Since Noor Ali set up Rehmat, a tiny grocery store or ‘kirana’ in the old Indian town of Ahmedabad, nearly a decade ago, he has sold more branded goods every year. Strip after strip of sachets containing shampoo, Vaseline, washing powder, hair dye, Vicks balm, face cream — just about everything you’d find in a chemist’s in Europe — dangle around the window through which he serves his customers.
The sums of money involved are tiny. A sachet of Pond’s skin moisturiser sells for just two Indian rupees (Euro 0.03) and Ali gets only a slim margin, but he’s happy with the change.
“A shampoo bottle costs at least sixty Indian rupees (Euro 0.85). A teenage girl cannot buy that, but she can definitely buy a sachet worth one rupee,” he points out. “Small packs allow people to afford international brands, so consumers who were not using cosmetics like Fair and Lovely face cream, or shampoo, are now buying it, which is increasing our profits.”
A large proportion of Ali’s customers earn between Euro 1.80 and Euro 7.20 a day, putting them firmly in the Deeper in the Pyramid (DiP) consumer category that the Boston Consulting Group has identified as the “golden opportunity” for international companies.
Find out more about the DiP business model and how companies are helping meet the needs of low-income consumers in the growth markets of the future.