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Vincent Kapur

Consumers want to spend money for quality oriented lifestyle products. Seven key lessons learned from market (part 2)

Within the social enterprise space, “consumerism” may often be viewed as a negative behavioral driver. However, it remains a powerful motivator, as all human beings seek to obtain some form of comfort, connectedness, information, and entertainment. Suppliers of solar solutions may realize greater success if they respect the following seven rules about consumers:

Lesson 1-3 see part 1 of this article 


4.
Consumers WANT to spend money.
The barrier to sales is not the price. BoP consumers can and do spend money. In India, many low-income consumers do not have access to banking services and often participate in communal savings pools called ‘chit funds’ in order to enforce minimal savings behaviors. However, each member of the pool has the option to draw from the collective funds in turn for primarily discretionary spending of a sizable amount. Considering that many solar lighting options are available in India at or below the price of a standard feature phone, enterprises must recognize that individuals and families are silently indicating that they do not recognize a comparable value proposition for lighting solutions despite their ability to afford the purchase.


5.
Consumers want lifestyle products.
Most solar lighting solutions, particularly portable retail varieties, take the form of a lantern or a task-light. While this emphasizes functionality and utility, most use cases for BoP consumers take place in the home. Just like any other consumer, low-income Indians in rural or urban communities value aesthetics as well as utility and prefer items which look like they belong in a home rather than items which look like tools or some type of equipment. Products which have incorporated basic plastic shades on hanging light fixtures have generated strongly positive responses in very-low-income communities relative to high quality lighting in the form of lanterns.


6.
Consumers do not want to compromise on quality.
If they plan to spend money, a consumer desires some certainty that it will not be wasted. BoP con-sumers deserve to be sold real quality and they make their preferences known based on their experiences. In India, products labeled as being made in China are often suspected, perhaps unfairly, of being cheap in quality. A low income cook working in a city, having come from a village, had received a free smartphone from an acquaintance of mine but was disappointed that it was a generic Chinese model and was suspicious of its quality. Why shouldn’t BoP consumers demand recognizable quality? The mobile phones they purchase have many sensitive electronic components and last for many months if not a few years under conditions of aggressive handling. Shouldn’t a solar lighting solution last as long or longer?


7.
Consumers want transformational products which are marketed directly to them.
BoP consumers do not need to be reminded of the pyramid itself. No marketing efforts should be spent on referencing their status as being poor. Aspirational messages about net positive outcomes always have more appeal than messages about rectifying negative conditions such as economic and energy poverty.
Relatively privileged consumers in the developed world would not respond to marketing pitches that convey an implicit message such as "You are 1000x poorer than an oil sheikh, so you should buy basketball shoes from Nike." In the same way, social enterprises should avoid trying to convince consumers to buy products based on the implicit message, "You are 1000x poorer than a Nike customer, so you should buy this solar lantern." Solutions should not be offered as “products for the poor” but rather as aspirational products offered at an appropriately affordable price for the consumer.
To build lifetime customers among target markets, suppliers should define their transformational products as accessible, yet fresh, dynamic, and different rather than emphasizing existing conditions and orthodox modes of living. ‘Rags to riches’ sells in India because of the visualization of the riches rather than presenting a mirror to the rags.


Looking ahead…

India, along with many other developing nations, has a primarily young and growing population that is hungry to carve out comfortable lives in an increasingly crowded world. Engaging individuals and communities as consumers is not only best for solar solution providers to drive product sales, but also imperative when considering that if developing world populations double by 2050, we cannot allow kerosene usage to double as well.


VinceVincent Kapur is the founder and CEO of ACCESS microPower and is a partner of the Kapur Ener-gy Solutions Alliance based in India (www.accessmicropower.net
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