CH-5200 Mkaa with 5years Warranty

Mwananchi newspaper, April 28th, 2014.-Envirofit cookstoves

Interview with Ron Bills, Chairman and CEO of Envirofit

 

 Interview with Ron Bills, Chairman and CEO of Envirofit

In this Viewpoints feature we also met with Ron Bills, Chairman and CEO of Envirofit, to find out how his experience in industry is guiding the social enterprise’s efforts to commercialize improved cookstoves in India and Africa.

Ron, could you tell us a little bit about yourself, your background and how you became involved in marketing products for the bottom of the pyramid?

My background is in engineering and business management. I started my career in the field of aerospace engineering and programme management with Martin Marietta Aerospace where we designed rockets and spacecraft. But for the last 15 years I have run several consumer durable companies, helping them with product design and development and setting up their distribution and sales networks. My background has therefore been more in the for-profit business sector rather than the non-profit sector.

Given your background Ron, what was it like to enter an organisation the objective of which is not just profit? Is there a challenge of ensuring a sustainable business when the products you are promoting are more for a social purpose and less for making a profit?

It is absolutely wonderful to work for an organisation with a social cause. At the same time, all the business principles for a commercial business can still apply. There also seems to be a misconception that because an organisation is non-profit, that you do not need to make any money from your activities, which is not the case with Envirofit. Our objective as a social enterprise is to break even with our business (i.e. not make a loss), and in parallel to do social good.

Thinking about Envirofit’s clean cookstoves, in your experience how do you turn a smart technology into a marketable product?

You cannot assume that just because you have designed a slick technology that your intended beneficiaries will want it. If the end user won’t use the product because it doesn’t meet their needs, then it’s not a great product. The best way to create demand for your products is by designing a product that people aspire to own and that directly solves a compelling problem for them. You must design a product around people’s desires and wants, not around your own goals or around ideas you think people should like.

What are the challenges of bringing a product for the bottom of the pyramid to market and how do you overcome them?

There are several key challenges, the first one being education of the consumer about the product and its benefits, just like with any consumer durable product. However, due to the nature of Envirofit’s target customers (remoteness, lack of access to media, literacy) this cannot necessarily be done by conventional means. And in the case of cookstoves in particular, you have the challenge of trying to sell a brand new product concept (clean technology cookstoves), in an old product sector (traditional cookstoves). And so there is, understandably, consumer scepticism to overcome and a significant challenge for us to prove that our products do what we claim. It’s a matter of establishing faith in the credibility of the brand.

The second challenge is that of the creation of a solid distribution network. At Envirofit we achieve this several ways, from women’s self-help groups and district organisations to a classic multi-tiered commercial distribution network. What is important is to train the dealer network such that they understand the product benefits, how to use the stoves, and the most effective sales messaging around the product for different target customers (i.e. men versus women).

“If you are selling Honda cars, you are selling different models, which are part of a product line. Every one of those products is targeted towards a specific demographic with its own requirements and affordability levels. In a similar way, we have produced a line of stoves.”

Do you think that awareness campaigns which advocate for behaviour change for a social benefit, can be effective, especially if that change requires an investment into a new product?

We understand that people have a hard time changing social habits. That is one of the reasons Envirofit developed a stove that mimics the traditional cooking method, with the same type and size of fuel traditionally used. We wanted to minimise this barrier to entry and honour the traditional cooking methods and desired taste of the food. But we certainly think awareness campaigns can be effective, as long as the suggested behaviour change is not radically different and the customer perceives a great enough benefit.

The Shell Foundation’s Breathing Space programme should get a lot of credit for trying to change these perceptions. The Shell Foundation’s Room to Breathe campaign highlights three main issues: Awareness, Availability and Affordability. They have done tremendous work raising awareness around the hazards of indoor air pollution and advocating for the best solutions.

We’re really talking about a new generation of cookstoves. We have, until now, sold 100,000 stoves in Southern India. We have created and are sustaining a market for our products. If we can keep this level of acceleration over the next few years we’re going to see massive deployment of products on the market.

What is Envirofit’s manufacturing and dissemination model for providing cookstoves?

The scale to which we are trying to disseminate the Envirofit stove, in order to reach a significant proportion of the world’s population, requires mass production. It is therefore impossible to achieve by building local manufacturing centres in every village where we operate. It would be like Honda starting to build automobiles in every city that they hope to sell automobiles. Therefore Envirofit’s product design and our business model has been tooled from the beginning for mass production. We currently manufacture in two locations, India and China, from which we can sell stoves anywhere in the world.

Think about when Honda first introduced its cars to the US. Its first step was to develop a market for the products, so it exported finished cars to the US and built the market demand. Only then did they move on to the second step, which was to localise manufacturing plants in the US, yielding lower production costs. Envirofit’s methodology for entering new emerging markets is the same. It is highly unlikely that we will be able to mass produce in every country – because of quality control, material availability, capital equipment required to set up a manufacturing business etc. So the first step is to set up the market, and make sure we have great distribution and dealer channels. And then the second step is to look at localising assembly or manufacturing to lower end user costs.

What is the difference between Envirofit’s Marketing Strategy for clean cookstoves and that for the 2-stroke engine retrofit kit?

The clean cookstoves business is more of a rural marketing effort, whereas the 2-stroke retrofit kit business is much more focused on urban areas and members of drivers’ associations. The basics of how you market to these two types of consumers are the same. Up front you need to create products that people see as aspirational in need or value. Then you need good marketing collateral (i.e. flyers, sales brochures, posters, demonstration scripts) that use voice-of-the-customer appropriate messaging that consistently and clearly promote the compelling benefits.

In Southern India for example we use techniques like wall paintings, which are very common, to advertise Envirofit. We also conduct van campaigns where we drive a van from one town to the next, gathering all the people together for a demonstration on Envirofit’s clean cookstove. We also train our dealers to be able to conduct demonstrations.

Are you providing different products for different segments of the market?

Yes. If you are selling Honda cars, you are selling different models, which are part of a product line. Every one of those products is targeted towards a specific demographic with its own requirements and affordability levels. In a similar way, we have produced a line of stoves and accessories that retail between US$15- US$30 in India. For example, we have a G-3300 cookstove with an LPG accessory, a double pot accessory kit that includes a chimney, a pressure cooker etc. We are also in the process of releasing a charcoal stove in Africa, which reduces charcoal consumption up to 35% and emissions up to 75%. Charcoal is a tremendous CO producer and this is the only mass-produced stove design on the market that can get beneath the World Health

Organisation 60 minute exposure level under typical African conditions. Since the vast majority of people that currently cook with charcoal need to purchase that charcoal, having up to 35% savings on that purchase can be a great economic boost for a family.

Ron, have you yourself ever cooked using an Envirofit Cookstove?

You know, I use one all the time for barbeques. I don’t cook every meal on it, but when I do use it, it cooks great and is very simple to use. It does not use a lot of wood and is a fantastic camping stove. I think it’s a great product!

Is there anything else you would like to mention?

We want to raise awareness of Envirofit’s solutions to groups that work in bottom of the pyramid markets in terms of disaster/aid relief, women and children’s health and global environmental issues. We are eager to partner with groups to help expand our reach and get these products into the hands of end users.

It is a great honour to be in my current position at Envirofit and to have the opportunity to partner with organisations such as the Shell Foundation, in the creation of products for the bottom of the pyramid.

Finally, I hope other manufacturers will join in this effort of clean cookstoves and creation of these markets, because it certainly is not a monopoly. We want and need other manufacturers in order to create a strong and viable clean cookstove business. That is what will truly make an impact.