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Prepared by
Rupesh Kumar GuptaProgramme Coordinator
(Management Deptt)
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Rural marketing can be define as afunction that manages all activitiesinvolved in assessing, stimulating and
converting the purchasing power of ruralconsumers into an effective demand forspecific products and services and movingthese products and services to the people
in rural areas to create satisfaction and abetter standard of living and therebyachieving organizational goals.
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Because rural India offers to greatest hub to Indianmarkets seeking growth for their production serviceswith 73 % of Indian population and 12% of worldpopulation living in villages of india.
In India--- 28 states
600000 villages
4 major religions
1650 ethnic group
15 major languages
1350 dialects
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Proliferation(rapidly change) of brands inurban
High saturation levels in urban
Greater awareness of brands in rural Ever-growing aspirations in rural
No effects of slow down on rural markets !
Greater opportunities for business Large customer area ( 73 % customers live in
rural area in India)
Low competition
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FMCG Rs.65000 crore Agri-inputs Rs.45000 crore Durables (long life goods)
Rs.5000 crore Automobiles (2 & 4 Wheelers) Rs.8000 crore Clothes, footwear etc. Rs.35000 crore
Construction material Rs.15000 crore Total Rs.173000 crore Source: CII Report (2008)
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Very intelligent and clever cannot be easilycheat.
Daily activity is routinised
Plenty of time / No SundaysVery conscious of value for money Does not like to pay extra for frills he cannot
use.
Eg. Colour TV High involvement in any product purchased
Eg. Durables (LIC)
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Perceptions, traditions, values vary from state tostate and in some cases from region to regionwithin a state.(MRF Bullock Cart Tyres)
Divisions based on caste, community and otherhierarchical factors continue to exist.
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Keep the communication simple
No scope for gimmicks( tricks)
Take time in communicating the message
Quickies have no impact.
Think in the local language to capture the local
spirit in the communication aimed at specificregion.
Demonstration a key element for success
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provided your communication is not gimmicky,suggestive and is easy to comprehend.
Target the opinion leaders first.( Educated villageyouth as opinion leaders)
Hence need for different communication
packages focused on rural audience
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Build Recognition Rural folks understands symbols and
colours better. Pahelwan Chap MRF
Haathi Beedi Laal Sabun Lifebuoy Peela Powder NirmaWhite paste- Colgate
This also leads to duplicates and fake products Largely sold in the Haats (weekly markets) in Rural
India Rs.12000 crore p.a. is the estimated loss to FMCG
sector
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Untapped potential: it offers a great chancefor different branded goods as well as servicesfor large number of customers.It is estimated by HLL that out of 5 lakh
villages in India , only lakh has been taped sofar , which goes on to indicate the marketpotentials of the rural market .
Market size and potential :The size ofIndia s rural market is stated as 12.2 % of the
percentage of the old population this means12.2% of the worlds consumers leave in ruralIndia.In India, rural household farm about 73 % oftotal household constitutes a huge market byany standard.
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Increasing income :Different programsundertaken have helped to improve the economic theeconomic situation of the rural areas. The increase inincome is seen in both absolute values as well as in the
increase in average number of days of occupation in ayear.
Competition in urban areas :The urban marketis getting saturated and thus is enable to provide the
much needed market to many companies and insearch of greener pastures many of these companiesare now targeting the rural market.
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Accessibility markets :Though the roadnetwork has not developed to the best possibleextent but a fire amount of development has beenmade in many regions, making these regionsaccessible from the urban region and making ineasier for supplying products to these regions
To create brand image
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Distribution and logistics: Infrastructurecontinues to be a challenge in rural India. Moreover,the lack of an efficient distribution network preventspenetration of products/services into rural India. Oneof the most innovative models in recent times has
been the usage of the postal service by mobileoperators to penetrate scrat
Payment collection: The majority of the ruralpopulation is still unbanked. Clearly, non-cashcollection becomes rather unlikely. Cash collections,
on the other hand, are messy and difficult to monitor,especially since cash cards or technology-enabledcentralized POS (like Suvidha or Itz World) have stillnot reached rural areas. ch cards to the villages
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Pricing: In rural areas peoples dont purchasehigh price goods
Social and cultural challenges: The cyber
caf (or kiosk) model has not worked in manyparts of rural India due to socio-cultural issues.
Education level in rural areas
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Consumer behaviour
Income level of consumer
Standard of living
Education of consumer
Cultural environment
Taste and preference of consumer
Consumption criteria of consumer Purchasing pattern of consumer( cash or borrow)
etc..
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They understand the regional ethos better They satisfy a perceived local need Their communication touches a chord which
helps in brand acceptance
They are flexible Adapt to changing market situations
Eg. Anchor, Gadi, Ajanta, Cavinkare (Chik), Power,Goldwinner, Swagat baniyans
If you are small with limited budgets start byconcentrating on smaller areas Outdoor / local Cable TV / Radio / participate in
local festivals etc.
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Even Nirma started very small
Today it is a Rs.2000 plus crore company!
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Marketers will have to understand therural customers before they can makeinroads in to rural makers.Indian rural market is undoubtedly
complex but there are some simple truthsthat we need to accept. The ruralconsumers are very value-conscious. Theymay or may not have purchasing power,but they can make a difference to thecompany's growth if concentrated.So, it is apt to say that The heart of India
still lies in the villages
..
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