IDEAS home Printed from https://ideas.repec.org/a/eee/jbrese/v63y2010i6p651-655.html
   My bibliography  Save this article

Strategic motivations and choice in subsistence markets

Author

Listed:
  • Elaydi, Raed
  • Harrison, Charles

Abstract

This paper examines the different motivations behind strategic choice in base of the pyramid or subsistence markets. Two strategies are examined through comparative analysis: market extension and strategic intent. Using two commercial bank's micro-lending business strategies in Sri Lanka, a comparative case study suggests that strategic intent is motivated by building capabilities over time that results in successful poverty alleviation, whereas market expansion is motivated by an immediate desire to expand overall sales revenue. This conclusion may help reframe subsistence market or BoP arguments away from such false choices as appropriate size (e.g., multinational corporations versus small and medium size enterprises) toward more useful discussion on understanding why firms participate in subsistence markets and what is the motivation behind their strategic choice. By considering more than just size and scope and studying the motivations behind long-term solutions to poverty alleviation, firm success can be better understood and achieved.

Suggested Citation

  • Elaydi, Raed & Harrison, Charles, 2010. "Strategic motivations and choice in subsistence markets," Journal of Business Research, Elsevier, vol. 63(6), pages 651-655, June.
    • Handle: RePEc:eee:jbrese:v:63:y:2010:i:6:p:651-655
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0148-2963(09)00164-7
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gallardo, J.S. & Randhawa, B.K. & Sacay, O.J., 1997. "A Commercial Bank's Microfinance Program: The Case of Hatton National Bank in Sri Lanka," World Bank - Discussion Papers 369, World Bank.
    2. Ted London & Stuart L Hart, 2004. "Reinventing strategies for emerging markets: beyond the transnational model," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(5), pages 350-370, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. N’Guessan, Marie Noëlle & Hartarska, Valentina, 2021. "Funding for BOP in Emerging Markets: Organizational Forms and Capital Structures of Microfinance Institutions," Research in International Business and Finance, Elsevier, vol. 58(C).
    2. Carlos M. Jardon & Xavier Martinez-Cobas, 2022. "Leadership and Marketing Capabilities in Small Businesses of Subsistence Marketplaces," SAGE Open, , vol. 12(2), pages 21582440221, April.
    3. Umawadee Detthamrong & Lan Thi Nguyen & Wirapong Chansanam, 2023. "Leadership and Group Management: Key Success Factors for Microfinance Institutions in Chaiyaphum Province, Thailand," Sustainability, MDPI, vol. 15(14), pages 1-20, July.
    4. Aman, Sadaf & Seuring, Stefan, 2022. "Interestingly it's innovation: Reviewing sustainability performance management in the base of the pyramid (BoP)," Technovation, Elsevier, vol. 112(C).
    5. Yan Yuan & Toshiyuki Sueyoshi, 2017. "Effects of balance transfer offers on consumer short-term finance: evidence from credit card data," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 6(1), pages 1-30, December.
    6. Raja Usman Khalid & Stefan Seuring, 2019. "Analyzing Base-of-the-Pyramid Research from a (Sustainable) Supply Chain Perspective," Journal of Business Ethics, Springer, vol. 155(3), pages 663-686, March.
    7. Elaydi, Raed & McLaughlin, Josetta, 2012. "Cultivating terroir in subsistence markets: Development of terroir strategy through harmony-with-community framework," Journal of Business Research, Elsevier, vol. 65(12), pages 1743-1748.
    8. Cristián Pinto, 2015. "The Effect of Labor Market Flexibility on Microfinance Institutions Performance: International Evidence," Serie Working Papers 21, Universidad del Desarrollo, School of Business and Economics.
    9. Mariadoss, Babu John & Johnson, Jean L. & Martin, Kelly D., 2014. "Strategic intent and performance: The role of resource allocation decisions," Journal of Business Research, Elsevier, vol. 67(11), pages 2393-2402.
    10. Hahn, Rüdiger & Gold, Stefan, 2014. "Resources and governance in “base of the pyramid”-partnerships: Assessing collaborations between businesses and non-business actors," Journal of Business Research, Elsevier, vol. 67(7), pages 1321-1333.
    11. Simon Joncourt & Heiko Gebauer & Javier Reynoso & Karla Cabrera & Ana Valdes & Katharina Greve, 2019. "Extending the Base-of-the-Pyramid Concept," Service Science, INFORMS, vol. 11(3), pages 241-261, October.
    12. Avinash G. Mulky, 2011. "Marketing to the Bottom of the Pyramid and subsistence markets - A research agenda," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 59(2), pages 9-14.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Srivardhini K. Jha & E. Richard Gold & Laurette Dubé, 2021. "Modular Interorganizational Network Governance: A Conceptual Framework for Addressing Complex Social Problems," Sustainability, MDPI, vol. 13(18), pages 1-21, September.
    2. Newburry, William & Gardberg, Naomi A. & Sanchez, Juan I., 2014. "Employer Attractiveness in Latin America: The Association Among Foreignness, Internationalization and Talent Recruitment," Journal of International Management, Elsevier, vol. 20(3), pages 327-344.
    3. Yadong Luo & Huan Zhang & Juan Bu, 2019. "Developed country MNEs investing in developing economies: Progress and prospect," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(4), pages 633-667, June.
    4. Mario Pansera & Fabien Martinez, 2017. "Innovation for development and poverty reduction: an integrative literature review," Post-Print hal-02887777, HAL.
    5. Colin C. Williams & Brunilda Kosta, 2019. "Evaluating Institutional Theories Of Informal Sector Entrepreneurship: Some Lessons From Albania," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 24(02), pages 1-17, June.
    6. C. Williams, Colin & Kayaoglu, Aysegul, 2016. "Tackling The Informal Economy In The European Union: A Social Actor Approach," UTMS Journal of Economics, University of Tourism and Management, Skopje, Macedonia, vol. 7(2), pages 133-147.
    7. Alexey Bereznoy, 2018. "Innovative Business Models In The Strategic Adaptation Of Multinationals To Emerging Economy Environment," HSE Working papers WP BRP 85/STI/2018, National Research University Higher School of Economics.
    8. Wani, Nassir Ul Haq, 2020. "Latency and Economic Concert of India’s Trade with Russia: An Empirical Investigation," MPRA Paper 104716, University Library of Munich, Germany, revised 20 Nov 2020.
    9. Min Ju & Hongxin Zhao, 2009. "Behind organizational slack and firm performance in China: The moderating roles of ownership and competitive intensity," Asia Pacific Journal of Management, Springer, vol. 26(4), pages 701-717, December.
    10. Geoffrey M. Kistruck & Paul W. Beamish, 2010. "The Interplay of Form, Structure, and Embeddedness in Social Intrapreneurship," Entrepreneurship Theory and Practice, , vol. 34(4), pages 735-761, July.
    11. Ayesha Siddiqui & Mohd Shamim & Mohammad Asif & Mamdouh Abdulaziz Saleh Al-Faryan, 2022. "Are Stock Markets among BRICS Members Integrated? A Regime Shift-Based Co-Integration Analysis," Economies, MDPI, vol. 10(4), pages 1-25, April.
    12. Brock, David M. & Hydle, Katja Maria, 2018. "Transnationality – Sharpening the Integration-Responsiveness vision in global professional firms," European Management Journal, Elsevier, vol. 36(1), pages 117-124.
    13. Jarkko Levänen & Mokter Hossain & Tatu Lyytinen & Anne Hyvärinen & Sini Numminen & Minna Halme, 2015. "Implications of Frugal Innovations on Sustainable Development: Evaluating Water and Energy Innovations," Sustainability, MDPI, vol. 8(1), pages 1-17, December.
    14. Sophia Belghiti-Mahut & Anne-Laurence Lafont & Angélique Rodhain & Florence Rodhain & Leila Temri & Ouidad Yousfi, 2016. "Genre et innovateur frugal : 4 cas de femmes innovatrices," Innovations, De Boeck Université, vol. 0(3), pages 69-93.
    15. Poul Houman Andersen & Lars Esbjerg, 2020. "Weaving a strategy for a base‐of‐the‐pyramid market: The case of Grundfos LIFELINK," Business Strategy and the Environment, Wiley Blackwell, vol. 29(8), pages 3687-3701, December.
    16. Colin C. WILLIAMS, 2015. "Out of the shadows: Classifying economies by the extent and nature of employment in the informal economy," International Labour Review, International Labour Organization, vol. 154(3), pages 331-351, September.
    17. Cieslik, Katarzyna, 2016. "Moral Economy Meets Social Enterprise Community-Based Green Energy Project in Rural Burundi," World Development, Elsevier, vol. 83(C), pages 12-26.
    18. Mbalyohere, Charles & Lawton, Thomas & Boojihawon, Roshan & Viney, Howard, 2017. "Corporate political activity and location-based advantage: MNE responses to institutional transformation in Uganda’s electricity industry," Journal of World Business, Elsevier, vol. 52(6), pages 743-759.
    19. Luiz Antonio Slongo & Carlos Sérgio Valdez Saldanha & Syed H. Akhter, 2014. "Low-Income Consumers in Brazil: Nuances of a Market That Can No Longer Be Ignored," International Journal of Management Sciences, Research Academy of Social Sciences, vol. 4(10), pages 485-505.
    20. Namgung, Hyewon & Fujiwara, Akimasa & Yamamoto, Jenny & Zhang, Junyi, 2023. "Small and medium-sized taxi firm operators' stated choices of future business models: A case study in Japan based on hybrid choice model with panel effects," Research in Transportation Economics, Elsevier, vol. 101(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:63:y:2010:i:6:p:651-655. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbusres .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.