Some of the best-selling products in emerging markets, such as solar lamps and a Nokia mobile phone, were specifically designed to help the owners of low-income businesses, known as micro-enterprises, make money, the study says.
These micro-enterprises are an untapped but potentially lucrative market and products tailor-made for them could make large profits for both local salesmen and multinational corporations.
The study authors, from the Massachusetts Institute of Technology in the United States, are now planning a large-scale study to evaluate and refine a set of guidelines for those designing products for developing countries.
Design firms in more mature markets generally develop products for consumers or businesses, but not for the informal markets that are prevalent in developing countries, says Maria Yang, co-author of the paper published as part of the ASME international design conference this month (4-7 August).
The study cited mobile phone multinational Nokia as an exception.
In 2003, Nokia launched a phone that dominated sales in India and Sub-Saharan Africa. It was designed for the owners of small, phone-renting businesses, according to the study.
The Nokia 1100 was intended to be shared by many people and used in various environments. It had an easy-grip back for humid climates, a dust-resistant keyboard, an LED torch and several contact lists so users could share the phone and keep personal contact lists separate. Nokia also developed eRefills, a metering tool that displays the exact cost of each call. In addition, Nokia used a fleet of vans to reach rural customers for marketing and product servicing.
"The phones have been used by farmers, fishermen and other producers to check market prices. They have also been used as the basis for money transfers in communities without adequate access to financial services," Yang tells SciDev.Net.
Products designed for this sector not only benefit local entrepreneurs, but can help develop whole communities.
"The ability to communicate is critical to development at a basic level, particularly when some emerging markets lack the infrastructure to support other key types of communication such as landlines," says Yang.
The researchers highlighted solar lamps as another example of design success aimed at micro-enterprises.
“Too much effort is put into designing these products, rather than on coming up with the right business and after-sales service models. That's really what makes these businesses successful.”
founder of the NGO EarthSpark International
Solar lamps enable micro-entrepreneurs to keep their businesses open at night. US firm Greenlight Planet has designed one that can also charge mobile phones. This lamp has sold particularly well because buyers can make money by charging phones for a fee.
But supplying emerging markets with solar lamps also benefits the entire community, driving the switch to solar lighting from expensive, potentially dangerous kerosene lighting.
Daniel Schnitzer, founder of the NGO EarthSpark International, which provides solar lamps to micro-entrepreneurs, believes that strong product design is not the only factor in ensuring sales success.
"Way too much effort is put into designing these products, rather than on coming up with the right business model and the right after-sales service model. That's really what makes these businesses successful," he says.
He adds that EarthSpark has spent much time and resources on designing education and training materials for the entrepreneurs to use themselves and to give to their customers. "I think this is an area where manufacturers have really fallen short," Schnitzer says.
But Yang disagrees. "Educating the user can take a long time, which can backfire," she says. "The best strategy is to come up with a novel product and business models that users can immediately grasp."
The paper offers some guidelines for future designers that focus on creating products that foster micro-enterprise. For example, it says that designers should think of their target users not only as consumers but also as micro-entrepreneurs, and be aware of their needs. It must be clear how the user can make money from the product, and the product should be upgradable so its performance capacity can grow with the business.
Another guideline calls on designers to consider multi-functionality, for example, the solar lamp's ability to charge phones was key to its success.
Link to the paper