buzz around the bottom

8/7/2019 Buzz Around the Bottom

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Abt Associates Inc. in partnership with:Banyan GlobalDillon Allman and Partners. LLCFamily Health InternationalForum One CommunicationsIntraHealth InternationalOHanlon ConsultingPopulation Services International

Tulane University School of Public Health and Tropical Medicine

The Buzz Around Base of the Pyramid:

What Does It Mean for Family Planning?

Denise Averbug, PSP-OneSeptember 12, 2008


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Base of the Pyramid - BOP

Who is the BOP?People at the base of the economic pyramid

Why are we talking about it?

More than 4 billion people at the BOP represent anuntapped market and a business opportunity forcompanies


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BOP business model

Companies reach BOP with products/services that

cater to their unique needsLow price, high volume Win-win situation, benefiting company (profit)and end-user (affordable products)

Collaborate with grass-roots NGOs as links tocommunity, its perspective, needs, and interests


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How is this different?

BOP is NO TCorporate Social Responsibility (CSR)

CharityPhilanthropy

Instead

It s a commercial, business venturePeople at BOP are seen as consumers or partnerswith a voice, who can lift themselves out of povertyby participating in the market economyEradicating poverty through profits


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BOP and Development

PotentialProfit motivation = inherent sustainability

Has been successfully applied to:- IT- Food and nutrition

What about health?Can we partner with companies to help deliveressential health products and services to the BOP ina fully commercial, unsubsidized way?


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PSP-One BOP experiences in FP

What do we mean by BOP ?Not just reaching BOP

Fully profit-driven, unsubsidized

Two approaches:- India: begin with existing multi-national BOP venture

and add health/FP- Ghana: begin with health intervention and add

commercial partners to move towards BOP


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India: Hindustan Unilever s ( HUL)

Project Shakti

Rural India represents 750 million people,52% of Indian economyThis population not reached by conventional commercialdistribution modelsShakti Entrepreneurs (S Es): 46,000 rural women that sell HUL products in small, affordable packets in theircommunities:

Shampoo, toothpaste, iodized salt, soap, etc.

Profitable, fully sustainable


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PSP-One and Project Shakti

Leverage existing distribution system to providesustainable supply of health products to rural India

Partnerships to add health and FP products to ShaktiConduct a pilot to test impact and commercial viabilityIf successful HUL and commercial partners will scale it upPSP-One s role:

- Health expertise- Broker partnerships between HUL and manufacturers of health

products interested in rural market - Evaluation

Maintaining/enhancing commercial viability of Shakti is key!


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Starting simple: ORS

Child health/diarrhea identified aspriority be convened health expertsHUL and S Es enthusiastic about it Low price, high knowledge andlatent demandPartner: Pharmasynth Indian manufacturerinterested in tapping into rural market Pilot launched in late April, results encouraging:

- Sales- SE status and confidence


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Exploring new terrain: FP

PSP-One had to educate HUL on FPCondoms

JK Ansell developed new condom brand exclusively forrural Indian market Brand in production

OCsHow do you adapt OCs to the BOP market?Most multi-national manufacturers approached wereconcerned about regulatory issues


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Challenges with FP

Multi-national s business strategyO RS and diarrhea prevention have a clear link to HULs

Lifebuoy soap brandFP products do not align with HUL brandsNew and delicate terrain

Sensitive topic for a multi-national company who is not in

health fieldConstant education and advocacy needed withincompany to move forward, high staff turnoverActual or perceived regulatory barriers


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Ghana: Freedom from Hunger s (FF H)

MicroBusiness for Health

Pilot initiative to expand access to essentialhealth products in rural areas going the last mile

FFH selects and trains rural women on healthand provides them with health products to sell:- i.e. I TNs, condoms, O RS, water treatment tablets

Includes hygiene and wound care products to boost revenueGoal is to reach sustainability at scale


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PSP-One and FF H Family Planning

PSP-One added OCs to thebasket Commercial manufacturerapproached, but volume not highenough yet

Starting with subsidized brand tobuild up the market


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PSP-One and FF H Commercial

Partnerships

FFHProduct suppliers(wholesalers) Health K eepers

Partner with companies interested in rural market todeliver their products to Health K eepers through theirown distribution channelsMove towards B O P approach to increase sustainability of program

Commercialdistributors


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Starting with commercially viable B O P

ventureO pportunities

Very promising due to difficulty in developing such

ventures

sustainable infrastructure already existsO RS pilot indicates possible success in health

Challenges: What about FP?It is more difficult for multi-nationals who are not

involved in health to embrace FPSuccess may depend on corporate culture and/orindividual personalitiesThere may be regulatory barriers


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Starting with health-impact oriented

interventionO pportunities for FP

NGO s have no issues with FP

Commercial investment does not need to be associatedwith FP no image or regulatory concerns for companies

Challenges: Will it be B O P?Identifying business opportunities for commercialmanufacturersGenerating enough demand/volume for FP productsBalancing commercial viability and health impact


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So, what does B O P mean for FP?

Requires changing the way we think about FP products- FP products as FMCG?

- Moving away from subsidiesDemand must be high to ensure high volumeBoth approaches show some promiseIf successful, replicability still depends on existing

opportunitiesIndia context is quite uniqueGhana will indicate whether less populous countriescan still generate enough volume to reach profitability

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