Marketing’s Lost Frontier: The Poor

Markets, Globalization & Development Review Volume 1 | Number 1 Article 3 2016 Marketing’s Lost Frontier: The Poor Ravi Achrol George Washington University Philip Kotler Northwestern University Follow this and additional works at: http://digitalcommons.uri.edu/mgdr Part of the Anthropology Commons, Economics Commons, Marketing Commons, Other Business Commons, and the Sociology Commons Recommended Citation Achrol, Ravi and Kotler, Philip (2016) "Marketing’s Lost Frontier: The Poor," Markets, Globalization & Development Review: Vol. 1: No. 1, Article 3. DOI: 10.23860/MGDR-2016-01-01-03 Available at: http://digitalcommons.uri.edu/mgdr/vol1/iss1/3http://digitalcommons.uri.edu/mgdr/vol1/iss1/3 This Article is brought to you for free and open access by DigitalCommons@URI. It has been accepted for inclusion in Markets, Globalization & Development Review by an authorized editor of DigitalCommons@URI. For more information, please contact . This article is available in Markets, Globalization & Development Review: http://digitalcommons.uri.edu/mgdr/vol1/iss1/3 Marketing’s Lost Frontier: The Poor Ravi Achrol Philip Kotler Abstract The problems of persistent poverty have occupied the minds, money and agencies of the world for a very long time. It is the subject of a large literature in economics and sociology, and the literature has evolved through a variety of theoretical paradigms. Despite numerous initiatives the impact on alleviating poverty is marginal. Recently the poverty conundrum has attracted the attention of schools of business and global corporations. In this paper we critically review the major changes in the conventional approaches to development. Then we review three models based on the thought traditions of business schools that offer a new way of thinking about poverty alleviation. One is the BOP model of Prahalad. The second is the social marketing model. The third is a radical new model of distributed marketing networks structured around micromanufacturing, microenergy and microfinance technologies. Keywords Marketing, Development, Poverty, Sustainability, Self-Preservation Capitalism Ravi S. Achrol is Professor of Marketing Science, School of Business, George Washington University, where he also served as the Associate Dean for Research and Doctoral Studies. He was on the faculty of the University of Notre Dame, and also held the Kmart Corp. Endowed Chair in Marketing at West Virginia University. His research interests include distribution channels, marketing strategy, interorganizational relations and network organizations. Journals featuring his articles include Journal of the Academy of Marketing Science, Journal of Marketing, Journal of Marketing Research, Journal of Public Policy and Marketing, Journal of Retailing, Social Science Research, and Journal of Business Strategy. Philip Kotler is the S. C. Johnson & Son Distinguished Professor of International Marketing at the Kellogg School of Management, Northwestern University. He has published over 50 books in marketing including the 15th edition of Marketing Management, the world’s most read book with this title. He has received 22 honorary degrees. His latest two books are Confronting Democracy: Real Solutions for a Troubled Economic System (AMACOM 2015) and Democracy in Decline: Rebuilding its Future (Sage 2016). He has keynoted at early, foundation-laying ISMD conferences in Istanbul, Budapest and New Delhi. Creative Commons License This work is licensed under a Creative Commons Attribution 4.0 License. This article is available in Markets, Globalization & Development Review: http://digitalcommons.uri.edu/mgdr/vol1/iss1/3 Achrol and Kotler: Poor - Lost Frontier Marketing’s Lost Frontier: The Poor Introduction We congratulate the International Society of Markets and Development (ISMD) on launching its new journal Markets, Globalization & Development Review (MGDR), co-edited by Nikhilesh Dholakia and Deniz Atik. This article’s second author was privileged to have been involved in the Society’s first conference in Istanbul. The Society is positioned to lead what should be among the foremost issues before the world in the 3rd Millennium – bringing the poor and struggling masses into the mainstream of economic opportunity and wellbeing. Both of us authors are honored to write this article for the inaugural issue of ISMD’s new journal. The majority of the peoples of this world have been left behind by the economic miracle of the 20th Century. Seventy-one percent of the world’s 7 billion human inhabitants in 2011 lived in poverty –15 percent lived in extreme poverty earning less than US $2 per day; and 56 percent earned less than the US standard of poverty of $10 per day (Pew Research Center 2015). The 3.2 billion people at the base of the world wealth pyramid, own just 3% of the world's wealth. In contrast the top one percent own just over half of the world's wealth and the top 10 percent own 87.7 percent (Credit Sussie 2013). It is perplexing--why has poverty defied the ingenuity of humans in the 20th century? Why can’t the people who have sent men to the moon, unraveled the genetic code, cloned life, built glittering cities in China in not much more than a decade, why can’t the architects of modern miracles of science solve one of the oldest economic and social problems plaguing humankind? In 2000 the United Nations issued an impressive document called the Millennium Development Goals (MDG) signed by 180 Heads of State. But in May 2005 UN Secretary General Kofi Annan warned that the poor countries will not meet many, or even most, of the MDG. The UN’s new Agenda for Sustainable Development (United Nations 2015, p.6) acknowledges that whereas significant progress was made, progress has been uneven, particularly in the least developed economies, and that some MDG are off-track. The MGD have been superseded by The 2030 Agenda for Stainable Development (ASD) with an even more expansive and ambitious set of 17 goals and 169 targets. So overwhelming is the scope of this document that it will surely provide more grist for the UN’s many critics who have long called it irrelevant and ineffective. For those with a management mindset the new UN document will appear fanciful being devoid of the critical analysis of what worked and what didn't with Published by DigitalCommons@URI, 2016 1 Markets, Globalization & Development Review, Vol. 1 [2016], No. 1, Art. 3 the MGD and why: it is only from such analysis that new vision and goals should emerge. Influential analysts and financial experts like Jeffery Sachs, Joseph Stiglitz and George Soros have expressed opinions that after five decades and over $2 trillion in “foreign aid,” the post-World War II development regime (including the IMF and the World Bank) is in some disrepute and disarray. Maybe it is for lack of determined effort from governments and the community of nations.1 Some like Jeffrey Sachs believe that the solution calls for a vast transfe (...truncated)