John Lancaster profiles how companies and entrepreneurs are targeting the untapped market potential of India’s rural poor.
A 30-year-old mother of two, Kadem is part of a novel Hindustan Lever initiative that enlists about 20,000 poor and mostly illiterate women to peddle such products as Lifebuoy soap and Pepsodent toothpaste in villages once considered too small, too destitute and too far from normal distribution channels to warrant attention.
Started in late 2000, Project Shakti has extended Hindustan Lever's reach into 80,000 of India's 638,000 villages, on top of about 100,000 served by conventional distribution methods, according to Dalip Sehgal, the company's director of new ventures. The project accounts for nearly 15 percent of rural sales. The women typically earn between $16 and $22 per month, often doubling their household income, and tend to use the extra money to educate their children.
So far consumer product firms have been the most successful at these pro-poor bottom-of-the pyramid approaches. Though this could soon change. Also see Unilever’s experience in Indonesia (1, 2).
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