One of the little-known benefits of globalization is how it has made multinational consumer staples companies a better income investment than consumer staples companies that serve only one country. The reason: “reverse innovation.”

In the depths of the global financial crisis, I was in business graduate school at Oxford University. There, I spent time studying how big companies based in developed countries were selling products to consumers in developing nations who could not always afford the products as they were priced in developed countries.

These firms changed their products to make them cheaper so they would fit the smaller budgets of these consumers, and this reverse innovation had a surprising benefit. Those cheaper, re-engineered products could be sold in developed countries for higher prices—and substantially higher margins.

Reverse innovation isn’t yet widely used. The father of the concept, Dartmouth Professor Vijay Govindarajan, wrote a few years ago in the Harvard Business Review that, “few companies experience this renaissance because reverse innovation … poses immense challenges.”

The mindset a company must adopt to take advantage of reverse innovation makes for a gut-wrenching change. Govindarajan says it means throwing out old ways of thinking, revamping product-development and manufacturing methods, and reorienting the sales force.

But a global firm that masters reverse innovation can increase profits even in times of high volatility or slow economic growth. In other words, times like now.

Our Conservative Portfolio holding –Unilever (NYSE: UL) is one consumer staples firm that has mastered reverse innovation. For example, Unilever has developed smaller package sizes of detergents, mayonnaise, and other products to meet the needs of consumers in emerging markets, while selling these same products successfully in the U.S. and other Western markets for higher prices, according to a PwC analysis.

Unilever is reverse innovating not only from emerging to developed markets, but also from one emerging market to another. In one case the firm’s research and development team in India built an award-winning water purifier, PureIt, for the Mexican market. Now Unilever’s purifier family of products is sold in Brazil, Indonesia and Nigeria, in addition to India. We profile Unilever on page 3.

Buy Unilever up to $54.

Meanwhile, in our Aggressive Portfolio, healthcare technology firm Philips (NYSE: PHG) also has mastered the reverse innovation strategy.

In 2008, Philips India bought India-based companies Alpha X-Ray Technologies and Meditronics. With them, Philips expanded its healthcare business to cater to the mass market for cardiovascular and general X-ray systems, according to the University of Pennsylvania’s online business journal. With the acquisitions Philips can not only sell lower-priced equipment in India and other developing markets, but in developed markets as well.

Just as with Unilever, Philips’s global footprint lets it take advantage of reverse innovation because it operates in so many countries that are at different levels of economic development.

Philips’s first-quarter earnings before interest, taxes and amortization (EBITA) rose 26% to $326 million, beating an average estimate of $294 million in a Reuters poll of analysts.

Comparable sales rose 5% to $6.3 billion, according to Reuters.

Philips is a Buy up to $35.

Finding safe income investments at good values has become increasingly tough given that everyone seems to want these investments lately, which has run up their prices.

For example, in the last few months, investors seeking safety have driven the Standard & Poor’s Consumer Staples Index to its highest point since at least the 1980s, according to Bloomberg. This led one Barclays’ analyst to argue that the sector is too expensive.

I would argue that when you factor in competitive advantages, such as reverse innovation, global firms such as Unilever and Philips deserve their higher valuations, and are actually undervalued when income opportunities are few and far between.

We will continue to be on the hunt for these rare gems.