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Poverty: when second best isn't good enough
 

By Gavin Chait, on 17 December 2006

In the late 1980's, towards the pathetic end of the government monstrosity known as Apartheid, Kentucky Fried Chicken (KFC) opened a franchise in Gugulethu, an informal settlement outside Cape Town. KFC is astonishingly popular amongst 'black' South Africans and they make up more than 80% of their client base. Business centre franchises sport long queues at lunch times as workers wait to order their budget specials. It seemed a rational decision to place a KFC inside one of these townships where the bulk of their clients live. It didn't work.

Far from offering a consistent standard, KFC opted for a 'light' version of the real thing. The thinking was that, since the area was impoverished, it would be better to offer a scaled-down version of their service.

Poor people value their money more than rich people. It stands to reason; they have less of it. Brands are also far more important to the poor than they are to the rich. If you have very little money then you don't risk it on some untried product. You spend it on the tried and tested and reliable: famous mainstream brands.

Being this value conscious the poor residents of Gugulethu quickly realised that they were being offered a product much less than the real thing. They stayed away and preferred to shop elsewhere.

Now we have alternative technology developments for the poor. From MIT's $ 100 notebook, to cheap alternative power supplies and scaled-down communications services. They won't work.

Poverty is not caused by a lack of infrastructure. That is simply a correlation. The US did not become wealthy because they had an advantage in technology - that came later. Poverty is caused by a dearth of creative thinking and local ambition to succeed.

Cheap offcuts do nothing to stimulate that ambition. What they do achieve is a reinforcement of the gap between rich and poor. They turn poverty - a problem of slow development and limited initiative - into a chronic disease requiring ongoing medical support.

It is almost as if rich countries are saying to poor countries, "We're really sorry you're so incapable. Why don't you play with these toys that are almost like the toys that grownups have, only they don't work as well. We'll come by and visit when we're not too busy."

Children play with toy-versions of grown-up tools knowing that they will get a chance to use the real thing. The poor are expected to use scaled-down versions as a substitute since they are deemed incapable of development.

If MIT and other organisations really aim to assist the poor then they would develop their products to be aimed at the rich first. Once they become cheap and mainstream then the poor will buy them on their own. Otherwise the products will become as irrelevant as the BayGen company that developed windup radios as a substitute for battery-driven ones.

Far from being accepted by the poor, BayGen radios became a retro-fashion accessory for the urban rich.

   
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Keywords : poverty, ambition, brands, people, money, technology, development, mainstream, reinforcement


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