Soft Drink, Soft Power: Using Coke's Reach to Deliver Medicine to the World's PoorestPublished January 24, 2012 in Arabic Knowledge@Wharton
Even in the most far-flung corners of the developing world, you can buy a bottle of Coca-Cola. But often in these same places, one in seven children die before their fifth birthday from preventable causes like dehydration from diarrhea. ColaLife, a nonprofit organization based in Britain, aims to bring vital medicines to vulnerable children via the same distribution system Coca-Cola uses.
In the mid-1980s, Simon Berry was working in Zambia for a British developmental aid agency when he came up with the idea. At the time, it was hard to get anyone to listen to his idea. Then, three years ago, Berry started a Facebook group and began advocating his idea on the BBC. His support base blossomed with thousands of Facebook followers.
The soft drink company started talking to him about how to get his innovative idea off the ground. Now, ColaLife has finally taken on a life of its own and will begin its trial run in Zambia early this year. Ahead of that project launch, Simon Berry talks to Arabic Knowledge@Wharton about figuring out how to achieve philanthropy through business infrastructure, and why ColaLife will also profit micro-entrepreneurs along the way.
An edited transcript of conversation follows.
Arabic Knowledge@Wharton: Why has Coca-Cola been so successful in their distribution system?
Simon Berry: I think it's because they have created a value around their products so people know about them and, for whatever reason, they want them. In addition, they've managed to enable people to make money satisfying that demand.
Arabic Knowledge@Wharton: Why has it taken so long for charities such as yours to piggy-back off the idea of using entrepreneurial systems to do good?
Berry: I don't really know. Lots of people in the past have highlighted the effectiveness of the Coca-Cola distribution system and wondered why we can't do the same with simple medicines. But no one has followed it through in a systematic way like we have.
Arabic Knowledge@Wharton: Will you have to pay Coca-Cola to use their distribution channels?
Berry: We're not using Coca-Cola's primary distribution system. We're operating from the wholesaler level downwards after the truck drops off the Coca-Cola products. We are piggybacking off the secondary distribution system. That's an independent distribution system, which takes the product on the so-called 'last mile' to its final destination.
When we say "last mile," it could mean the last six, seven, eight or 10 kilometers of rough terrain. The secondary chain is run by local, independent entrepreneurs and crates are carried by bike or bus or whatever means possible.
Arabic Knowledge@Wharton: What will be the incentive for the cyclist, the mule driver, or the cart-and-horse driver to distribute ColaLife products down the "secondary distribution chain"?
Berry: The incentive will be exactly the same as the incentive to distribute of Coca-Cola. We will create a demand from the community and it will be possible to make money fulfilling that demand.
Arabic Knowledge@Wharton: The concept of the "last-mile distribution network" seems to be a vital segment of this plan to work. How did you come up with that concept?
Berry: Just through the study of the system and talking to local people. We realized that actually the primary part of the Coca-Cola distribution plan is not unique. Many products go from Lusaka [Zambia] to a secondary distribution point. What is special about Coca-Cola is the distribution to remote communities. It's a demand-driven system. Coca-Cola doesn't push these products into these communities. They're pulled into the communities by demand from consumers.
Arabic Knowledge@Wharton: Back in the mid-1980s when you came up with the idea of ColaLife and you were using the Telex machine to communicate from Zambia, how did you imagine your idea being broadcast to the world?
Berry: In those days, we failed because we couldn't get people behind the idea. Coca-Cola wouldn't talk to me as an individual. What we're doing now is a direct result of social media. Three years ago, I went on Facebook and went on the BBC web site and started talking about our idea there. As supporter numbers grew so did my power to engage with the international organizations we need to make this work. As well as Coca-Cola, we've had a direct line to UNICEF and SABMiller. Top experts began to search us out. Our online profile has pulled all these powerful partners together to try something different.
Arabic Knowledge@Wharton: You say you got into Facebook three years ago. What made you decide to try Facebook and Twitter? How valuable were these social media tools to your idea?
Berry: I spent a lot of time in the U.K. from the early nineties setting up online communities. What became apparent in that process is that if you want to gather support around an idea, it's better to go where your supporters will be and not expect them to come to you. So we went on Facebook and the BBC.
We realized that it's more effective to go to an online community with like-minded values rather than creating an online presence and expect people to come to it. We didn't have a web site until six months into the program. Our web site [www.colalife.org] now is an aggregator of our presence elsewhere, such as on Flickr, YouTube, Twitter and Facebook. We have established a community based around Facebook. Going to where our supporters may be was a conscious decision and a very successful one. Others have set up a web site and expect people to come to them but what happens is that your potential supporters don't know it's there.
Arabic Knowledge@Wharton: You explain that open innovation is the concept of sharing ideas freely to as many people as possible via the Internet, presentations, radio, etcetera. How has open innovation helped your idea?
Berry: It has been very important. It has been the foundation of everything. We didn't go to Facebook with a precise idea. We went with a general idea of distributing children's medicines by sharing the Coca-Cola distribution system. Our idea has developed. People have challenged and criticized us. And the idea has got better and better as a result.
Arabic Knowledge@Wharton: In your trial, you mention that a 5% improvement in child survival rates can raise economic growth by 1% a year in the next decade. How important is that in Africa?
Berry: It's crucial. Children are the future of everything, aren't they? Not only is it morally unacceptable and incredibly distressing to have high child mortality rates, it doesn't make sense for economic development. Reducing child mortality makes sense from all angles.
Arabic Knowledge@Wharton: You discuss how this will be a combination of aid and trade. Why have you decided to use a hybrid model instead of doing pure charity?
Berry: We have demonstrated over the last two to three decades that working in silos, such as nongovernmental organizations, public organizations, and in the private sector, have not solved the problem of child mortality. We've made some progress in the last 30 years, but at the current rate of improvement, it'll be 185 years before child mortality in sub-Saharan Africa will be what is in the U.K. today. Carrying on as we have been doing is not enough. We need a step-change. And we need innovation to achieve this. We need to join people across sectors for a collaborative effort. One sector doesn't have all the expertise but coming together we may be able to move more quickly towards solving the problem.
Arabic Knowledge@Wharton: Will it remain a nonprofit?
Berry: We want ColaLife to remain a nonprofit. We don't want ColaLife to own the strategy or concept. We want to be public about what we're doing. We want to share lessons learnt as we go along. We want other people to pick up lessons and incorporate new methods and new thinking into their own operations. We don't see ColaLife as having more than two or three people employed [directly as part of the organization]. We want the rollout to be done by others. Our role at the moment is to produce data that people can trust so that they can incorporate our experiences into their own operations. Basically, we want to be a catalyst, not a controller.
Arabic Knowledge@Wharton: In your decades of experience working in Bolivia, Egypt, Dominican Republic and Zambia, what was your biggest frustration in aid work?
Berry: I don't necessarily see things as frustrations. I see a whole load of issues that need addressing. You don't need to see the development process as a set of frustrations. It's really a big opportunity to have a really big impact. It's one of the reasons I enjoy working in the development environment. I believe that I can have a bigger, more positive impact working in developing countries than I can working in more developed countries. This is certainly the case with something like child mortality.
Arabic Knowledge@Wharton: What will be in the ColaLife packets? I've seen background materials mentioning oral rehydration salts, zinc tablets, educational materials, water purification solutions, baby lotion, baby wipes, vitamin A tablets and condoms. How did you decide what goes into these small packets?
Berry: For the Zambian trial, the consensus among the local health officials is that we should focus on a niche product -- the anti-diarrhea kits [ADK]. These will contain oral rehydration salts, a course of zinc tablets and soap, plus educational materials. All the other things you mentioned will not be included in the trial.
One of the principles important to ColaLife is local determination. It will be up to the local people in charge of public health to decide how this channel will be used after the trial. We will be doing the trial to see if we can get the system to work. It's not up to me to dictate what goes in [the packets] but it will be up to the local people with the responsibility for public health to make these decisions.
Arabic Knowledge@Wharton: You mention 'para-skilling' which is training owners and staff of small retailers. Is that training and education in what the medicines in your packet are used for? Also you mentioned you'd be stocking the ADKs in small kiosks in open-air markets.
Berry: If you analyze what it that a retailer does, they 'sell the benefits' of the commodities they have on their shelves in their shops. They sell Coke or cooking oil. They say, "You buy this because of this." We want them to say that about ADKs. Your child has diarrhea and you need to buy this ADK. We will train retailers to be better retailers and in the process make agents of public health.
Arabic Knowledge@Wharton: Your methodology mentions mobile phones will be used to provide voucher redemption. How would the voucher be used?
Berry: We are planning to generate demand for the ADKs we are distributing. We've found that people are familiar with Oral Rehydration Tablets (ORS) component of the ADK but not the zinc. We will give vouchers to mothers to exchange for an ADK. They'll receive a scratch card and retailers will know what they are. The retailer will scratch to reveal the voucher number. Then they will text this number and the ADK number, which are all unique, and retailers will be paid for the ADK on their phones. The retailers will get paid and the mothers will get the ADKs. They won't be free but they will be at cost to the mothers.
The retailer will get paid. And that is the crucial part. If we give stuff away for free, we undermine all existing supply chains. We don't want to do that. We want to strengthen the existing, micro-entrepreneur-based supply chain.
Arabic Knowledge@Wharton: You're launching the trial in Zambia. What will happen?
Berry: We had a reception at the residence of the British High Commissioner to mark the fact that we raised the money to start the trial. We used this to bring together all those who've helped us get this far. It was also a way to refresh the memory of ColaLife to those who've helped us in the past. The official launch of the trial itself will be in 2012. Then there will be a nine-month setup to develop the package, set up the retailers, and carry out focus group work with mothers and caregivers. Then there will be a 12-month trial phase that will involve Johns Hopkins University and UNICEF. Finally, we'll do three months of analyzing and publishing the findings.
Arabic Knowledge@Wharton: How much money will it take for the project? Is the trial costing US$1.3 million?
Berry: We actually got a little more. We got more to distribute 40,000 ADKs instead of the original 10,000 planned. We have also been given additional resources to follow up interest in neighboring countries. We also want to help others to set up their own pilots to test their own variants of the ColaLife idea.
Arabic Knowledge@Wharton: What is the ultimate goal of ColaLife?
Berry: I want mothers throughout the developing world to be able to buy an ADK to stop her child dying of dehydration from diarrhea in all the places you can buy a bottle of Coke.