2018 MTR - DKT International

The findings of the report were presented in four sections: results and impact, human rights aspects of availability, accessibility, acceptability and quality, financial sustainability and market distortion. The findings include findings from the literature and document review, more detailed findings from the case studies – specifically for Ethiopia which was studied in-depth, and the two validation exercises. While the report aimed to provide general answers relevant for all 6 DKT countries, some apply more to particular countries than others. Results and Impact The DKT offices in the six countries vary considerably from each other: the stages of development, the business model, the levels of professionalization, the business focus, the capacity and organization of staff, the level of outreach, demand creation and awareness activities and country-specific challenges. The sales and linked Couple-Years of Protection (CYP) are the cross-cutting and key performance indicators used by DKT. Almost all results have been achieved as planned: sales and CYP results, branding, clinics supported/strengthened, and trainings conducted. Limited data with respect to the results of performance or other results areas has been captured. The social mission is at the heart of the DKT programs and is within their focus of selling commodities, integrated by their subsidization approach of products to contribute to equity and reach the poorer segment in society (but not with the ambition to reach the poorest of the poor). The social mission is also integrated into the specific DKT projects primarily focused on making social impact and increasing outreach. These projects are costly activities with limited financial returns in the short-term and aspire long term results and demand creation (growing this market, but not necessarily DKT’s market). Human Rights: Availability, Accessibility, Acceptability and Quality Availability Social marketing and social franchising interventions have the potential to contribute to increased availability of (the range of) contraceptives at a variety of prices – and therefore increased client choice. CYP based on measurements of the quantity of contraceptives sold or freely distributed, provides information on availability of commodities. DKT’s contribution to the delivery of the total CYPs is very significant (Ethiopia, Mozambique, DRC). DKT/E is the exclusive supplier of commodities to the private sector, and of 3 products to both public and private sector. In DRC, DKT is the 3rd main supplier, and in Mozambique DKT is the biggest supplier of modern contraceptive methods to the private sector. The supply system of DKT in Ethiopia is effective and constantly managed and monitored, resulting in limited time of stock outs. Most challenges with stock outs are related to the regulatory environment in Ethiopia. In all countries DKT is selling between 7 – 9 different commodities, both short-term methods (condoms, pills, IUD for example), long-term methods (implants) and emergency contraceptives, through the private sector and delivering to the public sector. The choice for methods is substantially facilitated by the DKT model for all market segments: offering a variety of modern contraceptives, and variety of types of the same products, different brands and at different prices. With respect to the existence of services and the contribution of DKT the following can be observed: in all countries services are provided through their (partner) clinics and trained health care providers. The quantity of delivered services through the DKT model is not yet monitored as such in all countries, except for Mozambique and to some extent Ethiopia. DKT Mozambique is expanding the outreach and services delivery in areas where FP services are limited or non-existent, and therefore contributes to the availability of the services. The Women First Program (WFP) platform is making clear and correct information on safe abortion and post abortion care available in the 6 countries through their online websites Safe2Choose and HowToUse.  Accessibility Several studies show that social marketing of modern contraceptives facilitate and improve the accessibility of contraceptives and family planning services, also for the low-income groups. A systematic review by Korachais et al. in 2016 concluded that most of the few studies meeting Cochrane standards concluded that contraceptives are not cost-sensitive. Literature shows the limitations of Social Marketing to reach the very poor, mostly living in remote and rural areas. However, the business model of social marketing generally is not designed to reach the very poor segment. Recent studies on access and choice to modern contraceptives highlight that the private sector as a source of accessing modern contraceptives for many (young) women is perceived as higher quality, higher availability of method of choice, to be more convenient and with greater respect for privacy – which can be confirmed by the findings from the key informant interviews in Ethiopia. DKT is contributing to the physical accessibility of commodities by selling through the private sector and delivering to the public sector, and through their outreach. In addition, DKT is contributing to the physical accessibility of services through the network of clinics and training of providers. The cross-subsidization model implemented by all DKT countries in which variants of the same product type are sold at different prices, enables DKT to serve different income levels. The higher priced products subsidize the lower priced products. DKT contributes to services being non-discriminatory through their partner clinics which need to adhere to specific guidelines covering specific quality assurance aspects. In addition to the guidelines, the providers receive (family planning in general, youth friendly service provision) training and support. DKT Tanzania screen providers for their attitude and way of communication, and willingness to comply with6DKT’s approach. DKT is making use of mass media through which access to information is provided, and awareness and demand is created. In addition, DKT contributes to contraceptive information directly to young people through projects and community-based events and indirectly through the trained health care providers. Moreover, the DKT established and strengthened (online) platforms providing direct information to(young) people and promote information sharing and conversation on FP and SRH: TemariNet (Ethiopia),Batela Lobi Na Yo Facebook (DRC) and HowToUse and Safe2Choose websites. While social marketing can provide access to information for a lot of people through mass media and internet, this also reflects one of its limitations as the reach depends on the level of exposure and access of especially women to these information sources. Literacy rate plays an important role here as well. Misconceptions and perceived misuse of contraceptives (for example, using the emergency contraceptive pill frequently) have been observed as one of the risks. Acceptability There is limited evidence available in the literature on the direct link between acceptability of contraceptives and the role of social marketing. Some evidence was found that commercial marketing techniques used by social marketing programs can increase awareness and acceptability of modern contraceptives: depending on their market segmentation approach social marketing programs can be tailor made for specific target audiences and designed to meet their cultural and social requirements(Herbert, 2015). Through the mass media campaigns DKT is reaching a lot of people and presents the DKT brands, contraceptives and services as common consumer products. According to the respondents in Ethiopia, DKT contributes to the acceptability of the services as the privacy and confidentiality is (perceived) better in private sector and the DKT clinics. The (partner) clinics are more convenient, especially for young people, for example the opening hours are longer and the waiting times are shorter. In addition providers in DRC are trained in youth friendliness service provision, contributing to the acceptability of the services. Interviews with DKT staff in DRC confirmed that especially(unmarried) young people are eager to obtain contraceptives through pharmacies as this increases their anonymity and therewith the acceptability of these services. Quality Beyerler et al. (2013) showed in a systematic review of reproductive health services that social marketing and social franchising facilitates the improvement of quality, equity and cost-effectiveness resulting in higher client satisfaction and access for reproductive health services. DKT mostly contributes to the perceived quality of the products by the clients according to the respondents both in Ethiopia and DRC by DKT staff and stakeholder representatives: free products are perceived as lesser quality compared to paid for products. Standards of quality assurance are followed by DKT/E. The quality of services is safeguarded by DKT through a variety of activities: the specific guidelines for providers and clinics, and in addition screening of the attitudes of the providers (Tanzania), training of providers and conducting supervision and follow up visits. The WFP websites provides culturally-sensitive and multilingual helpdesk services and specific efforts have been made to make the website more user-friendly and safe. WFP also developed an online eLearning module to further strengthen the quality of information (educational resources) and service provision, and counselling. Financial sustainability Overall, the report acknowledges that DKT operates using a highly interesting business model. The duality of the business model is clearly visible, with the social mission firm in the center of the enterprise, but with the daily mode of operations commercial. Given their current sales revenue performance, none of the DKT country offices would qualify as an SE according to the definitions from the literature. The best7performing DKT country office is currently still below 50% of income generated by sales revenues relative to total expenditures (75% commonly accepted in the literature). Hence, in line with the legal status of all the DKT country offices, they could also be qualified as NGOs active in social marketing. Nevertheless, for the purpose of this MTR, the review team will qualify DKT as a specific type of SE. Although DKT in a strict sense does not fulfill all the requirements to be called a SE, it does fulfill the majority of the requirements. Most importantly, in the core, the philosophy of DKT is similar the general philosophy of a SE. Yet, as a result all DKT offices highly depend on donor-funding. Given the decreasing availability of donor-funds in the development sector worldwide, this is a high-risk aspect of DKT’s business model. The dependence on donor-funding will remain for at least another 10 year, if the business model remains unchanged and the markets and the country offices continue to develop as currently. The review team does observe a strong focus throughout the offices on maximizing sales revenues, as well as the diversification of income sources (e.g. multiple donors). The market potential for growth is clear. The growth/scale-up potential of DKT is large if sufficient donor funding can be secured, and the country offices continue to professionalize. The following positive features of the DKT offices and the model are presented in the report: 1) Professional, highly qualified and satisfied staff: good mix between commercial and social impact (ETH), 2) Ownership creation through autonomy of country offices (all), 3) No mission drift (social mission strongly visible) (all), 4) At least on surface, potentially conflicting donor demands aligned (all), 5) No sign of DKT “lazy donor money” behavior (ETH), 6) DKT really operates in a niche (ETH and DRC), 7) Widely covering, well established and effective infrastructure and distribution channels (ETH), 8) Well-grounded and connected to local stakeholders (ETH), (9) Complying well in difficult regulatory environments (all), 10) Unique social marketing methods (all) AND 11) Diversification of risks (all). Next to these positive features, the report higlights some of the challenging features. It can be questioned whether the growth of the sales revenues is and will be high enough to cope with declining donor income, relatively. There is limited cross-learning and sharing of efficient and effective modes of operandi observed between the 6 countries. The autonomy of the DKT model contributes to the limited ability to learn from other countries’ experiences, and to standardize certain procedures and activities. The segmentation is based on products, not on end-clients, whereby it is assumed that certain products serve certain segments of the population. However, these are assumptions and most likely, per product multiple segments of the population are served, which are currently not within sight of DKT. This could make targeting and the maximization of sales (per customer segment) more difficult. Furthermore, the current pricing model and cross-subsidization approach limits financial sustainability of DKT in the short-term and is bringing in a risky component: when relying on a limited number of profit generating products to generate income, issues like a stock-out or new regulations could seriously jeopardize the total sales revenues. This risk is to some extent diversified and new products are introduced with a higher profit margin. There is limited available data to optimize performance related to impact and commercial viability. A SE does not only tries to optimize impact, but commercial performance as well. For both, data is needed, which in all DKT offices is not measured regarding all objectives yet. Although some DKT offices installed an elaborate system to optimize commercial performance, the impact side with all the outreach and awareness projects the DKT offices execute is hardly measured. Additionally, more insights in end-users (consumers) behavior could help DKT to make strategic and informed decisions on the outreach projects and the optimization of sales (steering). Market development effects The report notes that no general conclusions can easily be drawn regarding market effects of SEs in general as this depends highly on the context. Nevertheless, the review team did not see any distortion effects by any DKT country office. The markets are simply too large and even growing. Very limited competition on the private side is observed, although the markets themselves can be qualified as distorted as these have been flooded with free products for decades, by several stakeholders, which poses opportunities for the DKT offices as well as challenges . DKT/E does not block other stakeholders from entering the market and the market would benefit from some competition. The markets are too large for new competitors to form a real risk to DKT’s financial performance. Moreover, there is communication and coordination and sometimes even cooperation with competitors and all other stakeholders active in this sector, to not limit each other’s business. The public and private sector are not competing, they are serving different segments. And at least in certain countries, the MoH has taken up the role as central coordinator. To a certain extent the review team observed some demonstration effects: in Ethiopia and DRC, MSI plans to enter the market with a somewhat similar business model as DKT. In this sense, in certain countries, DKT distorts the markets by adding a private sector element to the traditional dominance of the public and NGO sector.

The contribution was a mid-term review of Sida’s contribution to DKT international’s program “Reducing unwanted pregnancies and increasing access to safe abortion in eastern and southern Africa”. The final report was delivered on time and includes the following annexes; Midterm assessment framework Overview documents used for documentation review Case study tools Extended literature review Financial deep-dive Ethiopia Logical Framework  The purpose of this MTR was to provide deeper insight into 1) the potential market-distorting and/or market development effects; 2) opportunities and risks of the program in relation to access, acceptability, acceptability and quality and reach from a human-rights based and non-discriminatory perspective; and 3) the sustainability and scale-up potential of the model. The focus thereby was on learning as input for management advice. KIT was procured using the Sida health framework agreement for the assignment.