CONSUMPTION AND

MARKETING PRACTICES
IN BOP CONTEXTS

Presented- Harjinder
BOTTOM OF PYRAMID – focus : low income markets

Bottom of the pyramid markets companies can build their fortune for themselves,
developing economics per producing and distributing products, service for the aspiring
poor.

characteristic..
@ customers: rural areas / sub urban areas.

@ little or no formal education.

@ MNCs – ignored – non consumers – low purchasing.

@ under tapped & degree of competition is low

What companies should be ??

1. Make radial innovations is technology --

--@ unique needs & purchasing power

2. Redefine “SCALE” OF OPERATIONS – bigger is better.
scale sale operation -- confined with world scale capabilities.

3. new business models – develop

-- revaluate price

Rural Markets in India—

Indian rural market has a vast size and demand base. About 70% if india population lives
in villages and these villages contribute in the economic
Development of the nation through the production of good grains vegetables, fruits.
Export on these agricultural commodities result in generation of capital earning in foreign
exchange.
Characteristics of Rural market.
1 large, diversified and scattered market.

2 Agriculture is the main source of income.

3 traditional outlook.

4 inadequate infrastructural facilities .

5 diverse socioeconomic background.

Challenges
• Rural markets remain untapped because of three D’s

• Distance.

• Diversity.

• Dispersion,

* Understanding the psyche of rural consumer.

The biggest challenge is to understand the perceptions, viewpoint and actual needs of the rural
people, which is dramatically different from urban people.
• Low standard of living
India is the fourth largest economy in the world due to a strong economic growth but still has a
low per capital income. It result in low consumption pattern as compared to the urban population.

• Low literacy levels

Marketers faces communication problem due to lack of literacy level.

• Seasonal demand
demand for goods in rural markets depend upon agricultural situation, as agricultural is the
main source of income.
Agricultural to a large extend depends upon monsoon and, the demand or buying capacity is not
stable or regular.
• Lack of proper infrastructure.
Nearly 50 percent of the villages do not have all weather roads. Physical communication to these village
is highly expensive.

Many rural areas are not by rail transport. Facilities such as telephone, fax
Telegram are rather poor in rural areas.

• Understanding people.

Rural society in India is undeveloped.

Unfortunately, the impact of the technology is not experienced uniformly throughout

in the nation.

Except some district in Punjab, Haryana and western uttarpradesh, large areas.
• Traditional outlook
Due to the traditional outlook of rural consumers, they are resistant to change.

Life in rural areas still governed by customs and traditions and people do not
Easily adapt new practices.

Thank you