Social marketing for a better world

Cost-Efficiency

One of ways DKT achieves cost-efficiency is through cross-subsidization of products. In Brazil, for example, DKT has condom brands at various price points which allows higher-priced condoms to subsidize lower-priced condoms.

One of ways DKT achieves cost-efficiency is through cross-subsidization of products. In Brazil, for example, DKT has condom brands at various price points which allows higher-priced condoms to subsidize lower-priced condoms.

People are surprised when they learn that DKT’s headquarters in Washington, D.C. has fewer than 10 employees, but this is only part of the story behind DKT’s cost-efficiency and why an investment in DKT produces significant health impact at very low cost.

In 2015, DKT spent less than 2% of total operating expenses on headquarters costs.  Even less (0.2%) was spent on fundraising. Based on preliminary financials, we anticipate that cost structures going forward will be similar. Most importantly, these cost-effective management indicators suggest that donor resources are being used where they have the greatest impact. DKT delivers many millions of couple years of protection at a cost per CYP of around $2.

Other aspects of DKT cost-efficiency include:

Financial Sustainability: DKT programs recover a significant portion of their costs through revenues collected, and it does this without sacrificing on product quality or affordability to poor people. Several DKT programs are now 100% financially sustainable and have provided seed money to start up new programs. For more details see our White Paper on Innovative Financing.

Cross-subsidization: One of the ways DKT enhances its revenues is by offering different variants of the same product type (like a condom) at different price points. In this way, all income levels are served, and the higher-priced brands help subsidize the lower-priced brands.

Entrepreneurial Spirit: DKT’s strategy is inherently entrepreneurial because its social marketing approach uses the tools of the commercial marketplace to achieve a social purpose. This entrepreneurial tendency generally results in less bureaucracy and more focus on bottom-line health impact using the commercial infrastructure already in place.

Decentralization: The DKT model is highly decentralized, ensuring that strategic and programmatic responsibility is delegated to our field offices and more than 2,000 employees around the globe. This allows for fast, on-the-ground decision-making that is based on the realities of the environment. It also means fewer headquarters costs.

Rigorous Measurement: Every DKT program is rigorously measured by yardsticks such as couple years of protection, contraceptive prevalence and maternal and child mortality. Our results are available here.

In addition, DKT publishes its annual Contraceptive Social Marketing Statistics for greater accountability. DKT believes that transparency on results and costs ensures greater accountability for DKT and engenders trust by our partners and donors.

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