Lighting the Bottom of the Pyramid

CLIENT: International Finance Corporation

The Business Issue

In sub-Saharan Africa, over half a billion people lack connection to grid electricity. New lighting technologies (LED, CFLs) make low cost and quality off-grid lighting now possible. IFC saw an opportunity to stimulate the private sector by using these technologies to develop appropriate products that are affordable to the poor. And will improve their lifestyle.

The Background

The IFC have engaged with over 100 world-wide lighting manufacturers to encourage and assist them to invest in this lighting sector. The challenge for the Social & Public Research Division of RI-Africa was to provide information from the target markets to help these manufacturers in sizing the market and develop appropriately tailored and priced products.

The Solution

Our solution was to provide insight from poor households and businesses using a 4 stage approach. The first stage involved in-depth interviews with 55 urban and rural poor households and businesses each in Ghana, Kenya, Ethiopia, Zambia and Kenya. During these interview, off-grid lighting products were tested and immediate feedback gathered. At the same time, national quantitative surveys provided information on product design features using conjoint methodology, on optimum pricing and habits and attitudes. The next stages, currently in development, will involve further qualitative research to fine tune products designed as a result of the first two stages, and a concept test of relevant product ideas using the RI eValuate methodology.

The Business Value

This research is integral to the project as it will determine manufacturers' willingness to invest in this sector and help mold strategic and tactical decisions. The study has already shown there is a viable market both in terms of money available in the sector and the level of likelihood to purchase expressed by the poor.

The overall value of this project is providing the poor with efficient lighting that will improve their lifestyles and development in Africa:

• Reduce expenditure on paraffin in poor households
• Enhance safety and security via outdoor lighting
• Improve studying conditions for students
• Improve health services delivery

For more information go to http://lightingafrica.org