PRODUCT STRATEGY

The Product Concept

 Rural customer judges product offerings based on:
 Product features and quality
 Services mix
 Price appropriateness
 Products for rural market:
 LG – Sampoorna TV
 Philips - ‘Free Power’ radio
 Cadbury – ChocoBix
 Micromax – 30 day battery back-up
 SBI- Tiny Account (zero balance)
The Levels of Product
 Core benefit
 Basic product
 Expected product
 Augmented product
 Potential product
 Rural Product Classification
• FMCG (Consumables)
• Foods & beverages, toiletries, cosmetics, footwear etc
• HLL, Dabur, Marico, Colgate, Bata, Coco Cola, Nirma etc
• Consumer Durables
• TV, Fridge, Fan, Pressure Cooker, Cycle, 2-wheelers, Sewing
machines, watch, mixer grinder, radio, music system
• Philips, LG, Videocon, Bajaj, Samsung, Hero, Mahindra, Tata etc
• Services
• Telecom, banking, health care, insurance, education etc
• Airtel, BSNL, SBI, PNB, Dena bank, ICICI, LIC etc
• Agri-inputs: Seeds, fertilizers, pesticides, tractors, implements
• Rallis, Bayer, Mahindra, TAFE, Monsanto, IFFCO etc
 Individual Product Decisions
• Quality: Rural consumers set their own ‘emotional’
specifications to judge quality:
• Quality of cement by bitter taste
• Tractor by the sound of the engine
• Heavy watches as quality watches
• Features: appropriate and recognizable as value
• John Deere added power steering in tractors to its base 35-hp
model
• Design and style: to suit rural environment
• Pressure cooker with handle on both side to suit ground level
• Metal/alloy torches instead of plastic ones
• Nokia 1100 with non-slip silicon coating of keypad and sides
 Other Product Decisions
• Product Line and Mix decisions
• PLC Strategies
• Rural markets are not homogeneous
• Rural markets can be classified as : developed, developing and
under-developed
• Same product will reach maturity in different times
• For tractors: Haryana is a more matured market than Bihar
• Consumption pattern are being changed by education
• Increase frequency of usage
• Low-priced options
• Dedicated rural marketing initiatives (HUL’s Shakti)
 Product Branding in Rural Markets
• Rural consumers associate brands mainly with:
• Colours: Red battery, Red Label tea (Brooke Band), Lal dant
manjan (Dabur)
• Numbers: 502 Pataka chai and bidi; Godrej No.1 soap; 555
detergent bar; A1 karak chai (Brooke Bond)
• Visuals: Ghari detergent; Rath vanaspati; Wagh Bakri tea;
Katchua chaap mosquito coil; Cycle agarbatti
• Developing Rural brand names and brand identity
• Sampoorna TV, Ajanta toothpaste, Bhoomiputra tractor of
Mahindra
• Shree Ultra cement’s ‘jung rodhuk’
 Brand Loyalty in Rural Market
• Brand ‘stickiness’ is more prevalent than brand ‘loyalty’
in rural market
• Less likely to switch brand
• LIC’s village adoption scheme – LIC Jeevan Bima Nagar
– Rs75000 for village development
• Mahindra village / Escorts village
• Regional brands
• Lamsa tea in Maharashtra
• Kala Ghoda tea in Rajasthan
• Balajee snacks in Gujarat
 Fake Brands in Rural Market
• Look-alike
• Shagun for Lifebuoy
• Lalita Amla for Dabur Amla
• Spell-alikes
• Paracute; Fare & Lovely; Pearl-G; Pomes; Kit Bar; Azee
• Duplicates
Fake Brands
Fake Brands
Fake Brands
Fake Brands
 Packaging for Rural Markets
• Rural market conditions affecting packaging decisions
• Poor road conditions
• Lack of safe storage (moisture, rodents, heat, rainwater)
• Reliable electricity supply for refrigerated storage
• Improvements in packaging material:
• LDPE/HDPE films and plastics
• Tetrapak (as small as 65ml – Frooti)
• Godfrey Philips packs Sona bidis in zip plastic pouches
• Small size packs with affordable prices – less than
Rs10
• The sachet revolution (Chik shampoo)
• Maggi Rasile Chow – Rs2 / Rs4
 Packaging for Rural Markets
• Packaging Aesthetics:
• Rural consumers appreciate bright colours and bold letters in
vernacular language
• Red colour is popular
• Colour preferences may vary across India (Goldflake – yellow
in south and golden in north)
 Warranty and After-sales Service
• Extended warranty
• Affordable Spare parts
• Availability of spare parts
• Exide’s ‘Project Kisan’ with Jai-Kisan batteries for tractors
• Bharti Airtel offering multi-lingual service
• Extended service networks
• Provide service facilities during haats and melas
 Product Development for Rural
Market
• Idea generation
• Concept testing
• Product development
• Market testing
• Examples:
• Mark II hand pumps
• ChotuKool
• Rasoi Ghar
• GE’s low cost ultra-sound machines (portable)