Analyst Insight by Chloe Wu - Personal Accessories and Eyewear Analyst
Businesses operating in emerging markets are looking beyond the higher-income brackets, towards the “Base of the Pyramid” (BoP) – the economic segment that operates in an informal economy and has an annual per capita income of less than US$3,000 in purchasing power parity, as defined by the World Bank Group. Yet this group has substantial purchasing power combined: the BoP constitutes a US$5 trillion global consumer market, after adjusting for purchasing power parity. The BoP mainly resides in rural towns, where the population is fragmented, products not evenly distributed and the market unpenetrated. Unlike in the cities, rural markets have little or no direct competition between products.
Within eyewear, there are examples of BoP strategies executed successfully, but such successes are few and far between due to the many challenges faced. Nevertheless, the BoP represents a huge untapped market for eyewear players. According to the World Health Organization’s estimates in August 2014, 285 million people are estimated to be visually impaired (suffering from refractive errors, cataracts, glaucoma or blindness). Notably, 90% of the world's visually impaired live in low-income settings.