New Models for a New World: Vietnam (2016)

The COVID-19 pandemic is challenging long-held beliefs in economics and business. As economies pause and support systems come under strain, returning to "business as usual" looks less likely by the week.
In New Models for a New World, our new series of blog posts, we return to some of our recent project outputs and the lessons they provide for today regarding economic development, sustainability and business opportunities. The COVID-19 pandemic reveals new challenges. GIFT's project outputs provide lessons on how to resolve them.
The importance of personal hygiene practices has been a consistent public health theme throughout the COVID-19 pandemic. Even something as simple as handwashing helps control the spread of infections: one MIT study found that tripling the number of air travelers washing their hands from 20% to 60% slowed infection spread by almost 70%.
Despite this, frequent handwashing has yet to become a habit in many parts of the world. Globla surveys from before the pandemic have found that only 20% of people was their hands after using the bathroom.
But personal behavior can be influenced by poor infrastructure: in this case, poor access to clean water and sanitation systems. According to NGO WaterAid, approximately 289,000 children under the age of five die each year from diseases caused by unclean water, inadequate sanitation and handwashing facilities.

Time for a Rethink: The HappyTap Model

In 2016, GIFT facilitated the Global Leaders Programme to develop a new product to help make handwashing with soap easier for Vietnamese communities. The field project was conducted, in partnership with HappyTap Co. Ltd, a Vietnamese social enterprise established in 2014 dedicated to providing market-based solutions to the provision of clean water and proper sanitation.
Vietnam has handled COVID-19 remarkably well, especially considering its proximity to China: this is the result of strong social cohesion, clear public messaging, and firm government action.
However, poor infrastructure has limited the adoption of positive personal hygiene behaviors. Only 3% of mothers reported washing their hands with soap before preparing dinner. Five million people in Vietnam reported practicing open defecation, and fewer than 10% are connected to sewer networks with water treatment. Ailments related to poor hygiene carries an estimated economic cost of USD 262 million annually.
HappyTap’s flagship product is the Labobo: a dedicated handwashing station that is affordable, easy-to-use, and portable. However, HappyTap relies on donor funding to cover its operational costs. Participants developed a new business model to support the large-scale sale and distribution of HappyTap’s handwashing devices (HWDs) to support greater public adoption of handwashing and improve public health in both rural and urban locations. While this product was pioneered in Vietnam, it was designed to be exported elsewhere in ASEAN (such as Cambodia and Myanmar) and eventually other regions as well.
In order to improve its business prospects, the report makes two key proposals: develop an upgraded model of the HWD, and separate HappyTap into two distinct entities, the HappyTap company and the HappyTap Foundation.
An upgraded version of HappyTap’s HWD could include a liquid soap dispenser and sensor technology, enabling HappyTap to collect, analyse and sell data based on consumer behavior and handwashing practices. Data analytics and sensor technology allow operations to be improved and offerings to be customized: for example, organisations like the World Bank may want analysis of handwashing behavior to improve their own educational campaigns. In addition, food and beverage companies may be interested in the data to improve their sales and marketing strategy.
Furthermore, it was recommended that HappyTap move away from a single product, and instead produce a generic HWD to be rebranded according to customer and partner preference. In this regard, Unilever had already produced HWD's branded with Lifebuoy soap for handwashing training in schools.
The HappyTap Company would focus on production, sales, and distribution in an attempt to reduce logistical and inventory-related costs. The Company would expand partnerships with private, public and civil sector organisations to deliver the HWD through multiple distribution and sales channels. Partners focused on health and hygiene, like drug stores, may be more inclined to carry and distribute the HWD, while partners like FMCG companies may be interested in the option of customizing the HWD. Finally, institutional customers, including NGOs, may include the HWD as part of their health and hygiene marketing and campaigning. These efforts would help HappyTap broaden its reach ad increase its revenue.
In contrast, the HappyTap Foundation’s mission would be to increase public awareness and understanding of hygiene, public health, water and sanitation. As a charitable organisation, the Foundation could seek pro-bono services to help develop a compelling brand, marketing material and campaign events. The Foundation could also leverage data collected from tech-enabled HWDs to lead and coordinate studies on handwashing behavior in partnership with international NGOs.
HappyTap’s objective is not focused solely on meeting a revenue target: it is to change behaviors in Vietnam and ASEAN as a whole. Vietnam’s compliance with mask-wearing and social distancing regulations shows that people are willing to accept and embrace new measures to achieve public wellbeing and in solidarity with their fellow residents. This is an opportune time for organisations like HappyTap to capitalize on their products and support the enabling environment that allows people to maintain better personal hygiene habits.
Feel free to read the report from the 2016 Vietnam Global Leaders Programme to learn more about the proposal created by participants. Stay tuned for more "New Models for a New World" posts regarding our other project outputs.
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