This chapter explores the phenomenon of frugal innovation in innovation management and multinational enterprises' business models. Frugal innovation is the process of stripping an existing product of unnecessary or luxury attributes to bring it within reach of the four billion people at the Bottom of the Pyramid (BoP) who live on less than US$ 2 a day. It is argued here that this view is too narrow as frugal innovation encompasses not only the transformation of an existing innovation ex ante by the producer who aims to anticipate the specific conditions of the BoP consume, but also the ex post transformation by the consumer who may (un)intentionally change some of the product's attributes while adopting or appropriating it. This two-sided transformation is illustrated by a case study of Unilever's OMO washing-powder sachets in Africa.
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