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The Smart Techie was renamed Siliconindia India Edition starting Feb 2012 to continue the nearly two decade track record of excellence of our US edition.

May - 2008 - issue > Profiles in Innovation

Sowing Innovations, Reaping Benefits – A Mass Market Story

Ash Tankha
Thursday, June 26, 2008
Ash Tankha
In the past, the initial focus of a vast majority of businesses was niche market segments, and most of the innovations were driven to cater to the top end of the market pyramid. The product prices reduce as the products percolate down the market segments to reach the mass market. In the new age economy, companies are focusing on innovation keeping in mind the lucrative bottom layers of the market pyramid.

The myth that only the early adopters determined the validity and acceptability of the product in the market has been discarded now. Innovation is increasingly being fueled by the needs of the society at large. The mass market consists of consumers who are closer to the bottom of the pyramid and who are quite price sensitive. Businesses are realigning their product development focus on tapping the potential of this larger segment of consumers. The diversity in the needs of these consumers is very large, forcing businesses to rethink their market segmentation, targeting, and product positioning.

Companies worldwide are looking at the emerging markets as the next big growth driver. The strong purchasing power of the middle class in both developed and developing countries may significantly dictate the product requirements of the future. The middle class in developing or near developed economies such as India and China is now a lucrative target for companies worldwide.

Many a times, business managers are setting product affordability as a primary criterion for new product development and innovation research activities. “The largest market opportunity lies at the bottom of the pyramid. Products that have traditionally focused on select segments need to cater to specialized features that may not have mass appeal, and often become too expensive. Such a product ends up at the stratosphere of the market and eventually gets forced out,” says Suneet Singh Tuli, Founder, Datawind Ltd.

The needs of the mass markets are far from homogeneous. The products and service requirements in a mass market may require mass customization. Product positioning in small niches is not necessarily dead. Increasingly, products will need to be positioned for a variety of users in the mass segment.

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