RURAL MARKETING

BY RAMESH KUMAR

WHAT IS RURAL MARKETING

Developing of the market in the area as defined as Rural, hence it could be aptly said that it encompasses the activities such as developing the process to meet this objective Right product at the right price to the right people at the right time. Function that manages all activities involved in assessing, stimulating and converting the purchasing power of rural consumers into effective demand for specific products and services to create satisfaction & a better standard of living for achieving organizational goals.

PHASES IN RURAL MARKETING

Sr. No 1 Time Frame Phase One( Pre 1960 s) Key Events & Trends rural products in rural and urban areas Agricultural inputs in rural areas  Agricultural marketing Farming methods were primitive and mechanisation was low Markets unorganised
Marketing

CONTD
2 Phase Two ( 1960s to 1990s) Revolution Companies like Mahindra and Mahindra, Sri Ram Fertilisers and IFFCO emerge Rural products were also marketed through agencies like KVIC
Green

Phase Three( 1990s to Present)

for consumables and durables rise Companies find growth in urban markets stagnating or falling

Demand

REASONS FOR GOING IN RURAL

1.Size of the market 2.Largely untapped 3.Too crowded urban market 4.Income on the rise 5.Great success stories

HLL Colgate LG Asian Paints Dabur Videocon Cadburys Hero Honda

50% 50% 50% 60% 40% 40% 25% 40%

POINTS TO NOTE WITH REGARD TO RURAL MARKETS

Extremely Diverse Market Villages Size, Population, Spread, Income Literacy levels , awareness level, languages Urban Market scope and saturation Flow of funds from Urban National /International Literacy levels on the rise Media Penetration

ENCOURAGING INDICATORS/INITIATIVES RURAL MARKET GROWTH

Scientific methods major impetus to Production of food grains Export on the rise Increase in agriculture and handicrafts Initiatives taken by banks for more branches and Kisan credit card to buy seeds, fertilizers, consumer goods on installment basis Reputed Companies helping in changing lifestyles Levers Britania ,Dabur, LG, Honda,Videocon Media creating an impact-creating awareness levels

FOR

Government Policies White Revolution Milk products Yellow Revolution (poultry and edible oils) Blue Revolution Aqua culture Employment Schemes JRY(Jawahar Rojgar Yojna, PMRY,Small Industries Training, Ruiral Electrification, Spend on Health and Sanitation, Medical and Health, Primary Education, Credit card for farmers Waiver of Loans  Initiatives by leading organization in spreading awareness Hindustan Levels Shakti, ITC Reliance etc

MOVE TO RURAL MARKET ENCOURAGING DATA

Soft Drinks approx 45% of all soft drinks Almost 50% motor cycles Approx 55% of cigarettes Half the total market for TV, Fans, pressure cooker, bicycles Washing soap, tea, blades, salt, toothpowder Coca Cola is growing over 35% in Rural areas compared to Over 22 % in Urban

According to Hasna Research , a market research farm that Has published a Guide to Indian Markets 2006 Consumer durables in Indian Villages risen sharply TV Sales up by 200% Motorcycle by 77%

There are 3000 households in rural area that earn > 50 lakhs

PROBLEMS IN RURAL MARKETING

LOW PER CAPITA INCOME LOW DISPOSABLE INCOME INADEQUATE FIXED INCOME INFRASTRUCTURE PROBLEMS LOW AWARENESS COMMUNICATION TOO MANY LANGUAGES GEOGRAPHIC SPREAD MAJORITY DEPENDS ON AGRICULTURE INCOME

PROFILE OF A RURAL CUSTOMER

Low Literacy Level >Low Income Level >Massive Geographic Spread Urban population concentrated 3200 cities town Rural scattered over 630000 villages Reference Group Health Workers Doctors Teachers Panchayat Members Rural Bank Managers District Managers

Occupation

Principal Farming Trading Handicrafts Cattle & Poultry Farming >Media Habits Fond of music T.V Radio Video Films

Generally they have a lot of reservation/inhibition rigid in their behaviour

SIMPLE MODEL BEHAVIOR

OF

RURAL CONSUMER

Need Recognition

Pre Purchase Search

Evaluation of Alternatives

Purchase Decision

Post purchase behaviour

KEY CHALLENGES
AWARENESS AFFORDABILITY AVAILABILITY ACCEPTABILITY

RURAL MARKETING RESEARCH

Marketing Research is a formalized means of obtaining Information to be used in making marketing decisions Issue Design Information Required to address

Method of Collecting Information

Manage

The data collection process

Analyze

The results

Communicate

Finding and implication

SOURCES FOR CONDUCTING RURAL MARKETING RESEARCH

Primary Sources Retail shops/STD booths Tea Stalls Playgrounds/schools Chaupals (meeting point old/middle aged/ influential) Haats & Melas Influence Group

Secondary Sources Government website www.censusindia.com www.indiastat.com www agroindia.com Private bodies (market research advertising agencies Indian Market Research Bureau Thompson Rural Index Guide to Rural Markets Publications

POINTS TO REMEMBER FOR RURAL MARKETING RESEARCH

Build Rapport - ***

Greet need to be informal Speak local language

Do not jump to survey speak of other matters of interest

Gradually lead to the objective of the interview Explain the benefit of the survey how it will gain

Interviewer should be aware of the rural area

Never make the respondent uneasy if he offers tea do not refuse

SEGMENTATION
Geographic: Region Village size Climate Demographic Age Family Size Gender Income Occupation Education Caste North, East, West and South

Psychographics (consists of psychological: sociology: anthropological) Lifestyle Rigid ,changing attitude, urban influence Personality Authoritarian, Ambitious Behavioral Occasions Regular, special occasion Benefits User status regular user, first time user, non user Usage rate Light, medium, heavy Loyalty None, medium, strong Attitude to ) positive, negative, hostile Product )

DEVELOP THE PROFILE Select the Target Market Evaluate the Market Evaluate the Segment size growth rate profitability accessible compatible with firms resources & capabilities

TARGETING
Select Target Segment >Formulate Market a marketing strategy for the target market

POSITIONING One shoe fits all !!!! . Everything for Everyone !!! It is Something for Someone How to Position USP of the product uniqueness of the product Special needs either address partially/ unaddressed Noticeable gap in the products available Positioning Concept Study the possible motives of the rural customer Then figure out how to appeal to them (USP, Price Quality Uses, Class, Culture etc

Select & Develop the Concept Bridge gap between the product and the target market. Communicate the Concept Advertise and Reach (Media) Offer Product After STP (Segmentation, Targeting and Positioning) Post Sales Feedback & After Sales Service

New Entrant Company starts Rural Market first & then ventures in Urban Market (eg Cavin Kare Chik & Meera Shampoo) Mid- Entrant Company starts Rural Market after success in Urban Market (eg HLL, LG)

ENTERINING THE RURAL MARKET

Late - Entrant Company starts Rural Market after success in Urban Market for long (eg Cadbury)

RURAL MARKETING STRATEGY P L A N N I N G

Profile the Rural Market

Profile the Consumer

Market Behaviour & MR

Segmentation Targeting Positioning

--------------------------------------------------------------------------------E X E C U T I O N
Rural Product Rural Pricing Rural Distribution Rural Sales Force Management

Rural Communication

F E E D B A C K

Monitor the Rural Strategy

Feedback & Control

THANK YOU