GSK, Nestle, Coca-Cola & Dabur Top Up Effort to Tap Rural Consumers

Tuesday, January 12, 2010

NEW DELHI: Consumer product makers such as GlaxoSmithKline, Nestle, Coca-Cola, PepsiCo, Hindustan Unilever, Marico, Godrej and Dabur ar are rushing
to the bottom-of-the-pyramid market with custom-made products six years after management guru CK Prahalad said consumers with incomes less than $2 a day can be a profitable segment for marketers.

Estimated at close to 350 million, the bottom-of-pyramid (BOP) consumer segment is the biggest and perhaps the fastest growing in the country with about 40 million families making the jump from poverty to the BOP club every year. Marketers are no longer only betting on smaller packs of existing products to tap the fortune at the bottom of the pyramid; they are also looking to roll out products specially made for the poor.

GlaxoSmithKline Consumer Healthcare (GSKCH), foods company Nestle andbeverage maker Coca-Cola have already entered the market with products created for BOP consumers, while PepsiCo is set to follow suit. Others such as Hindustan Unilever, Marico, Godrej Consumer Products and Dabur too are learnt to be working on products for the BOP segment.

GlaxoSmithKline is rolling out Asha – a milk food drink from Horlicks for rural consumers – in Andhra Pradesh; Nestle is promoting Maggi noodles at Rs 4 and Maggi seasoning at Rs 2 for low-income group consumers beginning with Mumbai’s Dharavi slum; Coca-Cola has begun selling a powder-based beverage called Vitingo at Rs 2.50 per sachet across villages in Orissa; and PepsiCo’s global chairman & CEO Indra Nooyi has announced that the company is working on a beverage or snack priced between Re 1 and Rs 5 for people ailing from malnutrition and deficiencies.

Source: Economic Times (link opens in a new window)