2. Rural Marketing Process

RURAL MARKETING PROCESS:• Rural Marketing is a Two-Way process:• - Rural to Urban and Urban to Rural • Rural to Urban:- Agril. produce, Vegetables, Fruits,

Wheat, Rice, pulses, and Milk etc.(produced in Rural area).-Consumed in Urban area.

• Urban to Rural:- Consumables, Consumer durables, Agril. inputs (Seed, Fertilizers, Pesticides, Insecticides etc.), Implements (Tractors, EPS/DPS, Threshers, Sprinklers) are supplied from Urban areas to Rural areas.

RURAL MARKET STRUCTURE:

• 1. Demographic Environment: Though, the population from Rural have migrated to Urban but the purchasing power have increased in Rural Area. It has increased from 40% in 1991 to 42% in 2001 and 48% in 2011.

• For Marketers, the population in young age-group shapes the marketing environment. Adult youth (20 to 35 years) in Rural is 23% and in Urban it is 27%. There is great scope in Rural Market for young generation.

• 2. Education & the Level of Demand: Due to increase in Literacy level in Rural area it has changed the Socio-Economic status of the people. The demand for Educational products e.g. Books, Magazines, Note-books, Pen/Pencils, Drawing instruments, Calculators, digital dairies, Computers etc. have increased. Overall products and brand awareness have increased and rural consumers are

• more matured in purchase decisions. • 3. House-hold Pattern: The Family structure

in rural area have changed from Joint family to nuclear family.

• Nuclear family live separately at the same place in rural area. The range and Branded products are purchased by the

• Nuclear family. Thus, there is good market for branded products in Rural Area.

• 4. Rural Housing Pattern: The rural housing pattern have increased as under

• from 2001 to 2011 :• (a) Pucca House from 41% to 62% • (b) Semi-pucca house from 36% to 24%• (c) Kuccha house from 23% to 14%

• Pucca Houses are increasing in Rural Area by 5% every year & they have surplus and sufficient disposable income. Therefore, the use of Cement, Iron, wood work, colour & paints & furnishing have increased in Rural Area which shows good market potential.

• 5. Occupational Pattern: Urban and Rural population or house-holds have different occupational pattern.

Occupational pattern is as under:• Occupation Urban Rural1. Cultivators 3.45% 40.86%2. Wage earners 20.93% 35.28%3. Salary earners 40.72% 11.28%4. Professional 3.59% 0.73%5. Artisan s 6.90% 3.41%6. Petty Shopkeeper 16.05% 4.97%7. Businessman & Others 8.37% 2.45%

• Wage earners and Salary earners have different Buying Behaviour.

• Daily wage earner have variation of income, whereas a Salary earner brings a fixed income, hence he can plan expenses in a better way.

• 3/4th Rural House-holds are either Cultivators or wage earners whereas 3/4th Urban house-holds are Salary earners & shopkeepers & wage earners. Salary earners have more buying power as compared with wage-earners.

• Cultivators has seasonal income (after harvesting). He makes purchases immediately after harvesting season. Durable goods are purchased by him at this time. Thus, the marketer must take care of time for sale of its product.

• Physical Environment: Physical environment in Rural and Urban area is different.

• In Village Area: • (i) Abadi land & Cultivated land is seen. (ii)

Abadi is seen in Cluster or Individiual House. • (iii) Farmer live in Abadi land in general. (iv)

Houses are mostly Kuccha and partly Pucca.

• Number of shops in Rural area:• (i) Population < 500 : Hardly 1 or 2 shops• (Known as small village).• (ii) Popu. Upto 2000 : About 16 shops• (Also known as developed village).• (iii) Popu. >2000 : 50 to 100 shops• (Big village or classified as Town)

• Marketer should target this category of village area where population is more than 2000. Number of shopkeepers are also available to market their product along with sufficient number of population .

• There are > 2000 Towns having population between 20,000 to 1,00,000 in India. Rural people buy their 90% of durables from these towns- i.e. MARKET.

• Economic Environment:• In Rural area the higher income class has grown by

more than 6 times. There is an increase in middle and upper-middle classes from 8.3% to 14.3% by 2000. And now in last 10 years it has reached to the level of 19%.

• Rural per capita income is increasing. Increasing incomes are changing expenditure patterns. More consumer durables are purchased in Rural Area due to increase in income.

• Per capita income is highest in Chandigarh in Urban, Semi-urban and Rural area and is lowest in U.P (in Urban); Orissa (in Rural and also in Semi-urban area).

• Per capita consumption expenditure in rural has increased FOUR TIMES in last 20 years.

• Rural population is spending 40% on Non-food items. It shows an encouraging trend for Consumer durables and non-durables.

• SOCIAL AND CULTURAL ENVIRONMENT: • The Social and Cultural environment in Rural area

is changing hence, people are buying branded products to show their up-graded social status. Rural people are buying following consumer and durable goods:-

• Some well established products:– Pressure cooker, Artificial Jewellary– Cooking utensils, battery– Tobacco products, tea, Coffee, – Soap, detergent, sewing machine– Glass ware, electrical goods, fan, light items,– Bicycle, mobile phones, wrist watches– Construction materials– Consumable Agri. Products, Biscuits etc.,

Rural area requirements:

• 1. HOUSEHOLD CONSUMABLES:• More and better food• Better clothing• Medicines• Toiletries and Cosmetics• Educational supplies (Stationery)• Wines & Spirits• Cigarettes, Beedies and Beverages.

2. Household Durables:

• 1. Furniture• 2. Cooking utensils• 3. Electrical appliances• 4. Radio and Television sets• 5. Clocks and Wrist watches• 6. Sewing Machines• 7. Ornaments & Jewellery.

3.CONSTRUCTION MATERIALS:

• 1. For residences• 2. For infrastructure facilities• 3. For rural and cottage industries• 4. For business establishments (shops)• 5. For Society/Community institutions• 6. For School and Hospital use• 7. Other utilities

4.CONSUMABLE AGRICULTURAL INPUTS:

• 1. Manures and Fertilizers• 2. Seeds including Hybrid seeds• 3. Agro-chemicals (pesticides etc.)• 4. Petrol, Diesel, Oils and Lubricants• 5. Electricity.

5.Capital Agricultural Inputs

• 1. Tractors, Trolley & other implements• 2. Ploughing Disc, Leveller,• 3. Harvesters, threshers, Cutters• 4. Pump-sets –Diesel Engine, and EPS• 5. Pipes and fittings for irrigation • 6. Drip Irrigation equipment, Sprinklers• 7. Small Generator-set (for Electricity)

6.TRANSPORTATION EQUIPMENTS:

• 1. Bullock/Camel Carts• 2. Bicycles, Motor-cycles and Mopeds• 3. Jeep/Car• 4. Light commercial vehicles• 5. Three Wheeler (Auto)• 6. Small Road Transport Vehicles

7.SERVICES REQUIRED IN RURAL AREA

• 1. Banks and its branches• 2. Health clinics and Hospitals• 3. Educational Schools and Colleges• 4. Coaching Centers• 5. Transport facilities • 6. Communication and Courier Services• 7. Electricity supply on regular basis.

• It is up to the Marketing Companies or marketers to identify the needs of different areas and fulfill them accordingly.

• Role of Print Media is very important in Rural Area. Daily newspaper can play a big role to highlight any consumer/ durable product for rural area.

• In Kerala, Maharashtra and Karnataka some daily newspapers are playing very important role and buying behaviour is different from other states.