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Up and Out of Poverty: The Social Marketing Solution |  |
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Up and Out of Poverty: The Social Marketing Solution | |
Philip Kotler is S.C. Johnson & Son Distinguished Professor of International Marketing at Northwestern’s Kellogg School of Management. Hailed as the “foremost expert on the strategic practice of marketing,” he is author of Marketing Management, the field’s definitive textbook (now in its 13th edition).
Kotler’s books also include Principles of Marketing, Strategic Marketing for Nonprofit Organizations, Marketing Places, Kotler on Marketing, Marketing Insights A to Z, Lateral Marketing, Social Marketing, Museum Strategies and Marketing, Standing Room Only, and Corporate Social Responsibility. His research encompasses social marketing, innovation, consumer marketing, business marketing, services marketing, distribution, and e-marketing. He has consulted with companies including IBM, Bank of America, Merck, GE, and Honeywell.
Nancy R. Lee, President of Social Marketing Services, Inc., has more than 25 years of practical marketing experience in private, nonprofit, and public sectors. An adjunct faculty member at the University of Washington and Seattle University, she teaches Marketing in the Public Sector, Social Marketing, and Marketing for Nonprofit Organizations.
Lee has coauthored four books with Philip Kotler, including Social Marketing: Improving the Quality of Life, Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause, and Marketing in the Public Sector: A Roadmap for Improved Performance.
Acknowledgments xiv
About the Authors xv
Foreword xvi
Preface xix
Part I Understanding the Poverty Problem and Its Broad Solutions 1
Chapter 1 Why Poverty Hurts Everyone 3
Chapter 2 Examining a Barrel of Current Solutions 21
Chapter 3 The Social Marketing Solution 47
Part II Applying Marketing Perspectives and Solutions 71
Chapter 4 Segmenting the Poverty Marketplace 73
Chapter 5 Evaluating and Choosing Target Market Priorities 101
Chapter 6 Determining Desired Behavior Changes 131
Chapter 7 Understanding Barriers, Benefits, and the Competition for Change 163
Chapter 8 Developing a Desired Positioning and Strategic Marketing Mix 185
Part III Ensuring an Integrated Approach 217
Chapter 9 Developing a Social Marketing Plan 219
Chapter 10 The Public Sector’s Role in Poverty Reduction 239
Chapter 11 The Nonprofit Sector’s Role in Poverty Reduction 261
Chapter 12 The Private Sector’s Role in Poverty Reduction 285
Chapter 13 Getting the Three Sectors to Work Together 307
Index 327
Many books have been written about the scourge of poverty. They offer different theories on poverty and different solutions. Some outline macro solutions, and others deal with micro solutions. Our book takes a very different look at the problem and offers a different model for helping the poor escape from poverty. We examine the power of “social marketing methodology” to abate the suffering of the poor. This preface describes the major approaches to fighting poverty and how our approach adds to the set of tools for helping the poor achieve a better life.
Of all the problems facing mankind—disease, hard drugs, crime, corruption, armed conflict, global warming, nuclear risks, environmental sustainability—poverty is among the most persistent and shameful. Furthermore, poverty contributes greatly to the other problems. The poor suffer more from disease, and their hopeless condition leads some of the poor into lives of crime, hard drugs, and armed conflict. This means that the cost of poverty far exceeds the cost that the poor themselves bear. Poverty pours its poison on the rest of mankind.
Until the nineteenth century, the poor received little attention. Poverty was seen as inevitable. Governments and do-gooders could do little about it. The Industrial Revolution exacerbated the problem by attracting poor rural peasants to the cities in search of work. This led to the establishment of shantytowns and poorhouses. The plight of the poor became more visible. Caring researchers such as Beatrice and Sidney Webb in the U.K. started to count the poor and write about their plight. Charles Dickens, in Oliver Twist, vividly dramatized the conditions and exploitation of the poor.
The concept of creating antipoverty programs began in the nineteenth century and continues today. One sixth of the world’s population earns less than $1 a day. Another 2 billion of the world’s 6 billion people earn less than $2 a day. In the year 2000, the United Nations outlined its multilateral plan for reducing world poverty. The United Nations formulated the Millennium Development Goals (MDG)—eight goals with eighteen accompanying targets, designed to significantly reduce poverty levels by 2015. Target 1 was to cut in half between 1990 and 2015 the proportion of people whose income is less than $1 a day. The goal is ambitious and is not likely to be achieved, given the tumultuous new circumstances of rising food and energy costs and continued armed conflict in the world.
Experts have put forth different theories of the causes of the problem and therefore have advocated different measures to cure the problem. We can distinguish between experts who see poverty as having a major basic cause and those who see many causal factors at work.
The simplest theory is that the poor have brought the condition on themselves. The assertion is that many are shiftless, lazy, and uneducated and prefer to live on handouts rather than exerting effort to lift themselves out of poverty. The implied solution from this view is to either find a way to change their attitude and behavior or leave them in their penurious state. Granted, some of the poor are responsible for their condition. However, there is evidence that most of the poor would be ready and willing to escape their penurious conditions if they could find employment and have a decent place to live.
Another simplistic theory is that poverty is the result of the poor having too many children. Each new child makes a poor family poorer. The argument goes further to say that the Earth has a limited population “carrying capacity” for resources and food to permit a decent standard of living for six billion people (let alone the 9 billion people projected by 2020). Therefore, poverty continues to be a problem because of overpopulation. This is a variation on Thomas Malthus’ proposition that the rate of population growth will exceed the rate of growth of food supply, resulting in starvation, war, and the continuation of poverty.1 The major modern version of this view is found in the book The Limits to Growth.2 Here the solution follows that much poverty would abate if poor families would limit the number of their offspring voluntarily or by edict. China represents the latter in restricting families to only one child. Certainly this has been one of the major contributors to China’s impressive reduction in the number of families living in poverty.
Another singular theory is that poverty persists because the poor don’t own any fungible property on which they could borrow money. They lack tradeable assets. This theory has been propounded by the highly respected though controversial Peruvian economist Hernando de Soto in his book The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else.3 De Soto argues that the real source of wealth is real property—that is, well-defined and socially accepted property rights. Property is an asset that can be used to get or make a loan or mortgage, or obtain insurance or own stock, and other things that make capitalism so effective in producing economic growth and prosperity. But de Soto says this doesn’t work in poor communities and countries because the institutions don’t recognize the assets of the poor. The poor have plenty of assets (land, homes, businesses), but they typically lie in the extralegal, informal realm. The legal system has not adapted to this reality. The costs of making these assets legal (obtaining proper title to a house, registering a business) are so prohibitive in terms of time and money that the assets end up being “dead capital.” The poor cannot use their assets to achieve any of the normal capitalist tools to achieve upward mobility. Because these assets are not recognized, they create an extralegal style of living within their informal social circles. For de Soto, the singular solution is to push the legal system to allow the monetization of these assets so that the dead capital becomes alive.
Besides these grand singular theories, the majority of experts recognize poverty as resulting from many interrelated causes, all of which must be addressed in an integrated fashion. Consider Paul Collier’s views in his book The Bottom Billion: Why the Poorest Countries Are Failing and What Can Be Done About It.4 According to Collier, the billion people at the bottom live in “trapped countries.” He identifies four elements that cause countries to become trapped:
Civil war. Nearly three-quarters of the bottom billion have been through or are currently experiencing civil war. Civil wars usually occur where there are large numbers of unemployed and uneducated young men and ethnic imbalances.Natural resources curse. Almost 30% of these countries rely on exporting some raw materials, such as oil or minerals. Countries with large amounts of natural resources tend not to develop the skill sets of their people, and they tend not to hold democratic elections. Corrupt governments and impoverished and violent masses often result.Landlocked countries. About 30% of the countries with desperate poor are landlocked or surrounded by bad neighbors. This leaves them economically disadvantaged.Bad governance. About 75% of the countries suffer from bad governance or autocratic leaders who exploit their people.Each condition requires a different type of solution. Collier favors legitimate military interventions in areas being torn apart by civil war. Countries with large amounts of natural resources should develop skills that raise the value of their exports and should not simply export raw materials at world market prices. Landlocked countries must learn to work with neighboring port-based countries to build roads that will give them access to ports. Bad governance is the hardest problem to solve. Robert Mugabe ran Zimbabwe into the ground, and the rest of the world stood helplessly by.
Collier’s chief recommendation to fight poverty is to “narrow the target and broaden the instruments.” Narrowing the target means focusing on the one billion of the world’s people (70% of whom are in Africa) who are in countries that are failing. Broadening the instruments means shifting focus from aid to an array of policy instruments: better delivery of aid, occasional military intervention, international charters, and smarter trade policy.
What about foreign aid as a partial solution to the problems of the poor? Two experts have sharply different views of the value of foreign aid. Jeffrey Sachs, author of The End of Poverty, wants the West to be more generous and to give substantially more foreign aid to poor countries.5 On the other hand, William Easterly, in The White Man’s Burden, advances strong arguments against foreign aid.6 He describes Jeffrey Sachs as one of those big “top-down planners” who is never embarrassed about the many failures of foreign aid. Some estimate that as little as 15% of foreign aid reaches the deserving poor as a result of high administrative expenses and corruption. Foreign-aid relief agencies’ tendency to do “top-down planning” fails to provide information on variations in local needs for medicines and foods. Foreign...
