Download - Rural Marketing Intro XIMB
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Introduction to RuralIntroduction to Rural
MarketingMarketingSessionSession II
Xavier Institute of Management,Xavier Institute of Management,BhubaneswarBhubaneswar
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Why should we do this course?Why should we do this course?
Agricultures share in GDP is going down, but, India stillAgricultures share in GDP is going down, but, India still
lives in her villageslives in her villages
Urban markets are crowded and saturatedUrban markets are crowded and saturated
The understanding of rural is diffused and sometimesThe understanding of rural is diffused and sometimes
confusingconfusing
Is rural marketing different from urban marketing ?Is rural marketing different from urban marketing ?
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Session CoverageSession Coverage
Rural IndiaRural India Some definitional issuesSome definitional issues
Phases/ stages in rural marketingPhases/ stages in rural marketing
Scope of rural marketingScope of rural marketing
How is rural India changing?How is rural India changing?
Schools of thoughtSchools of thought-- Approaches to Rural MarketsApproaches to Rural Markets
Strategic Issues & Directions in rural marketingStrategic Issues & Directions in rural marketing
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Defining Rural IndiaDefining Rural India
Organisation Definition Limitations
NSSO (
Census) Population density < 400 / Sq Km
75 percent of the male workingpopulation is engaged in agriculture
No Municipal corporation / board
rural not defined
PlanningCommission
Towns upto 15,000 population areconsidered rural
Towncharacteristics not
defined
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ContdContd
LG Electronics All places other than the7 metros
Only clarifies what arethe cities
NABARD All locations with a
population upto 10, 000considered rural
Village & town
characteristics notdefined
Sahara Commercial
establishments locatedin areas servicing lessthan 1000 population
Population
characteristics unknown
Source: The Rural Marketing Book- Text & Practice, Kashyap. P and Raut. S (2007)
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Defining Rural MarketingDefining Rural Marketing
National Commission onAgriculture
NGOs Corporate RuralMarketing Definition
Decisions to producesaleable farm
commodities involving
all the aspects of themarket system or
structure, bothfunctional and
institutional, based ontechnical & economic
considerations and
includes the pre & postharvest operations.
Marketing productsproduced in rural areas
to urban areas
Marketing products
produced in rural areasin rural markets
Function that managesall activities involved in
assessing, stimulating
and converting thepurchasing power of
rural consumers intoeffective demand for
specific products andservices to create
satisfaction & a better
standard of living forachieving organisational
goals.
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Phases in Rural MarketingPhases in Rural Marketing
Sr. No Time Frame Key Events & Trends
1 Phase One( Pre 1960s) Marketing rural
products in rural andurban areas
Agricultural inputs in
rural areas
Agriculturalmarketing
Farming methods wereprimitive andmechanisation was low
Markets unorganised
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ContdContd
2 Phase Two ( 1960s to 1990s) Green Revolution
Companies likeMahindra and Mahindra,
Sri Ram Fertilisers andIFFCO emerge
Rural products werealso marketed through
agencies like KVIC
3 Phase Three( 1990s to Present) Demand forconsumables and
durables rise
Companies find growthin urban marketsstagnating or falling
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Scope of Rural MarketingScope of Rural Marketing
Keenly debated topicKeenly debated topic
Definitions based on organisational/ institutional vision,Definitions based on organisational/ institutional vision,
mission & goalsmission & goals
Need for aNeed for a comprehensive and modularcomprehensive and modular understandingunderstanding
Rural Marketing is a work in progressRural Marketing is a work in progress
MultiMulti disciplinary approach is necessary for sharperdisciplinary approach is necessary for sharper
understandingunderstanding
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Domain of Rural MarketingDomain of Rural Marketing
To
Rural Urban
From
Rural
Urban
Source: M. Jha, Rural Marketing- Some Conceptual Issues, EPW, 1988
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Scope of Rural MarketingScope of Rural Marketing
Domain ofRural
Marketing
Dimensions of the transaction
Participants Products/
services
Modalities Norms Outcomes
Rural to
Rural
Rural to
Urban
Urban toRural
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Changes in Rural IndiaChanges in Rural India
Diverse change levers in rural India
The pull of the cities & towns migration and its side
effects
Effect of government programmes
Civil society interventions
Natural & manmade disasters
Slow but sure change
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Transitions In Rural IndiaTransitions In Rural India
Food Grain Crops
On land activities
Farm Activities
Non food, cash crops
Livestock & fisheries
Manufacturing &services
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Rural Employment Patterns( Male)Rural Employment Patterns( Male)
Sector Year 1987 ( % share inemployment)
Year -2004 ( % share inemployment)
Agriculture 75 67
Transport &Communication
2 8
Trade & Hotels 5 7
Construction 4 7
Manufacturing 7 8
Source: NSSO data, Mckinsey Global Institute Study, 2004-05
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Rural IndiaRural India Population TrendsPopulation Trends
1971 1981 1991 2001
Total
Population (in
million)
548.2 683.3 848.3 1026.9
Rural
Population (in
million)
524.0 628.8 741.6
As a proportion
of total
population
76.7 74.3 72.2
Decadal
Variation
19.8 16.7 15.2
Source: Census 2001
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ContdContd
The joint family system is being replaced by the nuclearThe joint family system is being replaced by the nuclear
family systemfamily system
The occupational pattern shows a predominance ofThe occupational pattern shows a predominance of
cultivators and wage earnerscultivators and wage earners
Cultivators( 40.86 %) and Wage Earners( 35.28 %)Cultivators( 40.86 %) and Wage Earners( 35.28 %)
according to NCAER studies (2002)according to NCAER studies (2002)
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ContdContd
Size of villages/ habitations are changingSize of villages/ habitations are changing
Role & influence of towns is changingRole & influence of towns is changing
Social interaction is a mix of rural and urbanSocial interaction is a mix of rural and urban
Lets look at some key trends in detailLets look at some key trends in detail
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Rural Income TrendsRural Income Trends
Annual Income (at 1998-99
prices)
Income Class 1989-90( %Households)
1998-99 ( %Households)
1,40,000 High 0.5 3.0
Source: National Council for Applied Economic Research, 2000
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Rural MarketingRural Marketing-- Schools of ThoughtSchools of Thought
Determinist SchoolDeterminist School
Activist SchoolActivist School
What is the right approach?What is the right approach?
Dependent on level of market development, stage in theDependent on level of market development, stage in the
PLC and access to resourcesPLC and access to resources
Amul & ITC prominent examplesAmul & ITC prominent examples
No waterNo water--tight compartmentalisationtight compartmentalisation
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Strategic Issues & Directions in RuralStrategic Issues & Directions in RuralMarketingMarketing
Evolutionary Vs revolutionary changes in rural marketsEvolutionary Vs revolutionary changes in rural markets
Role of state & market forcesRole of state & market forces
ICT based interventionsICT based interventions
Partnership innovationsPartnership innovations
Developmental role of rural marketingDevelopmental role of rural marketing
Scalability & replication of rural marketing programmesScalability & replication of rural marketing programmes
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ICT in Rural MarketsICT in Rural Markets
Category Government Private NGO/ PPP
Infrastructure
Provision
NIC N- Logue Simputer
Rural Services Bhoomi(
Karnataka)
Sewa
Agri Marketing Agmarknet E- Choupal OzhwarSandhiyes
Agri extension Universities EID Parry
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Close of SessionClose of Session
Thank YouThank You