Despite their poverty and limited purchasing power, people at the ‘bottom of the pyramid’ in South Africa increasingly attract the attention of marketers. At more than one third of South Africa’s population, they represent a significant, or potentially significant, market for companies. But they will not be ‘reached’ by conventional approaches — or by applying the individualistic perspective of the developed world. At the bottom of the pyramid in South Africa, communities are different — and collectivism still counts.
"Umuntu ngumuntu ngabantu" – A person is a person through other persons.
(from the humanist African philosophy Ubuntu)
The ‘bottom of the pyramid’ (BoP), the world’s poorest socio-economic group, as defined by business thinker C. K. Prahalad and his colleagues, has received much attention from marketing academics and practitioners in the past 10 years, both globally and in South Africa. So far, however, the themes have been quite limited, the focus quite narrow.
Most studies in the marketing literature have taken a highly individualised approach, using, for example, the individual consumer not the household or the family as the unit of analysis, and theories such as ‘self-determination’ as part of the frame of reference. In other words, they’ve tended to see BoP consumers as individuals acting in a social vacuum rather than as people bound by ties to wider groups.
New research adopts a different perspective. It takes as its starting point the decades-long distinction between individualism and collectivism that separates the developed and the developing world. (Individualism is mainly associated with richer societies and countries such as America, Australia and the UK; collectivism is mainly associated with poorer societies and countries.)
Building on two earlier studies, researchers from the University of Pretoria and the University of New Mexico hypothesise that collectivism is a key determinant of BoP classification in South Africa, and they test their theories through analysis of archival data from the All Media and Product Survey (AMPS), carried out by the South African Audience Research Foundation (SAARF).
The results show that collectivism and four proxy indicators of collectivism — income, lifestyle, community and race — can accurately predict whether or not a South African is part of the BoP. All hypotheses, in other words, are confirmed. The researchers found that:
This last finding reflects the legacy of apartheid and South Africa’s long years of racial discrimination and inequality. Why is it also a proxy indicator for collectivism? Because if you’re black in South Africa you are much more likely to follow Ubuntu, the humanist philosophy, whose postulates include “I am because you are and you are because we are”. Together with the other results, it shows collectivism is a defining characteristic of life at the bottom of the pyramid in South Africa.
Several managerial implications are highlighted in the study. They include the need for:
The researchers also underline the importance of adaptability, agility and vigilance. South Africa is changing. People at the bottom of the pyramid ‘today’ may not be there ‘tomorrow’. Urbanisation is likely to lead to vast increases in demand for items such as TVs, cell phones, fridges/freezers, DVD players and electric stoves. And companies will want to make sure demand does not outstrip supply.
The role of collectivism in defining the South African Bottom of the Pyramid. Kerry Chipp, Clive Corder & Dimitri Kapelianis. Management Dynamics: Journal of the South African Institute for Management Scientists (March 2013).
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