Partners Business Council

How to innovate for the poor? Pragmatism in innovation

How to innovate for the poor? Pragmatism in innovation

2016-10_pbc-group_como-inovar-para-pobre
“Simplicity is the ultimate sophistication” – Leonardo da Vinci.

I’m not an expert in innovation, but only an observer and admirer of the genius of simple and efficient solutions.

This concept of doing more with less, generating creatively low cost and efficient solutions it is known as Frugal Innovation (*). Eastern entrepreneurs mainly from India and China are currently leading these skills. Solutions that focus on high functionality at low costs have been quite suitable for the emerging countries markets. Some of these solutions started to be adopted in the developed countries markets.

In the food and beverages market in Brazil, I had the opportunity to follow at different times some examples of that touch of business genius, as in the following cases:

(1) Product: Sazón – Company: Ajinomoto
During a meeting with the Global VP of Food Division in the Anglo-Dutch multinational that I worked at one point he turned to us, the Brazilian team, and said: Brazilians love cooked rice and beans so what we can sell to rice or beans? We were stunned and unresponsive.
Who gave the brilliant answer sometime after this episode was Ajinomoto company. Using their core product mono sodium glutamate (MSG) as a basic ingredient they launched a powder seasoning line in sachet under brand Sazon, for the preparation of beans and rice. The company sales exploded in the Brazilian market.

(2) Product: Ready-to-eat Farofa – Company: Yoki (General Mills)
Every Brazilian from north to south loves a barbecue, but the farofa (fried cassava flour with butter, bacon, etc.) one of the main side dishes had to be prepared away from the barbecue place. This until the company Yoki, which used to sell basic products as pop corn and different types of flours have the brilliant idea to add value to cassava flour. They launched the Farofa Ready Seasoned, extremely practical and with a taste that delighted the consumers. This product was an immediate success and continues to be one of the main products in their portfolio.

(3) Product: Cracker biscuit with a butter flavor touch. – Company: Vitarella (M. Dias Branco)
There is not any more traditional product than cracker in the Brazilian biscuit market. In Pernambuco State, this market sub segment decreased each year and did not show any differentiation among the various manufacturers. In this scenario, Vitarella company decided to simply give a touch of “bottled butter” flavor (a very strong Northeast region type of butter) on their cracker. The success was so great in the Northeast that the product has revitalized the category and became a reference not only in the region but for the rest of the country.

In the Brazilian market, which experiences a sudden and dramatic drop in the consumer purchasing power, entrepreneurs and professionals from technical and marketing areas have to think and work with this kind of mentality, and stop acting only as quality thugs of their products by indiscriminated reduction of costs.

(*) suggested literature about Frugal Innovation
– Frugal Innovation – How to do more with less.
Navi Radjou; Jaideep Prabhou.
– Reverse Innovation – Create far from home, win everywhere.
Vijay Govindarajan; Chris Trimble.

Article author: Luiz Azevedo

BSc. Chemical Engineering, MBA Marketing, MSc. Economics, Director of Profiler Business Consulting and Partner of PBC – Food & Beverages Consultants