PSI’s Market Development Approach
PSI views the market development approach as a process to better understand consumer needs and health markets to improve sustainable market performance with a vision towards universal health coverage (UHC). For PSI, taking a market development approach involves identifying market failures and determining the most appropriate interventions needed to improve demand and supply as well as the enabling environment to result in an equitable and sustainable healthy market.
PSI uses market development approach as an umbrella term that incorporates total market approach (TMA), markets for health (M4H), markets for the poor (M4P), market dynamics, market facilitation, market shaping, and market transformation. For PSI, the common thread is ‘making markets work for Sara’.
What’s the problem?
Market systems are not working effectively to equitably address the health needs of all potential consumers across all population segments in the market. National and international resources need to be targeted based on health needs, and interventions designed as investments to improve performance, enhance market systems and sustainability. Poor understanding of market failures limits the ability of our response to improve access to and use of high quality, affordable health services and products.
How does PSI use the market development approach?
There are four questions we seek to answer when using the market development approach:
1) Who is the market failing? We consider potential consumers (total NEED for a product or a service) and actual consumers (total USE of a product or service) in a market. We conduct robust equity analysis of this gap through the lenses of age, gender, geography, wealth quintile and risk behaviors to help determine who the market is failing among non-users as well as users.
2) How is the market failing? We conduct market mapping to identify the key players in the relevant health market, the functions they are or are not performing, and how the enabling environment influences their capacities and incentives to perform in terms of meeting demand and supply in the market. We also measure market performance in terms of health trends, quality of use of health products and services as well as the availability of quality, affordable products and services in the market.
3) Where do we work in the market? We determine this based on where PSI is best positioned to further the market performance and market development at scale and sustainably. We use this to design interventions to influence the incentives and/or capacities of relevant market players as well as create a conducive environment to improve overall market performance.
4) How will we get there? We determine the steps to achieve our interventions’ goal and the metrics that will track our progress in getting there. Most importantly, we conduct an exercise to determine ‘who does and who pays’ for the interventions today as well as for the future vision of the market, in order to ensure sustainability of the market beyond the life of the project.
What is unique to PSI’s approach?
Learn more about our approach in Why Aren’t Markets Working? (http://psiimpact.com/2016/11/why-arent-markets-working/)
Increasing use as a percentage of need
PSI analyzes the population at risk and determines the universe of need for a product or service in order to meet the total health needs in a population. We then look at the current users and coverage to determine the number of products and services that are being used. The difference between use and need (i.e., how many and which people use a product or service, and how many still need it) is simply the gap, or unmet need, which we examine through various equity lenses.
Increasing market depth and breadth
To meet the diverse needs of a target population at scale, we measure both the breadth and depth of a market. Market breadth tells us the degree to which a range of products and services are available in the market at different price points, places, and promoted to different types of customers. Market depth provides us with the aggregate volume and value of the market. By increasing market depth and breadth, we aim to sustainably increase use as a percentage of overall health need.
Addressing market failures
Whenever the use of health products and services is less than overall health need, the market is failing those in need. We identify the symptoms of market failures and their root-causes by analyzing all of the key players in the value chain and the supporting environment. Working with the government and partners, we then develop sustainable interventions and match the right business models to the market failures, in order to improve overall market performance.
What does success look like?
A healthy market that drives public health impact, includes all of the following:
- Sufficient demand so high-quality and appropriate products and services are sought and used by consumers across all target groups.
- Robust supply, including a strong supply chain, sufficient delivery points, diverse range of products and growing market volume and value.
- Supportive functions such as useful information, coordination across market players, quality assurance, appropriate labor capacity and financing mechanism for the poor and vulnerable.
- Supportive policy and regulatory environment.
Building the global evidence base for HIV self-testing
Less than half of all people living with HIV globally (48%) know that they have the disease. HIV self-testing (HIVST), which provides a simple and discreet way to determine one’s status, could dramatically contribute to the UN’s 90-90-90 target that aims to first ensure 90% of all people living with HIV know their status by 2020, and to then increase the number of people who go on to access support and further testing, prevention, treatment and care. For women, in particular young women and adolescent girls who are at a greater risk of HIV infection, self-testing offers an effective way to reduce the social and economic costs of facility-based testing.
Despite initial indications that HIVST may increase testing among first-time and repeat testers, HIV self-tests are not widely available in most low-resource countries — particularly in sub-Saharan Africa, where the health impact from making this product available on the market may be greatest.
With funding support from the Bill & Melinda Gates Foundation, PSI and Accenture Development Partners analyzed the size of the HIVST market in nine African countries: Kenya, Malawi, Mozambique, Nigeria, South Africa, Tanzania, Uganda, Zambia, and Zimbabwe. Year 1 of the project also examined global supply constraints and made recommendations to develop a healthy HIVST market. Additionally, with its focus on market sizing, this analysis serves as a complement to other HIVST projects including the UNITAID/PSI HIV Self-Testing AfRica project (STAR), the largest evaluation of HIV self-testing in Africa to date.
PSI’s comprehensive research examines the current and potential market for HIVST, including the demand and supply constraints from the perspective of manufacturers. This analysis was based on critical questions using PSI’s market development approach. We asked:
- Who is the current HIV testing market failing and how can HIVST address issues of access and barriers to testing?
- What actions do we, the global HIV community, need to take to ensure a healthy HIVST market develops?
Year 2 of the project will deep dive into key African markets to better understand opportunities for distribution of HIVST, especially in the private sector, and pricing of HIVST.
Growing the total market for family planning
To reach its FP2020 goal, India will have to add 48 million additional new users of contraception. This constitutes 40% of the total FP2020 target worldwide. With support from the Bill and Melinda Gates Foundation, PSI is using the Market Development Approach (MDA) process to better understand current and potential consumers for the family planning market in India’s most populous states: Uttar Pradesh and Bihar. Initial analysis in both states confirms that the current market is failing rural, young and poor women.
PSI, in partnership with FSG Consulting, collected market data across all players in the value chain (i.e., manufacturers, wholesalers, distributors and different levels of providers) to understand their capacities and incentives to perform in the family planning market. Literature reviews and primary research was also conducted among indirect market players (i.e., government partners, other family planning implementing organizations, donors and regulatory bodies) to understand the enabling environment that supports or inhibits market performance.
In Uttar Pradesh and Bihar, female sterilization has been the major family planning option for most, therefore many girls and younger women who need family planning are not using any modern method. Using the MDA lens allowed PSI to understand the market failures and their root causes. This informs the interventions that we are rapidly innovating, to reach the women we hope to serve, while offering a full range of family planning methods. With our findings, we are adjusting our own social enterprise strategy for PSI’s portfolio of family planning products, while also being in a position to make recommendations for donors and governments on areas in the market needing further investment.
Improving malaria case management
Malaria remains one of the most dangerous infectious diseases in the world, particularly for pregnant women and young children. In many endemic areas, the private sector is often the primary source of treatment for patients at the onset of fever. Patients are frequently sold antimalarial drugs but without using a rapid diagnostic test (RDT) to confirm malarial infection, as recommended by the World Health Organization (WHO). In addition to leaving other illnesses untreated, overuse of the most effective and first-line treatment for malaria, artemisinin-based therapies (ACTs), has significantly contributed to the spread of drug-resistant malaria.
To address this situation, PSI and partners – the Malaria Consortium, FIND and WHO – implemented a project to provide much-needed evidence on how to safely introduce RDTs to the private sector in five malaria endemic countries: Kenya, Madagascar, Nigeria, Tanzania and Uganda. The UNITAID-funded project focused on increasing both access to and demand for quality-assured RDTs. Applying the findings has also helped to improve private providers’ ability to properly diagnose and treat febrile illnesses. PSI’s learnings contributed to a WHO roadmap for public-private engagement, that will inform other countries in taking a market development approach for correct febrile case management.
- Guidance for Conducting Health Need: Use Over Need Analysis
This document helps teams understand the size of need for a health product or service in a country and the gap between current use and need. As a result, teams can select the segments (socio-economic, geographic, demographic, gender, etc.) where the gaps are largest between use and need.
- Guidance for Mapping Market Players
This document helps teams map the players in the value chain from production to use. It helps teams identify the key players and the areas to focus on for analysis.
- PSI Production to Use Matrix
The Production to Use matrix lays out all of the functions in a market from production to use. It helps teams investigate and analyze the performance of key market players and is a key tool that is used in PSI’s Market Development Approach.
- Ignite and Triggerise: 2017 Analytics and Insights
This report was shared at the ignite project meeting held in The Hague in October 2017, highlighting Triggerise’ progress to date with ignite and brand redesign activities following market research insights.
- Ignite and Triggerise: 2016 Annual Report
Triggerise’s 2016 Annual Report, sharing insights and results across all of its major donor-funded projects, including PSI/Dutch-funded project ignite.
- Kenya HIV Self-Testing Landscape
Formative market and consumer research to understand the HIVST landscape in Kenya, with a focus on regulatory and cost constraints. Recommendations to develop the private sector market (pharmacy distribution) of HIVST to help close the testing gap among men and youth. Framed as an update to donors who could invest in market shaping interventions.
- Getting to FP2020: Harnessing the Private Sector to Increase Modern Contraceptive Access and Choice in Ethiopia, Nigeria, and DRC
- How PSI Generates Value for Money through Social Investments
This 2-page brief describes the principles of cost-effectiveness, world-class financial management and risk reduction procedures that PSI uses to deliver cost-efficient impact for our partners.
- Expanding Effective Contraceptive Options in Zambia and Malawi: Understanding the Consumer
Expanding Effective Contraceptive Options (EECO) is a USAID-funded project led by WCG with PSI and other partners to support the introduction of new contraceptive and dual protection methods. This case study presents EECO’s analysis of consumer insights and market data to develop a marketing strategy for the Woman’s Condom in Malawi and Zambia.
- Strengthening Mozambique’s Family Planning Market: A Way Forward
Total Market Approach report on family planning