Strategic Opportunity At Bottom of the Pyramid

In every economy, the bottom of the pyramid usually forms the largest market base. The case is not any different in Uganda. The bottom of the pyramid aka the low-income forms the largest base. The thing is most people don’t target them. Everyone tries to compete for the middle-class. And if you know the Ugandan market well, this is always floating. The middle class is never constant. It’s floating. It often has more people falling out of it than entering it. Then a few exceptional ones cross into the upper class.

So let’s say MTN. It could design data bundles that are pegged to monthly bundles. By doing this, it would lock itself out of the opportunity at the bottom of the pyramid. The opportunity is in the ability to sell daily data bundles. Sell someone 10mbs for example, 20 mbs. Sell airtime of UGX 500, UGX 1000.

The story is often told of Equity Bank. When all the other banks were going for the middle class, when they were designing banking halls that were intimidating to the bottom of the pyramid, Equity Bank played a different ball game. It went for the bottom of the pyramid, the Mama Mbogas. Warid Telecom had the same entry strategy into Uganda.

If one can figure out how to serve the bottom of the pyramid at the right price point, then that’s opportunity right there. The question is every business must often ask themselves how they can innovate for the bottom of the pyramid. In the economies such as ours, it’s risky for a business to target its strategy on the floating middle class or a tiny upper class. What would be the Bodaboda equivalent of your industry? For UMEME, this was the introduction of the Yaka meter. And that transformed collections, prior to UMEME, UEB had suffered with collections.

Every business ought to have a bottom of the pyramid strategy. What’s your solution for the Bodaboda rider? At this point, then you can start to think product-market fits, solution-market fits and all other fits…

Don’t ignore the bottom of the pyramid. Be a Mega Supermarket, not just a Carrefour…

Photo Credit: Olayinka Oshidipe | Unsplash