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Marketing Mix ‘refers’ to the set of actions,tactics, tools or variables that a company uses to

promote and sells its brand or product in amarkets

Rural Marketing Mix



4 Ps of Rural Marketing

Every Product and promotion, which is a hit in cities , might

not work in rural areas

Product Price

PlacePromotion





Product :Product’ refers to anything that is capable of

or can be offered to satisfy need or want?

Price :Price refers to the amount the customers has to

pay in order to acquire a product or services

3C’s of Pricing

Customer Value

Competitors Prices

Cost of Company



Place : refers to point of sale.

Promotion: This refers to all the activities

undertaken to make the product or service known

to and preferred amongst the user and trade.



Product

Product for rural market must be built or modified to suit the lifestyle and needs of the

rural consumers .

Product Strategies1. New/Modified Product.

2. Utility Oriented Product

3. Avoiding Sophisticated Packaging

4. Application of value Engineering.

5. Small unit packaging



New/Modified Product Designs – The research,

Manufacturing and marketing departments need to

think in terms of new product design speciallymeant for rural areas, keeping in view their styles.

The rural product usage environmental factors

must be considered while developing the products

meant for the rural audience. Nokia 11oo Model isa very good example of a customized model for

rural markets.

Utility Oriented Products – The rural consumer

are more concerned with the functional utility of theproduct than its appearance and sophistication.

Therefore, unnecessary frills can be taken off the

product for rural market as the rural consumer is

not likely to use them and this will make theroduct more affordable too. This will also reduce



Avoiding Sophisticated Packaging – Rural consumer

are more interested in the sturdiness and utility of the

product; it is possible to avoid sophisticated packaging,

which adds to the cost considerable

Application of value Engineering – To evolve

cheaper but quality products, companies need to go for

value engineering and substituting the costly raw

material with the cheaper one.

Small Units Packaging – Given the low per capital

rural income and purchasing habits of the rural

consumer, small unit packages stand a goodchance of acceptance in the rural market.There is a

generally held belief that small packs are good for

rural markets while large ones are good for the

urban markets .



Price

The villagers due to their limited resources are

very price sensitive by nature.

Pricing Strategies

Large Volume –low margin

Overall Efficiency And passing on benefits to

consumers.

low cost/ value for money product

Low volume-low price.



Large Volume Low Margin : Rapid or slow Penetration

strategy – Marketers have to focus on generating large

volumes and not big profit margins on Individual products. If

they price their product at a level which can lead to goodvolume, then they can still generate good returns on the capital

employed.

Low cost/ value for money products- This follows from the

product strategy. The price can be kept low by smaller unitpackaging or re-engineering. No frill functional products at a

low cost are perceived to have better value in the rural market

than higher priced, value added products, with features that a

rural consumer is not going to use.



Overall Efficiency & Passing on Benefits to consumer – For

rural products , the strategy should be to cut down the

production, distribution and advertising costs and passing on

these benefits to the consumer to further increase the turnover.Most often , it has been observed that advertising has less to do

with product sales in the rural areas. If an organization right,

then it can work in the rural market.

Low volume –

low price strategy- This strategy of reducingprices by reducing the package size in order to make it appear

more affordable, is delivering very good results for a large

number of FMCG product categories, in the rural markets of

India. In categories where maintaining the price point is

extremely critical, this strategy is delivering very good results



Examples

Godrej recently introduced three brands of Cinthol, Fair Glowand Godrej in 50-gm packs, priced at Rs 4-5 meant specificallyfor Madhya Pradesh, Bihar and Uttar Pradesh.

Hindustan Lever, among the first MNCs to realise the potentialof India's rural market, has launched a variant of its largestselling soap brand, Lifebuoy at Rs 2 for 50 gm



Place

A village as a place for promotion, distribution, and

consumption is very different from town or city)

Place Strategy

Segmentation Coverage of villages with 2,000 and above

population

Distribution up to feeder markets/ Mandi towns.

Direct Contact with rural Retail



Segmentation- The number of village in India is

huge and it is not viable to contact and serve all the

village directly therefore, companies or distributors

can carefully examine the market potential of different

village and target the village that can be served in a

financially viable manner through an organized

distribution effort.

Coverage of village with 2000 and abovepopulation- By organizing distribution up to this

level, the percentage of villages covered, comes to

only 10 % of all the village, but the rural populationcovered will be substantial, to the extent of about 40

% to 45 %. With a distribution network in about

55000 villages, which have a population of 2000

person and above each, one can cover about 25

crore rural consumer. This strategy is good to begin



Distribution up to Feeder Market/ Mandi Towns-The feeder market and mandi towns offer excellent scope

for distribution, especially for consumer durables. The

rural consumer visit these towns at regular intervals, not

only for selling their agricultural produce but also for

purchase of cloth, jewellery, hardware, radios, torch cells

and other durables and consumer products. But consumer

goods companies have to now think beyond these towns

and block headquarter.

Direct contact with Rural Retail- Along with the efforts

of wholesalers and dealers, companies need to have‘direct points of contact’ with retailers and sub-retailers in

the rural areas . If they want to have a strong network.

There is no substitute for stretching direct communication

to the village level.



Promotion

Promotion aspect always creates a challenge in ruralmarkets because of the fact that village have thinpopulation density and are widely spread over large

remote areas. NCAER conducted survey to study the socio

economic effects of advertising ; the India Society of Advertisers sponsored this survey. It covered 3,836

household in 50 towns and 50 rural district in 10states. It showed a clean rural – urban divide, 16% of rural and 25% of urban customers felt thatadvertising influenced them to frequently or alwaysbuy products they do not really need.



Media Vehicles

The marketers has to develop an appropriate

combination of traditional mass media and

unconventional media for different regions to take the

message effectively to the rural audience.



Mass Media: When it comes to rural market, two

out of five Indians are not reached by any media:

TV , Press, Radio and Cinema put together.

Television

Radio

Print media

Cinema Hoarding/Wall Painting

Unconventional Media- Media, as perceived in the

urban market, does not cover as much as 43% of rural

India. This means that organizations must think of

innovative ways of reaching the rural consumer. Haats,

mandis and meals are opportunities in the form of

unconventional ways to really reach the ruralconsumer.



Additional Ps of RuralMarketing

Passion

Passion to earn Goodwill for the company.

Passion to serve and educate the consumer

Passion to give 100% to the rural marketing effort

Pace

Product intended to be sold in the rural market need to be

launched into the heart of the customers, at the pacerequired in the rural market and not at the pace at which

the company wants it to be.



Examples of rural marketing mix

Noika develop affordable Mobile phones for rural markets with unique features such aslocal language capabilities, present time/ calllimits etc.

Philip develop a TV ‘ Vardaan’ for ruralmarkets. This TV work on the voltage 90-270volts.

Philips developed ‘ Free Power radio’ this

radio do not require power and battery also. itrun on simple winding of level provided in theset. The price of this attractive set is Rs. 995.



LG developed CTV called’ CinePlus’ was

launched in rural markets price Rs.5000

Hyundai increases focus on Rural India New promotional scheme titled - ‘Ghar Ghar Ki Pehchaan'.

In this first of its kind initiative, Hyundai Motor would

extend special schemes for government employees in

rural areas and members of Gram Panchayats on thepurchase of the Hyundai Santro

Launched on May 1, the ‘Ghar Ghar Ki Pehchaan' scheme

will continue till July 31, 2008. Through this special rural

scheme Hyundai Motor India plans to touch base with atleast 58 per cent of Indian villages with a population of 500

or more.



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