Innovation Trickle up from developing to developed countries

The process of developing some new products mainly for the developing world and then marketing it in the developed countries is called "trickle up". This is a new process as traditionally it has been US that led the innovation of products because of large consumer population. When the products were old and no more market in the USA, the companies used to market them in the Europe and Japan and then rest of the world.

But some companies are taking lead and changing this trend. For example, latest success in this process if GE healthcare's ECG machine, MAC 800. This is almost half in the weight of the lightest machine currently available in the USA and at just 20% of the price of the current models.

This is in line with the estimates from various agencies that the Asia and Africa have largest middle class populations and it is increasing day by day. These consumers might not pay the price the companies can demand in the developed countries but they are huge in numbers and can generate big revenues. This trend is particularly of interest when the consumers in the USA are turning to saving their money and consumerism is on decline.

In this scenario the companies need to focus where they can generate more revenues. This is not only GE that is turning to Asia for more revenue but also Philips, Nokia, Nestle and other companies as well. These companies will need to move their operation to developing countries in the light of new realities and perhaps their head offices one day. That will be very tough decision for the companies and it will put and question mark on the supremacy of the USA.

Impact of trickle up innovation can be far reaching. Lets wait and watch how it turns out.