Problem and Issue Associated with Rural Market in

India.
There are various problems and issues associated with the rural market, some of which are discussed
in this article.

#1. Diverse Markets:

There is a misassumption in the mind of the marketers that rural market is ‘homogenous market’
where in real scenario rural market and rural consumers vary across incomes and regions. The rural
market is mix of various type of consumers as there are some traders, people providing goods and
services, marginal and contract farmers, laborers and daily wage workers as well as affluent landlords
and businessmen. Along with this the income inequality the education/literacy scale also vary to a
greater extent – rural youth move towards towns to seek admission in colleges and university.

The proximity of urban area also plays a vital role in determining the consumer buying behavior –
villages near to towns and cities have people who are aware of and consume modern goods and
services. These villages are well connected through the roads; which enables better distribution
channel for the goods, while the villages that are far away do not have proper roads and connectivity
channel.

Due to all these facts associated with consumer and the market, it is impossible to treat rural market
as one ‘homogenous group’. This creates problem for the company, while marketing to rural
consumers.

By the above argument it is clear that the rural consumer cannot be typecast. This implies that
companies must market products more creatively and target to serve deeply felt consumer needs. For
this the marketer needs to have good understanding of rural market environment.

#2. Rural Transport:

According to National Transport Policy Committee (NTPC) fair weather roads connect only 55% of
villages. It is estimated that about 54% of villages are inaccessible during rainy seasons, while 46% of
villages are connected by all-weather roads.

According to Estimation of planning commission the percentage of connected habitats varies from
30% in many states to above 90% in others. The report of Working Group on
Rural Road states that there is growing empirical evidence that links transport investment to the
improved well-being of the poor and therefore the lack of roads hurts them directly. This is one of the
major hindrance in the rural marketing. Low connectivity leads to high poverty.

The result of this rural environment is as follow:

 Short distance and bad road result in popularity of bicycles

 Better road lead to more demand of motor vehicles
 Innovative way for distribution of goods, as formal transport does not exist

#3. Water Availability:

Meeting with the daily needed amount of water is also challenge for many people in rural India. Due
to improper public water supply, rural households depends on groundwater for 85% of their needs.
Women spend most of their day in just fetching water for their families, according to the report of
National Commission for Women.

In some region, water quality deteriorated due to groundwater pollution, leading to rampant spread
of water borne diseases. According to the Central Groundwater board the two pollutants together
affect nearly 80 Million people. It is estimated that India loses 2.5-4.5 percent of its GDP every year
because of unclear water.

#4. Rural Electrification:

Rural electrification is also one of the major challenge faced by the marketer in promoting and creating
the demand of its product in the area. As per the ‘The Hindu’ (2017) 519,685 out of 597,464 census
villages (approx. 99%) have been electrified. As per the government definition of electrification
includes only the provision of electricity line to that point, not actual continuous access. So even if
very few houses in village receive a couple of hours of electricity a day for a few days in the year, it is
also considered as electrified. So such figures are misleading.

As there is too much short supply of electricity in the rural regions of India; it leads to some
consequences which are as follow:

 Less demand for electric goods and appliances in rural region

 Due to unavailability of proper storage facility of processed foods, chocolates and ice creams
(required refrigerator) the demand is too limited
 It leads to create need of innovative products that do not need continues supply of electricity
 It leads to create a better market for the batteries and generator manufactures

#5. Rural Communications:

Since long marketers are fighting to over-come the problem of ‘Communication’ in rural region of
India. Even today very few newspaper are been made available to the rural population, that too which
are published one or two days before. Along with this TV penetration in rural areas is also limited to
approx. 45% (lack of electricity is also one of the reason).

The introduction of mobile phones in rural India have led to communication revolution in the rural
region of India. The urban Tele-density was 149.20 while rural Tele-density was just around 47.15, this
shows the unbalanced growth in the telecom sector since independence. But today the scenario is
changing at a faster pace, the monthly rural growth rate is 1.10% which is nearly double that of 0.69%
in the urban areas.

The mobile phone have opened new doors for the marketers by bringing new opportunity for the
companies in rural market, such as:

 The interaction with the company has increased due to increase in the phone in rural areas
 The availability of low priced smart-phone in the rural area have increased the reach of the
rural consumer to the companies and their products
 People are getting various advantages by the use of smart phone, as now they can use apps
for their convenience (micro payment for easier transact)
The lack of proper infrastructure in the rural market, make it remain deprived and isolated. This is the
reason why they remain bound together by tradition and culture. Lack of proper internet facility is one
of the major issue faced by marketers in the rural India. There are many region where the signal is too
low or not available. All these factors limit the opportunity created by introduction of mobile phones
in the rural India.

“To Understand the Rural Consumer One has To First Understand

The Rural Society”