Reaching the bottom of the pyramid
It is estimated that 1 billion people will rise out of poverty in the next ten years, particularly in China and India. Our deep roots and early engagement in these markets have given us valuable experience in meeting the needs of these consumers at the 'base of the economic pyramid'.
Our aim is to satisfy the needs and aspirations of consumers at all levels of the pyramid with quality products. This means a differentiated portfolio in terms of price and packaging format to address the needs of different income groups.
Developing new business models
Whether it is through new distribution channels, using smaller formats or creating new products, we are developing business models to reach the poorest members of society.
Our new Pureit in-home purifier was designed to provide an affordable safe drinking water solution to low and middle-income families. In India, where Pureit has been launched, one rupee can buy you 3.5 litres of Pureit safe drinking water (including the initial one-off cost of the purifier unit). This makes it a more affordable alternative to boiling water, where one rupee will buy you 2.5 litres, or bottled water where one rupee will buy you just 0.3 litres.
Another example is the Pepsodent Fighter, a quality low-cost toothbrush which brought better oral care within the reach of millions of low-income consumers in 2007. Our research centres in Italy and India have worked together to develop the toothbrush which is now available in 30 countries across Asia, Africa and Europe for 20 – 70 euro cents. We sold 40 million Pepsodent Fighter toothbrushes during 2007.
Replicating this approach across a broader range of brands is a much bigger task. Nonetheless, finding more ways to reach consumers at the base of the pyramid makes business sense and enhances our ability to improve the lives of the poorest communities.
Some trade-offs are currently inevitable, however, in trying to meet all our social, economic and environmental commitments. Making products available in small-pack sizes and single-dose sachets brings quality brands to some of the world's poorest consumers, but it also contributes to litter in markets where waste management infrastructure cannot always provide facilities for reuse and recycling. We are working with stakeholders on how best to solve this dilemma without affecting the affordability and accessibility of our products.
