It has been a couple of weeks since Professor Aneel Karnani and Professor C.K. Prahalad debated the best (and worst) ways to serve bottom of the pyramid markets here at NextBillion.net. You may recall that it started when Karnani posted his criticism of Prahalad’s best-selling book; Prahalad responded in-kind. Now the Acumen Fund weighs in on the debate:
The paper argues that the only way to alleviate poverty is to focus on the poor as producers – not as consumers – to raise their income. We, like Prahalad, believe that these are not mutually exclusive. Given the right access to choices, the poor can make consumer decisions that increase their ability to generate income and improve their overall quality of life. The fact that there is ongoing debate around this idea reinforces the need for Acumen Fund, and others in this space, to continue to find and support examples of enterprises that are successfully serving the poor.
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but, 'producer' denotes a complete lack of relationship with the people of the BOP. only 'customer', 'supplier' and 'competitor' connote any kind of business relationship. but, given their scale, 'supplier' and 'competitor' is rather less likely than 'customer'.
so, you may market products to them because they are 'producers', but their status changes to 'customer' once you build that relationship. and, if you want to engage the BOP, then you have to look toward building a relationship with them - and that means making them a 'customer'.
a 'producer' is somebody out there i've heard about; a 'customer' (or 'potential customer') is someone i want to serve.