As a process, frugal innovation redesigns goods and reconfigures value chains in order to service users with severe affordability restrictions in a scalable and sustainable manner. It entails bridging or exploiting institutional chasms and resource constraints in order to foster more inclusive marketplaces. Simply said, frugal innovation creates functional solutions for the many who have limited resources (emerging markets) with few resources.

When and how to apply Frugal Innovation:

Companies' assumptions frequently diverge from the desires and requirements of consumers. They desire only a product or service that performs its intended function. This is the beginning of frugal innovation - functional, user-friendly, and regional.

In concrete terms, economical product or service innovation means the following:

• Remove features that are not part of the basic functionalities

• Making materials, design or processes more environmentally friendly or local, e.g. re- and up-cycling.

• Adapt existing resources, e.g. reuse them instead of making new ones.

• Add new features only through minimal changes, e.g. software updates

• Simplify complicated, expensive or time-consuming parts or processes

• In addition, adapt the business model to reduce costs

• Build an ecosystem in the sense of open innovation, e.g. by involving advisors, experts, researchers, organisations, etc.

Well-known companies that use this pattern are Vapiano and Boxabl.