Rural Market Environment

Forms basis for consumer decisions ,also for marketing

actions.
Use S-T-E-P model:
S - population, households, education, literacy,
reference groups, folk arts/ entertainment, hatts, melas.
T ICT, electrification. Pucca houses ,Digitalisation
E- Occupation, land-use/ holdings / distribution,
irrigation levels, Incomes, savings, disposable incomes,
rural credit suports,retail outlets, micro finance activity
etc
P- Panchayat raj, development initiatives,

Or- analyze as Demographics, Physical, socio cultural,

political, technological, economical,

Marketing decisions and environment

1- demand estimation

2-S.T.P.

3-Product decisions

Demographics etc

Psychographics, usage levels etc

Income, quality consciousness, brand

awareness, consumer preferences,
competition, technology developments etc
Disposable incomes, demand, per capita
consumption ,competition, input cost levels

4-Price decisions

5-place decisions

6-Promotion decisions

Channel availability, distribution facilities, ICT

developments, location etc

Media availability, costs, habits, target

customers, competition etc

 Demographic environment
Rural population growth additional 200 millions in last two decades- 629 in 1991
and 826 in 2010
Households 112 millions in 1991 to 165 millions in 2010
Joint families to nuclear
1/3 rural population in consuming class of 15 34 years
Education20% population SSC/HSC pass
Rural Literacy from 53% to 63% in last 10 years
Occupationfarm to non-farm shift
Reduction in agri labor
Supplementary occupations
Land ownerships
Land fragmentation
Income-

Rural constitutes 56% share in total income

Per capita rural income increased from Rs-11227 in
2005 to 15173 in 2010
Income growth faster in rural and future projections
shows higher incomes with large population
Physical environment
Scattered
Villages with less than 500 population- 37%
Next level between 500 to 2000 population 46 %
2000 to 5000- 13%
5000 + 4%
Prosperity more in 2000+ , more shops etc ,also
account for 50 +rural population
% of Kuccha houses
coming down fro 23 % in 2001 to 14% in 2010
The socio cultural environment-

Socio cultural regions and sub regions

Caste, linguistic groups differ Lifestyles and
consumption patterns
90 distinct SCR in our country being used for media
surveys etc- provides homogeneity reference for STP
Village community-village administrations, caste
system
The political environment
Panchayat raj institutions
Gram sabha - roles, group grampanchayats
The technological environment
Rapid mechanizationuse of animal power to tractor
Use of tractors increases from 30 % to 46 % in last 10
years
ICT revolution
Information access and network
The Economic environment

Subsistence to commercial farming opened up

consumption of many goods and services
Cash crops
Better MSP
Non-farm support
Developmental activities
Contract farming
Rural enterprises
Increased from 17.19 millions to 25.54 million in last
10 years in farm and non-farm sector
Changing MigrationsRural employment opportunities increasing provides
stable pattern
Income expenditure patterns- NCAER surveys ,
+shifts
Income disparity- reduction in bottom profiles
Rural spending- + shifts for travel, personal care,
recreation, education, healthcare, - shifts for food

RURAL ECONOMY-sources
FARM SECTOR
(AGRIL & ALLIED)

NON-FARM SECTOR
(FORMAL& INFORMAL)

AGRICULTURE

RURAL INDUSTRIES

RURAL SERVICE

ANIMAL HUSBANDRY

AGRO PROCESSING

RETAILING &
TRADING

HORTICULTURE

FORESTRY
FISHING

MANUFACTURING
HANDLOOMS
MINING &
QUARRYING
CONSTRUCTION

COMMUNITY &
SOCIAL

TRANSPORTATION
COMMUNICATION

 Rural Infrastructure
MGNREGA,BHARAT NIRMAN
Increased budgets
Road connectivity- PMGSY
All weather connectivity to all habitations
Electrification
Increased from 48 % households to 60 percent - 2001 to
2008
Rajiv Gandhi grameen vidyutikaran yojana
Rural housingIndira Awas yojana
Telecommunications
Teledensity increased in rural fro 1.2 to 26.4 -2002 to
2010
Subscriber base in progressively increasing in rural
Drinking water
Postal servicestotal-1,55,618,rural-p.o. 1,39,081
rural bank network of 30977 branches

 Media habits Radio a cost effective media in rural, f.m. channels

penetration
Interests in news papers increasing
Internet-5.5 mn rural users and penetrating fast
State wise reach of medias-83% TV in goa and 62%
print in Kerala
Gender based media penetration- TV 39% men 35%
women,radio-22:13, print-20:7,cinema-4:1
Non-conventional forms of media
Advertisers choice of media?