Abstract
A qualitative study of subsistence consumer–merchants (SCMs) in Chennai, India, reveals that they sustain relationships in three interdependent relationship domains: vendor, customer, and family. Relying on long interview data, the authors interpret the subsystems as closed-loop and self-sustaining relationships. Subsystems are managed by SCMs through buying and selling activities alongside the receiving and granting of credit, and these activities engender three facets of commitment: continuance, affective, and normative. Different facets of commitment underlie the relationships in the three subsystems. Through different role-based activities, SCMs enhance or diminish commitment levels to keep all three types of relationships viable while moving their scarce time, energy, and financial resources into the domain with the greatest need. Activities and the management of commitment are performed within 24-hour business cycles, with negligible resources, and in highly unstable environments, providing valuable theoretical insights and managerial implications that guide recommendations for firms wanting to serve subsistence markets successfully.
Highlights
A qualitative study of subsistence consumer–merchants (SCMs) in Chennai, India, reveals that they sustain relationships in three interdependent relationship domains: vendor, customer, and family
We find that SCMs buy and sell goods and services on a daily basis, that commitments to and from vendors and customers are central to the multiple daily exchanges SCMs perform, and that the commitments underlying these activities exist in the context of intricate relationship subsystems that such commitments concurrently sustain
Each business differs in the products and services offered, SCMs engage in a common set of key activities, such as obtaining and extending credit, that contribute to self-stabilizing relationship subsystems with vendors and customers
Summary
A qualitative study of subsistence consumer–merchants (SCMs) in Chennai, India, reveals that they sustain relationships in three interdependent relationship domains: vendor, customer, and family. Sometimes referred to as base-of-the-pyramid or bottom-of-the-pyramid markets, is a promising strategic alternative for companies involved in product and services marketing (Hammond et al 2007; Prahalad 2005; Rosa and Viswanathan 2007). Some firms have successfully served such markets for decades through product, pricing, distribution, and promotion initiatives carefully tailored to each market. One such example is Coca-Cola’s collaboration with small store operators in India through affordable sizes, unique flavors, and refrigerators designed for the region’s climate and unreliable electricity supply (Kripalani 2002). Some marketing disappointments may stem from firms overlooking the marketing capabilities and approaches already held by millions who survive by running their own businesses; these are microenterprise operators from whom other firms can learn (Hawken 2007; Simanis, Hart, and Duke 2008; Viswanathan and Rosa 2007)
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