slow down and identify challenges to a major funder. In this case, being customer-centric unearthed the need to pivot, illuminating a point made by Ella Gudwin: “value propositions are not static.”  

 

As important as customer-centricity is, it does not exist in a vacuum. As Sean Blagsvedt points out,  “getting people to pay for something… suddenly makes you much more beholden to what they truly think and believe.”  
Lady in blue

A woman that picks coffee. She is glad to use her new glasses as they truly improve her daily life. Photo: Credit: Vision Spring

But to be an inclusive business, you must also have your intended impact, which can require more than just customer-centricity. In the case of Katherine Lucey this meant being customer-centric in not only the product (solar lighting solutions), but also the distribution model (developing women entrepreneurs) to reach “the last mile.”  

Lady in store

Developing women entrepreneurs is important to strengthen distribution models, which in turn is key to being customer-centric. Photo Credit: Fundacion Capital

And even once all the work has been done to develop a product and distribution with consumers, that they want, Ahmed Abbas reminds us that there is a “gap in financing available… for [those] who have difficulties affording new products,” meaning there are other hurdles to overcome.  

Lady at bank machine

When entrepreneurs have developed a product and distribution with consumers for a product that they want, it is important to ensure they can afford the new product. Photo Credit: Fundacion Capital

Stuart Hart’s suggested strategy therefore is “the dance of co-creation,” where corporate global best practices and technologies from the company are married with the local knowledge, skills, and aspirations of the local community. Could this help entrepreneurs like Abbas overcome the financing gap he faces in Egypt?  

People with a phone

The knowledge, skills, and aspirations of communities are important when companies want to reach customers effectively. Photo Credit: © GIZ / Susann Tischendorf

Alternatively, are there opportunities to consider customer-centricity when building cross-sector partnerships? Which brings us to Niti Bhan, who leaves us to ponder the question, “who exactly are we designing solutions for?”  

Lady wth seeds

Equally important is that companies know whom they are designing solutions for. Photo Credit: GIZ / Dirk Ostermeier

Ana Pantelić points out that answering this question and being customer-centric requires “investments in patient, relationship-building capital” across multiple stakeholders, including financial institutions, governments, and funders. 

Funding

Being customer-centric requires a strong commitment to relationship-building. Photo Credit: Fundacion Capital

Tackling the topic of customer-centricity effectively requires a thorough and integrated approach to all these issues. The variety of contributions to this edition of the online magazine provides insightful suggestions on how to do so.  

Dana Gulley
Dana joined iBAN as the Editor-in-Chief of its online magazine, CLUED-iN, in July 2018. She is the founder and lead consultant at Third Peak Solutions, a firm that advises businesses and nonprofits on developing innovative strategies to solve our world’s most pressing challenges. A trained mediator with a background in natural resources and business administration, Dana has spent her career building cross-sector partnerships to tackle both energy and water issues.

Blog post

Customer-centricity: is it not obvious?

Three reasons why customer-centricity isn’t as easy as it sounds

By Caroline Ashley

Table of contents

graphic summary

GRAPHIC SUMMARY

A visual summary of key challenges and opportunities for entrepreneurs when addressing the topic of customer-centricity. Learn more about all these aspects by reading this first edition of the newly developed online magazine on Inclusive Business! The…

editorial

THE END OF THE BENEFICIARY, THE RETURN OF THE CUSTOMER

Why a shift from ‘beneficiary’ to ‘customer’ has the potential to be one of the greatest paradigm shifts facing the development industry 

Alexis Bonnell

feature story

Customer-centricity at the Base of the Pyramid: Key Insights from Inclusive Business Practitioners

In this issue of iBAN’s online magazine, practitioners from the inclusive business world share their insights about challenges and best practices in the realm of customer-centricity. Entrepreneurs tackling wide-ranging issues, from energy access to affordable eye care, all weighed in to share how they view – and act on – “customer-centricity.” Here are their key findings and thoughts.

Dana Gulley

Profitably serving the modest-income consumer takes forward, not backward, thinking

Designing profitable businesses for modest-income consumers has been a major challenge for companies for the past thirty years, yet new growth in world consumption will come from this population.

How to put the customer first at the base of the pyramid

The base of the pyramid (BoP) has long been recognised as an untapped market, but the question has now shifted to the more complicated how do we tap into it?.

Putting needs at the centre of product development: lessons learned from a forest honey filter prototype

There is a common phenomenon in product development. A particular product might pass all assessments and quality control, but struggle to be adopted by the intended users, leaving us wondering where it went wrong.

Who are you designing for? Using human-centred design to create inclusive value

Niti Bhan brings a multidisciplinary and multicultural perspective to innovation for the informal economies of the emerging markets of the developing world.

Financial inclusion begins with understanding what drives customers and partners, from individuals and financial institutions to governments and funders

Introduction

Fundación Capital is a social enterprise working to improve the financial lives of millions of people in poverty by designing and delivering solutions that make families more resilient to economic stress.