Can Too Many Free and Subsidized Condoms Actually Harm Markets?

Thursday, February 26, 2015

In Myanmar, sexual encounters are the most common mode of HIV transmission, causing the epidemic to concentrate among key populations such as female sex workers (FSW) and their male clients (MC), as well as men who have sex with men (MSM). Since 1996, PSI/Myanmar has targeted its condom social marketing program to these groups in order to achieve the greatest impact by preventing the spread of infection.

PSI/Myanmar offers several varieties of Aphaw (“Trusted Partner”) branded condoms, which, through funding from PSI’s donors, are sold at subsidized prices. The attractive price is paired with mass media communications campaigns to promote use of the condoms among the FSW, MC, and MSM populations. Before Aphaw, there were few condom brands on the market, few advertising campaigns, and very little targeting of key populations at risk.

Since 1999, the National AIDS Programme and its NGO partners have distributed free, unbranded condoms to the poorest consumers, who cannot even afford subsidized Aphaw. The public sector distribution takes place in drop-in-centers, through peer educators, gatekeepers at brothels, and in massage parlors and karaoke venues. By 2009, these free condoms held a third of the market share.

In recent years, the Myanmar market has become more dynamic with more commercial businesses entering the market. Commercial condoms can cost three times more thanAphaw because they are targeted at well-off consumers who want (and can afford) brands that symbolize quality and luxury. Male clients of FSW, who are often wealthier, were poised to be a strong consumer base; however, the commercial sector had only reached about 5 percent market share by 2009 because many MC continued to buy the Aphaw brand that they knew and trusted.

In theory, the Myanmar market for condoms aspired to a total market approach (TMA). TMA segments the market so that the poorest consumers receive free products through the public sector; those with some resources buy subsidized products, usually through NGO-affiliated social marketers; and those with even greater resources purchase products through the commercial sector. By directing public finances to those who cannot afford products and services on their own, TMA can help governments achieve commitments and meet the health needs of the poorest and most vulnerable. Better use of donor funds for socially marketed products and opening up the commercial sector helps the market grow and become sustainable.

Central to successful TMA programs are partnerships that leverage each actor’s strengths and allow them to maximize their impact. The Myanmar experience, however, revealed that because the public, NGO, and commercial sectors’ work was not coordinated, the market for condoms was not functioning as efficiently as it could be.

Source: PSI Impact (link opens in a new window)

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Health Care