PS040404

Frugal Innovation and Technology Networks with Africa

Frugal innovation concerns value-sensitive design and marketing strategies that bring sophisticated products within the reach of relatively poorer consumers. Through re-engineering, re-inventing or stripping down high-value consumer products and dramatically lowering their unit consumer price, a significantly extended range of products is made affordable for the roughly four billion consumers at the Bottom of the Pyramid (BoP), of whom about 500 million live in Africa.  Examples include Tata’s simplified water purifier that provides poor people with safe drinking water; Unilever’s OMO sachets that contain small amounts of detergent specifically for hand washing in cold water; Tata’s economical Nano car that was produced for the emerging Indian middle class and is sold for about US$ 2000; and low-cost solar lighting (Philips) that can be used in places with no electricity.

While these examples show their developmental potential, frugal innovations can also lead to increased environmental damage and more exploitative labour conditions if the ‘stripping down’ means undercutting existing environmental and labour standards. Moreover, when frugal innovation and the technologies and strategies it involves are fully developed in the headquarters of Western or Chinese, Indian or Brazilian companies without any interaction with local entrepreneurs, these strategies are less likely to be beneficial or successful in Africa.