Our partners:
 

Vincent Kapur

How Consumer Values Drive Purchases. Seven key lessons learned from market (part 1)

Suppliers of solar lighting solutions need to create demand for their products among individuals and communities in the developing world in order to achieve the desire goal of displacing kerosene lighting and alleviating poverty. Despite many new products and extensive outreach activities, progress towards widespread adoption has been slow. Why? Most of the effort directed at this issue seems to be focused on addressing the issue as a problem to be solved rather than engaging people to achieve customer satisfaction from purchasing a product. In my opinion, individuals at the bottom of the pyramid (BoP), even those living in poverty, deserve the dignity of being treated as consumers, rather than as beneficiaries of problem mitigation. 

From, my experience in India, I have seen that marketing strategies which seek to aggressively consumerize BoP customers have been extremely successful, particularly in ways which are not only related to the lowest cost available. Therefore, any entrepreneur looking to make an impact with solar lighting can find great lessons from consumer-centric product sales already reaching their target markets.

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. The best model for how consumerism may be harnessed to achieve transformative impact is the explosive growth worldwide in the use of mobile phones. Hundreds of millions of users among BoP in India are proof that consumers will spend money on products they want without subsidies or giveaways. Suppliers of solar solutions may realize greater success if they respect the following rules about consumers:

 

1.Consumers pay for direct and apparent value.

Indian villagers, just like American middle class consumers, often have a tough time understanding the value of conceptual appeals on issues such as preventative health benefits and projected future financial savings through avoided costs. The value of such matters if kerosene is replaced by solar is only tangibly realized over time, so demand for that value lags the provision of the benefit. In contrast, products with immediately direct and apparent appeal, including phones and televisions, are in huge demand among low-income consumers. Even items such as soft drinks, with no health benefits and no functional value, appeal to consumer demand for comfort in a direct way that BoP consumers value. Solar solutions must show capability to power something of apparent and immediate value to consumers. However, lighting alone, regardless of technical or aesthetic design, is not sufficient because…

 

2.…consumers will pay now only for what they do not wish to put off to a later time.

Consider this true scenario that I witnessed: The daughter of worker at a factory in India (urban poor) dropped his mobile phone into a bucket of water. His first reaction was to dismantle the phone as best as possible in hopes of drying everything out. When the phone no longer worked anyway, he scraped together enough money to buy a replacement phone the next day. Would the same happen with a solar lantern if it was broken, or would the customer return to a conventional light source for an extended or indefinite period of time until it was convenient to secure a replacement solar lantern?  Although kerosene lighting is dirty, dangerous, and poor in quality, it is always available to stand in for the customer in place of a solar lighting option. Product developers absolutely must incorporate features which cannot be immediately substituted by kerosene.

 

3.Consumers make purchases in response to “selling” rather than “educating.”

While non-profits may engage in education, enterprises must focus on selling. Who "educated" anyone on the value of mobile phones, which are often used by illiterate consumers? The best solar lanterns aren't nearly as complicated as the most basic menus on a mobile phone. If the value proposition of the product is apparent, consumer nature will drive people to buy. Otherwise, if the consumer is not willing to learn how to adopt a product, they will not be fully convinced to make a purchase. The consumer will find a way to become educated after deciding to make  a purchase based on the immediately apparent value.


See also Part 2.


Vincent Kapur is the founder and CEO of ACCESS microPower and is a partner of the Kapur Energy Solutions Alliance based in India (www.accessmicropower.net)