Father and daughter leaving willingness to pay session with Kit Yamoyo
Before we moved to scaling up Kit Yamoyo in the private sector across Zambia, we wanted to be sure we were working within a retail price that people were willing to pay.
In May 2013 we were deep into the analysis of our Midline Survey of the COTZ trial. Our midterm results for uptake of Kit Yamoyo were looking good, so we had started to plan for a scale-up across Zambia after the trial. We’d previously met Paul and Esther Wang in 2012, when IDInsight had only just started work in Zambia, helping projects assess their impact. They’d recounted interesting experience working in Cambodia for the Gates Foundation, conducting Willingness to Pay studies and sent us some interesting links to consider. We had not seen anything similar offered anywhere else. Could IDInsight help us with a pricing strategy for Kit Yamoyo?
By July 2013, we had a concept note ready and were grasping new insights into price elasticity, demand curves, bid wagers and Vickrey Auctions – all highly technical and a steep learning curve for us! But by the time the IDInsight team had turned it into a workshop presentation for rural carers of under-5 children in Monze, Southern Province, it all came across as a rather exciting participation game. As our field teams were still active in the trial areas, it was straightforward to obtain permissions, make the introductions and recruit participants for the sessions. In all, 217 care-givers took part, over a 3-week period, in groups of 5-10 people. They were presented with Kit Yamoyo, what it contained, how it worked, and its benefits, and – excitingly – bid with real money to secure a winning bid for a kit.
This gave us a lot of confidence in the findings, which can be read in full here. In summary, although cash in hand is very tight in rural areas, people are willing to pay for a life-saving product obtained locally; travel to a clinic in rural areas can be both costly and mean a dangerous treatment delay for a sick child. Whilst half of our sample were uncomfortable paying more than 2.50 Kwacha – indicating that in future a free or subsidised supply would be needed – over one third of participants bid over 5 Kwacha for the product (a little under 1 US Dollar). Beyond that price point, willingness to pay dropped noticeably.
IDInsight’s conclusion was that the 5 Kwacha price that we’d chosen at the beginning of the trial, based on our own Focus Group work – using a much simpler methodology – came out as the best-fit price for commercial success though retail outlets. However, they advised that we’d have to offer options for the poorest to ensure equitable access – for example through continuing with a voucher programme or subsidised sales through Community Health Workers or working with the Ministry of Health to develop free government supply of the kit through Health Centres. The latter alternative was our preferred option.
