Marketing Management II

The ITC e-Choupal Initiative
1] How is the market offering of ITC different from a more developed economy context? 2] Is the new initiative suitable to the target audience? 3] Critically examine the marketing implications for ITC in this initiative. Ans. 1: The market offering of ITC was eChoupalwhich was initiated due to the challenges faced by the farmers and ITC i.e.
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Lack of proper channels of information, Absence of infrastructure (telecommunication and electricity), Less knowledge about weather related diseases and pests, Low levels of transparency in the supply chain on parts of the middlemen in the mandis.

The vital offerings of ITC were: The principle offering put forward was the integration of the earlier infrastructure that had evolved in the villages rather than owning or controlling the entire value chain from top to bottom. The Salient features of ITC s offering that were different from developed economies: A. Sanchalak- A well- known person in the village whose home had already been a natural choupal platform for years. Also, who was hospitable and people felt comfortable in visiting his home. Thus, ITC trained those Sanchalaks to put in place the computer system and other telecom facilities so that the farmers would visit the Sanchalak s home to gain information regarding: 1. Weather 2. Prices, which generally followed the agriculture future markets on the Chicago Board of Trade and the Kuala Lumpur Commodity Exchange. 3. Best practices to be followed 4. Crop 5. Market 6. Daily news updates 7. Question and answer forum

B. Samyojaks-They were the already existing commission agents of the Mandi Life, which were used by ITC.Samyojak s role comprised of three major areas of responsibilities: a) Setting up the eChoupals b) Facilitating ITC s purchasing transactions c) Helping with ITC s selling transactions

C. Reorganisation of the Supply Chain Generally such companies in the developed economy used to follow contract farming where they usually bought every product from the farmers. But contrary to that ITC did not bind the farmers to sell their produce to them only. They were free enough to sell their produce in the Mandis too.

Ans. 2: The eChoupal is very suitable for target audience i.e. the farmers of crops important for ITC s business viz. soybean, wheat, pulses etc. eChoupaladdresses the farmer s difficulties in marketing of his output 
Farmer knows the sale price for his produce even before he leaves the village through online real-time information ‡

Who otherwise has to sink in the cost of taking the produce to Mandi before knowing the price Farmer can also decide the time at which to sell in order to maximize his profit, by comparing market rates Transparency of rates

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Transparent weightage and quality testing practices

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And more importantly, offers the facility to delink produce delivery, cash payment and price finalisation for the benefit of small farmer Who otherwise ends up selling his produce immediately after harvest at low price because of cash needs and lack of storage

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Providing other services namely insurance, FMCG, banking, inputs, credit through this route which is generally not easily available in rural areas.

Ans. 3:

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