The Double Bottom Line

The Double Bottom Line is a short (9-minute) documentary about social enterprise and two companies (LifeSpring Hospitals and D.Light Design) who are trying to:

  1. Change the world
  2. Make a profit

One is providing quality maternity healthcare at a price lower than the government hospitals; the other is selling solar latterns that are cheaper and safer than kerosene lanterns.

I have to admit that the idea of “marketing to the bottom of the pyramid” leaves a bad taste in my mouth. But I also have to admit that I don’t know much about marketing, and I probably have to reframe its purposes and methods in my head to separate out the tools from the context in which they are currently used. (So please school me, business majors.)

When Tricia Morente, head strategy and marketing at LifeSpring Hospital, talks about making the hospital a sustainable business rather than relying on a one-time cash infusion, it makes sense in the long run. What resonated with me was when she says turning it into a mutual business transaction not only empowers the customer (in this case a new mom) with choice, but also increases the responsibility of the hospital to provide quality service. They are working for-profit, but not for profit maximization.

Seth Godin (relation to Alex Godin who made the video?) writes about marketing to the bottom of the pyramid:

Change the world? Sure. Because capitalism and markets scale. If you can make money selling someone a safer item, you’ll make more. And more. Until you’ve sold all you can. At the same time, you’ve enriched the purchaser, who bought something of her own free will because it made things better.

Not only that, but engaging in the marketplace empowers the purchaser. If you’ve got a wagon full of rice as food aid, you can just dump it in the town square and drive away. You have all the power. But if you have to sell something in order to succeed, it moves the power from the seller to buyer. Quality and service and engagement have to continually improve or the buyer moves on.

The cell phone, for example, has revolutionized the life of billions in the developing world. If you have a cell phone, you can determine the best price for the wheat you want to sell. You can find out if the part for your tractor has come in without spending two days to walk to town to find out. And you can be alerted to weather… etc. Productivity booms. There’s no way the cell phone could have taken off as quickly or efficently as a form of aid, but once someone started engaging with this market, the volume was so huge it just scaled. And the market now competes to be ever more efficient.

He also points out that marketing here is difficult because the consumerist mindset to upgrade or buy innovative doesn’t exist in certain parts of the world.

Let me add one more easily overlooked point: Western-style consumers have been taught from birth the power of the package. We see the new nano or the new Porsche or the new convertible note on a venture deal and we can easily do the math: [new thing] + [me] = [happier]. We’ve been taught that an object can make our lives better, that a purchase can make us happier, that the color of the Tiffany’s box or the ringing of a phone might/will bring us joy.

That’s just not true for someone who hasn’t bought a new kind consumer good in a year or two or three or maybe ever. As a result, stores in the developing world tend to be stocked with the classic, the tried and true, because people buy refills of previous purchases, not the new.

I guess what makes me uneasy is if we start swooping in on this “untapped market” and start treating it like any other business deal without regard to the people, the environment, or the impact of what we’re selling (literally and figuratively). This is where ethics starts to play a role, and yet we don’t have a code in place to follow. Because how do you build a code that will be large enough to make sure the world isn’t screwed in the process?