For 20+ years Jeb Brugmann has been a leading practitioner in devising localised solutions, at scale, for business, government and international development agencies. Brugmann’s current work in The Next Practice focuses on supporting large corporations with consumer research, high-impact product, business model and distribution channel development, and customer relationship management approaches for very diverse local base-of-the-pyramid markets. Most recently, he led TNP’s work in India to develop rural distribution channels, marketing concepts, and partnership management frameworks.
Jeb spoke on strategies for understanding and serving the emerging marketplace that lies outside of the formal economy. He presented a diagram that illustrated that this market—what he called the informal of “other” economy—is twice as large as the economy we know, at about 3 billion people.
He took us through a series of perceptions (“lenses,” or biases, knowledge gaps) about the marketplace, illustrating that our paradigms of people and place could keep us from understanding and participating in the development of this next economy.
He spoke of certain characteristics of the emerging consumer:
- They compose psychodemographic clusters
- Co-creation is the order of the day
- Customer relationship management is a greater challenge with them–this is a trust-based economy
- Do not expect a “switch” to an economy that looks like our–participate in co-evolution
For example, he used illustrations from Dharavi, a Mumbai slum. In one, he showed a third world back alley that had none of the marks of commercial activity, but was the home of one of the world’s largest and most influential goatskin markets, a place where some of the world’s best designers of leather goods came to do business. In another, he illustrated how culture, tradition, and need developed very clever tools for using alternate, and alternative fuels, for cooking.
He advised us not to expect the “switch” that would turn these cultures and economies into a marketplace that looks like the one we participate in now.
Instead, he offered strategies for participation that included recognition of other market development potentials and characteristics, and alternative approaches.
Jeb is partner with C.K. Prahalad.
C.K is at the University of Michigan Business School. If you have not plugged in to Prahalad, you are missing one of the the most innovative, influential and important voices in business today. I wish we could find a way to collaborate with these guys in our own work.
(By the way, are you aware of former Genslerite, Cameron Sinclair? Cameron is a very important voice in support of emerging/challenged societies, leading Architecture for Humanity. He is profiled in the upcoming June issue of Wired magazine, as winner of one of the “2006 Rave Awards.”)