Reducing market separation through e-commerce: cases of Bottom of the Pyramid (BoP) firms in India

Abstract

Market-based solutions for poverty alleviation at the Bottom of the Pyramid (BoP) have been discussed extensively in the literature. Most BoP producer firms are based out of remote locations and suffer from informational asymmetry and a lack of financial resources. This study looks at three BoP firms through Bartels’ theory of market separation to examine whether the adoption of e-commerce helps reduce gaps between producers and consumers. The findings indicate that e-commerce has enabled firms to decrease the spatial, temporal, and informational gaps; however, the effect on the financial gap is yet to be determined. It also recognizes the importance of e-commerce adoption as an effective market-based solution for BoP firms. The findings helped develop a conceptual framework to understand the stages of e-commerce channel adoption by BoP firms. The implications of our findings for theory and practice are discussed.