The world's most exciting, fastest-growing new market is where you least expect it: at the bottom of the pyramid. Collectively, the world's billions of poor people have immense untapped buying power. They represent an enormous opportunity for companies who learn how to serve them. Not only can it be done, it is being done--very profitably. What's more, companies aren't just making money: by serving these markets, they're helping millions of the world's poorest people escape poverty.

C.K. Prahalad's global bestseller The Fortune at the Bottom of the Pyramid, now available in paperback, shows why you can't afford to ignore "Bottom of the Pyramid" (BOP) markets. Now available in paperback, it offers a blueprint for driving the radical innovation you'll need to profit in emerging markets--and using those innovations to become more competitive everywhere. This new paperback edition includes eleven concise, fast-paced success stories from India, Peru, Mexico, Brazil, and Venezuela--ranging from salt to soap, banking to cellphones, healthcare to housing. These stories are backed by more detailed case studies and 10 hours of digital videos on whartonsp.com. Simply put, this book is about making a revolution: building profitable "bottom of the pyramid" markets, reducing poverty, and creating an inclusive capitalism that works for everyone.

Preface  xi

About the Author  xix

Part I: The Fortune at the Bottom of the Pyramid  1

Chapter 1: The Market at the Bottom of the Pyramid  3

Chapter 2: Products and Services for the BOP  23

Chapter 3: BOP: A Global Opportunity?  47

Chapter 4: The Ecosystem for Wealth Creation  63

Chapter 5: Reducing Corruption: Transaction Governance Capacity  77

Chapter 6: Development as Social Transformation  99

Part II: Business Success Stories from the Bottom of the Pyramid  113

Financing the Poor  115

Aravind Eye Care—The Most Precious Gift  131

Energy for Everyone  137

Agricultural Advances for the Poor—The EID Parry Story  149

Retail for the Poor  159

Information Technology to the Poor  169

The Jaipur Foot Story  187

Health Alerts for All  191

Transparent Government  201

The Annapurna Salt Story  213

Homes for the Poor—The CEMEX Story  221

From Hand to Mouth—The HHL Soap Story  235

Part III: On the Web at Whartonsp.com

Video Success Stories

            Casas Bahia

            CEMEX

            Annapurna Salt

            Hindustan Lever

            Jaipur Foot

            Aravind Eye Care

            ICICI Bank

            ITC e-Choupal

            EID Parry

            Voxiva

            E+Co/Tecnosol

            Andhra Pradesh

Full Success Case Stories in pdf format

            The Market at the Bottom of the Pyramid

            Known Problems and Known Solutions: What Is the Missing Link?

            Known Problems and Unique Solutions

            Known Problems and Systemwide Reform

            Scaling Innovations

            Creating Enabling Conditions for the Development of the Private Sector

            The EID Parry Story

Biographies of the Researchers/Writers of the Success Case Stories from The Fortune at the Bottom of the Pyramid  247

About the Video Success Stories  255

Index  257

Amazon.com® Reader Reviews (Ranked by Helpfulness)

Average Amazon.com® Rating:  Based on 70 Ratings

Good Seed or Evil Roots? - 2009-11-20
Reviewer Rating:
I think the title of the book is more appealing to the greed of the capitalists than the practical side of it because it is simply common sense. Many Christian and philanthropic organizations have been doing the same things without expecting the return of fortune. I think those deeds are more honorable in eradicating poverty than going there for the profit. there is nothing wrong with expecting the profit because it will help you sustain what you do, but usually such intention can be counter productive and even lead to abuse of the poor. A few years ago, I remember the Gap company taking the production to South America in the name of giving the poor opportunity to earn money and providing cheaper clothing to the American consumers, but at the end of the year it was the CEO's of the company that got their salaries increased by several million dollars. The poor continued to be poor and the consumers still paid the same expensive price.

Another problem I have is that the bottom of the pyramid is actually not free to participate in this scheme because the true bottom of the pyramid is usually under a dictatorship. How are you going to eradicate poverty in Burma this way? If this book is talking about the countries that already have freedom, then these ideas are mere commonsense.

Profit does come from helping the poor in free countries, but I think helping the poor with the profit in mind is problematic. There is a saying of Confucius that I can only translate it loosely, "Doing evil and afraid of being noticed, that person has some good seeds; doing good and desire being noticed (or gaining profit) that person's good deed has some evil roots." I am sure the intention of this book is good. I just think the title is "greed tripping!"

Valuable Though Incomplete [5th Anniversary Edition] - 2009-11-18
Reviewer Rating:
This is a valuable book that puts forward a formal framework to work with, and specific and detailed case-studies. However, some examples are outdated, and the book lacks specific, forward looking predictions and analyses.

This book is invaluable because it brought to the fore, first in 2002 via two articles co-authored by CK Prahlad and published in Strategy+Business and the Harvard Business Review, and then in book form, in 2004, in a structured manner with an academic rigor, the reasons for corporations to stop trying to sell "to" the poor, and instead work to "co-create" innovative products and services that were actually affordable, reliable, and usable. The Bottom of the Pyramid, or "emerging consumer markets" or just "emerging markets" as these are "more emotionally neutral terms" often surprise managers "who are used to developed markets" ... "by the sophistication and demands of the Bottom of the Pyramid markets." [page 13]

It is not just about the benefits that a huge market of "micro-consumers" can bring to corporations, it is equally about bringing the benefits of technology and sophisticated products and services that can help lift millions of people out of poverty that should motivate people.

This updated, 5th anniversary edition is divided into five parts:
1. "A new introduction outlines the progress in the BOP agenda since the publication of the book in 2004."
2. "In Part II, which was part of the original 2004 edition (left unchanged), we develop a framework for the active engagement of the private sector at the BOP."
3. "... contains letters from CEOs of major corporations supporting the approach"
4. "... describes cases, in a wide variety of businesses..."
5. "... contains the videos tha accompany the case studies..."

Good though the book is, some counterexamples come to mind when reading the book. I will list three examples, one of each kind:

Incorrect Example
-----------------
CKP credits Airtel with building the microcredits and distribution network that helped enable the 400 million strong mobile customer base in India today. However, that is not quite correct. The distribution network had existed for decades - via the corner shops selling cigarettes, biscuits, and candies that have been around by the millions, on every street in every city and town and village in every corner of the country, for decades. Airtel and other mobile vendors did not create this infrastructure. They simply partially re-purposed this network.

Outdated Example
----------------
Amul is also cited; but Amul created this network for collecting milk from individual farmers more than 30 years ago. CK Prahlad's BOP theory may be used to explain this remarkable success, but its success was more the result of individual genius and government backing than corporate involvement.

Missing Example
---------------
The Nano car from the Tata group was announced in 2008, and launched in 2009. It costs a little over US$2,000 (the cheapest Toyota in the US starts at $12,350, and the cheapest Hyundai starts at $9,970) and has the potential to bring the benefits of personal, safe transport to Indian families at or near the bottom of the pyramid in India, and possibly elsewhere. Will it succeed? Or fail because of logistical issues? It would have been fascinating to read CKP analyze this nascent revolution and bring his formidable intellectual prowess to analyze, make suggestions, and prognosticate on the Nano's success. Put it on paper, and watch events prove him right, or wrong. Or at least help in making it a success.

If inclined to read more on related topics, I would recommend the following books:
- The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good
- Everybody Loves a Good Drought: Stories from India's Poorest Districts
- Banker To The Poor: Micro-Lending and the Battle Against World Poverty

I would recommend this book to anyone wanting to get started on understanding how to build products and services for large, under-served, emerging markets.

Inspirational and Insightful Look into the Future Global Economy - 2009-11-18
Reviewer Rating:
It appears that many of the reviews for this book are actually based on the original version. This review is based specifically on the hard cover 5th Anniversary Edition. The core argument, that money can be made given the proper business model while catering to the world's poorest, remains the same. In the updated edition, the original text remains intact but a few more chapters are added in the beginning and additional follow-up is provided for the original case studies.

Overall, I believe that this book delivers an excellent value. The book's binding and material are of high quality, and the inclusion of a CD with supplemental material (additional case studies) and videos is greatly appreciated. More importantly, the subject matter, while not quite revolutionary anymore, provides an insightful framework into a new way of doing business.

The term "emerging markets" seems almost like a clichGÇÜd catch phrase, but this book takes an honest and detailed look into what an emerging market is and what it takes to be successful in one. It offers a rare level of depth and perspective that acts as an enabler to ponder viability and strategy for potential services in the future. While I don't necessarily agree with the author on all points, especially the seeming omission of the high-risk nature and relatively hostile environments where the members of the bottom of the pyramid are found, the part that resonated most with me is the drive towards a common form of social justice. It should be noted that even Bill Gates said that it might not always be possible to make money serving the bottom of the pyramid, but a proxy to profits might simply be recognition.

A minor gripe I had with the book is that it didn't feel immediately accessible to me. While the overall structure is sound (first stating what the author believes are the keys to success in emerging markets, and later showcasing successful companies in various case studies that embodied the various points), the book reads like a matter-of-fact textbook and assumes you already have knowledge in this area. Also, the generous usage of acronyms was mildly annoying at times, but the index was useful in clarifying.

I don't think this book is supposed to be a specific guide to how to make your riches serving the poor, or how to capitalize on the growing ranks of middle class as predicted by the author. Rather, through varied tales of success, it dares us to dream.

---------------------------------
About the included CD:

The primary benefit of the CD is that it includes 3 additional case studies:
The EID Parry Story
Innovations in Energy: E+Co's Investment in Tecnosol
Citizen Centricity: E-Governance in Andhra Pradesh

For the additional case studies, text is provided (in PDF format), and amounts to about 100 additional pages. There are also short video clips ~4-5 minutes in length (in WMV format) for each of the original and additional case studies.

The videos are somewhat inconsistent in overall presentation and content, and appear to be produced by different people. If you're going to watch the case study videos, I recommend watching them first before reading as they only provide a cursory view of the case study material. I found that the videos helped by giving a summary of what's to come and put faces on the people being discussed. On a side note, interlacing artifacts are present in the videos, and voices can be hard to hear at times.

The CD is thankfully not DRM'ed so you can copy the contents to your hard drive or flash drive (in case you want to use it on a computer without a CD drive, or just for ease of use).
---------------------------------
Published System Requirements:

To view all the content on this CD, you will need to use a computer with one of the following operating systems and configurations loaded with the software listed below:

Operating Systems and Configurations
* Windows 2000 or Windows XP, with a Pentium(r) 4 processor at 1.3GHz or better, 256MB RAM memory, video card with 8MB dedicated memory, and 16x~ CD-ROM; or
* Mac OSX, with a G4 or G5 processor, 256MB RAM memory, video card with 8MB dedicated memory, and 16x~ CD-ROM.

Software
* Windows Media Player, Version 9 or newer. Available for download from Microsoft
* Adobe Acrobat Reader, Version 5 or newer. Available for download from Adobe

A four star textbook, but two stars for the general reader and the specialist - 2009-11-17
Reviewer Rating:
This is a difficult book to evaluate especially since it is built around an earlier one, reprinted in the original with cases and affidavits added. It is really two books, one successful and one weak. The original was published in 2004 and made a powerful case that challenged much of the conventional thinking about economic and social development. It wasn't perhaps as original as it claimed in its argument that the two billion people at the "bottom of the pyramid" were both an opportunity for enlightened capitalism, a source of energy and creativity, and a breakout opportunity to bootstrap business growth that would substantially reduce poverty. But it did draw attention to a way of thinking that got away from the top-down, infrastructure-focused programs that the World Bank and development agencies had funded with very limited success. It was part of a shift in view that saw the poor not as uneducated, lazy and needing wise guidance but as entrepreneurial, receptive to new ideas and able to build effective business initiatives on the ground.

If you (or your students - this is very much textbook type didactics) are unfamiliar with what has been happening in Asia and Africa via the combination of large companies like Coca Cola, Cemex and Unilever meeting the consumer needs of the poor and small domestic businesses thriving in market and job building, then this is still a good book and one that has many truly exciting examples in it. Since it was first published, microfinance has grown as a widespread and very effective model for stimulating and funding village entrepreneurship. Mobile phones have created new markets in handling remittances and managing cash among poor families. The basic case Prahalad made in 2004 holds up well today.
If you know the field at all, it is a disappointing book, not helped by the cumbersome expansion of the new material, little of which adds much. There are some major forces he neglects or finesses, especially the huge burden of corruption and rule of force of rich landowners, tribal leaders, and government. Water, transportation, and electricity are downplayed or ignored. The issue of replication of successes, generalizability of experience, and infrastructures is barely addressed. Too often, a single innovation is overstated in its impacts and general applicability; an example is e-governance in an Indian state which presents where the 2004 presentation shows a distinctly successful but limited "dexperimental" program. In 2009, it is standard practice -- Web site service and information access. The key question is what happened between 2004 and 2009. Did it grow? Become embedded in the social fabric? Stall? All we get is the 2004 material which includes a list of impediments to full adoption and impact. There's no follow up review for 2009. The book is a series of short stories, interesting in themselves but little more than moral fables. It is not the blueprint for transforming life at the bottom of the pyramid that is its claim and goal. I'd recommend Easterley's White Man's Burden as a far more comprehensive and solid coverage of the core issues, that is very compatible with Prahalad's view but has far more depth and Africa Rising, a book similar to this one and sharper in focus. The New India, written by one of the nation's most successful entrepreneurs, is much more comprehensive in its coverage of context and as practical in its recommendations for action. This book is no longer definitive and there are many more timely and relevant other published works.

The book is a harder read than the material warrants. It is best described as cumbersome. The writing lacks pace and flair. It's solid and free of tendentious academese or business popspeak, though. The details in the cases are well laid out. By coincidence, one of the examples came out of my own consulting work in the company, where I was a fairly close adviser to the CEO for ten years and Prahalad captures accurately how my simple idea was turned into a powerful program of social innovation. I mention this only because I can vouch for the reliability and responsibility of the book's description.

I am a great admirer of Prahalad, whose contribution to thought leadership in the management field has been very strong and sustained. But the task at hand is to assess the book as a book. I'd rate it as a four star college textbook, but only a two-star book for the general reader or for the specialist. I wish I could be more positive but at the end of reading it, I felt that I'd had to plough through it a little laboriously and that I did not get a sense of a crisp and clear analysis and set of lessons. I admire the writer and respect the work that has gone into the book. But in thinking about would I recommend it to my friends, colleagues and students, I reluctantly say no.

The business breakthrough manuel - 2009-09-16
Reviewer Rating:
This book is extraordinary. A new face to how we see business. The BOP really is the source of major profits fot Multinational firms. Its an eye opener to me.

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