Abt Associates Inc. in Partnership with: Data Management Systems Inc. IntraHealth International

1. Moving Toward Sustainability:Transition Strategies for Social Marketing ProgramsJeff Barnes, Gael O’Sullivan, Cindi Cisek, PSP-One Abt Associates Inc. in Partnership with: Data Management Systems Inc. IntraHealth International Dillon Allman and Partners London School of Hygiene and Tropical Medicine Family Health International Population Services International Forum One Communications O’Hanlon Consulting Global Microenterprise Initiatives Tulane University School of Public Health

2. A New Set of Tools • Technical Report – background, definitions, analysis, including: • Sustainability Continuum • Sustainability Strategies • Case Studies – Honduras, Peru, Ivory Coast, Romania, Nigeria • Self-Assessment Tool

3. Why the Need for this Paper? • Social marketing has been a popular market development approach • Some SM program dominate markets, but require huge donor subsidy • Lack of sustainability or exit strategies.

4. Uses of the Sustainability Continuum • New framework to analyze sustainability components over time with indicators • Stimulus for rethinking the different components of a social marketing “bundle” • Fosters dialogue between stakeholders and SM managers about what can/should be sustainable • Prioritizes needs of the SMO • Identifies needs for market analysis or research

5. The old bundle: Donor financed product supply Branded and generic communications Low cost recovery General market research A new bundle? Product supply with commercial partnerships Branded and generic communications High cost recovery Research for market segments Targeting of subsidies (vouchers, free distribution, etc.) Improved policy to increase access Rethinking the social marketing “bundle”

6. Key Definition • Sustainability: “The ability of a social marketing program over time to manage its technical, financial, institutional and market-related activities to maximize efficiency, self-financing and self-governance without reliance on external support.” Source: PSP-One Project

7. The Sustainability Continuum for Social Marketing • Technical Sustainability (Product, Price, Promotion and Place) • Financial Sustainability • Institutional Sustainability • Market Sustainability • Three stages of progress • Illustrative indicators

8. Technical Sustainability • Mastering the four P’s • Product: Financial and technical capacity to procure quality products • Price: Effective and efficient pricing that maximizes cost recovery while adhering to the willingness to pay of its target consumer segment • Promotion: Communication that is sustained by sales revenues or by local partners • Place: Maximum use of efficient structures to distribute product (commercial and other).

9. Financial Sustainability • Sales revenues > total costs • Diversified sources of revenues • Ability to control costs by product line • Knowing what requires subsidy and what doesn’t • Adequate liquidity and cashflow management • Strong links with management capacity

10. Institutional Sustainability • Management Capacity: Strong systems (Finance, HR, procurement) and local managers. • Governance: Legal status, systems to ensure legal compliance, Board oversight • Leadership: Mission, vision and commitment by a core group of local leaders

11. Market Sustainability • Market size– Large number of consumers demanding products and many brands (and sources of supply) satisfying demand • Market efficiency: Each sector (social, public and commercial) serves appropriate consumer segments, multiple price points in among commercial brands

12. Use of the Tool: Ivory Coast Example • Background: • AIMAS (Agence Ivoirienne pour le Marketing Social)—local association created out of a PSI project– 80% of funding from KfW • Products limited to condoms, pills and ORS; good national distribution, contributing about 1/3 of CPR– 30m condoms, 1m pills. • Additional income from audio-visual production studios.

13. Technical Sustainability Needs Product: Lack of capacity in ensuring product quality. Price: Condom prices well below cost recovery- no increases since 1991, WTP not tested. Strategies Negotiate contracts with qualified sampling and testing firms. Negotiate distribution contracts with suppliers of quality products. Institute use of WTP questions in surveys. Increase prices incrementally. Ivory Coast Example

14. Communications/Promotion Need Overuse of mass media– interpersonal and underuse of community-based communication. Strategy Increase use of IPC and working through community-based institutions. Ivory Coast Example

15. Financial Sustainability Needs Cost recovery by product line, including product costs is not tracked or managed. Product range is limited, increasing costs per unit distributed. Strategies Reconfigure financial reporting systems and project indicators to cost recovery by product line. Include COGS. Diversify product range through commercial partnership and new donors. Ivory Coast

16. Market Sustainability Needs Large number of consumers, but poor segmentation—probably crowding out and unneeded subsidy for urban middle class. Strategies While increasing cost recovery of AIMAS products, shift urban consumers to commercial brands by having AIMAS sales staff sell commercial brands. Convince gov’t to focus free in rural areas. Ivory Coast

17. Thank you Additional resources Thank You