Marketing and Management in Subsistence Marketplaces

Abstract: This commentary reiterates the essence of the subsistence marketplaces stream in light of the focal paper. The subsistence marketplaces stream provides a granular, micro-level understanding of the intersection of poverty and marketplaces. The term ‘subsistence marketplaces’ was deliberately coined to keep the focus on preexisting marketplaces to learn from in order to design solutions for all contexts. Such marketplaces should be studied in their own right, and not as a means to a preconceived end, whether it be for outside companies or government policy and so forth. We study subsistence marketplaces inside-out rather than outside-in – beginning at the micro level and being bottom-up in deriving implications for many sectors of society. We traverse a journey which is in the opposite direction to beginning with ideological lenses, wherein we have developed an ecosystem of research, forums, curricular innovations and community outreach. Read more.

Abstract: More than a billion entrepreneurs worldwide live in subsistence contexts and run micro-enterprises to meet life's basic consumption needs. In this article, the authors investigate how two types of consumption constraints in poverty, chronic and periodic constraints, combine to influence entrepreneurial intention. Chronic and periodic constraints are concomitant in subsistence marketplaces and represent consumption-side constraints. A field experiment shows that chronic constraints amplify entrepreneurial intention, but this effect is contingent on the level of periodic constraints. When experiencing low periodic constraints, people with high chronic constraints have greater entrepreneurial intentions than do those with low chronic constraints. When experiencing more periodic constraints, however, the authors do not find this difference.

Another field experiment shows the effectiveness of marketplace literacy education in alleviating the adverse impact of periodic constraints through enhancing entrepreneurial self-efficacy. The authors present specific policy recommendations for government, social enterprise, and business relating to enhancing entrepreneurship among the poor in the face of such constraints. Read more.

Abstract: This article describes the findings of an immersive program of field research on consumers living in poverty in South India and the lessons learned from the development and operation of educational interventions designed to enhance the marketplace literacy of these consumers. Whereas extant research and practice have traditionally addressed two key factors that facilitate market participation for the poor-market access and financial resources-the current research focuses on a third critical and complementary factor-namely, marketplace literacy.

The authors contend that to sustainably benefit from enhanced market access and resources, (1) people living in subsistence conditions need to develop tactical or procedural knowledge, or concrete "know-how," regarding how to be an informed consumer or seller, and (2) this know-how must be grounded in conceptual/strategic knowledge, or "know-why" understanding, of marketplace exchanges. To that end, the educational program outlined begins by familiarizing participants with the purpose and logic of marketplaces and then transitions to the tangible aspects of how these marketplaces function. The article concludes with reflection on the implications for consumer policy, marketing research, and business practice. Read more. 

Abstract: This article demonstrates why and how bottom-up understanding and local collaboration can enable outside entities to design context-sensitive solutions in subsistence marketplaces in emerging markets. Using the literature, we argue that external entities need to understand subsistence marketplaces from the bottom-up in terms of customers/consumers, communities, and the larger context. In turn, they should design context-sensitive core solutions that involve a true collaboration with the preexisting entrepreneurial ecosystem. We use a case study where the first author had direct involvement in implementation to abstract generalizable insights and further assess our arguments with two other case studies from a different organizational context. We draw on these insights to derive implications for marketing management in subsistence marketplaces. Read more. 

Viswanathan, Madhubalan, Jose Rosa, and Julie Ruth (2008), “Emerging Lessons – For multinational companies, understanding the needs of poorer consumers can be profitable and socially responsible,” Wall Street Journal Online, October.

Abstract: A qualitative study of subsistence consumer-merchants (SCMs) in Chennai, India, reveals that they sustain relationships in three interdependent relationship domains: vendor, customer, and family. Relying on long interview data, the authors interpret the subsystems as closed-loop and self-sustaining relationships. Subsystems are managed by SCMs through buying and selling activities alongside the receiving and granting of credit, and these activities engender three facets of commitment: continuance, affective, and normative.

Different facets of commitment underlie the relationships in the three subsystems. Through different role-based activities, SCMs enhance or diminish commitment levels to keep all three types of relationships viable while moving their scarce time, energy, and financial resources into the domain with the greatest need. Activities and the management of commitment are performed within 24-hour business cycles, with negligible resources, and in highly unstable environments, providing valuable theoretical insights and managerial implications that guide recommendations for firms wanting to serve subsistence markets successfully. Read more. 

Abstract: Subsistence marketplaces, sometimes known as the base of the pyramid or BOP, are resource-poor communities mostly concentrated in developing countries. While traditionally viewed as difficult to do business in, some firms, entrepreneurs, and nonprofit organizations are choosing to address the needs as well as leverage the opportunities within these communities. In so doing, they are advancing the frontier of marketing and delivering sustainable innovations. This special issue is dedicated to understanding these advancements, insights, and processes from multiple perspectives.

The research herein was presented at the Third Subsistence Marketplaces Conference held in 2010. Collectively, the studies describe new theories and frameworks on individual, organizational, and market dynamics specific to subsistence environments, along with empirical evidence gathered through surveys, experiments, depth interviews, and observations of how these dynamics work. As a consequence, it is clear that knowledge on the rich complexity of BOP lives is growing rapidly, and being translated into economically impactful, socially meaningful, and sustainably innovative endeavors. This special issue is one contribution toward that end, benefitting hopefully all its participants, now and into the future. Read more. 

Abstract: Subsistence marketplaces, sometimes known as the base of the pyramid or BOP, are resource-poor communities mostly concentrated in developing countries. While traditionally viewed as difficult to do business in, some firms, entrepreneurs, and nonprofit organizations are choosing to address the needs as well as leverage the opportunities within these communities. In so doing, they are advancing the frontier of marketing and delivering sustainable innovations. This special issue is dedicated to understanding these advancements, insights, and processes from multiple perspectives.

The research herein was presented at the Third Subsistence Marketplaces Conference held in 2010. Collectively, the studies describe new theories and frameworks on individual, organizational, and market dynamics specific to subsistence environments, along with empirical evidence gathered through surveys, experiments, depth interviews, and observations of how these dynamics work.

As a consequence, it is clear that knowledge on the rich complexity of BOP lives is growing rapidly, and being translated into economically impactful, socially meaningful, and sustainably innovative endeavors. This special issue is one contribution toward that end, benefitting hopefully all its participants, now and into the future. Read more. 

Abstract: This article uses insights gained from the unique context of subsistence marketplaces, or the base of the pyramid, to put forth a sustainable market orientation for businesses. Using qualitative research and case studies of businesses, ingraining social good in a product-relevant sense is argued to be central and essential for businesses in subsistence contexts to be successful. This analysis is unique in taking a bottom-up in orientation and begins at the microlevel, drawing on. Read more. 

Abstract: Management research has recently begun to shed new light on the role and nature of business innovations targeted at subsistence marketplaces (Viswanathan and Rosa 2007), the four billion poor that have also been referred to as constituting the Bottom of the Pyramid (Prahalad 2005). The notion that ways might be found for business to effectively serve the needs of subsistence markets is gaining increasing currency, and holds promise for both firms and consumers.

For firms, it constitutes potential access to a vast, under-tapped market for products and services. For subsistence consumers, it includes the promise of affordable access to products hitherto unaffordable or unavailable. Although gaining momentum, this viewpoint still faces many challenges, including the central question of whether business really can help to overcome the problem of poverty. We contend that the best way to begin to address such issues is to develop deep understanding of the lives of individuals living in subsistence conditions.

This paves the way for a bottom-up, grounded understanding of the potential for business to contribute to economic and social development among the poor. Our subsistence marketplaces perspective is a bottom-up approach to understanding buyer, seller, and marketplace behavior that complements mid-level business strategy approaches, such as the base of the pyramid approach, and macro-level economic approaches to studying business and poverty that currently exist in the literature. Read more. 

Abstract: Over 4 billion people live in what is commonly referred to as the "bottom of the pyramid" or as subsistence marketplaces. These individuals and families live in substandard housing, with limited or no access to sanitation, potable water, and health care, have low levels of literacy, and earn very low incomes. Scholars and practitioners alike suggest that the problems existing in subsistence marketplaces demand the attention and involvement of responsible businesses and that doing business with consumers in such marketplaces can be both socially responsible and profitable.

This research explores the strategies and tactics currently being used across commercial and social enterprises engaged in subsistence marketplaces. The analysis leads to recommendations about marketing practices currently used by companies and organizations that are successfully operating in subsistence marketplaces. Read more. 

Abstract: This paper draws from a research program comprising qualitative methods as well as case study analyses. The central aspect of the approach to this topic is that it is a bottom-up perspective grounded in understanding consumers. The theoretical scope of the paper includes consumption, entrepreneurship, and social capital in impoverished environments.

The authors' key finding is that businesses must follow three principles for consumer marketing - deep understanding of subsistence consumer psychology, social embeddedness, and entrepreneurial empowerment.

This research has implications for several aspects of consumer marketing strategy. The authors categorize these under the following: marketplace research, marketplace solutions, value propositions, communications, partnerships, harnessing social capital, designing marketing structure, and evolving the marketing mindset. Read more. 

Abstract: In recent years, market-based approaches have been proposed for the base of the pyramid (BoP). However, the literature offers little theoretical or practical guidelines for innovative product development for what are radically new market contexts for most businesses in advanced economies. Considering that product development is a fundamental activity in a market economy, and that much BoP consumer welfare potentially arises from innovative and affordable goods and services that can solve critical life needs, this is a substantial gap in knowledge.

This paper attempts to address this gap by using an analysis of 13 year-long university projects on BoP-focused concept and prototype development conducted between 2006 and 2010. An inventory of research propositions is developed that identifies factors necessary for effective product development for BoP markets. Implications for new product development research and practice are discussed. Read more. 

Abstract: As regular readers of the Journal of Macro-marketing well know, Macro-marketing is an academic discipline broadly committed to the study of the interplay of markets, marketing and society (e.g., Hunt 1981). Macro-marketing research, therefore, is particularly germane to environments in which people find themselves in subsistence living conditions. Indeed, for decades, macro-marketers have studied distressed countries, regions, communities, and systems in which such conditions often are the norm with the intent of understanding them, and more importantly, improving life quality.

Subsistence marketplace studies, with a bottom-up orientation, provide unique micro-level insights for macro-marketing, sharing the primary concern of developing a sustainable and just marketing system in which prosperity and quality of life are enhanced for all who reside in the marketplace. What follows is an introduction to the articles that comprise this special issue on "Subsistence Marketplaces." Read more. 

Sridharan, Srinivas, Madhu Viswanathan, Raymond Benton, and Cliff Shultz, “Introduction to a special section on subsistence marketplaces: moving bottom-up from marketplace insights to managerial implications,” Journal Of Marketing Management, 30:5-6, 435-438, DOI: 10.1080/0267257X.2014.884789.

Over the past decade and a half, the study of subsistence marketplaces has garnered significant attention among marketing scholars, as evidenced by the burgeoning body of literature on the topic. Journal of Public Policy & Marketing (JPPM) has played an instrumental role in nurturing scholarship in this arena. The journal's focus on the nexus between marketing, public policy, and societal wellbeing (Stewart 2013) finds a natural confluence with the inherent goals of subsistence marketplaces research. Prior work published in JPPM has (1) advanced our understanding of subsistence marketplaces, (2) informed social initiatives in subsistence communities (Viswanathan et al. 2009), and (3) articulated policy recommendations for enhancing consumer and entrepreneurial well-being in subsistence contexts (Viswanathan et al. 2012). This JPPM special section provides further impetus to research subsistence marketplaces. Read more.