Business Model Categories for the Base of the Pyramid and Challenges in the South African Market

Abstract

The purpose of this thesis is to map various categories of business models to reach the Base of the Pyramid (BOP) customer segment, and to highlight some of the main perceived challenges in the South African market, with an emphasis on how these are dealt with within the different business model categories. Applying a business model framework consisting of the four interrelated elements of target customer, value proposition, delivery and capture, we conducted a qualitative, multiple case study to aggregate the three business model categories Engaging the Entrepreneur (EE), Poverty Premium Eradication (PPE) and Multipurpose Product (MPP). These offer insights as to the role of the BOP, how to create value for this segment and how value might be captured. Value delivery was found to be independent of the business model categories. Furthermore, we found that the main perceived challenges were dealt with in similar manners across the business model categories, and that one means was used to solve several issues. As the solutions to the challenges were found mainly, but not exclusively, in the value delivery of the business model framework, it lead us to conclude that the solutions to the challenges were largely business model category independent.