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Project REPORT
ON
PROF. G. M. JAYSHEELAN
2
A
Project REPORT
ON
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DECLERATION
The Live Rural Marketing Project is meant to bridge the gap between the real-life
business and academic Knowledge. It is a simulation of the business environment and
enables to experience the rigors of Rural Marketing Concept.
It provides opportunities to apply the concepts learnt in the class-room to real-life
situations.
Full care has been taken to make this report error free yet the responses collected
through respondent cannot be 100% error free and I hope I shall be excused for that.
Last but not the least I hope this research work will prove to be of some help and
it would applicable to ITC LTD. in formulating an effective and efficient marketing &
financial strategy.
DATE: SIGNATURE
4
Abstract
The project “study of soaps buying behavior of rural consumer” is prepared under
the guidelines of PROF. G M JAYSHEELAN (rural marketing faculty, KBS). This
project report provides a bunch of knowledge about the demand of different soaps
available in rural market as well as it also provides detail knowledge about
consumer preference towards different soaps.
The report also provides details about the history of soaps and Shampoos sector in
rural India. there is plenty of data analysis and conclusions are given in research
paper.
On the basis of feedback through questionnaire and observation method, I find out
that rural consumer has changed their strategy towards the products and start to
purchase them basis on their quality. As the result, there is close competition among
the companies. As each of companies are increasing their products, qualities, looks
and providing best services each days. Our analysis is based on sample results. It
was challenging as well as learning experience to gather the information from
respondents by meeting them personally in order to get questionnaire filled .there
was a lot of time pressure and unwillingness of respondent to respond.
(SUPERVISOR)
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INDEX
1 INTRODUCTION 7
2 SCOPE OF STUDY 8
4 LITERATURE REVIEW 13
5 SWOT ANALYSIS 14
6 RESEARCH METHODOLY 15
7 VILLAGE INFORMATION 15
8 QUESTIONNAIRE 16
9 DATA ANALYSIS 27
10 CONCLUSION 28
11 RECOMMENDATIONS 28
12 ANNEXTURE 30
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INTRODUCTION
There was time when FMCG companies ignored rural market, they took no interest
to produce or sell products in rural market in India. It was initial stage of FMCG
companies in India. As per the time had passed, the strategy and marketing style of
FMCG companies had changed.
BACKGROUND OF STUDY:
In 1970, Nirma was the first FMCG company to initiate and produced goods
according to the rural consumer. In early 1970s, when Nirma washing powder was
introduced in low income market, HLL reacted in a way typical of many
multinational companies . however, Nirma’s entry changed all Indian FMCG as
well as soap market scene . it became a great success story and laid the roadmap for
others to follow. MNCs like HLL, which were sitting pretty till then, woke up to
new market realities and noticed the latent rural potential of India.
Sales zoomed from 35,000 sachets to 12 lacks. Initially they took any sachet, but
after 3 months they restricted to chik sachets.
Now a days, rural market is most lucrative , opportunistic and most focusing sector
by major MNCs in India. Each and every company is set to invest huge capital to
competes in rural market. According to the FICCI, the number of rural household
using soaps products has grown from 136 million in 2004 to 143millon in 2007, it
is clear indication that rural consumers have shifted from commodities to branded
7
products . urban consumer, on other hand could go slow on FMCG expenses ,
thanks for inflation spiral, rise in fuel cost and costlier credit. The evidence shows
that first time rural market grow faster than urban market in key product category
April- may 2008, the latest month for which information is available , according to
the market research firm AC Nielsen.
In those days, rural market is one of the best opportunities in FMCG sector in
Indian market. It is wider and less competitive market for FMCG. As the income
level of rural consumers increasing, the demand of FMCG products is increasing
continuously.
PROBLEM DEFINITION:
The study of opportunity of Soaps and Shampoos in rural market is sum total of
deferent analytical survey of different Soaps and Shampoos in rural market. In one
sense, we can say that it is determination of how much market is captured by
different Soap and Shampoo companies.
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SCOPE OF STUDY:
With the population of 1 bn people, India is a big market for FMCG companies.
Around 70% of total household in India reside in rural area . total number of rural
household is expected to rise from 135m in 2002 to 153m in 2010, which
represents largest potential market in the world.
Urban Rural
Population 2001-02(m household) 53 135
Population 2001-02(m household) 69 153
% distribution (2001-02) 28 72
Market (towns/villages) 3768 627000
Source: Statical outline of India (2001-02), NCAER
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An average Indian spends 40% of his income on groceries and 8% on
personal care products . a larger part of total spending pie along with
large base(population) makes India largest FMCG market.
spendind pattern(%)
saving, 4%
others,
11% clothing,
9% personal care, 8% saving
clothing
personal care
entertainments
, 30% grocery
Rising per capita income, increase literacy and rapid urbanization has caused
rapid growth and change in demand pattern. The rising aspiration levels,
increase in spending power has led to change in consumption pattern.
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LOW PANETRATION AND LOW PER CAPITA CONSUMPTION:
PENETRATION (%)
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OBJECTIVES:
HYPOTHESIS:
LIMITATIONS:
While surveying I encounter with some problems like some people were not ready
to respond and few of them who responded were in hurry hence the active
participation was lacking.
Threats to me were that people were hesitant to give income related information so
there is chance to error regarding income.
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LITRATURE REVIEW:
Rural market is one of the best opportunity in India for soaps and shampoo sector.
In this sense, I can say that rural market is future of FMCG(soaps and shampoos).
As the research of PURBA BASU (FACULTY OF ICFAI, B. SCHOOL), The
lifestyle of rural consumers is changing. Rural market and marketing strategy have
become latest marketing buzzword for most of FMCG majors. She added the
strategies of different FMCG companies for capturing rural market like Titan’s
sonata watches, coca cola’s 200ml bottles, different marketing strategies of HLL
and Marico Ltd. She takes into consideration the study of national council for
applied economic research (NCAER). According to the NCEAR projections, the
number of middle and high income household In rural India.
India is expecting to grow from 80 million to 111 million by 2007. In urban India
same is expecting to grow from 46 million to 59million. Thus , absolute size of
rural India is expecting to grow double that of urban. increasing demand. Factors
like village psyche, strong distribution network, and market awareness.
This implies that rural market has huge potential for marketer to meet up the are
few prerequisites to make dent into rural markets. the model is of the stolid Dutch
Anglo conglomerate UnileverGroup, which has enjoyed century long presence in
India through its subsidiary Hindustan lever Ltd. It was Hindustan lever Ltd which
several years ago popularized Idea of selling its products in tiny packages. Its
sachets of detergent and shampoos are in great demand in rural Indian villages.
Britannia with it low priced Tiger biscuits has become success story in rural
market. The characteristics of rural market in terms of low and spared out
population and limited purchasing power make it difficult market to capture. The
bottom of pyramid marketing strategies and 4 P’s model of availabilities,
affordability, acceptability and awareness provide us with a means of developing
strategies to tackle marketing issues to marketing soaps and shampoos in rural
India. some successful stories like Garmin phone in Bangladesh .
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SWOT ANALYSIS
Strength Weakness
Trusted Brand
Opportunity Threat
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RESEARCH METHODOLY :
Sample design :
sample unit: working people, school students, unemployed and housewives i.e.
males and females irrespective of their education level .
Sample size: 50
PRIMARY DATA:
Primary data collected through self administrated questionnaire. The aim of this
questionnaire to gather the information of various branded soaps and shampoos
reach among the rural consumers and what are the benefits of products and
accordingly the perceptions of consumers.
SECONDRY DATA:
Secondary data was collected through magazines, research papers and Internet.
QUESTINNAIRE DESIGN:
As questionnaire is self administered one, the survey is kept simple and user
friendly. Words used in questionnaire is easily understandable to all respondent and
technical jargons avoided to make it most worthwhile without any confusion to
respondents.
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VILLAGE DETAIL
Market day - No
Village functions -
1).Lifebuoy (46)
3).Dettol (30)
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4). Santoor (10)
5).breez (33)
6).godrej (12)
7) .Sinthol (16)
9).Nirma (36)
10)Vivel (7)
7) . Sinthol (0)
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5. since when you are using this soap?
1).Lifebuoy (16)
3).Dettol (9)
5).Breez (3)
6).Godrej (1)
7) .Sinthol (0)
9).Nirma (9)
1). One time (31) 2).Two times (17) 3). Three times (2)
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10. What do you consider while buying the soap?
a).week 1(38)
b) week2(2)
c) week3 (0)
d) week4(10)
a) Retail (39)
b) Haats (2)
c) Mandis (0)
d) Melas (0)
e) Nearby village/town( 6)
f).others (3)
a) Fairness (10)
b) Freshness(31)
c) Softness(4)
e) others specify(0)
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14. How much money(in Rs.) you spend to buy the soap?
b) 5> 10 (32)
a) TV (23)
b) NEWSPAPER (17)
c) Magazine (2)
g) Radio (7)
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The 50 respondents in a village are studied using the following scale for
question nos. 18-24
18. Local influential persons are the best source for awareness of FMCG product
20 17
15
15 11
10
5 5
0 2
strongly Agree
Agree No
Disagree
opinion strong
Disagree
21
19. “BUZZ”: are used as a source of information
20 14
13
10
8
5
0
strongly Agree
Agree No
Disagree
opinion strong
Disagree
22
20. ”BUZZ” are used to choose a brand
15
15 12
10
10
8
5
0 2
strongly Agree
Agree No
Disagree
opinion strong
Disagree
23
21. “BUZZ” are reliable for product value
15 14 14
12
10
10
0
0
strongly Agree
Agree No
Disagree
opinion strong
Disagree
IV = 21
22. “BUZZ” are helpful to avoid risk
15 13
10 12
10
10
5
5
0
strongly Agree
Agree No
Disagree
opinion strong
Disagree
24
IV = ((Points in strongly agree X 2) + (Points in agree X 1)) – ((Points in strongly
disagree X -2) + (Points in disagree X -1))
20
20
15 13
10
6
5 4 7
0
strongly Agree
Agree No opinion
Disagree
strong
Disagree
25
24. Advertisements are not considered for decision making:
20
15 16
7 9 11
10
7
5
0
strongly
Agree
Agree No opinion
Disagree
strong
Disagree
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DATA ANALYSIS:
After a good deal of consumer survey and marketing research, I have collected
worthwhile data to make it valuable information in conclusion. The analysis of
those data’s is given below :-
30
30
25
20
15 12
10 6
5 2
0
LUX LIFEBOUY REXONA ITC' SOAPS others
BRANDS
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As per given in above chart, 90% of soap market share is captured by HUL. 50%
consumers prefer HUL’s LUX and 30% lifebuoy.
CONCLUSION:
In this analysis I found that a vast majority of rural consumers prefer LUX and
LIFEBUOY most trusted brands. But all these brands are costlier and entrance of
ITC’s soaps with vast of soaps varieties i.e. Superia for mass and de wills for high
income group population with competitive prices attracting rural consumers to use
ITC’s soaps.
RECOMMENDATIONS:
1) Company should held awareness campaign about ITC.
2) There should be oil ingredient in soap to replace external oil usage
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DATABASE OF RESPONDENT COLLECTED THROUGH SURVEY
ANNECTURE
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24 TULSIDAS M 26 9823885037 10TH FARMER 0.55
BHIKARI
25 UMESH PAWAR M 21 9623136832 12TH SHOP 0.90
TH
26 VIJAY GHARE M 24 9823396552 12 SERVICE 1.5
27 VIJAY GAIKHE M 31 9923608505 12TH SERVICE 1.2
28 DINESH M 17 9049373069 10TH SHOP 0.45
PADWARKAR
29 DATTARE M 24 9823851524 10TH SHOP 0.36
PAWAR
30 SUNIL KHADKI M 25 9664911242 7TH SHOP 0.45
31 DHNANJAY M 21 9637394305 9TH SERVICE 2.0
SATHE
32 SANTOSH M 26 - 10TH SHOP 0.35
DEVIDAS
33 SUDAM SOPAN M 36 9673767551 8TH FARMER 0.30
TH
34 DEVKAR M 26 9765943213 4 FARMER 0.55
35 SWAPNIL M 24 9823671021 9TH SERVICE 1.6
PADWAR
36 MAHADEV M 42 - 4TH FARMER 0.7
BOTRE
37 SHRIRANG M 27 9637545230 4TH FARMER 0.35
PANDURANG
38 VISHAL YAWLE M 25 9960855291 8TH SERVICE 0.90
39 SANTOSH M 25 - 9TH SERVICE 0.65
PADWAR
40 SHANKAR TAPE M 29 - 5TH SHOP 0.45
41 YASHWANT TAPE M 22 - 4TH SHOP 0.22
TH
42 THANTARAM M 29 - 6 FARMER 0.25
GAIKWAD
43 MADHURAM M 45 9765421663 4TH SHOP 0.35
PADWADE
44 SANTOSH M 25 9923457909 10TH SHOP 0.35
KASHIRAM
45 ARUN M 35 10TH FARMER 0.65
THAKARKAR
46 DASHRATH M 26 4TH FARMER 0.70
PADWAR
47 PRAKASH M 24 4TH SHOP 0.40
DESHMUKH
48 RAJU M 27 9823481861 4TH SHOP 0.32
DESHMUKH
49 RAGHUNATH M 33 9673128588 2TH SHOP 0.35
BOTHRE
50 RAJU M 17 9823481861 4TH SHOP 0.25
DESHMUKH
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31
32
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