Condoms
A review of the condom market in the DR
A custom report compiled by Euromonitor International for
Options
September 2009
TOC
Table of Contents
Introduction
Key findings
Facts and figures
Final thoughts
Appendix
Disclaimer & Contact information
2
Introduction
3
Introduction
Project Objectives
Options
 The core research objectives are to:
 What is the size of the overall market for condoms in the DR?
 What are the leading branded products?
 What are the leading forms of distribution (retail/non-retail)?
 What are the key drivers, trends and future outlook in the market?
 Point of sale audits, what condoms are on offer? How are they priced?
How are they sold and marketed?
Euromonitor International
 Euromonitor’s consulting team aligned with Options and PSI to develop a
customized solution for the above questions
 The project methodology focused on Euromonitor’s experience utilizing the
following techniques:




Retail store audits
Internal data/analysis collation & secondary research
Data validation via industry contacts
Transparency in sources, inputs and assumptions
4
Introduction
Euromonitor Methodology
Primary Research
Trade interviews
Store audits
Secondary Research
Syndicated data
Trade associations
5
Key findings
6
Key findings
Commentary from across the value chain
Stockouts are a problem;
distribution failures are
NGOs
the root cause—that is,
filling condom orders and
not placing orders
Prices have risen on the
distribution end in recent
Distributors
years, despite the fact
that PSI has kept Pante
prices stable
Retailers
Retailers cite condom
quality, variety and price
as key success factors in
the retail market
7
Key findings
Government is an integral player in the DR
NGOs view the
government as an
Government important stop-gap when
regular condom sources
dry up
Follow-through can be
unpredictable, but the
Political
Dominican gov’t has
committed to supporting
condom programs
UNFPA is the major
supplier of condoms to
Global
the government;
organizations
reaffirmed its support for
the DR after 2004
8
Key findings
Condom supply chain is a complex affair
Gov’t/Free condoms
Subsidised condoms
USAID
Secretary of
Public Health
(SESPAS)
PSI / Profamilia
COPRESIDA
Commercial
Condoms
NGO´s
Distributors
Wholesalers
Non-profit orgs.
Pharmacies
Promoters
NGOs
Wholesalers
Colmados
Gov. Clinics &
Health Centers
& Programs
Pharmacies
NGOs, Clinics &
Health Centers,
Programs
Motels / Hotels
Brothels / bars
Colmados
Others
Consumer
9
Key findings
Free condoms involve international NGOs
• Depend on international aid
organizations, which have
withdrawn funding in the
past
Gov’t/Free condoms
International
USAID
Secretary of
Public Health
(SESPAS)
• Condom programs
breakdown if key
government personnel do
not maintain support
COPRESIDA
Government
Non-profit orgs.
• Consumer access to
condoms highly depends on
clinic hours, which are
unreliable
• Condoms can only be
distributed by personnel
associated with HIV or
family planning programs, if
person is absent, consumer
cannot access condoms
NGOs
Gov. Clinics &
Health Centers
& Programs
NGOs, Clinics &
Health Centers,
Programs
Consumer
Clinics
10
Key findings
Subsidized condoms: most players
Subsidised condoms
ofit Org.
PSI / Profamilia
• PSI/Profamilia have
ability to procure and
Commercial
distribute condoms
Condoms
reliably
Primary
NGOs
NGO´s
SAID
inton
Distributors
Wholesalers
Pharmacies
Promoters
• Most distributors are
reliable—they play by
the rules and take
good care of the
Wholesalers
stock—a few are not
Distribution
Colmados
Pharmacies
Motels / Hotels
Brothels / bars
Consumer
• Most products are
Colmados
reaching consumers
appropriately, though
methods
are greatly
Others
varied
Availability
11
Key findings
Free condoms
Commercial value chain: traditional setup
Subsidised
•Most straightforward distribution
system, withcondoms
far
fewer players and more direct manufacturer to
consumer product flow
For-profit
Non Profit Org.
Goverment
Grey
COPRESIDA
Market
Secretary of
Public Health
NGOs
Distribution
PSI / Profamilia
•Illegal importation of condoms from Haiti,
Pante
USAIDappear in commercial chain, NGO´s
condoms
free
condoms being resold in commercial outlets
Clinton
•While estimates vary widely, industry agrees grey
market is significant
Commercial
Condoms
Distributors
Wholesalers
•Issues at play in the distribution system include
Pharmacies
tax evasion and “grey market” suitcase trade
Promoters
Wholesalers
Colmados
Gov. Clinics &
Health Centers
& Programs
NGOs, Clinics &
•Smaller consumer base due to increased
to
Motelscost
/ Hotels
Health Centers,
consumer; however steady product stock is
Programs
more predictable
Availability
Brothels / bars
Consumer
Pharmacies
Colmados
Others
12
Key findings
Durex, Trojan most expensive brands
Socially marketed condoms all priced below market average;
Pante is priced at the bottom of the market
Average price per unit by brand, US$
0.90
0.80
0.70
0.60
US$
0.50
0.40
0.30
0.20
0.10
0.00
13
Key findings
Most brands have over 3 years shelf life
Pante is above average with 44 months shelf life; best in market is
Vitalis with 49 months, worst is Lifestyles expired by 9 months
Average shelf life in months by brand
60
50
40
30
20
10
0
-10
-20
14
Key findings
Consumers clear in what they want
Value-added condoms an option, but not an essential offering
Basic attributes
Value-added
• Latex, lubrication
are a must
• Flavor, color catch
some attention
% of audited condoms
% of audited condoms
100%
10%
90%
9%
80%
8%
70%
7%
60%
6%
50%
5%
40%
4%
30%
3%
20%
2%
10%
1%
0%
0%
Lubrication
Latex
Spermicide
Flavor
Color
15
Key findings
Standard packaging formats in retail
Boxes of 3 foil-wrapped condoms are most prevalent; though
pouches of plastic and large-format packages are also found
% of audited condoms, selected product attributes
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Box
Pouch
Exterior Packaging
Foil
Plastic
Wrapper type
3
144
Pack Size (units)
16
Key findings
Durex most prevalent brand in audits
Socially-marketed condoms appear often in audits; vast majority
of condoms required assistance for purchase
Frequency of brands found in audits
% of audited condoms requiring
assistance for purchase
% of audited products, by brand
Trojan
8%
Pante
9%
Te Amo
8%
Contempo
6%
100%
Escudo
6%
80%
Get Wild
2%
Other
10%
Durex
52%
90%
70%
60%
Vitalis
2%
50%
Life Styles 1%
40%
Watson 1%
30%
Preventor 1%
Protector 1%
Revenge 1%
Slam 1%
Tutti Frutti 1%
20%
Te Amo does not
use POS materials;
Durex and Trojan
had displays in
some outlets
10%
0%
Requires assistance for
purchase
17
Key findings
Market
drivers
Grey
Market
Suppliers
Retail commentary highlights
Consensus that
consumers are looking
for both good price and
quality—that is,
reliability—in condoms
Agree that sales occur
without invoice—in one
case, “especially…for
Pante”, where sales are
not meant to occur
Most retailers are buying
from wholesalers based
on visits by salespeople
18
Facts and figures
19
Facts and figures
Key assumptions underlie forecast growth
Government
• Government follows through on key program initiatives; can fill in stockout gaps from NGOs
• Relies heavily on UNFPA for funding, UNFPA is steady for forecast period
Commercial
• Steady year-on-year growth between .5% and 2%
• No major shifts in market share, major players; no market entrants, exits
• Consumer pattern to balance price with quality remains status quo
PSI
Profamilia
Per-capita use
Crowding in/out
• Supply chain problems improve going forward into forecast period
• Pante remains top brand in the DR and PSI remains a market leader
• YTD sales figures provide reliable baseline for total distribution 2009
• Hindered by move to self-funding, but improving going forward
• Efforts to augment distribution network will be successful
• Slowly increasing number of clinics throughout the country
• Benchmarked against global/regional figures where social programs exist
• Per capita pool is sexually active individuals (ages 15+)
• Per capita condom use will increase into the future
• To a certain degree, increased distribution of free/subsidized condoms
increases commercial sales
• In the end, price is one of the main determinants of condom use
20
Facts and figures
Per capita usage driven by social agencies
Drop in social condom market size corresponds with drop in total
per capita condom usage; commercial and government flat
Per capita condom usage in the DR by channel, 2007-2011
5
4.5
0.3
0.3
0.3
4
Per capita usage, units
3.5
0.3
1.2
1.1
0.3
1.2
1.2
3
1.2
2.5
2
1.5
3.1
3.0
2.7
3.2
2.3
1
0.5
0
2007
2008
Social Agency
2009 (f)
Government
2010 (f)
Commercial
2011 (f)
21
Facts and figures
Condom market rebounding by 2010
Fall in social agency volume impacts entire condom market;
Government steps in while social agencies recover
Dominican condom market in volume (units mn), by channel
30,000
25,000
1,490
1,468
1,609
1,460
20,000
Units, mn
5,885
6,045
6,115
1,458
6,161
15,000
5,944
10,000
15,495
15,536
13,846
17,089
11,528
5,000
0
2007
2008
Social Agency
2009 (f)
Government
2010 (f)
Commercial
2011 (f)
22
Facts and figures
Social condoms will show most growth
Social condoms turn around in 2009, then flatten out;
Commercial growth more predictable; government fills gaps
Dominican condom volume growth by channel (y-o-y), 2008-2011
30.0%
20.1%
20.0%
12.2%
10.0%
10.0%
3.7%
1.0%
0.0%
1.5%
0.6%
0.1%
-1.1%
-0.7%
-9.4%
-10.0%
-20.0%
-30.0%
-25.6%
2008
2009 (f)
Social Agency
2010 (f)
Government
Commercial
2011 (f)
23
Facts and figures
Social agencies approach 70% share, 2011
Social agency market share recovering through 2011; commercial
loses share despite volume gains, government presence fluctuates
Dominican condom market distribution by channel, 2007-2011
100%
7.0%
7.7%
6.8%
6.4%
6.1%
28.7%
26.5%
24.6%
64.5%
67.2%
69.4%
2009 (f)
2010 (f)
2011 (f)
90%
80%
25.6%
31.4%
70%
60%
50%
40%
67.4%
30%
60.9%
20%
10%
0%
2007
2008
Social Agency
Government
Commercial
24
Facts and figures
Pante approaching 2/3 of the DR market
Market share by brand, 2008
Pante
• Well-known brand throughout the DR
• Originally smuggled in from neighboring Haiti;
population familiar with Pante by official
launch
• Many education programs centering around
Pante
• PSI works closely with numerous NGOs in the
DR, increasing share
Others
31%
(includes generic)
Durex
4%
Te Amo
3%
Escudo/
Protector
3%
Trojan
1%
Te
Amo
Trojan/
Durex
• “Cheap” brand in both cost and quality
• High channel presence, more popular in
down-market outlets
• Dubious point of origin—nobody seems to
have a clear understanding of the product
• Likely produced in and imported from China
• Leading commercial brands with wide product
ranges
• Seen as “premium” products in both price
point and quality
• Significantly more popular in up-market
channels and appeals to niche market
Panté
58%
Other
brands
•Government distributes “generic”
condoms along with other contraceptives
•Escudo and Protector are the leading
brands from Profamilia
•Other major global brands exist in the
market, but are not very popular
•Female Health Company working to boost
distribution and sales
25
Facts and figures
Social agencies are main condom source
Original source distribution, 2008
Social agency,
60.9%
• Social agencies putting
close to 2/3 of condoms
into the market in the DR
Social
agency
• Government agencies
responsible for roughly 1/3 of
condoms distributed in the DR
Government
Super/hyper, 0.8%
Colmados, 3.3%
Retailers, 7.7%
Convenience stores,0.6%
Pharmacies, 2.6%
Government,
31.4%
Retailers
Mixed retailers, 0.1%
Wholesalers, 0.4%
Retailers
• Colmados and pharmacies are
the major source for condoms
for consumers in the DR
Subsidized
/ free
• Social agencies limited by low
number of clinics, boosted by
condom distribution events
Others
• Retailers account for only 7% of
documented condoms in the market
• Presumably if they grey market was
included, retailers would account for
higher share
• Vending culture nonexistent
while hotels and clubs
accounting for only 2%
Consumer procurement distribution, 2008
Pharmacies,
26.9%
Government
agency, 19.3%
Super/hyper, 2.2%
Convenience stores, 0.5%
Others, 6.6%
Social agency, 1.5%
Vending, 0.1%
Hotels/clubs, 2.1%
Colmados,
48.0%
26
Final Thoughts
27
Final thoughts
Commercial
Failure points throughout the system
• Free/subsidized condoms are NOT cannibalizing commercial condoms
• Appeals to a different market niche that is largely insulated from the
market dynamics free/subsidized condoms
Informality
• Tax evasion is prevalent, so there are few—if any—concrete records as to
what is occurring in the condom market
• Brands such as Te Amo almost completely escape regulatory purview
Availability
• One of the major problems facing the DR is steady availability to the
consumer: many outlets do not follow posted operating hours or the staff
needed to give out condoms is absent
• This makes it much harder for low-income consumers to obtain condoms
Supply and
Demand
• There are many variables in the DR condom market, making it difficult to
forecast the future
• Local conditions along the supply chain are informal and unreliable
Distribution
• Conditions such as storage have improved, but basic problems like
opening hours and delays in customs still plague the system
• Merchandise quality has been positively affected, but not consumer
availability
28
Disclaimer
Information in this report researched by Euromonitor has been extracted from a
report produced by Euromonitor International Ltd (“Euromonitor”) solely for its
client Options.
Euromonitor does not have any control over the particular purpose(s) for which
its information or intelligence is used. Euromonitor has agreed to permit the
reproduction of extracts from Euromonitor’s report on condition that
Euromonitor disclaims and excludes any and all liability (whether arising in
contract, tort or otherwise) for any loss of any nature suffered by any party as a
direct or indirect result of any error in or omission from the Extracts, as a direct
or indirect result of the use of any of the Extracts or of making any business
decision, or refraining from making any such decision, in reliance or based wholly
or partly on any data, expression of opinion, statement or other information or
data contained in the Extracts.
29
Contact details:
Mike Jozwik
Head of Research Consulting (Americas)
Tel: +1 312-922-1115 x 8238
mike.jozwik@euromonitorintl.com
Tom Anzur
Head of Business Development, Consulting EMEA
Tel: +44 (0)207 251 8024 x 2416
tom.anzur@euromonitor.com