How to get your innovation known among your consumers and fulfil the demand you are establishing
In the previous modules, we have mainly looked at the product or service innovation itself: where the ideas come from, how you translate an idea into a sellable product or service, and how you include the voice of your consumers in this development process. With a validated innovation and a strong value proposition, it is time to work on the business model that is required to launch and grow your innovative idea in the market. This is what this module (module 5) and the next one (module 6) are about. When we talk about business models, we do not mean writing a full business plan. It is better to start with simple methods such as the Business Model Canvas (downloadable from the ‘Additional Reading’ section of this module) that will guide you through the strategic decision-making for essential parts of the business model.
There are three areas in the business model that require particular attention when doing business with the Base of the Pyramid (BoP). First, how you organise the distribution of your products or services in areas that generally lack good infrastructure and formalised supply chains (this influences the accessibility for your consumers).
Second, how you optimise the costs and effects of your marketing outreach to underserved consumers that have little prior awareness and knowledge of what is available (this influences the awareness and demand among your consumers).
And third, how you price your product or service and generate revenues when selling to consumers that have limited purchasing power (this influences the affordability for your consumers).
This module (Module 5) focuses on the first two business challenges; the marketing and distribution of your new product or service. The third challenge is covered in Module 6. As the profitability of your innovation lies in the number of consumers reached, you will need to excel in marketing and distribution. This module will give you concrete tips to select the appropriate strategies that allow you to reach as many consumers as possible, with the lowest upfront costs and operational risks.
Complete this module to take out the following learnings:
- Every innovation needs a Go-To-Market strategy. An idea will not sell itself, particularly not in underserved markets.
- It is very costly and risky to take on all marketing and distribution activities yourself. Especially when you are new to a market, success lies in establishing the right partnerships.
- When selling something new, you will first need to gain the trust of consumers. They will only invest if the benefits are understood and, even better, experienced first-hand.
- consumer retention is just as important as consumer acquisition. It allows you to build a steady consumer base that you can leverage as ambassadors to reach new consumers.