Austerity-battered Western companies are looking everywhere for growth
Multinationals are applying to rich countries the lessons learned from reaching
customers in poor ones. Unilever has enjoyed success selling consumer goods in
small portions to Indians whose grocery budgets could not stretch to
Western-sized packets; now it is offering shrunken packs of detergent to
cash-strapped Spaniards and modest packages of mashed potatoes to impoverished
Greeks.
There are plenty of reasons for Western business to resist the new gospel of
frugality. Why look at the bottom of the pyramid when there are still millions
of people in the middle? Why risk introducing cheap brands that could cut into
sales of your existing ones?
But the forces of frugality are nevertheless powerful. The rich world is ageing.
By 2030 a quarter of Europeans will be over 65. Lean emerging-market firms are
challenging Western ones in everything from white goods (Haier) to telecoms
equipment (Huawei) to baked goods (Bimbo).
