Pay Your Way Into A Better Market

When looking at a market economy, many assume that richer regions are really the only ones that take part. Though this may seem logical, it is not the case. Poor consumers make up much of the market as well, and furthermore they demand higher quality. Since they are not as financially able, the poorer consumers want to ensure that their money is not going to waste, which is why so many of the companies that attempt to cater to poorer regions tend to fail. If a product cannot readily position itself in the market with a clear use-value proposition to its targeted demographic, then it is probably not going to be given a second thought by a consumer who can only spend sparingly.

              Companies that are successful in a poverty penalty market have the ability to set their own reasonable prices. If more companies were able to enter the market then competition would increase, therefore, the prices would drop without the quality of the good or service suffering. This scenario would benefit those living in poverty, as desperately needed products would now be with their extremely limited budget. As stated in the article “How Misinformed Ideas About Profit Are Holding Back The World’s Poor” we see that constant charity is neither the most effective nor efficient way to help those in need. The best way to help these people is through creating a stimulated economy around them, thus allowing them the opportunity to earn the success that so many aspire to attain but so few reach.

              Personally, I was on the side of assuming that charity was the better option for people that did not have much to give in the first place. It seemed somewhat cruel to make the poor pay for products or services that they could hugely benefit from, however, after reading this article and seeing the short video on the money maker pump I can see the large payoff. By just giving, one is not really able to make a long term impact, while a for-profit company can set up in a poor region and show others how they too can have a business of their own. When looking at the pumps, the farmers valued the pump much more than if it had just been given to them free and clear. It was even able to set a goal for them to work towards, first the money maker and then the super money maker. In turn, this allowed them to grow more crops, and feed more of those around them.

              Most of those that decide to go into the market for the underprivileged go in with good intentions, but only some really understand the long term benefit versus the short term reward. The poor are in need for a long term solution, and companies starting up in favor of their market are beginning to begin to bring the elevator back down for those that are in poverty. Although this solution seems simple, market success is never black and white. This leads to the following questions: What makes a product or service successful? How does your targeted demographic value the good or service that you bring to the table? What are the actual wants in relation to the needs of the demographic that you aim to sell to?