Frugal innovation (FI), which has gained traction in various sectors, is loosely defined as developing quality solutions in a resource-constrained environment that are affordable to low-income consumers. However, with its popularity, multiple and diverse definitions have emerged that often lack a theoretical foundation. This has led to a convoluted conceptualisation that hinders research and adoption in practice. Despite this plethora of perspectives and definitions, scholars do agree that there is a need for a unified definition. This critical review across the management, entrepreneurship, business and organisation studies literatures explores the multiple definitions of FI that have appeared in the last two decades and seeks to examine the commonalities and differences. One definition is supported by a theoretical underpinning, and main themes include affordability, adaptability, resource scarcity, accessibility and sustainability, however, there remains significant ambiguity around what constitutes an FI. Defining FI as a concept should not deter from focusing on its core aim and identifying an FI may be best achieved by comparing it to an incumbent alternative, rather than against an ill-defined concept. There is merit in developing a common understanding of FI to support strategies for its successful acceptance and diffusion globally.
What is already known?
Frugal innovation (FI) is ill defined and is synonymous with numerous innovation types such as jugaad, bricolage, disruptive, cost and grass roots innovation.
The premise of FI is essentially to develop quality and affordable solutions in resource-constrained environments for low-income consumers.
Since its introduction and with its growing popularity, a plethora of definitions and descriptions have been developed often supported by conceptual and case studies thus lacking a theoretical underpinning.
What are the new findings?
Various definitions share many overlapping characteristics such as affordability, functionality, resource-scarcity, accessibility and sustainability.
Conceptualising FI should not deter from focusing on its core aim. Identifying an FI may be best achieved by comparing it to an incumbent alternative, rather than against an ill-defined concept.
A common understanding of FI will add significant value to research and practice.