Rural Marketing

4Ps & 4As of Rural Market

• Product
• Price
• Place
• Promotion
• Availability
• Affordability
• Acceptability
• Awareness
 Product
• “ Anything that has a value in exchange”
• Product – price – place – promotion
• Challenges – Availability, affordability,
acceptability & awareness
Marketing Tools Marketing Challenge
Product Acceptability
Price Affordability

Place Availability

Promotion Awareness
Cont’d
 Appropriate Product Strategies
• Existing & New Products
• Product features – service quality – price &
performance relationship
• Simplicity is key
• “ Sense & Simplicity” – Phillips Global Campaign
• Urban market successes could be rural market
failures
• Appropriate new product development processes
 Product Levels

CORE BENEFIT

BASIC PRODUCT

EXPECTED PRODUCT

AUGMENTED PRODUCT

POTENTIAL PRODUCT
 FMCG Consumption Trends
Products Urban( 1000 HH) Rural ( 1000 HH)
Toilet Soap 998 992
Washing Cake 980 950
Cooking Oil 968 952
Hair Oil/ Cream 897 787
Tea 876 758
Toothpaste 822 449
Washing Powder 819 576
Electric Bulb 723 394
Shampoo 663 352
Biscuits 579 314
Health Beverages 324 67
 Consumption Ranking
Rank Rural Product Urban Product Rural HH
Consumption
grams / month

1 Toilet Soap Toilet Soap 268

2 Washing Powder Biscuits 950

3 Packaged Tea Washing Powder 268

4 Biscuits Packaged Tea 302

5 Detergent Cake Detergent Cake 893

 Rural Durable Usage Trends
NCAER has classified durables into three categories

Group One( <Rs. 1000)

Group Two( Rs.1000- 6000)

Group Three( >6000)

In group one the growth is as high as 75 percent

Electrical goods show the highest urban- rural disparity, why ?

Television( B & W) 195/1000HH in rural Vs 490/1000HH in urban

Colour TVs 48/1000 HH in rural Vs 304/1000HH in urban

 Packaging
Associated with affordability - Convenience -
Consumer recognition & product protection
Packaging material, size, convenience and aesthetics
 Example: Chik Sampoo
 Corporate Responses to Fakes
Look-alikes- Spell-alikes & Duplicates
Prices range from MRP to 60 % of MRP
Margins range from 60 % to 300 %
Legal action – awareness programmes – New
Package Development
Fakes: Some Examples
Cont’d
Pricing
 Issues in Pricing
• Internal & external factors
• Selecting pricing methods
• Pricing adaptations
• Low price points – Simple packaging – utility
around packaging material
• Highlighting value
 Price Adaptations ( Indicative)
• Product sharing services, Example: Tractors
• Product Bundle pricing, Example: HUL
Operation Bharat
• Free gifts – may sometimes not work in rural
areas
• Special event pricing- Hero Honda Rs. 500
campaign
Colgate- Cibaca
 Place- Rural Distribution Challenges

Large number of small markets

Dispersed population and trade
Poor connectivity
Low availability of suitable dealers
Inadequate banking/ credit facilities
Poor product display and visibility
Poor communication of offers and schemes
 Levels of Distribution
Level Partner Location
1 Company Depot/ C & FA National/ State level

2 Distributor/ Van Operator/ District level

Super Stockist/ Rural
Distributor

3 Sub Distributor/ retail Tehsil HQ, towns and large

Stockist/ sub stockist/star villages
seller

4 Wholesaler Feeder towns, large

villages, haats

5 Retailer Villages, haats

Distribution Adaption( Indicative)
• Hub and Spoke Model, Example: Coca Cola
• Use of Affinity groups, Example: Project Shakti
• Haat Activation, Example: Colgate
• Syndicated distribution, Example: Cavin Care &
Amrutanjan
• Use of marketing co-operatives, Example:
Warna Bazaar in Rural Areas
• Mobile traders, Example: FMCG companies
Promotion- Adaptations for Rural Markets

Conventional Non- Conventional Personalised

Television Haat and Mela Direct mailer

Radio Folk Media( puppet and magic POS (demonstration, leaflet)

show)

Press Video Van Word of mouth

Cinema Mandi Interpersonal communication

Outdoor: Wall Painting, Animator

Hoarding
 Melas & Haats
Melas Haat

1. 25,000 melas 1. Periodic markets located in larger

2. Companies can concentrate on the
top 100 melas
3. Pushkar Mela in Rajasthan
4. Organised by the state veterinary
department
5. Product sales, promotion,
demonstration and database
generation
6. Cultural activities and rural sports
villages(> 40,000)
2. 10 – 50 villages are serviced
3. Sunday markets are most popular
4. Average number of outlets is 315 and
average daily sales is about Rs 2 lakhs
5. Traders participate in at least 4 haats
6. 81 percent of the visitors are repeat
customers
 Types of Promotions
Advertising
Sales promotions – coupons, contests, demonstrations
and sampling, Example: Tata Shaktee Haat Hungama
Direct marketing, Example: Videocon
Publicity, Example: Project Shakti and AP Online

Using a direct selling through a sales force, Example:

Swasthya Chetna for Lifebouy
 Cont’d
Push strategy – sales force and trade promotion
Pull strategy – advertising and consumer promotion
• Kankhajura Station
https://www.youtube.com/watch?v=qHTY7C-YyM0

• Project Shakti
https://www.youtube.com/watch?v=Fu1pkdVk7ow

• Mahindra BTL Campaign

https://www.youtube.com/watch?v=Z9oco0xI3NA