CHAPTER 4 & 5

• Consumer Behaviour
• Rural market Research
CONSUMER BEHAVIOUR
 Introduction
• Factors affecting consumer behaviour
• Consumer buying process
• Opinion leadership process
• Diffusion of innovation
• Brand loyalty
 Factors affecting CB
• Culture
• Subculture
• Social factors
• Technological factors
• Economic factors
• Political factors
 Culture

• Collective social sanction:

• Societies are bound by definitive norms being followed by set of the people . This norms
dictate the ways and means of behaving ,working addressing and conducting ourselves
in society.

• In rural India these norms are strong and rigorously followed too.

• Violation of these norms can even lead to cast out of the society.
 Influence of social customs
• Social custom
• Customs are socially accepted norms that have been in practice
over a long time .In urban India due to due to course of time
customs are fading away . Eg; touching feet of elders

• Traditions
• Traditions are the long standing beliefs that are believed to be true
in nature and often practiced in a ritualistic manner, without knowing
the origin or questioning the need to do so.
• Rural people are staunch believers in traditions.
• Eg; washing hair and leaving open calls evil spirits.
 Influence of caste
• Cast play a key role in behaviors of community . In rural India ,the
upper caste and lower cast differences still continue and are
considered an important facet of everyday life.

• There is a clear demarcation in the villages for house making, two

areas , including natural resources such as drinking water and
grazing land for cattle.

• In urban limited physical space and pressure on limited available

natural resources , interaction based on economic status and
vocations rather than on basis of caste leads to an absence of such
division.
Funeral in rural India
 SOCIAL CLASS

Socio Economic Classification (Urban)

•Unskilled/Skilled workers
•Shop owners/Industrialists
•Self-employed professionals
•Clerical/salesman
•Supervisory level
•Junior level Officers/Executives
•Senior level Officers/Executives
Socio Economic Classification (Rural)
• Landlord farmers, educated, exposed to urban
environment, aspiring to match urban lifestyle,
technology adapters, owns tractors, two wheelers, music
system.
• Rich farmers with about 5 acres of land, may not be
educated, with friends and relatives in urban and consult
them for technology adaptation, status conscious, owns
tractors, two wheelers, TV.
• 2-5 acres land, manage small savings, opt for time
tested technology, owns TV, tractors.
• Little or no land, agricultural labour, living below poverty
line .
 CHANGING BEHAVIOUR
• Return of people from urban
• Information technology
• Communication
• Explosion of Media

FAMILY
• Individualized Joint Family

ROLES and STATUS

• Urban- Social standing or Material wealth
• Rural- Occupation, Caste
 PRODUCTS AND STATUS SYMBOL
• Urban- Features
• Rural- Ease of operation
SOCIABILITY
TECHNOLOGICAL FACTORS
ECONOMIC FACTOR
 Characteristics of
Rural Consumer

Characteristics of rural consumer

• Consumer behaviour is a complex phenomenon that is
influenced by various factors such as income, occupation,
education, lifestyle and geographical location.

• Using a single factor would be misleading.

 Personality &
Psychological
Factors

Perception
& Lifestyle
Brand belief

Characteristics of
Rural Consumer
Occupation
Age & &
Stages of Income
Lifestyle

Personality
Economic &
Circumstances Self-concept
 CONSUMPTION BY AGE & STAGES OF LIFE CYCLE
LIFE-CYCLE
AGE RURAL URBAN
STAGE
Video games,
chocolates,
Below 12 Child Toys, ice candy, daliya
beverages/health
drinks
Bicycle, television, Cell phones,
13-19 Teenage
cinema motorcycle, internet

Motorcycle, telephone,
LPG, Car, PC, branded
20-40 Young Tailored/unbranded clothing, alcohol,
clothes, local liquor, stores/malls
haat

Tractor, kisan-credit Luxury car, credit

40-60 Middle Aged card, postal savings, cards, house, health
mela insurance, holiday trips

Chaupal, playing
Above 60 Old Clubs, theatre, parks
cards, pilgrimage
RURAL BELOW 12 YRS URBAN
RURAL 13-19 Yrs URBAN
RURAL URBAN
20-40 Yrs
RURAL 40-60 Yrs URBAN
 Personality
• Sum total of unique individual characteristics that determine
how a person responds to the environment.
• Tendency to buy the products which suit our personality.
• Self image is the way we perceive ourselves in a society.
• In the rural market, purchase depends on situation and
person.eg. Pan Masala in rural, Popcorn in urban
• The rural customer is content to satisfy basic
needs.
• Persuasion necessary to convince a customer.

• Peer pressure not very relevant

• High esteem but content with everyday life.

 Perception and Brands

• Perception plays a major role in purchase

behavior for the rural consumer.
• Quality and price influence the perception of the
consumer.
• Barrier to level of trial and acceptance of products

• Rural customer trusts government services

 Information Search and Pre Purchase
Evaluation

• Prefers getting information from opinion

leaders rather than media.
• For high involvement products, information
may be obtained by visits to company outlets
• Touch and Feel experience is very important
in the current scenario
 Rise of Consumerism
• Rural people working in urban India
increasing
• Gifts from urban people
• Migrated village folk – New Class of
Opinion Leaders
• Rural Consumer – Ready to buy products
that are not basic necessities
 Consumer Buying Process
• Level of involvement depends on factors
like
– Price
– Availability
– Variety
– Knowledge
– Purpose
Eg. Wristwatch, Cereals and Pulses, Medical
Services
 Stages in Buying Process
• Problem Recognition – NA for rural
consumers
• Information Search – NA for rural
consumers
• Evaluation of Alternatives
• Purchase Decision
• Post Purchase Behaviour
 Buying Roles
URBAN RURAL
Young Man INITIATOR Son
Colleagues INFLUENCER Urban
Relatives
The Young Man DECIDER Father
The Young Man BUYER Relatives,
Friends
The Young Man USER
Father,Son
 OPINION LEADER PROCESS
• Power to influence other
• Can be non verbal
• Urban OL having specialized knowledge
• Gram Pradhan or Sarpanch, Ex. Alwar (John Dheere)
• School teacher restricted among school going student
• Influenced college going student by urban life style

• Increasing exposer to education, the media, awareness

of technology has given new power to youth.

• Mainly in rural area OL influence about product which

have direct impact their occupations and sources of
livelihood
 Rural Opinion Leader

• Sarpanch/Gram Pradhan-Village

administration, resolving social & family conflicts, introducing

new idea of farming, purchase of new products on farming.

• College educated youth/villagers working in urban centers-

Influence in family and neighborhood, on purchase of durables
like refrigerators, TVs, motorcycles
 Understanding rural youth

• Literacy level rising

• Education not considered to be a learning process but a
gateway to a job or livelihood
• Government job is a dream
• Job security, power, less work responsibility, higher social
status & post retirement benefits
• Migrated person from his own community and made it big is a
role model for rural youth
• Younger generation prefer trouser, shirts & t-shirts instead of
traditional Dhotti & Kurta
• Youth prefer simple sober colours, branded clothes now taking
place
• Action movies, cricket match, serials & music programme are
most watched
• During playing cricket consumption of cold drinks & bubble
gum is more
• Cold drinks is taking place instead of Nimbu Pani & Lassi
• Easily recall action involve & personality driven commercials
• Home made wafers & sevaiah are preffered as snakes
• High awareness of FMCG product, like toothpaste, (Colgate,
pepsodent) soaps (Lux, Lifebuoy)
• In vehicle category motorcycle commonly used because of
macho style
 Diffusion of innovation

• Due to a long chain rural consumer are less exposed to product

& services evolving regularly in the market

• Due to low level literacy consumer is also limited in his or

desire to adopt innovations

• The concept of adoption of innovation is same in urban &

rural, but the role played by different consumers in different
stages varies
Urban profile
Young, public-school educated,
in business, fun loving, credit
card holder
Young, educated, employed in
MNC, exposure to media
Young, married, disposable
income, self employment/in
service
Middle aged, in service/self
employed, opts for consumer
schemes
Middle aged, in service, shops in
neighborhood
Type of consumer Rural profile
Innovator Young progressive farmers, urban
exposure, additional income (part
time service, agent
Early adopter Rich farmer, high disposable
income, urban exposure, high social
status
Early majority Mediocre farmer, member of
cooperative society, willing to adopt
technology products
Late majority Hesitates to take agri-loan, member
of cooperative society, adopt only
time tested technology
Laggard Marginal farmer using traditional
forms of cultivation
 Brand loyalty (Stickiness)

• Due availability of more choice now evaluation

parameters increasing for making choice
• 80% of FMCG sold in rural markets are branded either
national or regional (less than 50% availability)
• Ex. Ghari, Parle-G, Lux, Fair & Lovely, Colgate
• Ghari gives customer satisfaction and solve primary
objective of the consumer
• Mahindra village, Escort village
• Relation building concept lacking in rural market
• Brands like “Kala Ghora” in Rajasthan & “Lamsa” in
Maharashtra convince their regional customer

• Ex. Veldanda village in Andra Pradesh

• Customer relationship maintained by social interaction &

extension of credit

• Ex. In small town shopkeepers gives “freebies”

CHAPTER 5

CHAPTER 5
 Rural Market Research
Rural Market Research
 Planning Research
• Research objectives includes the perfect
roadmap to entry in rural markets
• Investigative and exploratory in nature
• Requires a small sample size
• Types of rural studies includes
4 As
U&A or KAP
Feasibility
Promotion distribution channel
 Primary data collection
• Mostly secondary data are available
• Data collection method includes focused
group discussion and in depth interviews
• PRA (participatory rural appraisal) is the
best method by which people share
enhance and analyze their knowledge of
life and conditions to plan and to act
PRA FGD
Large and Small and
heterogeneous homogeneous
Expression is verbal and Only verbal expression
nonverbal
Information flow is more Moderators role is high
natural
Attitude and behavioral Action oriented
change oriented
On the spot analysis Analysis by moderators
 PRA Tools
• Social mapping used to capture house
location and caste distribution
• Resource mapping used to capture
availability of resources
• Seasonality diagram is used to get
infotmation on basis of seasons
• Venn diagram deals with various issues
with their importance
 Measurement and scaling methods
• Faces for rating includes various faces
and respondents give their opinion about
the product by indicating the face
• The rating is from 5 to 1
• Most effective tool
 Wheel with different colours
• The colours are selected on the basis of
their association with certain values
among rural people
• Dark green represents HARYALI with a
rating of 5
• Extreme black represents death or doom
which is considered to be worst
• The remaining colors are orange yellow
and red
 Ladder
• A small bamboo ladder with a number of
rungs corresponding to number of items to
be compared is constructed
• A high rung implies a higher rank
• But it is not a good rating tool
 Questionnaire design
• GIGO principle is applied
• Questions should be simple and direct
• Should be self explanatory
• Should not be ambiguous
• Should have a logical flow
• Should be in local language
 Sampling
• Population spread
• Scattered and remote village
• Heterogeneity
• Sampling process is complicated
• Includes village sampling that covers population
occupation religion tribal population
• Respondent sampling
• Sample size determination
Field Procedures & Rural Market Realities
 Do’s & don'ts in rural market
research
• Wear simple clothes

• Should either be familiar with local dialect or

ask an educated resident to accompany you

• Invest time in establishing rapport with

interviewee

• Conversation should be gradually build up

• Make purpose of study clear and gain their trust and
cooperation

• Make respondent a part of research project and tell

him that his responses are really important

• Give importance to interviewee by actively listening

to his concerns

• Rural people can handle only limited information at

time
• Make him feel that he is leading the interview

• Interviewer should talk a good deal about general

topics

• Interviewers should avoid being overfriendly

• Issues sensitive to respondents should be carefully

handled
 Attributes of Rural researchers
• Mindset

• Effective Communication

• Discerning abilities

• Patience
 Location for conducting research
• Caste neutral

• Easy to locate

• Easy to find people

 Location for conducting research
 Retail shop/ STD booth
 Tea stall
 Play ground
 Chaupal
 Haat
 Interviewee & Interviewer
 Who is to be interviewed?

 When?

 By whom?
Urban researchers sensitized to rural realities
NGOs
Researchers should not be Government officials
 Limitations of Rural Research
• Low literacy level

• Poor media exposure, low product and brand

awareness

• Local language communication

• Scattered and remote village, inaccessible road

• Social taboos; difficulty in interacting with women

• Interview timing

• Revalidation of data
 Major Research Organizations
• National Council for Applied Economic
Research (NCAER)
• Social and Rural Research Institute
• AC Nielsen ORG-MARG
• MART
Thank You