The Nature of Family Decision Making at the Bottom of the Pyramid (BoP): Social and Managerial Implications

Part of the Applying Quality of Life Research book series (BEPR)

Abstract

This paper describes the consumer at the bottom of the pyramid (BoP) to shed light on the resources and constraints associated with consumption in this marketplace. It compares and contrasts the nature of decision making in BoP households and roles of its members to research mostly conducted in the context of western societies. Data for this paper comes from a qualitative study conducted with 58 urban poor consumers in India who provide detailed accounts of their household purchase behavior. Findings from this study carry significant ethical and marketing implications for companies that target the BoP segment and highlight the importance of revising marketing strategy to better fit the needs of the BoP household. This research makes a contribution the literature on transformative consumer research (TCR) to generate insights into poverty alleviation by understanding consumption by the poor. In the area of consumer decision making, the TCR approach advocates to help the poor become better decision makers by customizing market information to fit their cognitive and emotional abilities. We hope that the findings of this study and suggested implications for marketing practice will have help improve the well-being of the poor, reduce their vulnerability through innovative marketplace interventions which in turn will empower the poor consumers.

Keywords

Bottom of the pyramid Family decision making Shopping roles Marketing ethics Subsistence marketplace 

References

  1. Blocker, C., Ruth, J., Sridharan, S., Beckwith, C., & Ekici, A. (2011). Applying a transformative consumer research lens to understanding and alleviating poverty. Journal of Research for Consumers, 19, 1–9.Google Scholar
  2. Brim, O. G. (1968). Adult socialization. In J. A. Clausen (Ed.), Socialization and society. Boston: Little, Brown.Google Scholar
  3. Brown, W. (1979). The family and consumer decision making: A cultural view. Academy of Marketing Science Journal, 7(4), 335–345.CrossRefGoogle Scholar
  4. Carson, D., Gilmore, A., Perry, C., & Gronhaug, K. (2001). Qualitative marketing research. London: Sage.Google Scholar
  5. Caruana, A., & Vassallo, R. (2003). Children’s perception of their influence over purchases: The role of parental communications patterns. Journal of Consumer Marketing, 20(1), 55–66.CrossRefGoogle Scholar
  6. Chikweche, T., Stanton, J., & Fletcher, R. (2012). Family purchase decision making at the bottom of the pyramid. Journal of Consumer Marketing, 29(3), 202–213.CrossRefGoogle Scholar
  7. Cotte, J., & Wood, S. (2004). Families and innovative consumer behavior: A triadic study of siblings and parents. Journal of Consumer Research, 31(1), 78–86.CrossRefGoogle Scholar
  8. Davis, H. (1976). Decision making within the household. Journal of Consumer Research, 2(4), 241–260.CrossRefGoogle Scholar
  9. Elaydi, R., & Harrison, C. (2010). Strategic motivations and choice in subsistence markets. Journal of Business Research, 63(6), 651–655.CrossRefGoogle Scholar
  10. Engel, J., Kollat Kollat, D. B., & Blackwell, R. (1973). Consumer behavior (2nd ed.). New York: Holt.Google Scholar
  11. Foster, I. R., & Olshavsky, R. W. (1988). Extending information processing theory to family purchase decision making. In Proceedings of the Society for Consumer Psychology, pp. 87–90.Google Scholar
  12. Foxman, E. R., Tansuhaj, P. S., & Ekstrom, K. M. (1989). Family members’ perceptions of adolescents’ influence in family decision making. Journal of Consumer Research, 4, 482–491.CrossRefGoogle Scholar
  13. Hamilton, K. (2009). Consumer decision making in low-income families: The case of conflict avoidance. Journal of Consumer Behaviour, 8(5), 252–267.CrossRefGoogle Scholar
  14. Hammond, A., Kramer, W., Katz, R., Tran, J., & Walker, C. (2007). The next 4 billion. Innovations: Technology, Governance, Globalization, 2(1–2), 147–158.CrossRefGoogle Scholar
  15. Herbst, P. G. (1952). The measurement of family relationships. Human Relations, 5, 3–35.CrossRefGoogle Scholar
  16. Kim, C., & Lee, H. (1997). Development of family triadic measures for children’s purchase influence. Journal of Marketing Research, 34(3), 307–321.CrossRefGoogle Scholar
  17. McCracken, G. (1988). The long interview. Newbury Park: Sage.CrossRefGoogle Scholar
  18. Mick, D. G. (2006). Meaning and mattering through transformative consumer research. In C. Pechmann & L. L. Price (Eds.), Advances in consumer research (Vol. 33). Provo: Association for Consumer Research.Google Scholar
  19. Moschis, G. P. (1987). Consumer socialization. Lexington: Lexington Books.Google Scholar
  20. Moschis, G. P., & Churchill, G. A., Jr. (1978). Consumer socialization: A theoretical and empirical analysis. Journal of Marketing Research, 15(4), 599–609.CrossRefGoogle Scholar
  21. Moser, C. (1998). The asset vulnerability framework: Reassessing urban poverty reduction strategies. World Development, 26(1), 1–19.CrossRefGoogle Scholar
  22. O’Malley, L., & Prothero, A. (2007). Contemporary families and consumption. Journal of Consumer Behaviour, 6(4), 159–163.CrossRefGoogle Scholar
  23. Prahalad, C. K. (2004). The fortune at the bottom of the pyramid: Eradicating poverty through profits (4th ed.). Upper Saddle River: Wharton School.Google Scholar
  24. Prahalad, C. K., & Hammond, A. (2002). Serving the world’s poor, profitably. Harvard Business Review, 80(9), 48–57.Google Scholar
  25. Prahalad, C. K., & Hart, S. L. (2002). The fortune at the bottom of the pyramid. Strategy + Business, 26(1), 2–14.Google Scholar
  26. Pratibandla, M. (2012). Foreign direct investment in India’s retail sector: Some issues. In Working paper no. 366. Bangalore: Indian Institute of Management.Google Scholar
  27. Santos, N. J. C., & Laczniak, G. R. (2009). Marketing to the poor: An integrative justice model for engaging impoverished market segments. Journal of Public Policy and Marketing, 28(1), 3–15.CrossRefGoogle Scholar
  28. Shepherd, C. D., & Woodruff, R. B. (1988). A muddling through model of family purchase conflict management. Proceedings of the Society for Consumer Psychology, 9, 73–86.Google Scholar
  29. Sheth, J. (1974). Models in buyer behavior. New York: Harper and Row.Google Scholar
  30. Smith, R. B., & Moschis, G. P. (1984). Consumer socialization of the elderly: An exploratory study. Advances in Consumer Research, 11(1), 548–552.Google Scholar
  31. Sproles, G. B., & Kendall, E. I. (1986). A methodology for profiling consumers’ decision making styles. Journal of Consumer Affairs, 20(2), 267–279.CrossRefGoogle Scholar
  32. Sridharan, S., & Viswanathan, M. (2008). Marketing in subsistence marketplaces: Consumption and entrepreneurship in a South Indian context. The Journal of Consumer Marketing, 25(7), 455–462.CrossRefGoogle Scholar
  33. Viswanathan, M. (2007). Understanding product and market interactions in subsistence marketplaces: A study in South India. In J. A. Rosa & M. Viswanathan (Eds.), Advances in international management – Product and market development for subsistence marketplaces (1st ed., Vol. 20). San Diego: Elsevier.Google Scholar
  34. Viswanathan, M., & Rosa, J. A. (2010). Understanding subsistence marketplaces: Toward sustainable consumption and commerce for a better world. Journal of Business Research, 63(6), 535–537.CrossRefGoogle Scholar
  35. Viswanathan, M., Srinivas, S., Gau, R., & Ritchie, R. (2009). Designing marketplace literacy education in resource-constrained contexts: Implications for public policy and marketing. Journal of Public Policy and Marketing, 28(1), 85–94.CrossRefGoogle Scholar
  36. Viswanathan, M., Rosa, J. A., & Ruth, J. A. (2010a). Exchanges in marketing systems: The case of subsistence consumer-merchants in Chennai, India. Journal of Marketing, 74(May), 1–17.CrossRefGoogle Scholar
  37. Viswanathan, M., Rosa, J. A., & Ruth, J. (2010b). Relationships and commitment as cornerstones in marketing systems: Subsistence consumer merchants in Chennai, India. Journal of Marketing, 74(May), 1–17.CrossRefGoogle Scholar
  38. Ward, S. (1974). Consumer socialization. Journal of Consumer Research, 1(2), 1–14.CrossRefGoogle Scholar
  39. Weidner, K. L., Rosa, J. A., & Viswanathan, M. (2010). Marketing to subsistence consumers: Lessons from practice. Journal of Business Research, 63(6), 559–569.CrossRefGoogle Scholar
  40. Williams, L. A., & Burns, A. C. (2000). Exploring the dimensionality of children’s direct influence attempts. Advances in Consumer Research, 27, 64–71.Google Scholar
  41. Woolcock, M., & Narayan, D. (2000). Social capital: Implications for development theory, practice and policy. The World Bank Research Observer, 15(2), 225–249.CrossRefGoogle Scholar
  42. Xia, Y., Ahmed, Z. U., Ghingold, M., Hwa, N. K., Li, T. W., & Ying, T. C. (2006). Spousal influence in Singaporean family purchase decision making process. Asia Pacific Journal of Marketing and Logistics, 18(3), 201–222.CrossRefGoogle Scholar

Copyright information

© Springer International Publishing Switzerland 2015

Authors and Affiliations

  1. 1.The Pennsylvania State UniversityAbingtonUSA

Personalised recommendations