Syama.k.

RURAL MARKETING
Rural marketing is a two-way marketing
process that includes the flow of good
and services from rural to urban areas
and the flow of goods and services from
urban to rural areas, as well as the flow
of goods and services within rural
areas.

NATURE OF RURAL MARKETING

The rural market is quite different from urban
markets.
Agriculture is the chief economic activity in rural
areas, the entire village population is associated
directly or indirectly to agriculture.
In the process of development of civilization
agriculture and pastoral life along river banks are the
first of settled life.

Importance of rural marketing

Size of rural market
Rural target population
Employment
Better living
Contribution to national income
Increase in farm income

Rural products
Rural products are the results of the
art of agriculture and allied activities.
In a narrow sense,rural products refer
to the products arising out of the
cultivation, namely various crops,
vegetables and fruits etc.

Types of rural goods

Industrial goods
consumer goods
Industrial goods:-industrial rural goods are
those use for further industrial processing.
e.g. tabacoo, fibre crops like cotton and
jute.
Consumer goods:-goods are mean for direct
use like all foodgrains, dairy product,
poultry products vegetables and fruits.

MARKETING MIX FOR RURAL

MARKETS
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 a markets
The marketing mix is a crucial elements of any marketing
plan as it offers marketers a mix of products, services
and prices, utilizes a promotion mix of advertising, sales
promotion, direct marketing and personal selling to reach
the target customers through distribution channels
The 4 Ps of the marketing mix remain the same, both in
urban and rural markets. However, marketers need to
meet the challenges of 4as

The 4 Ps of Marketing: A re-look

from the rural perspective
The basic marketing-mix tools remain the
same both in rural and urban markets, but it
is the challenges of the 4 As that compel
the marketer to revisit the marketing tools
when he ventures into rural markets

Availability
Total 6,38,000 villages in India; 742 million
Indians live in rural areas
HUL : strong distribution system to reach the
interiors of the rural market
Coca-Cola : evolved a hub-and-spoke distribution
model to reach villages
LG has set up 45 area offices and 59 rural /
remote area offices

Affordability
Low disposable income, daily wage earners attract small unit
packs.
Godrej : introduced three brands of Cinthol, Fair Glow &
Godrej in 50-gm. packs, priced at Rs 4-5 for MP, Bihar & UP
the so-called BIMARI states
HUL : launched soap brand Lifebuoy, at Rs. 2 for 50gm.
Coca-Cola : Introduced 200-ml glass bottle at Rs. 5. The
Sunfill, a powered soft-drink concentrate, sachet of 25gm
priced at Rs. 2

Acceptability
The third challenge is to gain acceptability for the product
or service
LG Electronics : developed customized television christened
it Sampoorna. It was a runway hit, selling 1,00,000 sets in
the very first year.
Coca-Cola : provides low-cost ice boxes, that is a tin box for
new outlets and a thermocole box for seasonal outlets
considering lack of electricity and the absence of
refrigerators in rural areas

Awareness
Only 41 percent of rural households have access to
televisionbuilding awareness
HUL : relies heavily on its own company-organized
media. These are promotional events organized by
stockists
Godrej Consumer Products : uses radio to reach the
local people in their own language
Coca-Cola : uses combination of television, cinema and
radio to reach 53.6 percent of rural households
LG Electronics : uses vans, local-language advertising
and road shows to reach rural customers

Examples of rural marketing

mix
ICICI BANK customized their rural ATMs, so they can
operate biometric authentication. ICICI rural ATMS
are battery operated so that power failure is not
issue.
Bank of India introduced Bhumiheen credit cards for
providing credit card facilities to landless farmers.
Noika develop affordable Mobile phones for rural
markets with unique features such as local language
capabilities, present time/ call limits etc.

SHAKTI

Operation
JAGRUTI

Parachute

ASHA

Rural initiative targeted villages population less than

2000, providing income generating opportunity through
shakti vani

OPERATION Jagruti, a village consumer contact

campaign was launched with the objective of
massive rural penetration targeted at the non-users
and
infrequent
users
of
dentifrices.

Anti Loose Campaign and Temper proof Packaging

Smaller Variants

Low cost snacks & Beverages

aged between 12- 16.

in

. Especially for girls

BIJLI

Launched New Refrigrtor for Rural and Semi urban

market priced at 10,000

SAMPOOR
NA

Range of TVs with Devnagri script on display Priced at

12,000

MAHASAN
GRAM

Focusing on rural town with population less than 5000

with special economy model of color TV priced at 8000

SAPNO KA
GHAR

Road Show in semi urban & Rural with mid priced

consumer durables to provide Touch & Feel experience

Problem and difficulties faced in

rural marketing
Lack of proper communication
Distribution problem
Seasonal demand
Low literacy level

Attractiveness of rural market

Rural markets have become the new targets to
corporate enterprises for two reasons :
1. Urban market has become congested with
too many competitors.
2. The market have reached a near saturation
point.

Various factors which have made rule

markets viable:1. Large population
2. Raising prosperity
3. Growth in consumption
4. Life-style changes
5. Market growth rates higher than
urban
6. Rural marketing is not expensive
7. Remoteness is no longer a problem

In 1998 HuLs personal products unit initiated Project Bharat,

the first and largest rural home-to-home operation to have ever
been prepared by any company. The project covered 13
million rural households by the end of 1999.
During the course of operation, HuL had vans visiting villages
across the country distributing sample packs comprising a
low-unit-price pack each of shampoo, talcum powder,
toothpaste and skin cream priced at Rs. 15. This was to create
awareness of the companys product categories and of the
affordability of the products.

Khaitan fans' ad on a horse cart

The greatest challenge for advertisers and

marketers continues to be in finding the right
mix that will have a pan-Indian rural appeal.
Coca Cola, with their Aamir Khan ad
campaign succeeded in providing just that.

"Yaara da Tashan... ads with

Aamir Khan created universal
appeal for Coca Cola

"Yaara da Tashan..." ads with Aamir Khan

created universal appeal for Coca Cola
Coca-Cola India tapped the rural market in a
big way when it introduced bottles priced at Rs
5 and backed it with the Aamir Khan ads. The
company, on its behalf, has also been investing
steadily to build their infrastructure to meet the
growing needs of the rural market, which
reiterates the fact that this multinational has
realised the potential of the rural market is
going strength to strength to tap the same.

For HLL, a one rupee or a five rupee sachet or the

Kutti Hamam (the small Hamam) helps in giving the
consumers a trial opportunity. While it does help in
generate volume but not in terms of values. "Till the
time that volume - value equation is managed better.
Ultimately, the ball lies in the court of rural
marketers. It's all about how one approaches the
market, takes up the challenge of selling products and
concepts through innovative media design and more
importantly interactivity.

Amul is another case in point of aggressive

rural marketing. Some of the other corporates
that are slowly making headway in this area
are Coca Cola India, Colgate, Eveready
Batteries, LG Electronics, Philips, BSNL, Life
Insurance Corporation, Cavin Kare, Britannia
and Hero Honda to name a few.

Satellite dish antennas reach rural

India

In 2000, ITC took an initiative to develop

direct contact with farmers who lived in farflung villages in Madhya Pradesh. ITC's Echoupal was the result of this initiative.

So the fact remains that the rural market in

India has great potential, which is just waiting
to be tapped. Progress has been made in this
area by some, but there seems to be a long way
for marketers to go in order to derive and reap
maximum benefits. Moreover, rural India is
not so poor as it used to be a decade or so
back. Things are sure a changing

Typical shop in rural India stocked

with sachets, etc