SEGMENTING, TARGETING AND

POSITIONING IN RURAL MARKETS.

 Customer connect in large , broad and diverse rural
markets – a challenge for marketers
 Only way to reach and connect all potential rural
consumers is to divide rural markets into meaningful
groups of consumers with distinct characteristics.
 Psychographics of a person has a direct relationship
with the way they think and purchase.
 Customer focused approach helps company , how its
products are perceived.
STP DECISIONS AND STRATEGIC
ACTIONS

Segmentation •Identify various bases for segmenting markets

•Developing profiles of market segments'.

Targeting •Evaluating the market segments for their attractiveness.

•Deciding market coverage strategies.

Positioning
•Identifying a set of competitive advantage of the brand
•Selecting the right competitive advantage.
•Communicating the chosen competitive advantages to target group.
 In a fast growing and competitive rural markets marketers
need to evolve different STP strategies
 Segmentation-

Sub-division of a market into homogenous subsets of

customers where any subset may conceivably be selected as
a target market to be reached with a distinct marketing mix.
Rural marketers may prosper thru creatively serving specific
market segment whose needs are imperfectly satisfied by the
mass market offering.
Farmers – large medium, small, non-farming, self employed
micro entrepreneurs, family members residing in urban,
media access can be considerd for rural market
segmentation.
 Factors considered for rural market segmentation-
Heterogeneity in rural markets.-
Socio –cultural, demographical, infrastructural, media
exposure levels etc play a significant role in consumer buying
behavior.
Marketers can carefully address the needs and related offerings
of the target customers optimally.
Effective segmentation possible provided it is-
1- Measurable- basic data of income etc is useful.
2-Accessible- convenient reach thru available channels of
distribution.
3-Differentiable- Indentify distinguishing feature
4-Substantial- based on SEC and related homogeneity of
consumption /buying behavior.size of potential users/
consumers
 Class exercise
Market segmentation criteria's for tractors
Benefits
Other factors
 DEGREES OF SEGMENTATION
NIL TO COMPLETE

Mass Segment Niche Micro

marketing marketing marketing marketing
•Identifies
•Considers •Serves •Focus on
different
all selectively individual
customers
customers one or few s or a very
as
homogen customer small
different
ous groups group.
groups
 Mass marketing-
Many companies entered as mass and later fallowed trickle
down approach to sell urban products to rural ex- Colgate.
Recently introduced rural specific variants.
 Segment marketing-

fmcg introduces as low priced ,innovative products for rural

segments.
 Niche marketing-

for Jewelry brands- gold-plus, detergent brands etc

 Micro marketing-

Hair oil- mustard, coconut oil –Amla etc

Local brands, Individual marketing
 BASES OF SEGMENTATION
Geographic Region- east, west, north, south
Village size-<1000, to 5000, >5000
Density- low , moderate , high
Climate- summer, rainy, winter
Culture- 56 socio –cultural regions- Bundelkhand, purvanchal etc

Demographic Age and lifecycle- children to seniors

Family structure- joint, nuclear
Gender-male/female
Income- deprived to aspiring ,seekers, strivers, global
Landownership- landless to marginal to landlords
Education- illiterate, semiliterate to literates
House type- Pucca, semi- pucca, kuchha
Occupation- self- employed, farmers, , salaried. traders
Religion-

Caste-
Psychographic Social class- lower to upper

Lifestyle- trendsetters, traditional, followers

Personality- authoritarian, ambitious

Behavioral Occasions- festivals, ,melas, haats

Benefits sought- quality, convenience, value for money

User status- non-user, first timer, potential users etc

Usage rate- light user, to medium to heavy user

Loyalty status- strong, weak, non- loyals

Place of purchase- village shop, haats, towns, melas, etc

 Multi-Attribute Segmentation- (MAS)
Very difficult for marketers to depend on single variable for
segmenting rural markets.
some companies and research organization have developed
multi attribute segmentation.
Rk swamy BBDO classified districts based on market
potential value (MPV) based on prosperity/means,
Consumption pattern, media exposure/awareness, market
support, and size of market/ population.
Recent approach for MAS was developed by Media research
users council (MRUC)- by Hansa research .
This initiative attempts to assign a premeiumness value to each
household. Premeiumness basis –wanted by many but
consumed by few.
 Concept of Household Potential Index ( HPI ) allocates
high scores for less penetrated products and services
 Whereas lower scores are attached to higher penetrated
or mass consumed categories.
 A basket of 50 variables used for calculating HPI
scores.
 HPI scores used for constructing a pyramid of Indian
consumer classes.
 We move up the classes the consumption potential
doubles with every subsequent class.
 HUL - WIMI strategy

 BOP -market strtegy

GREAT INDIAN PYRAMID- BY MRUC –
MEDIA RESEARCH USER COUNCIL- HANSA

Samridha -1,0.5%,1,hpi-1997

Samriddha-2,0.5%,1,hpi-998

Sampanna,2%4,hpi-484

Siddha, 3%,6,hpi-235

Unmukh 9%.19.hpi-119

Saamaanya, 10%,21,HPI-65

Sangharshi 35%,71,HPI-32

Nirdhan 40%,83, 15
 Legend- for pyramid-
Name of category
Percentage of household number
Number of households in millions
Average HPI score.
 MART also brought MART MAS (Market attractiveness
score)
 It captures data from below 5000 population villages and
maps their attractiveness score- as Urban and Rural
prosperity index.
 Data used fro 2011 census, RBI, agriculture census,
 MAS relevance to know relative importance of location in
terms of capacity to consume.
 Provides ‘ Best Fit ‘ location across population centre from
urban to rural centers.
 MART –MAS MODEL

Electrificati
Mart-Mas on
Owned
houses
BankMIS
deposit
Population Treated
s
Means
Work Consumption Awareness
Infrast
tapped water
particip Comps
4 wheelers
2 wheelers
Total literacy
Female literacy ructure
ation
Lpg
tv Internet availability

rates
Targeting-
Evaluating various segments and selecting how many and
which one to target for coverage based on attractiveness of
each segment for offering and resource competencies.
Basis for Overall Attractiveness of segment-
Size
Growth rate
Accessibility
Profitability
Scale economics
Low risk
In rural size with purchasing power to be considered
Compatibility with resources as rural is a long term strategy
 Coverage of segment.
Coverage strategies for targeting can be thru –
1-Undifferentiated- mass- nirma- needs mass distribution and
mass advertising. Suitable for only one product line . Keeps
other marketing costs like research, inventory etc low.
2-Differentiated- segment marketing – lifebuoy.
Provides strong identification with product category.
More costs but higher sales and profitability.
More loyal customers
3-Concentrated- Niche- multiple brands of soaps of HUL.
Need a multi –segment strategy to ensure adequate ROI
 SEGMENTATION IN RURAL

 Being highly scattered over wide geographical areas

identifying potential markets for products and services
needs considerations-
1-Irrigation facilities- HYV in irrigated -increased farm
incomes,
2-Electrcity- for pumps, fmcd goods,
3-size of land holding- more crops , higher income
4-type of crops- cash crops vs. food grains,
5-level of farm mechanization,
6- infrastructure – all weather roads, post offices,
7- taluka /district h.q.- wholesalers, distributors located ,
8-small scale industries- rice mills, oil mills, gives additional
incomes,
9-availability of sales outlets-,
10 –reach of mass medias
 Positioning-

Designing company’s offering and image to occupy

distinctive place in mind of target segment.
It involves-
Creating USP – to differ competitor’s offer
Selecting differences for Greater competitive advantage.
Communicating advantages
Positioning concept thru-
Product differentiation
Service differentiation
People differentiation
Image differentiation
Selecting concept-
Attractive, distinctive, affordable, communicable etc