PhD defence

Step-Change: How Micro-Entrepreneurs Enter the Upcoming Middle-Class Market in Developing and Emerging Countries

Short summary

With the recent rise of middle-classes in developing and emerging countries, micro-entrepreneurs, can potentially lift themselves out of poverty by seizing the opportunities provided by the new upcoming middle-class (UMC) customers. To exploit these opportunities micro-entrepreneurs have to make a step-change away from their current customers in subsistence marketplaces to create higher value propositions for UMC customers. As a strategic marketing decision, the step-change inherently comes with challenges in developing resources and capabilities required to cater to UMC customers. It hosts potential conflicts between informal- and formal-sector stakeholders as it requires both new resources and continued access to existing resources. The findings suggest that step-change is a three-step process consisting of three market entries, into, “passing-by customers”, UMC, and business markets. The thesis suggests that to initiate and sustain step-changes, entrepreneurs have to invest in capability-building.