Achieving price pack architecture in South Africa’s processed food industry through frugal innovation
Date
2021
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Abstract
For successful penetration into new markets, organisations should provide consumers with a product solution that is accessible to them and meets their needs, at a price point they are both willing and able to pay, while maintaining the value proposition. This process is known as price pack architecture.
This study investigated whether the constructs of disintermediation and price pack architecture could be integrated to enable businesses to successfully reach the bottomof-the-pyramid market in South Africa. Several research studies have shown that price pack architecture can be implemented by organisations to extend their reach into new market segments effectively, if all theoretical concepts relating to product, price, and accessibility are applied. However, when it relates to the bottom-of-the-pyramid market, several distribution challenges deter organisations from extending their reach to the lower income market, impeding a successful price pack architecture model. This case-based research study on the processed meat industry demonstrates how the amalgamation of disintermediation and price pack architecture can assist organisations to overcome the barriers to entry that make it difficult for them to sell their products to the bottom-of-thepyramid market in South Africa. It is proposed that price pack architecture could enable organisations to expand their market reach. However, to achieve successful price pack architecture strategies for the bottom-of-the-pyramid market, disintermediation needs to be incorporated as a constituent factor of price pack architecture.
The research study outlines two key objectives. Firstly, to demonstrate how the application of price pack architecture can aid organisations to effectively extend their reach to the bottom-of-the-pyramid-market by incorporating an additional theoretical construct to overcome the distribution challenges experienced in the processed meat industry. Secondly, to demonstrate the effect of incorporating disintermediation as a component of price pack architecture.
Description
A research report submitted in partial fulfilment of the requirements for the degree of Master of Management in Strategic Marketing to the Faculty of Commerce, Law and Management, Wits Business School, University of the Witwatersrand, Johannesburg, 2020
Keywords
Price pack architecture, Disintermediation, Frugal innovation