NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Thursday, August 15, 2013

Designing products for the developing world can be a hit-or-miss endeavor: While there may be a dire need for products addressing problems, such as access to clean water, sanitation and electricity, designing a product that consumers will actually buy is a complicated process. More often than not, such products — even those that are distributed at no charge — go unused due to poor quality, unreliability or differences in cultural expectations.

And yet, an increasing number of organizations, companies and startups are targeting products at developing countries for one very practical reason: money. Rising economies like China and India represent potentially massive emerging markets, a large portion of which are made up of small “microenterprises” — informal, mom-and-pop businesses of five or fewer people that generate limited income.

In a new MIT study (view PDF), researchers suggest that microentrepreneurs are a promising and largely untapped market. They say designers will have more success in developing countries by targeting products to microentrepreneurs, particularly if such products are designed to help make these small businesses money.

“If you can convince them you can make them money, you’re most of the way there to selling them your product,” says Jesse Austin-Breneman, a graduate student in MIT’s Department of Mechanical Engineering. “It seems obvious, but if you look at a lot of products out there, they’re not really doing that.”