Hindustan Lever (HLL)
A subsidiary of Unilever, HLL is the largest consumer goods company in India. Since 1987, it has launched a series of products (food, detergent, soap) for impoverished rural markets. With the goal of distributing its products to the maximum number of points of sale possible, it designed a new distribution system that included rural distributors and participation by women entrepreneurs, who bought the products on loan to later sell them in their communities and earn a profit by doing so. These women received support and training in sales techniques from HLL, which in turn undertook promotion campaigns in these villages in order to increase the population’s awareness of its products. Thanks to this system, it is reaching most of the rural areas in the country. HLL’s extremely positive experience has led Unilever to enter the base of the pyramid in other developing countries and set a goal of 40% of worldwide sales from this market segment.
ne of the leading cement companies in the world, in 1998 Cemex decided to promote the project Patrimonio Hoy in Mexico, with the goal of increasing its sales in the low-income sector. In this sector, families themselves usually build or add extensions to their homes, but the lack of money, unawareness of building techniques and poor service from distributors make the building period even longer and more expensive. This project combines access to loans, technical advice and the sale of cement. Access to loans is organized through savings schemes involving three members, so peer pressure encourages the money to be paid back. Each community has an office where technical advice is dispensed. Collaboration was also sought with distributors to participate in the project and improve the quality of service. Three years after getting underway, Patrimonio Hoy was present in twenty-three cities and had 36,000 customers. Every month, almost 1,600 new customers joined the program.
Tetra Pak is one of the largest companies manufacturing aseptic packaging for beverages. In 1999, it decided to increase its presence in emerging economies by launching a new aseptic package that was more economical and appropriate for this segment. To enter these markets, Tetra Pak sought alliances with both the private and public sector by promoting food campaigns at schools, with milk consumption taking center stage. Because of the company’s aseptic packaging, milk has a longer shelf life, which substantially improves the efficiency of the distribution system. These campaigns are combined with training activities at farms and loans to acquire the packaging machinery. In this way, Tetra Pak has created profits along its entire value chain. In Thailand, for example, milk production rose from 120,000 liters per day in 1984 to 1,500,000 in 2001, and average yearly milk consumption increased from two liters in 1984 to twenty in 1999.