Frugal Innovation Strategy and Market Creation in Nigeria’s Base-of-the-Pyramid Economy

This dissertation investigates frugal innovation strategy and its role in creating new markets among base-of-the-pyramid consumer segments in Nigeria. Despite Nigeria's large low-income consumer population, most strategic management scholarship on market creation has focused on middle and upper-income segments, creating a significant theoretical gap. Frugal innovation theory, market creation theory, and base-of-the-pyramid strategy literature provide the multi-theoretical foundation. The research employs a constructivist grounded theory methodology. Thirty-five in-depth interviews were conducted with founders and managers of firms successfully serving base-of-the-pyramid markets in the North West, North East, and South East zones. Interview data were complemented by longitudinal tracking of six firms over twenty-two months. Theoretical sampling continued until saturation was achieved. Constant comparative analysis generated theory from data. The study develops the Frugal Market Architecture Theory as an original contribution, specifying how base-of-the-pyramid market creation in Nigeria involves four sequential activities: constraint mapping, minimum-viable-value definition, trust-embedded distribution design, and community-embedded scaling. The theory challenges the technology-centric frugal innovation frameworks dominant in existing literature by demonstrating that distribution trust architecture is the most critical market creation mechanism in low-trust, low-income environments. The dissertation advances frugal innovation theory by providing a market creation-centered framework grounded in Sub-Saharan African empirical reality. Keywords: frugal innovation, market creation, base-of-the-pyramid, Nigeria, grounded theory.