Case 1: Ruf and Tuf Jeans

India’s leading denim manufacturer, Arvind Mills, achieved the expansion of its customer base,
with a new brand tailored for specifically the rural market. A study revealed the following facts:
 Many in rural areas found even the cheapest branded jeans beyond their means.
 There is scepticism towards readymade products among rural customers.
 Ready to stitch jeans for the first time priced at Rs. 195, as against the unorganized sector’s
range of Rs. 150-350, the kit included a denim trouser length with specific tailoring
instructions and the branded zipper, rivets and buttons that distinguish jeans from mere
denim trousers in the customer’s mind.
 The product was made available in villages with a population as small as 5000. Local cloth
shops were used as retailer outlets.
 Workshops were organized to train local tailors and to inform them about the changes
required in regular sewing machines out stitching jeans.
 The demand crossed a million pieces as against a production capacity of 2.50 lakh kits
within a time span of two months.

Questions

1. Analyse the reasons for success of Ruf & Tuf Jeans in Rural India.

2. Suggest marketing strategy for marketing of Peter England Trousers in Rural U.P.

Answers:

1. When Arvind mills launched Ruf & Tuf Jeans they kept in mind the scope of rural areas. They
identified the problems regarding Price and Place where they were going to sell their jeans.

 Price- They kept a competitive price compared to other rural brands which indeed helped
them in generating demand. They kept a very low price of Rs 195. They also decreased their
cost by providing only the kit and not stitched jeans, which enabled them to keep low price
with profit.
 Place- They analysed the rural customer behaviour where the rural customer whenever they
want to buy clothes go to the local cloth shops and not some big showroom or branded
shop. This also decreased their cost of setting up a showroom. They also knew that the rural
customers are sceptical about readymade jeans and prefer stitched more. So, they
converted this scepticism into strength thus saving their cost.

2. The marketing strategy that Peter England Trousers can use to market in UP are as follows:

 Product- Peter England can make a kit consisting of denim, buttons, zipper etc. but should
not compromise with quality so as to keep their brand image. Marketing the kit will be
useful because analysing the behaviour of the rural population and especially of UP we know
that they prefer stitched clothes more than readymade products.
 Price- In order to penetrate the market of rural UP, it is important for the brand to keep a
relatively low prices which are in level with the other rural jeans company and also a price
where they could get a meaningful and affordable profit.
 Place- The marketing strategy that the company can use for marketing in rural UP is
providing the clothing in local cloth shops and local tailors. As the customers in rural people
would prefer less to step in in a showroom and rather go to the local shops. And also
distributing to local stores would save a lot cost for company maximising the profit
 Promotion- The most effective way of promotion of a product in rural UP is by word of
mouth. Also, we can see the data of smartphone usage area wise we can observe that there
is a huge amount of people using smartphone and social media in rural areas so social media
ads can also be used for promotion in these areas
Case 2: Colgate-Palmolive India Ltd.
Colgate-Palmolive India Ltd., is one of the leading companies in FMCG’s. Till late 1980s, it was
pretty much smooth sailing for CPIL. Smaller toothpaste brands like Promise, built a strong
franchise in early 1980s and then began to flag. Others, such as Forhans, and Binaca, faded
away into the background. But in the late 1980s, Lever wanted to change the vary way the
market was curved up. It was moving aggressively to segment the market into two distinct need
areas with sharply defined brands. With effective advertising, the very dynamics of toothpaste
marketing started changing. Thus, the great toothpaste war began. Colgate matched close up
with a get variant of its own, aimed at those who wanted to keep their partners happy. CPIL
brought Colgate total, a top end formulation of its US based parent, to India, priced at 2.5 times
its regular paste. The product failed to justify its premium to the consumer. This tartar fighter
was supposed to be the knight in shining armour, and its failure dealt a severe blow to CPIL’s
leadership of the market. Meanwhile, Colgate’s advertising had become ‘globally aligned’ with
US based, Young & Rubicam, which tied up with re-diffusion in India, and lost some of the local
zest. Thus, CPIL saw the opportunity. The market expansion was to be done as the 90,000
tonnes (Rs. 200 crore) toothpaste market had barely grown 3 per cent in 2000. Colgate Total
has started doing well in the past two years. Total is medically superior formulation that is big
in high awareness market. It can upgrade users of gels as well as protective pastes. The
strategy is expected to unto the 1990’s segmentation by harmonizing the two different needs.
Balsara’s Babool was already a success. Colgate acquired Cibaca and re-launched it as
Colgate-Cibaca Top in a maligned package. Colgate Herbal is launched as a part of its flanking
strategy against aim, as Neem toothpaste by Lever.
In 1976, Colgate launched ‘Operation Jagrati’ programme to create oral hygiene awareness.
Nearly 100 vans went deep into rural areas to generate tribals through its 30-gm pack. Colgate
reaches 60,000 villages and 18 million rural consumers. Overall, an important part of the
education programme is CPIL’s association with the Indian Dental Association. Colgate’s
distribution strategy is a three pillar one: (i) physical distribution reach; (ii) customer marketing
approach; (iii) modernization of sales operations and enhancement of sales efficiencies, effective
presence in haats and savouries. It also caters to about 3 million retail outlets that stock
toothpastes ranging from roadside klorks to fancy supermarkets. Colgate supplies stock which
are ‘key account holders’ supplying supermarkets chain and the like. Thus, Colgate has gained
the strong brand image and it is progressively marching ahead.

Questions

1. Explain the strategy of Colgate-Palmolive Ltd.

2. Analyse the marketing mix of new product - Colgate Tulsi in rural Uttar Pradesh.

Answers

1. The marketing strategy which was used by Colgate-Palmolive Ltd. is as follows:

 Colgate has always been a master when it comes to marketing strategies and ad campaigns.
As the company saw new players coming up in the Indian market it decided to give them a
very tough competition by not providing them with a single market untapped. Colgate
entered each and every market of India be it Urban, Semi- Urban, Metropolitan, Rural,
Towns etc. It created a variety of product lines in every price range which made them nearly
completely penetrate the market of India.
  They came up with great ideas to enter the markets of rural India. They came up with a
marketing strategy ‘Operation Jagrati’ which aimed to promote oral hygiene in !976, they
came up with this idea when there was nearly no competition in the market which gave
them a major monopoly in the Indian rural market. They sent out vans to 100 vans to nearly
60000 villages with over 18 million customers.
 The first mover advantage gave them such a monopoly that even after 50 years of Operation
Jagrati it has impact in the market. People in rural areas still ask Colgate in shops rather than
tooth paste, for them toothpaste means Colgate.
 They used such a distribution strategy which included an infinite number of stores ranging
from a push cart to a super market which gave them a considerable market share.

2. Marketing Mix of Colgate Tulsi in Rural Uttar Pradesh:

 Product- As Colgate is an old player in the field of FMCG especially toothpaste, it knows that
the rural market it still inclined towards their tradition. It has used a very acceptable name
for the rural market which is Tulsi. It can use the platforms like Kumbh Mela, Chota Kumbh
and other village fairs where a large amount of people gather which can help them reach
maximum people in minimum cost. As the rural areas are very scattered and the number is
large it is difficult for the company to reach out to the consumers and it would be very
expensive for them to reach out to such a scattered population.
 Price- The company has to keep a relatively low price where their profit margin is
considerable. As the rural market of India is very big so the quantity sold will be large which
would decrease the production cost thus providing profit. Keeping a very high price in rural
market would not be beneficial for the company as large number of people are still below
the poverty line.
 Place- The company has vast number of retail networks and for the rural area distributing to
small shop owners would be more beneficial. It can setup camps and programmes in rural
areas where the population is considerably regarding dental check-up and oral hygiene
which can help them promote the product.
 Promotion- Word of mouth is the best way of promotion in rural area. It can also use social
media ads targeted to the rural population where the famous personality promotes the
product because in rural areas people get influenced by them easily. One more advantage
Colgate could get in the rural market is that the programme they launched in 1976
‘Operation Jagrati’ has created an image in minds of the rural people that toothpaste means
Colgate which would help them a lot in launching their Colgate Tulsi in the market
Case 3: LG Targets Rural
LG Electronics India Ltd., is a major dealer in Colour Television. It has already made a mark in the
television segment and as all set to capture the home appliances market with refrigerators, washing
machines, air conditioners and other appliances. LG has targeted the emerging rural markets with
high technology products at a reasonable price. It is also training its sights on the institutional and
governmental segment a new. The idea it to grow sales from the institutional segment from five per
cent now to 10 per cent in the coming year. As part of its strategy to tap the rural markets. LG has
initiated steps in Andhra Pradesh, Tamil Nadu, Punjab and Haryana, mainly targeting the rich and
middle class of agricultural segment. A budget of Rs. 10 crores has been allocated for rural marketing
in the coming year 2003-04. It has targeted to achieve rural market by 20 per cent accounting for Rs.
900 crores. LG is banking on its grassroots level marketing to edge out competing heavy weights
such as BPL, Samsung, Videocon and Whirlpool, which are all breathing down to neck. Low priced
‘Sampoorna’ TV has been a major success in rural India since its display system ensures vernacular
language as per local tongue and interest. This has been ensured through investment of Rs. 25 lakhs
for product modification. The company has already about 100 service centres in the country to cater
to the consumer and it intends to enhance quality of the services and goods.

Questions

1. Suggest a marketing plan for effective marketing of TV and Refrigerators in rural U.P.

2. Discuss marketing mix of Videocon Coloured TV in rural U.P.

Answers

1. The marketing plan effective for marketing of tv and refrigerators in Rural UP:

 Product- Considering the rural population the product be it TV or refrigerator, both should
be sturdy because the rural consumer believes more the heavier more is the power and
durability. The company should also choose a name which the rural consumer can relate to
like when LG launched Sampoorna Tv it got a huge success which may be due to relativeness
to the name the rural consumer feel. It should also do branding where the rural consumer
can differentiate the product from other competitive products.
 Price- The company has to keep a comparatively lower price than the products they sell in
the urban market. The price should be competitive to the others brand in rural market
because the majority of the population in India is below the low-income level. They should
also decrease the features in the tv so that the price can be set low and they can get
considerable profit. They can provide discounts on their products which would motivate the
rural consumer to buy the product. They could also provide the rural consumers with
promotional schemes during the festive seasons of Diwali, Holi, Onam etc.
 Place- LG can distribute their products using small electric shops because setting up a full-
fledged showroom or shop could increase their expenses decreasing their profit. They can
also provide credit facilities to the rural population through the village’s big merchants.
Catering to rural population can also take place through village melas and haats. They could
also use mobile vans to spread awareness and sell their product in the deep rural of UP.
 Promotion- Word of mouth is the best way of promotion in rural market. They could also
use opinion leader of the village to whom every rural people go for suggestion for promotion
of the product. Formal media is not so success in rural areas but still they could social media
ads, Local language newspaper ads for promotion. Wall paintings can also used as a form of
advertising in the rural market.
2. Marketing mix for marketing Videocon coloured TV to Rural UP-

 Product - Product is a powerful determinant of firm’s success. The TV must be suitable to

rural customers in all significant aspects. The company has to produce TV according to the
present and the expected state of rural buyers. Product features (size, shape, colour, weight,
etc.), qualities, brand name, packaging, labelling, services, and other relevant aspect must be
fit with needs, wants and capacity of buyers. TV must undergo necessary changes and
improvements to sustain its suitability over time. Effectiveness of other decisions like pricing,
promotion and place also depends on the product.

 Price- Rural customers are most price sensitive and, hence, price plays more decisive role in
buying decisions. Pricing policies and strategies must be formulated with care and caution.
Price level, discounts and rebates, credit and instalment faculties, and so on are important
considerations while setting and altering prices. Normally, the low-priced products attract
rural buyers. However, some rural customers are quality and status conscious.

 Promotion- Rural markets are delicately powerful. Certain adaptations are required to cater
to the rural masses. The promotion strategies and distribution strategies are of paramount
importance. Ad makers have learned to leverage the benefits of improved infrastructure and
media reach. Wall paintings can also use as a form of advertising in the rural market. Formal
media is not so success in rural areas but still they could social media ads, Local language
newspaper ads for promotion.

 Place- Rural markets face the critical issues of distribution. The Videocon company has to
strengthen the distribution strategies. Both physical distribution and channel of distribution
should be decided carefully to ensure easy accessibility of products for rural buyers.
Choosing suitable mode of transportation, locating warehouses at strategic points, sufficient
insurance, maintaining adequate inventory, maintaining a sufficient number of retail outlets
at different regions, and deploying specially trained sales force are some of the critical
decisions in rural distribution. Normally, indirect channels (particularly one or two level) are
more suitable to serve scattered rural customers. In two level channels wholesalers are
located at urban and semi urban to serve urban and rural retailers. However, not only in
backward states, but also in progressive states, local producers (farmers and others)
distribute directly to customers.
Case 4: Prestige
Prestige, India’s leading pressure cooker brand, over the last few years was faced with the problem
of stagnant sales and reduced realizations. Urban markets were getting saturated. Prestige Popular,
in larger sizes, was launched in 1999, and since then the sales has been on the decline. However,
rural markets were growing at almost five times the growth of the category. Thus, company decided
that rural market are going to be a thrust area of marketing. A pilot project in the rural Mahboob
Nagar district of Andhra Pradesh with the help of MART was initiated. The women’s self-help group
(SHG’s) movement has been very strong in Andhra Pradesh. MART and the company organized
meetings of the women of SHG’s explaining the concept of pressure cooking, giving them details on
the company, the brand end what they stand to gain by selling Prestige pressure cookers. For
enlisting dealers, the help of animators, who are paid a stipend by the Government for
propagating/implementing developmental activities of the state government among the rural
population, was enlisted. All those who became dealers were given a demo pressure cooker.
Meetings were organized by the dealers for potential customers, where the concept of pressure
cooking was explained. These meetings were attended by company personnel so that the dealers got
trained on the concept of pressure cookers. To take the initiative forward the company got in touch
with the Department of Women Empowerment. The TTK group was asked to make a proposal on
how it could work with the government on improving the lot of the rural women. After prolonged
discussions with the Department, TTK gave a proposal which was a three-pronged strategy:

1. Appointing women as dealers of ‘Prestige’;

2. Setting up an assembly plant in Andhra Pradesh with land and building provided by the
government using women of the rural areas;

3. Setting up a ready to fry snacks conversion units in each of the 21 districts of Andhra Pradesh with
equipment provided by TTK and appointing dealers to sell these snacks in each of the mandals in
these 21 districts.

TTK Prestige has set up a four members sales team to take the rural initiative forward. During 2003-
04, 1000 dealers are to be appointed. Dealers would be women as individual or SHGs themselves.
The company intends to replicate this model in three others southern states i.e., Tamil Nadu,
Karnataka and Kerala in the near future.

Questions

1. Analyse the ‘Prestige initiative’.

2. Discuss the case and suggest marketing plan for marketing of pressure cookers in rural areas of
U.P.

Answers:

1. The initiative take by Prestige to penetrate the rural market was a good initiative. The company
took the benefits of the government initiatives like modern cooking and ujjwala scheme to penetrate
the market. It also saved its cost for marketing in rural area by taking the advantage of government
initiatives. It also taught and introduced the rural population to pressure cooking which saves a lot of
time and energy. It taught them about the benefits of pressure cooking. They set up plants in Rural
Andhra Pradesh which were sponsored by the government saving their costs. It also set up ready to
fry snacks in different districts of Andhra Pradesh which also introduced the rural population to
readymade snacks. They also promoted women empowerment by giving the dealerships to only
women. They used the help of Self-Help Groups of women to promote their brand and pressure
cooking and also gave the SHG’s dealership promoting empowerment. They coined out that the rural
market was much much bigger than the urban market which helped them nearly doubling their
sales. The market in the rural space is as good as it is in the urban market. Company’s strategy is to
develop it very fast.

2. The marketing plan to market the product in rural UP:

Product- The product i.e., pressure cooker that is to be introduced in the rural market should be
durable. The product should be less sophisticated with limited features and a simple packing to save
cost. The product should have the safety to its top level because the rural population would be using
it for the first time.

Price- The price of the product should be very low with a low profit margin as maximum people in
the rural population are still below the low-income level. The price should be decided where there is
full coverage of production cost and a considerably low profit. In the rural market the consumers
look for value for money rather than the brand value. The company should use psychological pricing
like pricing the product 999 instead of 1000 because seeing a thousand will be a very high price and
999 would be a good price. The company should avoid sophisticated packing which would save the
cost for the company.

Place- One of the major hurdles for penetrating the rural market is distribution. And the main
problem in distribution is availability. Sometimes people in the rural areas demand for the product
but they do not get it due to the lack of the marketing network of the company in the rural areas. To
solve this problem the company can use Local Haats/ Melas, Kirana stores, Rural Malls such as
Godrej Aadhar and Warana Bajar. They can also take help from the village SHG’s for promoting their
product and creating awareness. They can also distribute through mobile vans and retailers in these
areas

Promotion- The focus of the promotion strategy should be generating awareness, interest and
conviction among the potential consumers through appropriate media usage along with direct
marketing, folk media etc. They can launch the product during festive melas of Diwali, Holi, Makar
Sankranti etc. Rural advertisement through channels like Doordarshan, Colour channel etc. Wall
paintings in areas which will generate a lot of visibility like gramin panchayats, schools etc.
Case 5: Punjab Tractors
The Tractor Industry is divided on the basis of the power of the tractor engine expressed in HP
(horse power). The market has gradually shifted to the 31-40 HP category. This gradual shift is due to
shifting of sales from northern states to other parts of the country. With an increase in irrigated-
cropped area, the number of tractors started increasing in west and south India. Tractor sales gained
momentum in states like Madhya Pradesh, Maharashtra, Gujarat and Rajasthan since last few years.
There are five major players of tractor viz. Mahindra & Mahindra, Punjab Tractors, Escort, TAFE and
Eicher. The market share in April-July, 2000 shows:

M&M 38%
Punjab Tractors 21%
Escorts 19%
TAFE 13%
Eicher 7%
Punjab tractors has shown negative results of sales, mainly in its traditional markets of Punjab,
Haryana, Gujarat and Madhya Pradesh and stagnating sales in Maharashtra and Bihar due to
drought conditions. The company expended its network of dealers and has improved market share
earlier from 18.9 per cent to 21 per cent in 2000. A new model, the ‘Swaraj’ 744 was also introduced
in the market in the 40-50 HP range category. This has led to a greater demand for tractors which
contributed to the increase in sales volumes in 1999-2000.

Questions

1. Suggest marketing plan for marketing of Eicher Tractor in rural U.P.

2. Suggest marketing mix to retain leadership of Mahindra & Mahindra in total sales of tractors.