Fantastic Article in the WSJ about designing for the "Other 90%"

[red-beard]

The WSJ does some great articles/Human interest stories on the weekends.

http://online.wsj.com/article/SB117951728791007805.html?mod=hpp_us_editors_picks

How Innovative Devices Can Boost
Poorest Farmers, Entrepreneurs
By ANNELENA LOBB
May 18, 2007 6:58 p.m.

Design often caters to the wealthy, or at least the comfortable. But what about the world's poor? Design For the Other 90%, an exhibit at New York's Cooper-Hewitt National Design Museum, features products developed to improve the quality of life of people in extreme poverty.

The Wall Street Journal Online spoke with Martin Fisher, co-founder of KickStart International, a non-profit organization that develops new technologies to help very poor entrepreneurs start businesses; and Paul Polak, of International Development Enterprises, which aims to increase the income of low-income farmers. Among other things, both men have worked on designing pumps, irrigation systems and other equipment sold to small farms, now on display in the Other 90% exhibit, whose lead sponsor is the Lemelson Foundation. WSJ.com spoke to them about the challenges of designing products for the poor.

Martin Fisher: We buy time-saving and labor-saving devices, and many of those aren't that relevant for the poor. They have a fair lot of time and labor. What they don't have is very much money. We've realized that an expensive item for a poor person, something that costs about $10, should be a money-making device. They spend money on a daily basis, so they have to find a way to make money.

Paul Polak: There are huge untapped markets in the other 90%. Many designers have never run into [that group] or just haven't thought about it. That doesn't mean they're not interested in it.

WSJ.com: When you design products for the poor, what must you keep in mind?

Mr. Fisher: The No. 1 items will be money-making devices, and money-saving ones only if they're extremely cheap. You need something easy to maintain without many tools, and something that can be easily transported, because the poor live in remote areas. It can't require a pickup truck. Human powered -- maybe no petrol and no electricity. It has to be energy efficient. You're dealing with 80 watts of human power.

Mr. Polak: You have a whole different range of affordability when you're surviving on a dollar a day. We see it a little differently on quality versus affordability. People will pick a product that only lasts two years if it's cheap. But some of the design principles are the same [as when you design for the rich] -- you look at a tool and identify the key contributors to cost and look at ways to design around them.

WSJ.com: Does quality suffer when you make a product very affordable?

Mr. Fisher: We're not that far off. If you design a two-year drip irrigation system or a one-year pump, that comes into your design criteria. My only concern is that it does last for a year and doesn't break the first time it's used. There's a difference between something breaking versus wearing out after a year. The quality control has to be good.

Mr. Polak: These are basically survival microenterprises. Whatever you design that is income generating must actually last long enough to turn a profit.

WSJ.com: Why do you sell your products instead of giving them away?

Mr. Polak: You can't donate people out of poverty, although many people think so. [Economist] Jeff Sachs believes it will take $1.6 trillion a year, and he believes that a dollar a day people are too poor to invest in their own path out of poverty. Martin and I both feel that poor people have to invest time and money to move out of poverty. In Bangladesh, President Ershad was impressed with treadle pumps, so he said would give 10,000 of them to people in the district he came from. Then farmers stopped buying them, local manufacturers had to close their doors, and it set farmers back in that region two years.

Mr. Fisher: Four reasons giving things away is bad -- it's very unfair, how do you decide who gets something and who doesn't? It's unsustainable, where I give you something today and next year you need a spare part. It kills or distorts the local private sector; and it's not being appreciated or used well. It's like being given a gift that ends up in a drawer. It creates dependency, and it's not cheaper. You still have to set up a distribution network.

WSJ.com: What are some of the challenges to the adoption of your products?

Mr. Polak: In the beginning people felt it was all trivial. I gave a talk at Cornell 22 years ago, and the professors of engineering there really tore me apart. They said, how dare you push a technology that enslaves people? We have a motorized pump, and you're pushing coolie labor. But we ended up selling a million and a half treadle pumps in Bangladesh. The conventional belief in the West is that technology is meant to take away the slave labor of the poor, without recognizing that poor people in developing countries are working for five cents an hour. Modern technology doesn't fit. Now, the situation is different. We have design courses where students are learning to make a difference through this kind of design. So all of a sudden the whole tone and the culture changed.

Mr. Fisher: Convincing the farmers is also hard. Even convincing retail shops to stock these pumps is a challenge. Occasionally, we had to use butcheries or hairdressers to sell our pumps because they were the only ones who would stock it. You're selling an expensive item -- representing a big chunk of annual income -- and you're selling it to the poorest and most risk adverse people in the world, and people who have never seen technology like this before. At Kickstart, about 75% of our money goes to marketing. We have to create awareness to convince them to come in to a shop and try out the pump. It takes them a long time to decide, they have to save up the money and know you're not a snake oil salesman. Eventually people learn about these things and make a decision, but it's a hard sell.

Mr. Polak: Just to zoom this out a bit, if you look at business in developed countries, any venture capitalist knows marketing is ¾ of the issue. If you look at the other 90% as a customer group, they may not be able to read and write. You have to design a marketing and promotion program to a highly risk adverse group, and they're risk adverse because they're rational. If they make a mistake, it can have terrible consequences. You have to go back to the kind of marketing we did here 100 years ago. You maybe hire a local staff who can talk to farmers, identify the farmers who are little better off. Design is much more than designing equipment -- designing a marketing strategy under these conditions is the most basic design problem. How do you scale it up so you reach millions of them?

WSJ.com: How do you interest young designers in working in this field, and in staying in it?

Mr. Fisher: We need to get it to the point where there are a lot of jobs designing products for the poor. We need to make this field as big and as commonly known as what happened in microfinance. Ten years ago you couldn't get a microfinance job, but now you can -- it's grown to a size where billions in donor money and investor money get poured into it.

Mr. Polak: The design field is a field full of missed opportunities. When the guy who founded Sony bought a transistor license from RCA, RCA thought it was ridiculous, but it created a revolution. Nobody visualized transistor radios or any of the things that kids walk around with in their ears now. Design for the other 90% represents markets just as big -- just unrealized.

Write to Annelena Lobb at annelena.lobb@wsj.com

[Jims5543]

At first glance it seems like a oxymoron, marketing to the poor. But after reading the article you realize there is a huge untapped market out there that many ignore basedon the fact that they do not want to deal with the poor.

Pretty cool article, neat concept. I can see how this would work, but it requires one to think a lot differently when marketing.

[Jims5543]

At first glance it seems like a oxymoron, marketing to the poor. But after reading the article you realize there is a huge untapped market out there that many ignore basedon the fact that they do not want to deal with the poor.

Pretty cool article, neat concept. I can see how this would work, but it requires one to think a lot differently when marketing.

[M.D. Holloway]

What ever happen to the $10 laptops?