report on to analyze the marketing of consumer products

Report on to analyze the marketing of consumer products

1. VUACCESS2.3.4. Http://vuaccess.blogspot.comA REPORT ON “To analyze the marketing of

consumer products(both durable and non durable products) in rural areas” A Dissertation report submitted to ASIA-PACIFIC INSTITUTE OF MANAGEMENT STUDIES, Towards partial fulfillment of the Post Graduate Program in Management Submitted To: Submitted By: Program: ASIA-PACIFIC INSTITUTE OF MANAGEMENT STUDIES MATHURA ROAD, NEW DELHIHttp://vuaccess.blogspot.com

5. Http://vuaccess.blogspot.comAcknowledgementI consider my proud privilege to express deep sense of gratitude to……………………………… for his admirable and valuable guidance, keeninterest, encouragement and constructive suggestions during the course ofthe project. I would also like to thank my father ………………………., for theirinspiration and moral support received in completing this work as forcollecting the data I had to visit so many rural areas or villages.Http://vuaccess.blogspot.com

6. Http://vuaccess.blogspot.comTABLE OF CONTENTS TOPIC PAGE NUMBER EXECUTIVE SUMMARY 04 RESEARCH METHODOLOGY O6 REVIEW OF LITERATURE 09 INTRODUCTION 13 FINDINGS AND ANALYSIS 118 CONCLUSIONS 128 SUGGESTIONS AND 131 RECOMMENDATIONS APPENDIX 132 BIBLIOGRAPHY 138Http://vuaccess.blogspot.com

7. Http://vuaccess.blogspot.comEXECUTIVE SUMMARY India’s way is not Europe’s. India is not Calcutta and Bombay. India livesin her seven hundred thousand villages.....................Mahatma Gandhi,1926 Marketing in developing countries like India have often beenborrowed from the western world. Concepts like Brand identity, Customerrelationship management, 4 Ps of the marketing mix, Consumer behaviorprocess; Segmentation, targeting and positioning etc. have often beenlifted straight from the marketing intelligentsia abroad and adopted inIndian conditions, often with minimal success. Reason lies not in the faultof such concepts, but their integration with the Indian ethos and culture.The rural India offers a tremendous market potential. Nearly two-thirds ofall middle-income households in the country are in rural India andrepresents half of India’s buying potential. Despite, the strong potential therural markets are by and large less exploited. Consider the market, out offive lakhs villages in India only one lakh have been tapped so far. Accordingto us if the rural market has to be adequately tapped, there has to be achange in the way marketing concepts learnt in B-schools with adequateadoption according to scenarios prevalent in rural India. The paper therebypresent the modified version of Philip Kotler’s famous marketing mixconsisting of 4Ps. The focus is on its modification and subsequentcustomization to Indian rural markets perspective. The 4Ps have to bemodified to include 1P i.e. Packaging and 1R i.e. Retailer as special focusareas. Further to ensure the sustainability of the marketing mix two Es i.e.Education and Empowerment have to be at the core as they help ingenerating widespread participation from the rural clientele by enhancingtheir standard of living. The Products in the rural market should essentiallyoperate at the basic and expected level of product classification. Theyshould essentially meet the basic needs of the consumer and should be ano-frill product, as the consumer would not be valuing much any furtheraddition to the product concept. Companies also face a daunting task


incommunicating about their products to the consumer due to lack of literacyand failure of traditional media to penetrate in the rural households.Http://vuaccess.blogspot.com

8. Projectsformba.blogspot.comHence, the advertising mix has to be more towards non-conventional yeteffective medium like Puppetry, Folk Theater Song, Wall Painting,Demonstration, Posters, Agricultural Games, NGOs network, etc. Thusoverall either the product or communication or preferably both need to becustomized to target the rural customer. In terms of physical distributiondue to lack of infrastructure the costs are very exorbitant to reach the ruralcustomer. Thus, mediums like rural marketing vehicles and melas and haatsprovide better opportunities to meet customer needs. Also the existingdistribution would need a transformation to achieve the requiredpenetration levels as success of Project Streamline of HLL has shown. Since,the value for money concept is more important rural customers, there hasto be an approach of treating customer as budget seeking consumer. Here,fitting the consumer needs into an affordable price point is pursued firstand then other features of product are fitted in. Similarly, packaging has tomeet customer needs of better brand recall and introducing favorable pricepoints. At the same time the importance of retailer has to be recognizedwhere he is one of the most major influencer is customer’s decision makingprocess. He acts as the friend and guide in this process and hence, needs tobe managed effectively through promotion programmes and incentives topromote the brand of a company. In order to bridge the gap between PhilipKotler and countryside Indian what is needed the appreciation of uniquefeatures of rural India and thus, responding to them by making adequateimprovements in the application of the marketing concepts learnt in theclass. For achieving the desired results of capturing the rural customer acomprehensive approach to the traditional marketing concepts has to betaken. This marketing mix has to be responsive to customers needs and fitinto his life as a tool of self-enhancement. To be successful the concept ofmarketing has to be taken in conjunction with its economic, psychologicaland social implications.Http://vuaccess.blogspot.com

9. Http://vuaccess.blogspot.comRESEARCH METHODOLOGYOBJECTIVES OF THE STUDY: Any task without sound objectives is like Tree without roots. Similarly incase of any research study undertaken, initially the objectives of the sameare determined and accordingly the further steps are taken on. A researchstudy may have many objectives but all these objectives revolve aroundone major objective which is the focus of the study. In this study, the focusis on the emergence of rural markets as the most happening market onwhich every marketer has an eye. And so this study will be based onstudying the emergence of rural market in various contexts.The main objective of the study is to analyze and present the marketing ofconsumer products in rural areas. The following objectives have been setforth. They are to: •Present a rural marketing perspective. • Present a profile of Indian Rural market. •Study and analyze the consumer behavior in rural areas. •Examine the product and brand penetration in rural markets. •Analyze marketing of consumer product in rural markets. •Present marketing strategy frame for marketing consumer products in rural areas.Http://vuaccess.blogspot.com

10. Projectsformba.blogspot.comSCOPE OF THE STUDY:The study is restricted to selected districts of Haryana. Further, product andbrand penetration is examined. As regards marketing of consumer productsin rural areas, the study analyzes products from non durable category (abathing soap, detergents, tea, coffee, shampoo) and from durable category(a wrist watch, television, refrigerator, fan and bicycle).Data collectionSample


unit:1. Working people (including men &women), basically farmers.2. College students3. School students4. Senior citizenSample size:1. Working people: 32%2. College students: 29%3. School students: 23%4. Senior citizens: 16%Sampling region: •I have selected, of Haryana as the area of study. •I have chosen Bhuratwala,Poharka , Chilkani Dhab and Kumthala as areas of research. The population status of these areas can be shown in a tabulated manner,which is given as follows:Http://vuaccess.blogspot.com

11. Projectsformba.blogspot.comArea PopulationChilkani Dhab 3500Kumthala 4000Poharka 8000Bhuratwala 7600Data collection method:1. Primary data: it will be collected with the help of a self administeredquestionnaire. This questionnaire aims to gather information related tovarious Branded products.Questionnaire design:As the questionnaire is self administrated one, the survey is kept simpleand user friendly. Words Used in questionnaire are readily understandableto all respondent. Also technical jargons are avoided to ensure that there isno confusion for respondents.2. Secondary data: it will be collected with the help of books, researchpapers, magazines, news papers, journals, Internet, etc.Http://vuaccess.blogspot.com

12. Http://vuaccess.blogspot.comReview of LiteratureRural market is one of the best opportunities for the FMCG sector. In somesense we can say that rural market is future of FMCG.1. Basu Purba (2004) suggested that the lifestyle of rural consumers ischanging. Rural Indian market and the marketing strategy have become thelatest marketing buzzword for most of the FMCG majors. She added thestrategies of different FMCG companies for capturing rural market likeTitan’s Sonata watches, Coco Cola’s 200mlbottle, different strategies ofHUL and Marico etc. She takes into consideration the study of NationalCouncil for Applied Economic Research (NCAER).According to the NCAERProjections, the number of middle and high-income households in ruralarea is expected to grow from 140 million to 190 million by 2007.In urbanIndia, the same is expected to grow from 65 million to 79 million. Thus, theabsolute size of rural India is expected to be double that of urban India.2. Tognatta Pradeep (2003), suggested that, the economic growth inIndias agricultural sector in last year was over 10%,compared with 8.5%inthe industrial sector. This implies a huge market potentiality for themarketer to meet up increasing demand. Factors such as village psyche,Strong distribution network and market awareness are few prerequisitesfor making a dent in the rural markets. The model is of the stolid Anglo-Dutch conglomerate Unilever Group, which has enjoyed a century-longpresence in India through its subsidiary Hindustan Lever Ltd. It wasHindustan Lever that several years ago popularized the idea of selling itsproducts in tiny packages. Its sachets of detergent and shampoo are ingreat demand in Indian villages. Britannia with its low priced Tiger brandbiscuits has become some of the success story in rural marketing..Http://vuaccess.blogspot.com

13. Projectsformba.blogspot.com3. Dr. N. Rajendhiran(MBA, PhD)/ Mr. S. Saiganesh(MBA, MA, M.Phil)/ Ms.P. Asha(MBA)Prime Minister Dr. Manmohan Singh recently talked about his vision for ruralIndia: "My vision of rural India is of a modern agrarian, industrial and serviceseconomy co-existing side by side, where people can live in well-equippedvillages and commute easily to work, be it on the farm or in the non-farmeconomy. There is much that modern science and technology can do to realisethis vision. Rural incomes have to be increased. Rural infrastructure has to beimproved. Rural health and education needs have to be met. Employmentopportunities have to be created in rural areas."Go rural is the slogan of marketing gurus after analyzing the socio-


economic changes in villages. The Rural population is nearly three timesthe urban, so that Rural consumers have become the prime target marketfor consumer durable and non-durable products, food, construction,electrical, electronics, automobiles, banks, insurance companies and othersectors besides hundred per cent of agri-input products such as seeds,fertilizers, pesticides and farm machinery. The Indian rural market todayaccounts for only about Rs 8 billion of the total ad pie of Rs 120 billion, thusclaiming 6.6 per cent of the total share. So clearly there seems to be a longway ahead. Although a lot is spoken about the immense potential of theunexplored rural market, advertisers and companies find it easier to vie for ashare of the already divided urban pie. Http://vuaccess.blogspot.com

14. Projectsformba.blogspot.comThe success of a brand and in the Indian rural market is as unpredictable asrain. It has always been difficult to gauge the rural market. Many brands,which should have been successful, have failed miserably. More often thannot, people attribute rural market success to luck. Therefore, marketersneed to understand the social dynamics and attitude variations withineach village though nationally it follows a consistent pattern looking at thechallenges and the opportunities which rural markets offer to the marketersit can be said that the future is very promising for those who canunderstand the dynamics of rural markets and exploit them to their bestadvantage. A radical change in attitudes of marketers towards the vibrant andburgeoning rural markets is called for, so they can successfully impress on the230 million rural consumers spread over approximately six hundred thousandvillages in rural India. Http://vuaccess.blogspot.com

15. Http://vuaccess.blogspot.comRURAL INDIA…a new dawnIndia needs creative solutions to start a revolution which can take its villages fast forward in time – convertingthem into economically viable units and growth engines, harnessing the power of the villagers, and opening up new horizons with the promise of a better tomorrow.Http://vuaccess.blogspot.com

16. Http://vuaccess.blogspot.comINTRODUCTION“India lives in her villages”. As described by Adi Godrej, Chairman, Godrej Group – “The ruralconsumers are discerning and the rural market is vibrant. At the currentof growth, it will soon outstrip the urban market. The rural market is nolonger sleeping but we are”. Before gamboling into issues like where the Indian rural marketstands and the opportunities for corporate’s to explore there... lets look atthe definition of urban and rural India. The Census defined urban India as -"All the places that fall within the administrative limits of a municipalcorporation, municipality, cantonment board etc or have a population of atleast 5,000 and have at least 75 per cent male working population inoutside the primary sector and have a population density of at least 400per square kilometer. Rural India, on the other hand, comprises all placesthat are not urban!"Http://vuaccess.blogspot.com

17. Projectsformba.blogspot.comIn our country over 70%of the total population live in villages. There arestates like U.P, M.P, Bihar, Rajasthan and Orissa where rural populationvaries form 8 to9 percent. Agriculture and agriculture related activities contribute to about75%of the income in rural areas. The general impression is that the ruralmarkets have potential only for agricultural inputs like seeds, fertilizers andpesticides, cattle feed and agricultural machinery. More than 50%of thenational income is generated in rural India and there are opportunities tomarket modern goods and services in rural areas and also marketagricultural products in urban areas. Infact it has


been estimated that therural markets are growing at fives times the rate of urban markets. About70% of bicycles, mechanical watches and radios and about 60%of batteries,sewing machine and table fans are sold in rural India. At the same time thesales of color television, washing machines, refrigerators, shampoos, facecream, mosquito repellent and tooth paste are very low and there istremendous potential for such products in rural markets. Now for some facts and figures The Indian rural market today accountsfor only about Rs. 8 billion (53 per cent - FMCG sector, 59 per cent durablessale, 100 per cent agricultural products) of the total ad pie of Rs. 120billion, thus claiming 6.6 per cent of the total share. So clearly there seemsto be a long way ahead.Time and again marketing practitioners have waxed eloquent about thepotential of the rural market. But when one zeroes in on the companiesthat focus on the rural market, a mere handful names come to mind.Hindustan Lever Limited (HLL) is top of the mind with their successful ruralHttp://vuaccess.blogspot.com

18. Projectsformba.blogspot.commarketing projects like Project Shakti and Operation Bharat. The lynchpinof HULs strategy has been to focus on penetrating the market down theline and focusing on price point. Furthermore, activating the brand in therural market through activities, which are in line with the brand itself, iswhat sums up HULs agenda as far as the rural market is concerned informsMindshare Fulcrum general manager R Gowthaman. Amul is another casein point of aggressive rural marketing. Some of the other corporates thatare slowly making headway in this area are Coca Cola India, Colgate,Eveready Batteries, LG Electronics, Philips, BSNL, Life InsuranceCorporation, Cavin Kare, Britannia and Hero Honda to name a few. Khaitan fans ad on a horse cart Wheels wall paintingWe can safely say that until some years ago, the rural market was beinggiven a step-motherly treatment by many companies and advertising torural consumers was usually a hit and miss affair. More often than not, theagenda being to take a short-cut route by pushing urban communication tothe rural market by merely transliterating the ad copy. Hence advertisingHttp://vuaccess.blogspot.com

19. Projectsformba.blogspot.comthat is rooted in urban sensitivities didnt touch the hearts and minds of therural consumer. While, this is definitely changing, the process is slow. Thegreatest challenge for advertisers and marketers continues to be in findingthe right mix that will have a pan-Indian rural appeal. Coca Cola, with theirAamir Khan Ad campaign succeeded in providing just that.Lifebuoys wall painting in rural IndiaCorporates are still apprehensive to "Go Rural." A few agencies that aretrying to create awareness about the rural market and its importance areAnugrah Madison, Sampark Marketing and Advertising Solutions Pvt Ltd,MART, Rural Relations, O&M Outreach, Linterland and RC&M, to name afew. Also, the first four agencies mentioned above have come together toform The Rural Network. The paramount objective of the Network is to getclients who are looking for a national strategy in rural marketing and helpthem in executing it across different regions.Http://vuaccess.blogspot.com

20. Projectsformba.blogspot.comInterestingly, the rural market is growing at a far greater speed than itsurban counterpart. "All the data provided by various agencies like NCAER,Francis Kanoi etc shows that rural markets are growing faster than urbanmarkets in certain product categories at least. The share of FMCG productsin rural markets is 53 per cent, durables boasts of 59 per cent market share.Therefore one can claim that rural markets are growing faster than urbanmarkets," says Sampark Marketing and Advertising Solutions Pvt Ltdmanaging director R A Patankar."Yaara da Tashan..." McCann


Ericksons ads with Aamir Khan createduniversal appeal for Coca ColaCoca-Cola India tapped the rural market in a big way when it introducedbottles priced at Rs 5 and backed it with the Aamir Khan ads. The company,on its behalf, has also been investing steadily to build their infrastructure tomeet the growing needs of the rural market, which reiterates the fact thatthis multinational has realised the potential of the rural market is goingstrength to strength to tap the same.Http://vuaccess.blogspot.com

21. Projectsformba.blogspot.comIn 2000, ITC took an initiative to develop direct contact with farmerswho lived in far-flung villages in Madhya Pradesh. ITCs E-choupal wasthe result of this initiative.Clearly the main challenge that one faces while dealing with ruralmarketing is the basic understanding of the rural consumer who is verydifferent from his urban counterpart. Also distribution remains to be thesingle largest problem marketers face today when it comes to going rural."Reaching your product to remote locations spread over 600,000 villagesand poor infrastructure - roads, telecommunication etc and lower levels ofliteracy are a few hinges that come in the way of marketers to reach therural market," says MART managing director Pradeep Kashyap.Citing other challenges in rural marketing, Patankar says, "Campaigns haveto be tailor made for each product category and each of the regions wherethe campaign is to be executed. Therefore a thorough knowledge of thenuances of language, dialects and familiarity with prevailing customs in theregions that you want to work for is essential. The other challenge is thereach and the available means of reaching out to these markets, hence thevideo van is one of the very effective means of reaching out physically tothe rural consumers."The fact of the matter remains that when compared to the Indian urbansociety, which is turning into a consumerism society; the rural consumerwill always remain driven by his needs first and will therefore be costconscious and thrifty in his spending habits. "Decision-making is stillconscious and deliberated among the rural community. But nevertheless,the future no doubt lies in the rural markets, since the size of the ruralmarket is growing at a good pace. There was a time when marketpredictions were made on the basis of the state of the monsoon but thistrend has changed over the years; there is a large non farming sector,which generates almost 40 per cent of the rural wealth. Hence the growthHttp://vuaccess.blogspot.com

22. Projectsformba.blogspot.comin the rural markets will be sustained to a large extent by this class inaddition to the farmer who will always be the mainstay of the ruraleconomy," affirms Patankar."Although the melting of the urban - rural divide will take a while, this is notfor want of the availability of the means but for want of the ruralconsumers mindset to change; which has its own logic, which is driven bytradition, custom and values that are difficult to shed," he points out.Satellite dish antennas reach rural IndiaFulcrums Gowthaman says, "The biggest impending factor or deterrent onrural monies going up is that there is a general sense of trying tobenchmark cost per contact (CPC). The television CPC is going to anywaysbe cheaper to rural CPC and unless and until the volume - value equationturns the other way round, you will not be able to spend disproportionatemonies in the rural market."Http://vuaccess.blogspot.com

23. Projectsformba.blogspot.comTypical shop in rural India stocked with sachets, etcFor HUL, a one rupee or a five rupee sachet or the Kutti Hamam (the smallHamam) helps in giving the consumers a trial opportunity. While it doeshelp in generate volume but not in terms of values. "Till the time thatvolume - value equation is managed better, the CPC is preventing anybodyto look at rural at a large scale activation programme,"


reiteratesGowthaman.Ultimately, the ball lies in the court of rural marketers. Its all about howone approaches the market, takes up the challenge of selling products andconcepts through innovative media design and more importantlyinteractivity. INDIA INFRASTRUCTUREThe best barometer of country’s economic standing is measured by its GDP.India, the second most populated country of more than 1100 million hasemerged as one of the fastest growing economies. It is a republic with afederal structure and well-developed independent judiciary with politicalconsensus in reforms and stable democratic environment .In 2008-09Http://vuaccess.blogspot.com

24. Projectsformba.blogspot.comIndia’s economy-GDP grew by 6.5% due to global recession. In the previousfour years,economy grew at 9%.The Indian economy is expected sustain agrowth rate of 8% for the next three years upto 2012. With the expectedaverage annual compounded growth rate of 8.5%, Indias GDP is expectedto be USD 1.4 trillion by 2017 and USD 2.8 trillion by 2027. Service sectorcontribute to 50% of India‘s GDP and the Industry and agriculture sector25% each.Investment Opportunities in Indian InfrastructureThe robust current growth in GDP has exposed the grave inadequacies inthe country’s infrastructure sectors. The strong population growth in Indiaand its booming economy are generating enormous pressures to modernizeHttp://vuaccess.blogspot.com

25. Projectsformba.blogspot.comand expand India’s infrastructure. The creation of world class infrastructurewould require large investments in addressing the deficit in quality andquantity. More than USD 475 billion worth of investment is to flow intoIndia’s infrastructure by 2012. No country in the world other than Indianeeds and can absorb so many funds for the infrastructure sector. With theabove investments India’s infrastructure would be equal to the best in theworld by 2017.In the next five years planned infrastructure investment in India in somekey sectors are (at current prices): Modernization of highways -US$ 75billion, Development of civil aviation US$ 12 billion, Development ofIrrigation system- US$ 18 billion, Development of Ports-US$ 26 billion,Development of Railways- US$ 71 billion, Development of Telecom- US$ 32billion, Development of Power -US$ 232 billion. Thus in the eleventh fiveyear plan ,investment in the above sectors (Aviation infrastructure,Construction infrastructure, Highway infrastructure ,Power infrastructure,Port infrastructure ,Telecom infrastructure ) will be US$ 384 billions(Rs17,20,000 Crores) considering the huge infrastructure market potential inIndia. In addition to the above, investments to the tune of US$ 91 billionshave been planned in other infrastructure sectors like Tourisminfrastructure ,Urban infrastructure ,Rural infrastructure, SEZs ,and waterinfrastructure and sanitation infrastructure thus making the totalinfrastructure investments in the eleventh plan period 2007-08 to 2011-12as US$475 billions. Domestic and global infrastructure funds have exposureto Indian infrastructure sectors.Http://vuaccess.blogspot.com

26. Projectsformba.blogspot.comRural MarketingRural marketing involves the process of developing, pricing, promoting,distributing rural specific product and a service leading to exchangebetween rural and urban market which satisfies consumer demand and alsoachieves organizational objectives.It is a two-way marketing processwherein the transactions can be: •Urban to Rural: A major part of rural marketing falls into this category. It involves the selling of products and services by urban marketers in rural areas. These include: Pesticides, FMCG Products, Consumer durables, etc. •Rural to Urban: Transactions in this category basically fall under agricultural marketing where a


rural producer seeks to sell his produce in an urban market. An agent or a middleman plays a crucial role in the marketing process. The following are some of the important items sold from the rural to urban areas: seeds, fruits and vegetables, milk and related products, forest produce, spices, etc. •Rural to Rural: This includes the activities that take place between two villages in close proximity to each other. The transactions relate to the areas of expertise the particular village has. These include selling of agricultural tools, cattle, carts and others to another village in its proximity.Http://vuaccess.blogspot.com

27. Projectsformba.blogspot.comRural marketing requires the understanding of the complexities. Indianagricultural industry has been growing at a tremendous pace in the last fewdecades. The rural areas are consuming a large number of industrial andurban manufactured products. The rural agricultural production andconsumption process plays a predominant role in developing the Indianeconomy. This has designed a new way for understanding a new processcalled Rural Marketing.The concept of rural marketing has to be distinguished from Agriculturalmarketing. Marketing is the process of identifying and satisfying customersneeds and providing them with adequate after sales service. Ruralmarketing is different from agricultural marketing, which signifiesmarketing of rural products to the urban consumer or institutional markets.Rural marketing basically deals with delivering manufactured or processedinputs or services to rural producers, the demand for which is basically aderived outcome.Rural marketing scientists also term it as developmental marketing, as theprocess of rural marketing involves an urban to rural activity, which in turnis characterized by various peculiarities in terms of nature of market,products and processes. Rural marketing differs from agricultural orconsumer products marketing in terms of the nature of transactions, whichincludes participants, products, modalities, norms and outcomes. Theparticipants in case of Rural Marketing would also be different they includeinput manufacturers, dealers, farmers, opinion makers, governmentagencies and traders.Http://vuaccess.blogspot.com

28. Projectsformba.blogspot.comRural marketing needs to combine concerns for profit with a concern forthe society, besides being titled towards profit. Rural market foragricultural inputs is a case of market pull and not market push. Most of thejobs of marketing and selling are left to the local dealers and retailers.The market for input gets interlocked with other markets like output,consumer goods, money and labor.INDIAN RURAL MARKET:Rural marketing in India is not much developed there are many hindrancesin the area of market, product design and positioning, pricing, distributionand promotion. Companies need to understand rural marketing in abroader manner not only to survive and grow in their business, but also ameans to the development of the rural economy. One has to have astrategic view of the rural markets so as to know and understand themarkets well. In the context of rural marketing one has to understand themanipulation of marketing mix has to be properly understood in terms ofproduct usage. Product usage is central to price, distribution, promotion,branding, company image and more important farmer economics, thus anystrategy in rural marketing should be given due attention and importanceby understanding the product usage, all elements of marketing mix can bebetter organized and managed.Http://vuaccess.blogspot.com

29. Projectsformba.blogspot.comEvolution of Rural MarketingPhas Major Source Destination Origin Function e Products Market MarketI Before Mid-1960 Agricultural Agricultural Rural Urban (from Marketing independenc Produce e to green revolution)II Mid- Sixties (Green Marketing Agricultural Urban Rural revolution to Of Pre- Inputs


liberalization Agricultural period) InputsIII Mid- Nineties Consumable (Post- s And Rural Urban & Rural liberalization Durables For Rural period on Marketing 20th century) Consumptio n& ProductionHttp://vuaccess.blogspot.com

30. Projectsformba.blogspot.comIV 21st century Developmen All products Urban & Urban & tal & services Rural Rural marketing •Phase I ( from Independence to Green Revolution): Before the advent of the Green revolution, the nature of rural market was altogether different. Rural marketing then referred to the marketing of rural products in rural & urban products. •Phase II (Green Revolution to Pre-liberalization period): During these times, due to the advent & spread of the Green Revolution, rural marketing represented marketing of agriculture inputs in rural markets & marketing of rural produce in urban areas. •Phase III (Post-liberalization period on 20th century): The third phase of rural marketing started after the liberalization of the Indian economy. In this period, rural marketing represented the emerging, distinct activity of attracting & serving rural markets to fulfill the need & wants of rural households, peoples & their occupations. •Phase IV (21st century): Learning from its rural marketing experiences after the independence, the corporate world has finally realized the quick-fix solutions & piecemeal approaches will deliver only limited results in the rural markets. And, if an organization wants to tap the realHttp://vuaccess.blogspot.com

31. Http://vuaccess.blogspot.compotential of the rural market, it needs to make a long-term commitment with this market. Its approach & strategies must not focus in just selling products & services, but they should also aim at creating an environment for this to happen.The objective of rural marketing in the current phase is the improvement ofthe quality of life by satisfying the needs & wants of the customers, notthrough at and-alone products or services, but by presentingcomprehensive & integrated solutions which might involve a set of inter-related products & services.Till recently, the focus of marketers in India was the urban consumer and bylarge number specific efforts were made to reach the rural markets. Butnow it is felt that with the tempo of development accelerating in ruralIndia, coupled with increase in purchasing power, because of scientificagriculture, the changing life style and consumption pattern of villagerswith increase in education, social mobility, improved means oftransportations and communication and other penetrations of mass mediasuch as television and its various satellite channels have exposed rural Indiato the outside world and hence their outlook to life has also changed.Because of all these factors, rural India is now attracting more and moremarketers.Increase in competition, saturated urban markets, more and move newproducts demanding urban customers, made the companies to think aboutnew potential markets. Thus, Indian rural markets have caught theattention of many companies, advertisers and multinational companies.Http://vuaccess.blogspot.com

32. Projectsformba.blogspot.comAccording to a recent survey conducted by the National Council for AppliedEconomic Research (NCAER), the purchasing power of the rural people hasincreased due to increase in productivity and better price commanded bythe agricultural products. By and large this rise in purchasing powerremains unexploited and with the growing reach of the television, it is nowquite easy for the marketers to capture these markets.Rural marketing has become the latest mantra of most corporate.Companies like Hindustan Lever, Colgate Palmolive, Britannia and evenMultinational Companies (MNCs) like Pepsi, Coca Cola, L.G., Philips, andCalvin kare are all eyeing rural markets to capture the large Indian market.Coming to the frame


work of Rural Marketing, Rural Marketing broadlyinvolves reaching the rural customer, understanding their needs and wants,supply of goods and services to meet their requirements, carrying out aftersales service that leads to customer satisfaction and repeat purchase/sales.The Indian growth story is now spreading itself to Indias hinterlands. RuralIndia, home to about two-thirds of the country’s 1 billion population, is notjust witnessing an increase in its income but also in consumption andproduction. The union budget for 2009-10 hiked the allocation for theNational Rural Employment Guarantee Act (NREGA) to US$ 8.03 billion,giving a further boost to the rural economy. This is in addition to the farmerloan waiver of US$ 13.86 billion and the ambitious Bharat NirmanProgramme with an outlay of US$ 34.84 billion for improving ruralinfrastructure. Additionally, the rural economy has not been impacted bythe global economic slowdown, according to a recent study by the RuralHttp://vuaccess.blogspot.com

33. Projectsformba.blogspot.comMarketing Association of India (RMAI). The study found that the rural andsmall town economy which accounts for 60 per cent of India’s income hasremained insulated from the economic slowdown. Moreover, rural incomesare on the rise driven largely due to continuous growth in agriculture forfour consecutive years. According to a McKinsey survey conducted in 2007,the rural India market would grow almost four times from its existing size in2007, which was estimated at US$ 577 billion.RURAL INFRASTRUCTURE:1) 46 percent of villages are connected by all weather roads.2) 84 percent of villages are electrified.3) 5700 regulated markets.In the early 2000s, around 700 million people, i.e. 70% of the Indianpopulation lived in 6,27,000 villages, in rural areas. Of this, 90% wereconcentrated in villages with population less than 2000.3 According to astudy conducted in 2001 by the National Council for Applied EconomicResearch (NCAER), there were as many "middle income and above"households in rural areas as there were in urban areas. There were almosttwice as many "lower income households" in rural areas as in urban areas.There were 2.3 million "highest income" households in urban areas asagainst 1.6 million in rural areas. NCAER projections indicated that theHttp://vuaccess.blogspot.com

34. Projectsformba.blogspot.comnumber of "middle income and above" households was expected to growto 111 million in rural India by 2007, compared to 59 million in urban India.Gone were the days when a rural consumer had to go to a nearby town orcity to buy a branded product. The growing power of the rural consumerwas forcing big companies to flock to rural markets. At the same time, theyalso threw up major challenges for marketers.FMCGThere was a time when the FMCG companies ignores rural market, theytook no any interest to produced or sell products in rural market in India. Itwas the initial stage of FMCG companies in India. As per as the time hadpassed, the strategy and marketing style of FMCG companies had beenchanged.The rural market is the one of the best opportunity for the FMCG sector inthe India. It is wider and less competitive market for the FMCG. As theincome level of the rural consumers increasing, the demand of FMCG isincreasing continuously.Top Players in FMCG Sector1. Hindustan Unilever limited (HUL)2. ITC (Indian Tobacco Company)3. Nestle India4. GCMMF (AMUL)5. Dabur IndiaHttp://vuaccess.blogspot.com

35. Projectsformba.blogspot.com6. Asian Paints (India)7. Cadbury India8. Britannia Industries9. Procter &Gamble Hygiene &Health Care10. Marico IndustriesSecondary Players1. Colgate-Palmolive (India)Ltd.2. Godrej Consumers Product Ltd.3. Nirma Ltd.4. Tata Tea Ltd.5. Parle AgroRural consumers spend around 13 per cent of their


income, the secondhighest after food (35 per cent), on fast moving consumer goods (FMCG), asper a RMAI study.The FMCG industry in India was worth around US$ 16.03 billion in August2008 and the rural market accounted for a robust 57 per cent share of thetotal FMCG market in India.The FMCG sector saw rural markets post 20 per cent growth, ahead of the17-18 per cent growth from urban India, aided by three years of goodmonsoon, higher prices of farm produce and farm-loan waiver.Most FMCG companies are now working on increasing their distribution insmaller towns and focusing on marketing and operations programme forsemi-urban and rural markets.Http://vuaccess.blogspot.com

36. Projectsformba.blogspot.comFor instance, Godrej Consumer Products intends to increase revenue fromrural areas from 38 per cent to 55 per cent in the next three years byincreasing its distribution network substantially. The products will reach outto 50,000 villages in the next couple of years from the present 18,000villages while the number of towns covered will double from 3,300 toalmost 6,500 in a year.RetailThe rural retail market is currently estimated at US$ 112 billion, or around40 per cent of the US$ 280 billion retail market. Major domestic retailerslike AV Birla, ITC, Godrej, Reliance and many others have already set upfarm linkages. Hariyali Kisan Bazaars (DCM) and Aadhars (Pantaloon-GodrejJV), Choupal Sagars (ITC), Kisan Sansars (Tata), Reliance Fresh, ProjectShakti (Hindustan Unilever) and Naya Yug Bazaar are established rural retailhubs.TelecommunicationA Gartner forecast revealed that Indian cellular services revenue will growat a compound annual growth rate (CAGR) of 18.4 per cent to touch US$25.6 billion by 2011, with most of the growth coming from rural markets.Also, a joint Confederation of Indian Industries (CII) and Ernst & Youngreport reveals that of the next 250 million Indian wireless users,approximately 100 million (40 per cent) are likely to be from rural areas,and by 2012, rural users will account for over 60 per cent of the totaltelecom subscriber base in India.Http://vuaccess.blogspot.com

37. Projectsformba.blogspot.comIn a bid to acquire rural subscribers, most Indian telecom operators havestarted investing in infrastructure to roll out their services in these areas.Realising this as a huge potential, small Indian handset manufacturingcompanies, including Micromax, Intex Technologies and Karbonn, havelined up a marketing spent of around US$ 21.02 million for the financialyear 2009-10.AutomobilesFor the auto industry, semi-urban and rural markets contribute close to 40per cent of sales, led by demand for two-wheelers, entry-level cars andtractors. Significantly, car sales grew 8.3 per cent in June 2009, aided byrising demand in semi-urban and rural markets. Mahindra & Mahindra isbullish on the rural and semi-urban markets, with its utility vehicle, Scorpioclocking 60-65 per cent sales from the rural markets as against 20 per centHttp://vuaccess.blogspot.com

38. Projectsformba.blogspot.comearlier. TVS Motor also registered around 50 per cent of its sales from therural and semi-urban markets.Consumer durablesA survey carried out by RMAI has revealed that 59 per cent of durablessales come from rural markets.Presently, around 50 per cent of sales in the US$ 5.14 billion consumerelectronics industry come from the urban markets, 30 per cent from tier-IIand -III towns and balance 20 per cent from rural India.Many leading consumer durable companies are now increasing theirpresence in rural India. Recently, LG has set up 45 area offices and 59 ruraland remote-area offices. Moreover, it has outlined plans to invest aroundUS$ 40 million towards development of entry-level products targeted atrural


markets.Samsung has also rolled out its Dream Home road show which was to visit48 small towns in 100 days in an effort to increase brand awareness of itsproducts. Samsung expects that its rural revenues would increase to US$287.7 million in 2009 from US$ 164.4 million last year. The company alsoplans to expand its sales channel by 25-30 per cent in rural India.Whirlpool, is eyeing rural markets in India for its next phase of growth. Thecompany is set to tap markets with a population between 100,000 and500,000 in the first phase, and in the next phase, will look at expanding thebase in villages with a population of 50,000.Http://vuaccess.blogspot.com

39. Projectsformba.blogspot.comNature of Rural Market •Large, Diverse and Scattered Market: Rural market in India is large, and scattered into a number of regions. There may be less number of shops available to market products. • Major Income of Rural consumers is from Agriculture: Rural Prosperity is tied with agriculture prosperity. In the event of a crop failure, the income of the rural masses is directly affected. •Standard of Living and rising disposable income of the rural customers: It is known that majority of the rural population lives below poverty line and has low literacy rate, low per capital income, societal backwardness, low savings, etc. But the new tax structure, good monsoon, government regulation on pricing has created disposableHttp://vuaccess.blogspot.com

40. Http://vuaccess.blogspot.comincomes. Today the rural customer spends money to get value and is aware of the happening around him. •Traditional Outlook: Villages develop slowly and have a traditional outlook. Change is a continuous process but most rural people accept change gradually. This is gradually changing due to literacy especially in the youth who have begun to change the outlook in the villages. •Rising literacy levels: It is documented that approximately 45% of rural Indians are literate. Hence awareness has increases and the farmers are well-informed about the world around them. They are also educating themselves on the new technology around them and aspiring for a better lifestyle. • Diverse socioeconomic background: Due to dispersion of geographical areas and uneven land fertility, rural people have disparate socioeconomic background, which ultimately affects the rural market. •Infrastructure Facilities: The infrastructure facilities like cemented roads, warehouses, communication system, and financial facilities are inadequate in rural areas. Hence physical distribution is a challenge to marketers who have found innovative ways to market their products.Some Myths: •Myth-1: Rural Market Is a Homogeneous MassHttp://vuaccess.blogspot.com

41. Projectsformba.blogspot.comReality: It’s a heterogeneous population. Various Tiers are presentdepending on the incomes like Big Landlords; Traders, small farmers;Marginal farmers: Labors, artisans. State wise variations in ruraldemographics are present viz. Literacy (Kerala 90%, Bihar 44%) andPopulation below poverty line (Orissa 48%, Punjab 6%). •Myth-2: Disposable Income Is LowReality: Number of middle class HHs (annual income Rs 45,000- 2, 15,000)for rural sector is 27.4 million as compared to the figure of 29.5 million forurban sector. Rural incomes CAGR was 10.95% compared to 10.74% inurban between 1970-71 and 1993-94. •Myth-3: Individuals Decide About PurchasesReality: Decision making process is collective. Purchase process- influencer,decider, and buyer, one who pays can all be different. So marketers mustaddress brand message at several levels. Rural youth brings brandknowledge to Households (HH).Is rural marketing transactional or developmental in itsapproach?Http://vuaccess.blogspot.com


42. Projectsformba.blogspot.comIt is true, rural markets have become an attractive proposition forcommercial business organizations.The role of rural marketing as such is more developmental thantransactional. It is more a process of delivering better standard of living andquality of life to the rural environment taking into consideration theprevailing village milieu.Transactional Vs Developmental: For better comprehension ofthis role let us distinguish development marketing and transactionalmarketing. Table brings out the differences in brief. Transactional Vs Development Marketing S.No Aspect Transactional Development 1. Concept Consumer orientation, Society orientation, societal Marketing concept concept 2. Role Stimulating and Catalytic and conversional transformation agent marketing 3. Focus Product-market fit Social change 4. Key task Product innovations Social innovations and and communications communications 5. Nature of Commercial Socio-cultural, economic activity 6. Participants Corporate enterprises, Government, voluntaryHttp://vuaccess.blogspot.com

43. Http://vuaccess.blogspot.comSellers agencies, corporate enterprises, benefactors7. Offer Products and services Development, projects/schemes/program s8. Target group Buyers Beneficiaries and buyers9. Communication Functional Developmental10. Goal Profits, Customer Market development satisfaction Corporate Image Brand image11. Time-Frame Short-medium Medium-Long12. Motivation Profit-motive Service-motive Business policy Ideological or Public policyModel: The model of rural marketing represents a combination of thetransactional and developmental approaches. •Rural marketing process is both a catalyst as well as an outcome of the general rural development process. Initiation and management of social and economic change in the rural sector is the core of the rural marketing process. It becomes in this process both benefactor and beneficiary.Http://vuaccess.blogspot.com

44. Http://vuaccess.blogspot.com•Innovation is the essence of marketing. Innovative methods of social change for successful transformation of traditional society are virtual. Such a change narrows the rural-urban divide. •The process of transformation can be only evolutionary and not revolutionary. The growth of the rural market can be a planned evolutionary process based on strategic instruments of change rather than constitute just short-term opportunities for commercial gains. •The exposure of ruralities to a variety of marketing transactions during the change process puts them in the role of beneficiaries than of just `buyers of modern inputs and infrastructural services. •Communication is the vital element of rural marketing. It should serve to resolve social conflicts, encourage cooperation and strengthen competitive spirit during interactions between rural and urban as well as within rural areas. Another critical point for communication is the point of conversion of ruralite from an "induced beneficiary" to an "autonomous buyer".Classification of rural consumersThe rural consumers are classified into the following groups based on theireconomic status: •The Affluent Group: They are cash rich farmers and a very few in number. They have affordability but not form a demand base largeHttp://vuaccess.blogspot.com

45. Http://vuaccess.blogspot.comenough for marketing firms to depend on. Wheat farmers in Punjab and rice merchants of Andhra Pradesh fall in this group. •The Middle Class: This is one of the largest segments for manufactured goods and is fast expanding. Farmers cultivating sugar cane in UP and Karnataka fall in this category. •The Poor: This constitutes a huge segment. Purchasing power is less, but strength is more. They receive the grants from government and reap the benefits of many such schemes and may move


towards the middleclass. The farmers of Bihar and Orissa fall under this category.Roadblocks of Indian Rural MarketThere are several roadblocks that make it difficult to progress in the ruralmarket. Marketers encounter a number of problems like dealing withphysical distribution, logistics, proper and effective deployment of salesforce and effective marketing communication when they enter ruralmarkets. The major problems are listed below. •Standard of living: The number of people below the poverty line is more in rural markets. Thus the market is also underdeveloped and marketing strategies have to be different from those used in urban marketing. • Low literacy levels: The low literacy levels in rural areas leads to a problem of communication. Print media has less utility compared to the other media of communication.Http://vuaccess.blogspot.com

46. Http://vuaccess.blogspot.com• Low per capita income: Agriculture is the main source of income and hence spending capacity depends upon the agriculture produce. Demand may not be stable or regular. •Transportation and warehousing: Transportation is one of the biggest challenges in rural markets. As far as road transportation is concerned, about 50% of Indian villages are connected by roads. However, the rest of the rural markets do not even have a proper road linkage which makes physical distribution a tough task. Many villages are located in hilly terrains that make it difficult to connect them through roads. Most marketers use tractors or bullock carts in rural areas to distribute their products. Warehousing is another major problem in rural areas, as there is hardly any organized agency to look after the storage issue. The services rendered by central warehousing corporation and state warehousing corporations are limited only to urban and suburban areas. • Ineffective distribution channels: The distribution chain is not very well organized and requires a large number of intermediaries, which in turn increases the cost and creates administrative problems. Due to lack of proper infrastructure, manufacturers are reluctant to open outlets in these areas. They are mainly dependent on dealers, who are not easily available for rural areas. This is a challenge to the marketers. • Many languages and diversity in culture: Factors like cultural congruence, different behaviour and language of the respective areasHttp://vuaccess.blogspot.com

47. Http://vuaccess.blogspot.commake it difficult to handle the customers. Traits among the sales force are required to match the various requirements of these specific areas. • Lack of communication system: Quick communication is the need of the hour for smooth conduct of business, but it continues to be a far cry in rural areas due to lack of communication facilities like telegraph and telecommunication systems etc. The literacy rate in the rural areas is rather low and consumer’s behaviour in these areas is traditional, which may be a problem for effective communication. •Spurious brands: Cost is an important factor that determines purchasing decision in rural areas. A lot of spurious brands or look-alikes are available, providing a low cost option to the rural customer. Many a time the rural customer may not be aware of the difference due to illiteracy. •Seasonal demand: Demand may be seasonal due to dependency on agricultural income. Harvest season might see an increase in disposable income and hence more purchasing power. • Dispersed markets: Rural population is highly dispersed and requires a lot of marketing efforts in terms of distribution and communication.Attractiveness of rural marketHttp://vuaccess.blogspot.com


48. Http://vuaccess.blogspot.com• Large Population: The rural population is large and its growth rate is also high. Despite the rural urban migration, the rural areas continue to be the place of living majority of Indians. •Rising Rural Propensity: 2005-0 Income Group 2000-01 2008-09 6 Above Rs. 1.6 3.8 5.6 100,000 Rs. 2.7 4.7 5.8 77,001-100,000 Rs. 50,001-77,000 8.3 13.0 22.4Http://vuaccess.blogspot.com

49. Http://vuaccess.blogspot.comRs. 25,001-50,000 26.0 41.1 44.6 Rs.25,000 & 61.4 37.4 20.2 below Thus we see that population between income level of Rs. 25,000- 77,000 will increase from 34.3% in 1994-95 to 67.0% in 2006-07. The rural consuming class is increasing by about 3-4% per annum, which roughly translates into 1.2 million new consumers yearly. •Growth in consumption: Per capita household expenditure (in Rs.) Level N States Expenditu o. reHttp://vuaccess.blogspot.com

50. Http://vuaccess.blogspot.comPunjab 614 Kerala 604 Haryana 546 High Rajasthan 452 (Above Rs 7 Gujarat 416 382/-) Andhra 386 Pradesh Maharashtr 384 a West 382 Bengal Orissa 381 Average 5 Tamil Naidu 381 (Rs. 382/-) Uttar 373 Pradesh Karnataka 365 Assam 338 Low Madhya 326 (Below Rs. 3 Pradesh 382/-) Bihar 289Http://vuaccess.blogspot.com

51. Http://vuaccess.blogspot.comDistribution household’s income wise (projection in Rs Crore) 2001 – 02 2006 – 07 Income Rural Rural groups Total No. % Total No. % High 0.26 0.07 26. 0.52 0.12 23. 9 1 Middle 12.04 7.73 64. 16.72 10.3 61. 2 2 8 Low 5.7 5.09 88. 3.68 3.52 95. 7 7 Total 18.04 12.8 71. 20.90 13.9 66. 9 4 6 7Spending pattern (Rural Household’s in Rs.) Item % Rich Poor Average Food Articles 4 147 73 95 4 Toiletries 2 67 33 43 0 Washing Material 1 43 22 28 3 Cosmetics 1 33 17 21Http://vuaccess.blogspot.com

52. Http://vuaccess.blogspot.com0 Otc Products 4 13 6 9 Others 9 30 15 19 Total 333 166 215 Average rural household spends on consumables excluding food grains, milk & vegetables are Rs. 215/-. •Life style changes: Income vs. usage of packed consumer goods (% of household using) Monthly household income (Rs.) Goods Up to 351 – 751 – 1501 350 750 1500 + Washing Cakes/Bars 60 78 86 91 shampoos 57 72 89 93 Tooth 22 36 65 85 Paste/Powder bathing soaps 20 25 41 63 Tea (Packaged) 22 30 48 64Http://vuaccess.blogspot.com

53. Http://vuaccess.blogspot.com•Life cycle advantage: Stages in life cycle Product Urban Market Growth Rural Rate % Popular soaps Maturity 2 Growth Premium Late 11 Early soaps growth growth Washing Late 6 Early powder growth growth Skin creams Maturity 1.1 Growth Tea Maturity 4 Growth • Market growth rates higher: Growth rates of the FMCG market and the durable market are higher in rural areas for many products. The rural market share will be more than 50% for the products like toilet soaps, body talcum powder, cooking medium (oil), cooking medium (vanaspati), tea, cigarettes and hair oil.•Rural marketing is not expensive: Conventional wisdom dictates thatsince rural consumers are dispersed, reaching them is costly. However,new research indicates that the selling in Rural India is not expensive.According to one research it costs roughly Rs.1 Crore to promote aconsumer durable inside a state. This includes the expenses of advertisingHttp://vuaccess.blogspot.com

54. Projectsformba.blogspot.comin vernacular newspapers, television spots, in-cinema advertising, radio,van operations and merchandising and point of purchase promotion.Campaign like this, which can reach millions, costs twice as much in urbanarea. Rural Vs Urban MarketingNo Aspect Urban Rural .1 Marketing & Marketing


& Societal Concepts Societal Concepts, & Relationship Development Philosophy Marketing Marketing & Relationship Marketing2 •Market •Demand High Low •Competition Among Units In Mostly From Organized Sector Unorganized Units Consumers Location Concentrated Widely Spread Literacy High Low Income High LowHttp://vuaccess.blogspot.com

55. Http://vuaccess.blogspot.comExpenditure Planned, Even Seasonal, Variation Needs High Level Low Level Innovation/Adoptio Faster Slow n3 Product Awareness High Low Concept Known Less Known Positioning Easy Difficult Usage Method Easily Grasped Difficult To Grasp Quality Preference Good Moderate4 Price Sensitive Yes Very much level desired Medium-high Medium-low5 distribution Wholesalers, Village shops, stockists, retailer, “Haats” supermarket, channels specialty stores, & authorised showrooms Transport Facilities Good Average Product Availability High Limited6 Promotion Advertising Print, audio visual TV, radio, printHttp://vuaccess.blogspot.com

56. Http://vuaccess.blogspot.commedia, outdoors, media to some exhibitions etc. few extent. More languages languages Door-to-door, Occasionally Personal Selling frequently Contests, gifts, Gifts, price Sales Promotion price discount discounts Publicity Good opportunities Less opportunitiesSpecial Products for Rural Markets:•Rural Transporter: Mahindra & Mahindra is busy developing theprototype of what it calls a ‘Rural Transporter’ – basically a hybrid betweena tractor and a rural transport vehicle. The product at 20-25 HP will betargeted at those who cannot afford a normal tractor and would also fulfillthe need of family transporter that could take in the rural roughs but wouldbe much more comfortable and safer than the conventional tractor-trolley.•Sampoorna TV: LG Electronics, the Korean firm has rejigged the TV toappeal to local needs. It spent Rs. 21 Lacs to develop a set that would haveon-screen displays in the vernacular languages of Hindi, Tamil and Bengali.The logic, rural consumers unfamiliar with English would still be able to usethe TV without being intimidated.Http://vuaccess.blogspot.com

57. Projectsformba.blogspot.com•Titan Watches: A recent NCAER study revealed that there is a greatpotential for watches in rural areas. In fact it is considered to be a highpriority list. It was also found that a rural consumer looks for theruggedness of the watch more than the urban consumer does. He prefersthick watches than slim watches. The biggest problem that the Marketersare facing in the Rural Markets is Of IMITATIONS. Imitations may result intwo types of goods depending upon the purpose, commitment, andcompetence of imitator. A poor imitator will end up in producing deceptive,spurious, fake, copycat products. He dupes the gullible customer byoffering products having close resemblance with the original. In quality, it ispoor cousin to the original. On the other hand, a poor imitator may evenproduce an improved version of the original product. In this scenario thejob of the Marketer becomes even more difficult in the sense that he hasnot to fight other competitors but also the imitated products. Theadvantages that these products enjoy in the rural markets are that theImitators who are in the villages are making these and they are offeringMore Margins & Better credit Facilities.To solve this problem the Marketerhas to educate the consumer about his product and show him the benefitsof his products over the imitated ones.Need-Product Relationships and the changes happening in Rural IndiaNeeds Old Products New ProductsHttp://vuaccess.blogspot.com


58. Projectsformba.blogspot.comBrushing Teeth Neem sticks, Charcoal, Toothpaste, tooth Rocksalt, Husk powderWashing Vessels Coconut fiber, Earthy Washing Powders, materials, Brick Powder, soaps and liquids AshTransport Bullock Cart, Horses, Tractors, LCVs, Donkeys Mopeds, Scooters, Motor cyclesIrrigation Wells, Canals, Water Bore-wells, Motors, lifters, Wind Mills Power Generators, Pump SetsHair Wash Shikakai powder, Retha, Shampoos and hair Besan care soapsCONSUMER BEHAVIOR IN RURAL MARKETS:Promotion of brands in rural markets requires the special measures. Due tothe social and backward condition the personal selling efforts have achallenging role to play in this regard. The word of mouth is an importantmessage carrier in rural areas. Infect the opinion leaders are the mostinfluencing part of promotion strategy of rural promotion efforts. Theexperience of agricultural input industry can act as a guideline for theHttp://vuaccess.blogspot.com

59. Projectsformba.blogspot.commarketing efforts of consumer durable and non-durable companies.Relevance of Mass Media is also a very important factor.The Indian established Industries have the advantages, which MNC dontenjoy in this regard. The strong Indian brands have strong brand equity,consumer demand-pull and efficient and dedicated dealer network whichhave been created over a period of time. The rural market has a grip ofstrong country shops, which affect the sale of various products in ruralmarket. The companies are trying to trigger growth in rural areas. They areidentifying the fact that rural people are now in the better position withdisposable income. The low rate finance availability has also increased theaffordability of purchasing the costly products by the rural people.Marketer should understand the price sensitivity of a consumer in a ruralarea. This paper is therefore an attempt to promote the brand image in therural market.Indian Marketers on rural marketing have two understanding (I) The urbanmetro products and marketing products can be implemented in ruralmarkets with some or no change. (ii) The rural marketing required theseparate skills and techniques from its urban counter part. The Marketershave following facilities to make them believe in accepting the truth thatrural markets are different in so many terms.(i) The rural market has the opportunity for.(ii) Low priced products can be more successful in rural markets becausethe low purchasing, purchasing powers in rural markets.Http://vuaccess.blogspot.com

60. Projectsformba.blogspot.com(iii) Rural consumers have mostly homogeneous group with similar needs,economic conditions and problems.(iv) The rural markets can be worked with the different media environmentas opposed to press, film, radio and other urban centric media exposure.How reality does affect the planning of marketers? Do villagers have sameattitude like urban consumers? The question arises for the management ofrural marketing effects in a significant manner so than companies can enterin the rural market with the definite goals and targets but not for a shortterm period but for longer duration. The Research paper will discuss therole of regard. The strategy, which will be presented in the paper, can beeither specific or universally applicable.The ultimate objective of allproduction is consumption. A free market economy provides freedom tothe consumers to buy and consume goods of their choice. The buyingpreferences of consumers send signals to producers to produce variouscommodities in required quantities. Producers, therefore, produces onlythose commodities which are desired by the consumers. In India, consumerbehavior has changed in recent years owing to enhanced awareness,information technology, and, more


importantly, governmental interventionthrough legislations. Indias rural consumers account for about 73 percentof the total consumers. In recent years, the lifestyle of a large number ofrural consumers in India has changed dramatically and continues to do so.The buying behavior of the rural consumers is influenced by several factors,such as socio-economic conditions, cultural environment, literacy level,Http://vuaccess.blogspot.com

61. Projectsformba.blogspot.comoccupation, geographical location, efforts on the part of sellers, exposure tothe media, etc. This book examines the buying behavior of Indias ruralmasses and the diverse factors which influence their choices. The work isuseful for understanding the Indian rural consumer psyche in order toformulate an appropriate marketing strategy. It includes: •Media •Newspaper brand •Sources of information. RURAL CONSUMER PREFERENCES: In order to assess the buyer behavior towards certain critical aspects of marketing, the preferences of the consumers is directly related to: •Price •Quality •Credit •Variety •Dealer advice •Specific brand. PURCHASE BEHAVIOR: Rural people can buy only from three places includes: •From the shop in the same village •Weekly bazaar •From the shop of nearby town.Factors influencing buying behaviorThe various factors that affect buying behavior of in rural India are:Http://vuaccess.blogspot.com

62. Http://vuaccess.blogspot.com•Environmental of the consumer - The environment or the surroundings, within which the consumer lives, has a very strong influence on the buyer behavior, egs. Electrification, water supply affects demand for durables. •Geographic influences - The geographic location in which the rural consumer is located also speaks about the thought process of the consumer. For instance, villages in South India accept technology quicker than in other parts of India. Thus, HMT sells more winding watches in the north while they sell more quartz watches down south. •Family – it is an important buying decision making organization in consumer markets. Family size & the roles played by family members exercise considerable influence on the purchase decisions. Industry observers are increasingly realizing that at times, purchase of durable has less to do with income, but has more to do with the size of the family & that’s where rural India with joint family structures, becomes an attractive proposition. •Economic factors – The quantum of income & the earning stream are one of the major deciding factors, which determine to a great extent, what the customer will be able to buy. Many people in the rural market are below poverty line & for large number of people, agriculture is the primary occupation. More than 70% of the people are in small-scale agricultural operation. These factors affect the purchase decision.Http://vuaccess.blogspot.com

63. Http://vuaccess.blogspot.com•Place of purchase - (60% prefer HAATS due to better quality, variety & price) Companies need to assess the influence of retailers on both consumers at village shops and at haats. •Creative use of product - ex Godrej hair dye being used as a paint to colour horns of oxen, Washing machine being used for churning lassi. The study of product end provides indicators to the company on the need for education and also for new product ideas. •Brand preference and loyalty - (80% of sale is branded items in 16 product categories)Cultural factors influencing consumer behaviorCultural factors exert the broadest and deepest influence on consumerbehaviour. The marketer needs to understand the role played by thebuyer’s culture. Culture is the most basic element that shapes a person’swants and behaviour. In India, there are so many different cultures, whichonly goes on to make the marketer’s job tougher. Some of


the few culturalfactors that influence buyer behaviour are: •Product (colour, size, design, and shape): There are many examples that support this point. •For example, the Tata Sumo, which was launched in rural India in a white colour, was not well accepted. But however, when the same Sumo was re-launched as Spacio (a different name) and in aHttp://vuaccess.blogspot.com

64. Http://vuaccess.blogspot.combright yellow colour, with a larger seating capacity and ability to transport good, the acceptance was higher. •Another good example would be Philips audio systems. Urban India looks at technology with the viewpoint of ‘the smaller the better’. However, in rural India, the viewpoint is totally opposite. That is the main reason for the large acceptance of big audio systems. Thus Philips makes audio systems, which are big in size and get accepted in rural India by their sheer size. •Social practices: There are so many different cultures, and each culture exhibits different social practices. For example, in a few villages they have common bath areas. Villagers used to buy one Lifebuoy cake and cut it into smaller bars. This helped lifebuoy to introduce smaller 75-gram soap bars, which could be used individually. •Decision-making by male head: The male in Indian culture has always been given the designation of key decision maker. For example, the Mukhiya’s opinion (Head of the village), in most cases, is shared with the rest of the village. Even in a house the male head is the final decision maker. In rural areas, this trend is very prominent.Http://vuaccess.blogspot.com

65. Http://vuaccess.blogspot.com•Changes in saving and investment patterns: From gold, land, to tractors, VCR’s, LCV’s4 A’s approach of Indian Rural MarketThe rural market may be appealing but it is not without its problems: Lowper capita disposable incomes that is half the urban disposable income;large number of daily wage earners, acute dependence on the vagaries ofthe monsoon; seasonal consumption linked to harvests and festivals andspecial occasions; poor roads; power problems; and inaccessibility toconventional advertising media.However, the rural consumer is not unlike his urban counterpart in manyways. The more daring MNC’s are meeting the consequent challenges ofavailability, affordability, acceptability and awareness (the so-called 4 A’s) •AvailabilityThe first challenge is to ensure availability of the product or service. Indias627,000 villages are spread over 3.2 million sq km; 700 million Indians maylive in rural areas, finding them is not easy. However, given the poor stateof roads, it is an even greater challenge to regularly reach products to thefar-flung villages. Any serious marketer must strive to reach at least 13,113villages with a population of more than 5,000. Marketers must trade off thedistribution cost with incremental market saturation. Over the years, IndiasHttp://vuaccess.blogspot.com

66. Projectsformba.blogspot.comlargest MNC, Hindustan Lever, a subsidiary of Unilever, has built a strongdistribution system which helps its brands reach the interiors of the ruralmarket. To service remote village, stockiest use autorickshaws, bullock-carts and even boats in the backwaters of Kerala. Coca-Cola, whichconsiders rural India as a future growth driver, has evolved a hub and spokedistribution model to reach the villages. To ensure full loads, the companydepot supplies, twice a week, large distributors which who act as hubs.These distributors appoint and supply, once a week, smaller distributors inadjoining areas. LG Electronics defines all cities and towns other than theseven metros cities as rural and semi-urban market. To tap theseunexplored country markets, LG has set up 45 area offices and 59rural/remote area offices. •AffordabilityThe second challenge is to ensure affordability of the product or service.With low disposable


incomes, products need to be affordable to the ruralconsumer, most of who are on daily wages. Some companies haveaddressed the affordability problem by introducing small unit packs. Mostof the shampoos are available in smaller packs. Fair and lovely waslaunched in a smaller pack. Colgate toothpaste launched its smaller packsto cater to the travelling segment and the rural consumers.Godrej recentlyHttp://vuaccess.blogspot.com

67. Projectsformba.blogspot.comintroduced three brands of Cinthol, Fair Glow and Godrej in 50-gm packs,priced at Rs 4-5 meant specifically for Madhya Pradesh, Bihar and UttarPradesh — the so-called `Bimaru States. Hindustan Lever, among the firstMNC’s to realize the potential of Indias rural market, has launched avariant of its largest selling soap brand, Lifebuoy at Rs 2 for 50 gm. Themove is mainly targeted at the rural market. Coca-Cola has addressed theaffordability issue by introducing the returnable 200-ml glass bottle pricedat Rs 5. The initiative has paid off: Eighty per cent of new drinkers nowcome from the rural markets. Coca-Cola has also introduced Sunfill, apowdered soft-drink concentrate. The instant and ready-to-mix Sunfill isavailable in a single-serve sachet of 25 gm priced at Rs 2 and multi servesachet of 200 gm priced at Rs 15. •AcceptabilityThe third challenge is to gain acceptability for the product or service.Therefore, there is a need to offer products that suit the rural market. Onecompany which has reaped rich dividends by doing so is LG Electronics. In1998, it developed a customized TV for the rural market and christened itSampoorna. It was a runway hit selling 100,000 sets in the very first year.Because of the lack of electricity and refrigerators in the rural areas, Coca-Cola provides low-cost ice boxes — a tin box for new outlets and thermocolHttp://vuaccess.blogspot.com

68. Projectsformba.blogspot.combox for seasonal outlets. The insurance companies that have tailor-madeproducts for the rural market have performed well. HDFC Standard LIFEtopped private insurers by selling policies worth Rs 3.5 crores in totalpremium. The company tied up with non-governmental organizations andoffered reasonably-priced policies in the nature of group insurance covers.With large parts of rural India inaccessible to conventional advertisingmedia — only 41 per cent rural households have access to TV — buildingawareness is another challenge. Fortunately, however, the rural consumerhas the same likes as the urban consumer — movies and music — and forboth the urban and rural consumer, the family is the key unit of identity.However, the rural consumer expressions differ from his urbancounterpart. Outing for the former is confined to local fairs and festivalsand TV viewing is confined to the state-owned Doordarshan. Consumptionof branded products is treated as a special treat or luxury. •AwarenessBrand awareness is another challenge. Fortunately, however, the ruralconsumer has the same likes as the urban consumer — movies and musicand for both the urban and rural consumer, the family is the key unit ofidentity. However, the rural consumer expressions differ from his urbancounterpart. Outing for the former is confined to local fairs and festivalsand TV viewing is confined to the state-owned Doordarshan. Consumptionof branded products is treated as a special treat or indulgence. HindustanHttp://vuaccess.blogspot.com

69. Projectsformba.blogspot.comLever relies heavily on its own company-organized media. These arepromotional events organized by stockiest. Godrej Consumer Products,which is trying to push its soap brands into the interior areas, uses radio toreach the local people in their language.Coca-Cola uses a combination of TV, cinema and radio


to reach 53.6 percent of rural households. It doubled it’s spend on advertising onDoordarshan, which alone reached 41 per cent of rural households. It hasalso used banners, posters and tapped all the local forms of entertainment.Since price is a key issue in the rural areas, Coca-Cola advertising stressedits `magical price point of Rs 5 per bottle in all media. LG Electronics usesvans and road shows to reach rural customers. The company uses locallanguage advertising. Philips India uses wall writing and radio advertising todrive its growth in rural areas.The key dilemma for MNC’s ready to tap the large and fast-growing ruralmarket is whether they can do so without hurting the companys profitmargins.Evolving a New Marketing Mix for Selling to Rural IndiansThe marketing mix in the case of Indian rural markets consists of 4P’s i.e.Product, Price, Promotion, Place combined with 1 P that is Packaging andone R i.e. Retailer as special focus areas. However, at the base of thismarketing mix will be 2 E’s of Education and Empowerment.EMPOWEREMENTEDUCATIONHttp://vuaccess.blogspot.com

70. Projectsformba.blogspot.comCUSTOMIZATIONNThe traditional marketing hypothesis tends to ignore the requirement of adeveloping country’s rural needs. The concept of marketing has to be takenin conjunction with economic, psychological and social implications. Hence,the concept of Mega-Marketing where all such factors are taken intoconsideration while developing the Marketing Mix is more relevant tosucceed and build enduring brands. In rural India’s case the two mostimportant considerations are Education and Empowerment opportunitieswhich traditional approaches of marketing fail to acknowledge. Then onlythe opportunity provided by the rural market can be fully tapped. 12.2% ofthe world lives in Rural India. Put in a different context, this works out to 1in 8 people on Earth. Being able to successfully tap this growing market isevery marketer’s dream. However, myths abound. India’s rural markets areoften misunderstood. A clear distinction needs to be made with regard tothe reality versus the image of rural India. If such a distinction is not made,we will be unable to distinguish between the serpent and the rope and therope and the serpent.The rural market is not homogeneous. Though the aggregate size is verylarge, individual subsets of this market tend to be rather small anddisparate. Geographical, demographical, statistical, logistical differencesare very apparent. Positioning and realities regarding the potential of eachof these market segments differ and lie at the very core of forming thestrategy for the rural markets.Http://vuaccess.blogspot.com

71. Projectsformba.blogspot.comThe face of Indian agriculture is changing from dry land and irrigatedagriculture into high-tech and low-tech agriculture. Farmers in states likeMaharashtra and Andhra Pradesh have reaped the benefits of adoptingnew age farming practices, including green house cultivation, fert-irrigationand hydroponics. This has radically changed the economics of farming, withthe investment in these systems lowering the cost of cultivation, increasingyields due to integrated crop management practices and reducing thedependence on rainfall. As a result, disposable income has grown sharply.The aspirants are becoming climbers showing a sustained economic upturnas purchasing power is increasing in the rural markets. The proportion ofvery rich has increased five- fold. The growing incomes have modifieddemand patterns and buyer behaviour. Moreover, the need for a productor service is now adequately backed up with the capacity, ability andwillingness to pay.However, the market still remains largely unexploited. Atmost times, potential markets need to be found and at times, even created.Such creation of demand needs efficient management of the supply chain.To


increase market share, behavioural change needs to be at the forefrontof any strategy. Further, due to the diversity of this market, marketers needto think, plan and act locally. It is therefore essential to develop an accurateMarketing Mix for selling to rural Indians.Product“Authentic marketing is the art of identifying and understandingcustomer needs and creating solutions that deliver satisfaction to thecustomers, profits to the producers and benefits for the stakeholders.”Http://vuaccess.blogspot.com

72. Http://vuaccess.blogspot.comPhilip KotlerThe product offerings have to be not only customized but also at a differentplane altogether in case of rural markets. The various product levels asoutlined by Philips Kotler, namely Core Benefit, Basic Product, Expectedproduct, augmented product and Potential Product should be adequatelytaken into consideration and the product offerings should be henceforthcustomized according to the needs.The rural market is not a homogenousset of customers with preferences frozen in time. When developingproducts in any category, marketers must identify the typical rural specificneeds. Urban products cannot be dumped onto rural markets withoutmodifications. Tailor-made products are better received by the ruralaudience as the consumers feel empowered and tend to identify with theoffering. Most of the times in the urban market the product is offered atthe augmented product level where the objective of the product offering isto exceed the customer expectation. But in the rural markets of Indiawhich have been till date characterized by the absence of the choice, sub-standard products and cheap clones of their urban counterparts; theimmediate level to be operated is the Expected product where hisexpectations are met. Also, due to the low level of incomes and literacylevels, it is imperative that the basic needs of the consumer are met. Forinstance, shampoos or soaps with distinctive, strong rose or jasmineperfumes are very popular with the rural women in South India. The urbanwomen do not identify as strongly with these perfumes. Sachetization isalso a distinctly rural-driven phenomenon. As demand in several categoriesHttp://vuaccess.blogspot.com

73. Projectsformba.blogspot.comis being created, intensity of use is quite low. On average, rural folk woulduse a shampoo only once a week. Habits take time to change and makingunit sachet packs affordable is the key to inducing trial and purchase.Systematic, in-depth research that can help understand the depths of themind of the villagers, their buying criteria, purchase patterns andpurchasing power are an essential input while developing rural specificproducts or services. A common error has been to launch a completelystripped down version of the urban product in the rural market, with theobjective of offering the lowest possible price. This is not what a ruralconsumer wants. What is required is to introduce a product with ‘essential’features, whose needs are recognized and for which the consumer is willingto pay (value-adding features). Product developers should aim ateliminating all the cost-adding features, i.e., features which a consumer isunwilling to pay for as he sees no obvious utility. This would “redefinevalue” in the minds of the consumer and tremendously increase productacceptability.Product development is severely constrained by legislation in the case ofagricultural inputs like fertilizers, insecticides and pesticides. In the case offertilizers for instance, though levels of deficiency of nutrients haveincreased significantly over the past decade, no significant changes informulations notified under the Fertilizer Control Order have taken place.This has severely restricted the availability of cost effective specialtyfertilizers of global standards to Indian farmers. Technological know-howHttp://vuaccess.blogspot.com


74. Projectsformba.blogspot.comfor manufacture of such fertilizers exists within the country. However,farmers using modern farming practices are unable to get an assuredsupply of such farm inputs due to draconian legislation. A move to liberalizethe sector could perhaps consider the accepted worldwide norm ofallowing manufacturers with a strong R&D base to decide their ownformulations with the government machinery conducting checks on marketsamples of finished products to ensure that they live up to the labelledspecifications. This would be a major policy initiative that would give a hugeimpetus to innovative product development in the farm sector. Product lifecycles as are becoming shorter and these are having their impact oncompany life cycles. Thus for any company wishing to develop its productportfolio, allegiance to the classic American P-A-L Principle of Partnership -Alliances - Linkages is a basis for survival.PricingA significant portion of the rural population is paid in daily wages. Dailywage earners tend to have little stock of money, and therefore tend tomake purchases only to meet their daily needs. The implication is that packsizes and price points are critical to sales, and importantly, that ruralconsumers view the purchase-tradeoff dilemma across a much wider rangeof product categories. As a result, the nature of competition is muchHttp://vuaccess.blogspot.com

75. Projectsformba.blogspot.comgreater; a beverage manufacturer is not only competing with othermanufacturers in its category, but also other products that consumers mayconsider one-off luxury purchases such as shampoo. So marketer will haveto examine method by which he can make the product more affordable. Inthe case of consumer durable one way is to work through rural bank andoffer higher purchase terms to consumer. In short, the Value for money isthe most important concept that will differentiate the successful brandfrom the rest.BUDGET CONSCIOUS CONSUMERSTATUS SEEKING CONSUMERSEvery marketer must realize that the rural consumer is not a miser. He isnot simply looking for the cheapest product in every category. Heunderstands and demands value for money in every purchase that hemakes. Pricing therefore is a direct function of factors including cost-benefitadvantage and opportunity cost. Pricing offered to consumers should be forvalue offerings that are affordable. Price sensitivity is extremely high andcomparison with competitive prices is common. Consumers seem to createnarrow psychological price bands in their minds for product groups andprice elasticity beyond the extreme price points is very high. The perceivedutility or value of the product or service is the ultimate decision makingfactor. It is certain however, that buying cheap is not the primary objective.Rather, it is “buying smart”. A study revealed that the average ruralconsumer takes approximately 2 years to decide on buying a watch! He willnot do so unless he is totally convinced that he is getting value for Money.Http://vuaccess.blogspot.com

76. Projectsformba.blogspot.comImpulse buys and purchases for conspicuous consumption are alsoextremely few and far Between considering the “value for money” factorthat reigns supreme in most rural purchase decisions.It must be remembered that the rural consumer does not have a budgetproblem. He has a cash flow problem. This is because the village folkreceive funds only twice a year. At these times, he is capable of making highvolume purchases. At all times, however, the unit price is critical and so isthe pack size. Because of this, in the lean season when there is a cash flowcrunch, marketers need to provide financial products, schemes or solutionsthat suit the needs of the rural population.Promotions & AdvertisingThere are a lot of barriers that militate


against homogenous media andmessage delivery. These barriers stem from the fact that rural markets varyimmensely inTerms of tastes, habits and preferences leading to different expectations ofevery segment of the population. However, one fact is certain across allareas. The rural consumer likes to touch and feel a product before making achoice. Demonstrations are undoubtedly the most effective promotionaltool that shapes purchase decisions of the rural population.Demonstrations establish the credentials of any new technology used indeveloping the product.Http://vuaccess.blogspot.com

77. Projectsformba.blogspot.comIn today’s information era, it is very important for companies to wise-up onemerging technologies. It has in fact become a medium to attract largeraudiences for a product demonstration. Technology must be used toprepare a database of customers and their requirements. The use of videousing mobile vans and even large screen video walls at events should bearranged.The classic conundrums of reach and coverage of the media are shattered.Several creative communication media have been used by variouscompanies to tackle the problem of having to use visual communicationand non-verbal communication to reach the rural audience. This is requiredbecause a large proportion of the rural population cannot read or write.Alliances with cottage industries, dharmsalas, panchayats, post offices andpolice stations for advertising have also helped immensely. Moreimportantly, in rural India, experience has proved time and time again thatword of mouth is the key influencer.Intermediaries are the foundation to rural distribution. If the intermediaryunderstands and is constantly reminded about your product, then the enduser will not be allowed to forget. The companies must reinforce this highlyeffective medium and use all their innovation and money tom developmore dramatic point of sale and point of contact material. This becomes allthe more important when in rural India, more often than not, the overlapbetween the product categories sold in a single outlet in tremendous. ForHttp://vuaccess.blogspot.com

78. Projectsformba.blogspot.cominstance, a store may call itself as a grocery store but will stock everythingfrom groceries to vegetables to fertilizers and may at times even stockmedicines. In such cases, the point at which the customer actually comes incontact with a product may not be the point at which the sale is affected.The re-use capacity and colour of the container in which the product ispacked is also a crucial factor. In fact, reusable packaging is considered amajor aid in promoting sales for products in the rural market. Consumerand Trade schemes that Incentivise Spending using discount coupons, offseason discounts, free samples, etc. encourage spending. Lucky draws andgift schemes are a major hit in most states.The use of local idioms and colloquial expressions are an excellent way tostrike a rapport with the rural consumer and must be borne in mind whendeveloping media plans and public relations programmes. No high voltagepublicity is required. The rural consumer is very down to earth but equallydiscerning andmarketers need to step into the shoes of the rural folk while creatingproduct promotion campaigns. Another unique feature of rural markets isthat the Decision making process is collective. The persons involved in thepurchase process - influencer, decider, buyer, one who pays can all bedifferent. So marketers must address brand messages in their campaigns atseveral levels. Apart from regular household goods, several agribusinesscompanies have also started providing gift schemes with offers for freejewellery that influences the ladies to pressure the farmers to purchaseHttp://vuaccess.blogspot.com


79. Projectsformba.blogspot.comagricultural inputs from select companies. This promotion strategy thusmakes women influence purchase decisions that they would ordinarily notbe involved in.Youth power is becoming increasingly evident in villages. Rural youth bringbrand knowledge to the households. This has forced several companies tochange the focus and positioning of their products and services towardsthis segment that is growing in absolute number and relative influence.There are other attributes in the promotion strategy which are explained asunder:1. Mass media: In the present world mass media is a powerful medium ofcommunication. The following are the mass media generally used: •Television. •Cinema. •Radio •Print media: Handbills and Booklets, posters, stickers, banners, etc.2. Personal selling and opinion leaders: In personal selling it isrequired that the potential users are identified and awareness is createdamong them about the product, its features, uses and benefits. This can beachieved only by personal selling by highly motivated sales person. In factthe word of mouth information holds lot validity in rural areas even today.This is the reason why opinion leaders and word of mouth are thrivingamong rural consumers. An opinion leader in rural areas can be defined asa person who is considered to be knowledgeable and is consulted by othersHttp://vuaccess.blogspot.com

80. Projectsformba.blogspot.comand his advice is normally followed. The opinion leaders may be biglandlords or politicians or progressive farmers.3. Special campaigns: During crop harvest and marketing seasons it isbeneficial to take up special promotion campaigns in rural areas. Tractorowners (tonee) conducted by MRF Limited is one such example. BrooksBond carries out marches in rural areas with band, music and caparisonedelephants to promote their brand of tea.Mandi and Mela magicAt last count, India witnessed over 50,000 melas. Of these 25,000 meals areheld to signify religious, cultural festivals as well as local fairs and events.On an average, visitors at these melas spend between Rs. 5,000 to Rs.50,000 a day. Forexample, 3 lakh people visited the annual mela at Navchadi which lasts for7 days in Meerut. The largest such mela is the Maha Kumbh Mela which isvisited by an average of 12 crore people.There is however, a caveat when an organization is considering using melafor marketing their products. Is the audience at this mela fit for promotionof the product at hand? What are the psychographics of this audience?What is the motivational and behavioural impetus that brings visitors toeach of these melas. On considering these questions, it has been observedthat melas are fit to generate product exposure, package familiarity, brandreminder and word of mouth. However, for products that need conceptHttp://vuaccess.blogspot.com

81. Projectsformba.blogspot.commarketing and those that have high prices, such melas are not suitablepromotion media. This is because the time and the mood of the people thatvisit these melas are not right to digest technical information or for makinglarge purchases. People come to melas to have a good time and are notreminded of such high technology or high priced products when they returnhome. In the words of Mr. Neville Gomes, Managing Director of MultimediaAquarius, promotion at melas is like a “one night stand”. There will be noreminder later. Thus, a large amount of qualitative judgment is indeed inplanning promotions at melas by media planners.PlacePlace is the major reason behind the evolution of rural marketing as adistinct discipline. A village as a place for promotion, distribution &consumption is very different from a town or city, thus the generalmarketing theories can’t be applied directly


in rural markets. Reaching theright place is the toughest part in today’s rural marketing, as most of theproducts reach up to the nearest townships of any village, but due to higherdistribution costs, these products fails to reach the village as thedistribution channel fails to put in the required efforts. Most of the times,the rural retailers themselves go to the urban areas to procure these goods.Rural markets imply complex logistical challenges that show up as highdistribution costs.Significance of DistributionHttp://vuaccess.blogspot.com

82. Projectsformba.blogspot.comNo matter how well devised a company’s product, pricing or promotionstrategy, the most crucial link in ensuring the success of rural marketingefforts is distribution. Distribution must be strengthened and this wouldraise investment cost barriers for new entrants. In Rural India, the selectionand use of distribution channels is a nightmare. The reason for this is veryclear when we consider that on an average, Urban and Rural India bothhave approximately 3 million retail outlets. However, Urban India has only4,000 towns where these outlets are located. On the other hand, RuralIndia’s 3 million outlets are located in 6.3 lakh villages. Thus, marketers arefaced with the problem of feeding 3 million shops located in vastly diverseareas each of which records an average sale of only Rs.5,000 per outlet.Further compounding this problem is the fact that even this meager sale ismostly on credit. The diversity in the distribution of shops is the self-limiting factor in terms of servicing the rural distribution network.Http://vuaccess.blogspot.com

83. Projectsformba.blogspot.comThe distribution of outlets however shows that a marketer need not bepresent in all markets at all times. Being present in 6 lakh villages is virtuallyimpossible for an organization of any size. Rural wealth and demand isconcentrated typically at satellite towns, district headquarters, assemblymarkets and such central locations. Rural distribution has a rigid hierarchyof markets that make channel decisions relatively structured.Http://vuaccess.blogspot.com

84. Projectsformba.blogspot.comIt is essential for rural marketing companies to understand this hierarchy.Rural folk are habituated to traveling once a week for their weeklypurchases to a satellite town. They do not expect such items to be presentin every village. For durables where the outlay involved is typically large,the purchase would be made in an assembly market for reasons of choiceand availability of adequate cash flow. This is due to the fact that it is atassembly markets that auction yards are present where the farmerscongregate to sell their output. After such sale of produce, they are cashrich and can afford to make such purchases. It is therefore not necessaryfor a marketer of TV sets to take their distribution channel all the way downto the village shop. A TV will not be sold there as the cash flow does notexist at that point in the hierarchy of markets. A television distributor mustbe present at assembly markets which are much smaller in number, morecontrollable, easier to reach and service. Keeping the hierarchy in mind willhelp decide the optimum level of penetration required to reach a criticalmass of rural consumers.Http://vuaccess.blogspot.com

85. Projectsformba.blogspot.comMARKETING STRATEGIES TO CAPTURE RURAL INDIA •SEGMENTATION OF RURAL MARKETThe first step is to develop & implement any strategy for the rural marketshould include the appropriate segmentation of the rural market. Theimportant thing is that appropriate segmentation basis need to be applied.Different product categories have different rural markets to cater to &these can be selected by applying different criteria of segmentation. Theorganization


can do the following thing to start with: •Focus on select markets. •Focus on select villages. •BY COMMUNICATING AND CHANGING QUALITY PERCEPTIONCompanies are coming up with new technology and they are properlycommunicating it to the customer. There is a trade of between Quality acustomer perceives and a company wants to communicate. Thus, thispositioning of technology is very crucial. The perception of the Indian aboutthe desired product is changing. Now they know the difference betweenthe products and the utilities derived out of it. As a rural Indian customeralways wanted value for money with the changed perception, one cannotice difference in current market scenario. •BY PROPER COMMUNICATION IN INDIAN LANGUAGEHttp://vuaccess.blogspot.com

86. Projectsformba.blogspot.comThe companies have realized the importance of proper communication inlocal language for promoting their products. They have started selling theconcept of quality with proper communication. Their main focus is tochange the Indian customer outlook about quality. With their promotion,rural customer started asking for value for money. •BY TARGET CHANGING PERCEPTIONIf one go to villages they will see that villagers using Toothpaste, even whenthey can use Neem or Babool sticks or Gudakhu, villagers are using soapslike Nima rose, Breeze, Cinthol etc. even when they can use locallymanufactured very low priced soaps. Villagers are constantly lookingforward for new branded products. What can one infer from theseincidents, is the paradigm changing and customer no longer price sensitive?Indian customer was never price sensitive, but they want value for money.They are ready to pay premium for the product if the product is offeringsome extra utility for the premium. •BY UNDERSTANDING CULTURAL AND SOCIAL VALUESCompanies have recognized that social and cultural values have a verystrong hold on the people. Cultural values play major role in deciding whatto buy. Moreover, rural people are emotional and sensitive. Thus, topromote their brands, they are exploiting social and cultural values. •BY PROVIDING WHAT CUSTOMER WANTHttp://vuaccess.blogspot.com

87. Projectsformba.blogspot.comThe customers want value for money. They do not see any value in frillsassociated with the products. They aim for the basic functionality.However, if the seller provides frills free of cost they are happy with that.They are happy with such a high technology that can fulfil their need. As"Motorola" has launched, seven models of Cellular Phones of hightechnology but none took off. On the other hand, "Nokia" has launched asimple product, which has captured the market. •BY PROMOTING PRODUCTS WITH INDIAN MODELS AND ACTORSCompanies are picking up Indian models, actors for advertisements as thishelps them to show themselves as an Indian company. Diana Hyden andShahrukh Khan are chosen as a brand ambassador for MNC quartz clockmaker "OMEGA" even though when they have models like Cindy Crawford. •BY ASSOCIATING THEMSELVES WITH INDIAMNCs are associating themselves with India by talking about India, byexplicitly saying that they are Indian. M-TV during Independence Day andRepublic daytime make their logo with Indian tri-colour. Nokia has designeda new cellular phone 5110, with the India tri-colour and a ringing tone of"Sare Jahan se achcha".Http://vuaccess.blogspot.com

88. Http://vuaccess.blogspot.com•BY PROMOTING INDIAN SPORTS TEAMCompanies are promoting Indian sports teams so that they can associatethemselves with India. With this, they influence Indian mindset. LG haslaunched a campaign "LG ki Dua, all the best". ITC is promoting Indiancricket team


for years; during world cup they have launched a campaign"Jeeta hai jitega apna Hindustan India India India". Similarly, Whirlpool hasalso launched a campaign during world cup. •BY TALKING ABOUT A NORMAL INDIANCompanies are now talking about normal India. It is a normal tendency ofan Indian to try to associate him/her with the product. If he/she canvisualize himself/herself with the product, he /she become loyal to it. Thatis why companies like Daewoo based their advertisements on a normalIndian family. •BY DEVELOPING RURAL-SPECIFIC PRODUCTSMany companies are developing rural-specific products. Keeping intoconsideration the requirements, a firm develops these products. Electroluxis working on a made-for India fridge designed to serve basic purposes: chilldrinking water, keep cooked food fresh, and to withstand long power cuts.Http://vuaccess.blogspot.com

89. Http://vuaccess.blogspot.com•BY GIVING INDIAN WORDS FOR BRANDSCompanies use Indian words for brands. Like LG has used India brand name"Sampoorna" for its newly launched TV. The word is a part of the Bengali,Hindi, Marathi and Tamil tongue. In the past one year, LG has sold one lakh20-inch Sampoorna TVs, all in towns with a population of around 10,000. •BY ACQUIRING INDIAN BRANDSAs Indian brands are operating in India for a long time and they enjoy agood reputation in India. MNCs have found that it is much easier for themto operate in India if they acquire an Established Indian Brand. Electroluxhas acquired two Indian brands Kelvinator and Allwyn this has gave themthe well-established distribution channel. As well as trust of people, aspeople believe these brands. Similarly Coke has acquired Thumps up, GoldSpot, Citra and Limca so that they can kill these brands, but later on theyrealized that to survive in the market and to compete with their competitorthey have to rejuvenate these brands. •BY EFFECTIVE MEDIA COMMUNICATIONMedia Rural marketing is being used by companies. They can either go forthe traditional media or the modern media. The traditional media includemelas, puppetry, folk theatre etc. while the modern media includes TV,radio, and e-chaupal. LIC uses puppets to educate rural masses about itsinsurance policies. Govt of India uses puppetry in its campaigns to pressahead social issues. BrookHttp://vuaccess.blogspot.com

90. Projectsformba.blogspot.comBond Lipton India ltd used magicians electively for launch of Kadak ChapTea in Etawah district. In between such a show, the lights are switched ofand a torch is flashed in the dark (EVEREADYs tact). •BY ADOPTING LOCALISED WAY OF DISTRIBUTINGProper distribution channels are recognized by companies. The distributionchannel could be big scale Super markets; they thought that a similarsystem can be grown in India. However, they were wrong; soon theyrealized that to succeed in India they have to reach the nook and the cornerof the country. They have to reach the "local Paan wala, Local Baniya" onlythey can succeed. MNC shoe giants, Adidas, Reebok, and Nike started withexclusive stores but soon they realized that they do not enjoy much BrandEquity in India, and to capture the market share in India they have to go thelocal market shoe sellers. They have to reach to local cities with low pricedproducts. •BY ASSOCIATING THEMSELVES WITH INDIAN CELEBRITIESMNCs have realized that in India celebrities enjoyed a great popularity sothey now associate themselves with Indian celebrities. Recently LuxorWriting Instruments Ltd. a JV of Gillette and Luxor has launched 500"Gajgamini" ranges of Parker Sonnet Hussain special edition fountain pens,priced at Rs. 5000. This pen is signed by Mr. Makbul Fida Hussain arenowned painter who has created "Gajgamini"


range of paintings.Companies are promoting players like BhaichungHttp://vuaccess.blogspot.com

91. Projectsformba.blogspot.comBhutia, who is promoted by Reebok, so that they can associate their namewith players like him and get popularity. •MELASMelas are places where villagers gather once in a while for shopping.Companies take advantage of such events to market their products. Daburuses these events to sell products like JANAM GHUTI (Gripe water). NCAERestimates that around half of items sold in these melas are FMCG productsand consumer durables. Escorts also display its products like tractors andmotorcycles in such melas. •PAINTINGSA picture is worth thousand words. The message is simple and clean. Ruralpeople like the sight of bright colors. COKE, PEPSI and TATA tradersadvertise their products through paintings.Product StrategiesThe specific strategies, which can be employed to develop or modify theproducts to targets the rural market, can be classified as follows:1. Small unit packing: Given the low per capita income & purchasinghabits of the rural consumers, small unit packages stand a good chance ofacceptance in rural market. Single serve packets or sachets are enormouslypopular in India. They allow consumers to buy only what they need,Http://vuaccess.blogspot.com

92. Projectsformba.blogspot.comexperiment with new products, & conserve cash at the same time. Thismethod has been tested by products life shampoos, pickles, biscuits, Vickscough drops in single tablets, tooth paste, etc. Small packing stands a goodchance of acceptance in rural markets. The advantage is that the price islow and the rural consumer can easily afford it. Also the Red Label Rs. 3.00pack has more sales as compared to the large pack. This is because it is veryaffordable for the lower income group with the deepest market reachmaking easy access to the end user satisfying him. The small unit packingwill definitely attract a large number of rural consumers.2. New product designs: Keeping in view the rural life style themanufacturer and the marketing men can think in terms of new productdesigns. The rural product usage environment is tough because of roughhandling, rough roads & frequent power fluctuations. Thus, all theseenvironmental factors must be considered while developing the productsmeant for rural audience.Nokia’s 1100 model is a very good example of a customized model for ruralmarkets. Its design has been modified to protect it against rough usage inrural environment; it is dust resistant & has a small torch light in view of thefrequent power cuts in rural India. It is also introduces messaging in Hindilanguage now, in some of the economically priced models in order to caterto the semi-urban or rural consumers. This is in real terms, thinking global& acting local.Http://vuaccess.blogspot.com

93. Projectsformba.blogspot.com3. Sturdy products: Sturdiness of a product is an important factor forrural consumers. The product should be sturdy enough to stand roughhandling, transportation & storage. The experience of torch light drybattery cell manufacturers supports this because the rural consumerspreferred dry battery cells which are heavier than the lighter ones. Forthem, heavier weight meant that it has more over and durability.Sturdiness of a product either or appearance is an important for the ruralconsumers.4. Utility oriented products: The rural consumers are more concernedwith utility of the product and its appearance Philips India Ltd. Developedand introduced a low cost medium wave receiver named BAHADUR duringthe early seventies. Initially the sales were good but declined subsequently.On investigation it was found that the rural consumer bought radios notonly for information and news but also for entertainment.5.


Brand name: For identification, the rural consumers do give their ownbrand name on the name of an item. The fertilizers companies normally usea logo on the fertilizer bags though fertilizers have to be sold only ongeneric names. A brand name or a logo is very important for a ruralconsumer for it can be easily remembered. Many a time’s rural consumersask for peeli tikki in case of conventional and detergent washing soap.Nirma made a peeli tikki especially for those peeli tikki users who mighthave experienced better cleanliness with the yellow colored bar ascompared to the blue one although the actual difference is only of theHttp://vuaccess.blogspot.com

94. Projectsformba.blogspot.comcolor. e.g.: Coca-Cola targeted the whole Indian rural market with thepositioning of “Thanda Matlab Coca-Cola” advertisements because most ofthe villagers say when wanting a drink refer to it as Thanda…… so Coca-colaused that word.Pricing strategies1. Low cost/ cheap products: This follows from the product strategy.The price can be kept low by low unit packaging’s like paisa pack of tea,shampoo sachets, vicks 5 grams tin, etc. this is a common strategy widelyadopted by many manufacturing and marketing concerns.2. Refill packs / Reusable packaging: In urban areas most of the healthdrinks are available. The containers can be put to multipurpose uses. Suchmeasures can a significant impact in the rural market.For example, the rural people can efficiently reuse the plastic bottle of hairoil. Similarly the packages of edible oil, tea, coffee, ghee etc can be reused.Pet jars free with the Hasmukhrai and Co Tea, Ariel Super Compact.3. Application of value engineering: in food industry, Soya protein isbeing used instead of milk protein. Milk protein is expensive while Soyaprotein is cheaper, but the nutrition content of both is the same. The basicaim is to reduce the value of the product, so that a larger segment canafford it, thus, expanding the market.Http://vuaccess.blogspot.com

95. Projectsformba.blogspot.com4. Large volume-low margins (Rapid or slow penetrationstrategy): Marketers have to focus on generating large volumes & not bigprofit margins on individual products. If they price their product at a levelwhich can lead to good volumes, then they can still generate good returnson the capital employed.5. Overall efficiency & passing on benefits to consumers: For ruralproducts, the strategy should be to cut down the production, distribution &advertising costs & passing on these benefits to the customers to furtherincrease the turnover. Most often, it has been observed that advertisinghas less to do with product sales in the rural areas. If an organization getsthe price point right, then it can work in rural market.6. Low volume-low price strategy: This strategy of reducing prices byreducing the package size in order to make it appear more affordable, isdelivering very good results for a large number of FMCG productcategories, in the rural markets of India. In categories where maintainingthe price point is extremely critical, this strategy is delivering very goodresults.7. Ensuring price compliance: Rural retailers, most of the times, chargesmore than the MRP. The manufacture has to ensure price complianceeither through promotional campaigns, as was done by Coca Cola, or byensuring the availability of products at the retail outlets directly.Http://vuaccess.blogspot.com

96. Projectsformba.blogspot.comPromotion strategiesCustomized promotional media & messages need to be developed by theorganizations to effectively target the rural market. The following strategiescan be considered while developing promotional campaigns for the ruralmarkets: •Think Global Act Local Rural population is diverse, but the commonalities of their ethos & simple living habits need to be understood for


advertising to succeed. For that, the theme of the advertisement needs to revolve among universal themes, such as family-love. But the context, storyline, language & idioms should be such that the rural audience of different rural market segments can relate to. •Think in Local Idiom This is the need of the advertising professionals who can think like the rural people. The only we can have insights like ‘Thanda matlab Coca Cola’. There should be the use of language writers who understands the rural & regional pulse better. •Simplicity & Clarity All promotional messages targeted at rural audience need to be simple & clear, which can be easily understood, & they should not include any confusing elements. It is preferable that it has only a few propositions at a time. Bombarding rural consumers with too much, in less time can easily confuse them & leave them bewildered.Http://vuaccess.blogspot.com

97. Http://vuaccess.blogspot.comPromotional message should highlight only the functional values of the product & explains how those values can make the consumer’s life even better & solve any of his problems. •Narrative Story Style The promotional message can be delivered in the form of an entertaining story with a message depicting how the brand delivers “larger good” to the family & society. The theme of the story line can be about how the product can solve the problems of the rural consumers. •Choice of Brand Ambassador Brand Ambassador for the rural markets need to be picked carefully as urban successes might not get replicated in the rural markets. That is why Govinda in the Mirinda as boosted the sales of the drink in the rural markets. An organization might spend a lot of money in hiring a brand ambassador only to find out later that it had little impact on the rural consumer.Distribution StrategyMany companies view the rural markets as great opportunity for expandingtheir sales but find distribution as a major problem. Unfortunately, it isalmost impossible to transplant strategies which work successfully in urbanmarkets onto rural markets, namely, extensive retailing and sustained pullgeneration through mass media advertising.Http://vuaccess.blogspot.com

98. Projectsformba.blogspot.comThe road blocks to reach the rural customers are:•Lack of adequate transport facilities.•Large distances between villages.•Lack of roads connecting villages to nearest townships.•Lack of proper retail outlets•Lack of mass media infrastructure.The marketers were of the opinion that the villagers would come to nearbytowns and buy the products that they want. What has been found is that ifwe have to serve the rural consumer we will have to take our products tohim through the channels that he is using and some innovative ways ofgetting to him.The following distribution strategies formulated for the rural category.1. Coverage of villages with 2000 and above population: Ideally,coverage of villages with up to 2000 and above population could be thebreak-even point for a distribution setup. By doing so the percentage ofvillages covered comes to only 10% of all the villages, but the ruralpopulation covered will be substantial, to the extent of about 40 to 45percent. With a distribution network in about 55,000 villages, which have apopulation of 2000 persons & above each, one can cover about 25 croresrural consumers. This strategy is good to begin with & then subsequently,villages with lesser populations can be added.Http://vuaccess.blogspot.com

99. Projectsformba.blogspot.com2. Segmentation: the number of villages in India is huge & it is not viableto contact & serve all villages directly. Therefore, companies or distributorscan carefully examine the market potential of different villages & target thevillages that can be served in a financially viable manner through anorganized distribution effort.3. Use of co-operative societies: There are over 3 lacks co-


operativesocieties operating in rural areas for different purposes like marketingcooperatives, farmer’s service cooperatives and other multipurposecooperatives. These cooperatives have an arrangement for centralizedprocurement and distribution through their respective state levelfederation. Such state level federation can be motivated to procure anddistribute consumables items and low value durable items to the membersto the society for serving to the rural consumers. Many of the societiesextend credit to the members for purchases.4. Utilization of public distributory system: The PDS in the country isfairly well organized. The revamped PDS places more emphasis on reachingremote rural areas like the hills and tribal’s. The purpose of PDS is to makeavailable essential commodities like food grains, sugar, kerosene, edible oilsand others to the consumers at a reasonable price. The shops thatdistribute these commodities are called fair price shops. These shops arerun by the state civil Supplies Corporation, co-operatives as well as privateentrepreneurs. Here again there is an arrangement for centralizedprocurement and distribution. The manufacturing and marketing menshould explore effective utilization of PDS.Http://vuaccess.blogspot.com

100. Projectsformba.blogspot.com5. Utilization of multipurpose distribution centers by petroleum/oil companies: In order to cater to the rural areas the petroleum/oilcompanies have evolved a concept of multipurpose distribution centers inrural areas. In addition to petrol/diesel, lubricants, these outlets also stockconsumables agricultural inputs like fertilizers, pesticides and seeds. It isestimated that there are about 450 such outlets in operation in thecountry. The rural consumer who has tractors, oil-engine pump sets andmopeds frequent these outlets for their requirement. These outlets can beprofitably utilized for selling consumables and durable items also.6. Distribution up to feeder markets/mandi towns: Keeping in viewthe hierarchy of markets for the rural consumers, the feeder markets andmandi towns offer excellent scope for distribution. The rural customers visitthese towns at regular intervals not only for selling the agricultural producebut also for purchasing cloth, jewelry, hardware, radios, torch cells andother durables and consumer products. From the feeder markets andmandi towns the stockiest or wholesaler can arrange for distribution to thevillage shops in the interior places. This distribution can be done bymopeds, cycles, bullock-carts, camelbacks etc. depending upon thetownship.7. Shandies/Haaths/Jathras/Melas: These are places where the ruralconsumers congregate as a rule. While shandies/heaths are held aparticular day every week, Jathras and melas are held once or twice a yearfor longer durations. They are normally timed with religious festivals. SuchHttp://vuaccess.blogspot.com

101. Projectsformba.blogspot.complaces attract large number of itinerant merchants. Only temporary shopscome up selling goods of all kinds. It can be beneficial for companies toorganize sales of their product at such places. Promotion can be taken, asthere will be ready captive audience. For convincing the manufacturing andmarketing man with regard to the importance of these places from ruralmarketing point of view a visit to such places is necessary. It is estimatedthat over 5,000 fairs are held in the country and the estimated attendanceis about 100 million rural consumers. Biggest fair ‘Pushkar Mela’ isestimated to attract over 10 million people. There are 50 such big rural fairsheld in various parts of country, which attract urbanite also like‘Mankanavillaku’ in Malappara in Kerela, Kumbh Mela at Hardwar in U.P.‘Periya Kirthigai’ at Tiruparunkunaram in Tamil Nadu.Merits: •Convenience: The entire market can be related


to large departmental stores in cities, where the advantage is a one-stop shopping exercise. These outlets crop up every week, providing consumers immense choice and prices. •Attractive: The weekend shopping is not only convenient but also entertaining. The markets start early and will be over by lunch. Afterwards, there will be entertainment. In respect of transactions, it is an attractive place to those who want to buy second hand durables and to those who prefer barter transactions. Further the freshness of the produce, buying in bulk for, a week and the bargaining advantage attract the frugal and weeklong hard working rural folk.Http://vuaccess.blogspot.com

102. Http://vuaccess.blogspot.com•Availability: It is a market for everyone and for everything. Household goods, clothes, durables, jewellery, cattle, machinery, farming equipment, raw materials and a host of products are available.8. Agricultural Input Dealers: Fertilizers should be made available tothe farmers within the range of 4-5 km from their residence, as per theessential commodities act. This is why there are about 2 lakh fertilizerdealers in the country, both in cooperative & private sector. Example ofVarana Nagar in Maharashtra proved an eye opener in this regard wherethe sugar and milk co-operatives have totally changed the life style ofpeople. The supermarket in Varana Nagar caters exclusively to ruralconsumers. Similarly a co-operative supermarket called ‘Chintamani’ inCoimbatore (T.N) arranges free transit of rural consumers to thesupermarket of their purchases.9. Joint distribution by Non-competing Companies: As the cost ofdistributing the products in the rural market through distribution vans canbe unviable for a single company, different non-competing companies cancome together to jointly operate distribution vans for the rural market. Thiswill enable them to share the cost of operating the van & on account of thesharing of the cost by four or five companies; the entire operation canbecome financially viable for all the players.10. Personal Selling Network: It is very successful distribution channelbeing developed by companies like HUL. It adds a personal touch to themarketing, as the salesmen are the resident of the village or communityHttp://vuaccess.blogspot.com

103. Projectsformba.blogspot.comitself, making it easier to sell the product & maximise sales for thecompany.THE OLD SETUPThe historically available people & places for distribution include: - Wholeseller, Retailer, Vans, and Bazaars & Shadies.•Wholesalers The Indian wholesaler is principally a Galla – Kirana (food-grain) merchant who sustains the belief that business is speculative rather than distributive in character. He is a trader / commodity merchant rather than a distributor and therefore tends to support a brand during boom and withdraw support during slump. The reason for this speculative character and dormant role of wholesalers are:- •Indian market was largely sellers market. There was no need for active sales growth. •Companies laid more emphasis or retailers in urban areas, who are very large in number. As a result of retail based distribution was weakened. •Rural markets were neglected by many. The occurrence of retail outlets was low. Therefore many companies were dependent on whole sellers.Http://vuaccess.blogspot.com

104. Http://vuaccess.blogspot.comThe current need is to activate and develop wholesaler of the adjoining market as a distributor of products to rural retail outlets and build his loyalties to the company.•Retailers There are different kinds of retailers. •Shops within the village •Shops located on the main road and not exactly within the village •Kasba market or the tahsil market. Village retailers have traditionally been among the most mobile of rural residents. •CREDIBILITY: - He enjoys the confidence of the


villagers. His views are accepted and followed by the rural people whose awareness and media exposure levels are low. The urban retailer is not trusted. He is seen as a businessman with profit motto. His view points are evaluated with other sources of information.) •INFLUENCE LEADER: -Http://vuaccess.blogspot.com

105. Http://vuaccess.blogspot.comHis role as influence leader is indisputable. From tender twig of neem to washing powder retailer testimony has been vital part of the product adoption process. The role of urban retailer is weak. The urban consumers have numerous sources of information. Although retailer’s opinion is sought it may not be 100% believed and followed. •BRAND PROMOTER: - In rural market retailers remains the deciding factor to sell particular brand. Retailers helps in identification and selection of brands, there is less influence of shelf displays and point of purchase promotion. Presence of spurious brands is an ample testimony to this view. The urban retailer has a limited role as a brand promoter. - He cannot directly, recommend the brands. - He is to intelligently drive home his recommendations, as urban consumers do not trust him completely. It is through shelf displays and incentive offers that he has to push the brands.)Http://vuaccess.blogspot.com

106. Http://vuaccess.blogspot.com•RELATIONSHIP MARKETER Village retailer practices relationship marketing. He caters to a set of buyers who have income from immovable land resources and would be static over a much longer time span. The relationship could extend beyond three generations, backed by historical credibility of the retailer as a product referral. •HARBINGER OF CHANGE In an environment relatively isolated from external developments, he has been harbinger of change. He is one of the main sources of information and opinion as well as supplier of product and services. (As against this, we find urban retailer, wielding limited influence in changing the product choices and quality of life of consumers.) •Vans Mobile vans long since, have an important place in distribution and promotion of the products in villages.Http://vuaccess.blogspot.com

107. Projectsformba.blogspot.comMedia Vehicles Through the rural markets offer big attractions to the marketers, oneof the most important questions frequently asked is “How do we reach thelarge rural population through different media and methods?Mass Media Local Media Personalized MediaRadio Haats, Melas, Fairs Direct CommunicationCinema Wall Paintings DealersPress Hoardings Sales PersonsTV Leaflets Researchers Video Vans Folk Media Animal Parade Transit Media•Formal mediaIt includes Press and print, TV, Cinema, Radio, and Point of purchase andOutdoor advertisement. Reach of formal media is low in rural households(Print: 18%, TV: 27%, Cinema: 30%, and Radio: 37%) and therefore themarketer has to consider the following points:Http://vuaccess.blogspot.com

108. Projectsformba.blogspot.com•Newspapers and magazines: English newspapers and magazines have negligible circulation in rural areas. However local language newspapers and magazines are becoming popular among educated facilities in rural areas. Examples: Newspapers: Eenadu in A.P., Dina Thanthi in Tamil Nadu, Punjab Kesari in the North, Loksatta in Maharashtra and Tamil magazine Kumudam are very popular in rural areas.•Television: It has made a great impact and large audience has been exposed to this medium. HLL has been using TV to communicate with the rural masses. Lifebuoy, Lux, Nihar oil etc are some of the products advertised via television. Regional TV channels have become very popular especially in Southern states. Examples: SUN TV is


very popular even in rural areas in Tamil Nadu and Asianet is a preferred regional channel in Kerala. Many consumer goods companies and fertilizer companies are using these TV channels to reach the rural customer.•Radio:Radio reaches large population in rural areas at a relatively low cost.Example: Colgate, Jyoti Labs, Zandu Balm, Zuari industries are some of thecompanies using radio communication programme. There are specificprogrammes for farmers like Farm and Home/Krishi Darshan in regionallanguages. The farmers have a habit of listening to regionalHttp://vuaccess.blogspot.com

109. Projectsformba.blogspot.comnews/agricultural news in the morning and the late evening. Theadvertisement has to be released during this time to get maximumcoverage in rural areas. Another advantage is that the radio commercial canbe prepared at short notice to meet the changing needs of the rural folk.Example: Release of a pesticide ad at the time of outbreak of a pest ordisease in crops.•Cinema: About 65% of the earnings from cinema are from rural markets. Film viewing habits is high in certain states like Tamil Nadu, Karnataka and Andhra Pradesh. Village theatres do roaring business during festivals by having four shows per day. The monthly charge for showing an ad film is within Rs.500. Local distributor or dealer who has good contacts with cinema houses in villages can easily monitor this activity. Examples: Films on products like Vicks, Lifebuoy and SPIC fertilizers are shown in rural cinema halls. Apart from films, Ad slides can also be screened in village theatres.•Outdoor advertisements: This form of media, which includes signboards, wall painting, hoarding, tree boards, bus boards, dealer boards, product display boards etc, is cost effective in rural areas. Symbols, pictures and colours should be used in POPs meant for rural markets so that they can easily identify theHttp://vuaccess.blogspot.com

110. Http://vuaccess.blogspot.comproducts. Generally rural people prefer bright colours and the marketer should Utilize such cues.•Point of purchase: Display of hangings, festoons and product packs in the shops will catch the attention of prospective buyers. However a clutter of such POP materials of competing companies will not have the desired effect and is to be avoided.•Direct mail advertising: It is a way of passing on information relating to goods or services for sale, directly to potential customers through the medium of post. It is a medium employed by the advertiser to bring in a personal touch. In cities lot of junk mail is received by all of us and very often such mails are thrown into the dustbin whereas a villager get very few letters and he is receptive to such mailers.•Wall paintings:It is an effective and economical medium for communication in rural areas,since it stays there for a long time depending upon the weather conditions.The cost of painting one square foot area is just Rs.10. Retailers welcomepainting of their shops so that the shop will look better. Walls of farmhouses, shops and schools are ideal places for painting and the companyHttp://vuaccess.blogspot.com

111. Projectsformba.blogspot.comneed not have to pay any rent for the same. The walls have to be painted atleast one or two feet from ground level. It is better to take permission ofthe owner. Very often the owner takes responsibility for taking care of thewall painting. Painting to be avoided during election time and rainy season.The matter should be in the form of pictures, slogans for catching theattention of people. Companies marketing TV, fans, branded coffee/tea,toothpaste, pesticides, fertilizers etc. use wall painting as promotionmedium in rural areas.•Tree boards:These are painted boards of about two square feet in dimension having thepicture or name or slogan of the product


painted on it. The cost of such apainted board is about Rs.80. These boards are fixed to the trees on bothsides of the village road at a height of about 10 feet from ground level.These boards attract the attention of slow moving vehicles like cycles,bullock carts and tractors and people walking on the road. Considering thepoor condition of roads, even the buses move at slow speed through villageroad. Fertilizer and pesticide companies in rural areas extensively use treeboards. These are low priced promotion items and can be used byconsumer goods companies too.•Informal/Rural specific mediaHttp://vuaccess.blogspot.com

112. Http://vuaccess.blogspot.comThese media with effective reach and personalized communication will help in realizing the promotional objectives. Companies to suit the specific requirements of rural communication are using a variety of such media effectively and some of the more important media and methods are given below.•Farm-to-Farm/House-to-House visit: Rural people prefer face-to-face communication and farm visits facilitate two-way communication. The advantage is that the sales person can understand the needs and wants of the rural customer by directly discussing with him and answer his queries on products and services. Potential customers in the village are identified and the company’s/distributor’s representative makes farm-to-farm visits and highlight the benefits of the products. The person carries with him literature in local language and also samples of products. The person does not sell the product but only promotes the use of the product. Very often the local dealer also joins the representative in making farm-to- farm visits. The dealer clarifies the terms and conditions of sale and also makes independent follow up visits for securing orders. Example: This approach has been found to be very effective for agricultural machinery, animal health products and agricultural inputs. Many LIC agents and companies dealing with high value consumer durables have tried this method with success in rich rural areas.•Group meeting:Http://vuaccess.blogspot.com

113. Projectsformba.blogspot.comGroup meetings of rural customers as well as prospects are an importantpart of interpersonal media. The company is able to pass on the messageregarding benefits of the products to a large number of customers throughsuch meetings. Group meeting of key customers are conducted by banks,agricultural inputs and machinery companies in rural areas. The bankersvisit an identified village, get the village people in a common place andexplain the various schemes to the villagers. Such meetings could beorganized in prosperous villages for promoting consumer durables and twowheelers also. Example: MRF Tyres conduct tractor owners meet in villagesto discuss repairs and maintenance of tractors.•Opinion leaders: Villagers place more emphasis on the experience of others who haveused a product/brand to make purchase decision. Opinion leader is aperson who is considered to be knowledgeable and is consulted by othersand his advice is normally followed. Such opinion leaders could be biglandlords, bank official, panchayath-president, teachers, extension workersetc. Examples: a) Mahindra Tractors use bankers as opinion leaders fortheir product. b) Asian Paints promoted its Utsav brand of paint by paintingthe village Sarpanch’s house a few months prior to the launch if the branchto demonstrate that the paint does not peel off.•The Melas:Melas are of different types i.e. commodity fairs, cattle fairs and religiousfairs and may be held only for a day or may extend over a week. Manycompanies have come out with creative ideas for participating in suchHttp://vuaccess.blogspot.com


114. Projectsformba.blogspot.commelas. Examples: a) Britannia promotes Tiger Brand Biscuits through melas.b) The mahakumbh at Allahabad is the biggest mela in India. HLL has put up14 stalls in the mela grounds for promoting Lifebuoy. Handcarts have beendeployed for increasing access.•Folk dances: These are well-appreciated form of entertainment available to the village people. The folk dance “Kuravan Kurathi” is popular in Tamil Nadu. The troupe consists of dancers, drummers and musicians and they move in a well-decorated van from one village to another village singing and dancing. In a day the troupe covers about 8-10 villages. As soon as the van reaches a village, film songs are played to attract the attention of the villages. This is followed by folk dances. Mike announcement is made about the company’s products and leaflets are distributed. After the dance programme, queries, if any, about the products are answered by the sales person. Folk dance programme costs about Rs.5000 per day and therefore these programmes are conducted during the peak season in selected villages. Examples: Fertilizer and pesticide companies organize folk dance programmes during peak season in selected markets. Thumps Up has sponsored Lavnis, the folk dance programme of Maharashtra and over 30 programmes have been arranged in selected rural markets.Http://vuaccess.blogspot.com

115. Projectsformba.blogspot.com•Audio Visual Publicity Vans (AVP Vans):AV unit is one of the effective tools for rural communication. The van is amobile promotion station having facilities for screening films slides andmike publicity. The sales person makes a brief talk about situation in thevillage, the products and the benefits. The ad film is screened along withsome popular film shots and this continues for about 30 minutes. At theend of the film show, he distributes handbills and answers queries of thecustomers. The whole operation takes about 1-2 hours depending upon theproducts under promotion, number of participants in the meeting and timetaken for question and answers. The vans move to the next village for thesecond show. The cost of running a fully equipped AVP unit is aboutRs.4000 per day and AVP van operation has to be considered as aninvestment for business development in rural areas. Example: Companiessuch as HLL, Colgate, and Phillips have made effective use of AVP vans forpopularizing their products in rural areas.•Product display contests:Http://vuaccess.blogspot.com

116. Projectsformba.blogspot.comPackage is an integral part of the product. Its main purpose is to protect theproduct during transit, to preserve the quality and to avoid any loss inquality and quantity. The main purpose of this contest is to remind thecustomer to buy the product as soon as he enters the shop. Anotherobjective is to influence the dealer to stock the product and support thecompany in increasing the sales. The display contest has to be announcedwell in advance and promotional materials to be distributed to all theselected dealers in a geographical area. Prizes for best displays areannounced to motivate the dealers; the contest lasts for about a month. Awell-planned product display contest not only increases the involvement ofdealers in the company’s products but also increases the sales during thecontest period. This is used for promoting consumer goods such asshampoos, soaps and toothpaste.•Field demonstration:This is based on the extension principle “seeing is believing” and is one ofthe most effective methods to show the superiority of the company’sproducts to the customers. A progressive farmer who is an opinion leader isselected and the demonstration is conducted in his field in the presence ofa group of farmers in the village. The farmers observe the results in thefield and the local dealer calls on them in their farms and persuades themto buy the particular


brand of pesticide or fertilizer. Examples: a) Spraying aparticular brand of an insecticide against insect pests and showing thefarmer how effectively the insects are controlled. b) Demonstrating the useof tractor/implements for different agricultural operations. c) Hawkinspressure cooker has demonstration representatives who carry out demos inHttp://vuaccess.blogspot.com

117. Projectsformba.blogspot.comrural households. The representative receives 1% commission for everycustomer who approaches the dealer via demonstrations. e) Similarlyeffectiveness of detergents, pressure cookers, vacuum cleaners andmosquito coils could be promoted by demonstrations in selected markets.•Field days:These are extension of field demonstrations. One of the main objectives offollowing modern agricultural practices is to increase the yield. Thecompany organizes demonstrations in a piece of land belonging toprogressive farmers. All the fertilizers, pesticides, nutrients etc. are appliedafter making field observations. Just before harvest, all the importantfarmers are invited to see demonstration plot and see for themselves howthe yields are better in the plot compared to other fields. Fielddemonstrations/field days consume lot of time and efforts and thereforehave to be planned well.•Information centers:They provide latest information on cultivation of crops, fertilizerapplication, weed, management and control of pests and diseases.Experienced agricultural graduates who make frequent visits to the fieldand advice farmers on modern agricultural practices manage the centers.They also provide information on farm implements, seeds, fertilizers,pesticides, diesel engines, sprayers and tractors etc. Many consumer goodscompanies have opened show rooms in prosperous rural areas. Example:Http://vuaccess.blogspot.com

118. Projectsformba.blogspot.comHero Honda has opened extension counters with show room facilities inmajor rural markets.•Life-style marketing:Each rural market segment has certain special features i.e. they sharecommon life-style traits. They include village sports, religious events,prominent personalities and role models. Examples: Textile millsmaintaining community gardens, Mineral water companies supplying cleandrinking water during summer festivals in villages and Consumer goodscompanies sponsoring Kabaddi.Choosing media vehiclesThe choice of different media vehicles for any market is based on ananalysis of the standard features like: reach, frequency, cost & availability.Depending on the factor of reach & frequency, the different media can beclassified into the following categories. This categorization can help themarketer to make a decision about which type of media would be moresuitable to the product & the organization. High reach High frequency •Jeep based advertising •Wall painting •Bus stand & bus panelsHttp://vuaccess.blogspot.com

119. Http://vuaccess.blogspot.com•Haats •Hoardings •Postal branding Low reach High frequency •Co-operative notice board •Shop front painting •Tin plating – house •Dealer boards •Village boards •Well tiles •Calendars/labels High reach Low frequency •Van based advertising •Melas •Direct to home •Folklore group •Exhibitions/created events Low reach Low frequency •Tin painting – tree/shops •Leaflets •Posters & banners •Streamers •DanglersHttp://vuaccess.blogspot.com

120. Http://vuaccess.blogspot.comFINDINGS AND ANALYSIS Which soap u prefer to use The reaction of people towards various SOAP brands can be tabulated in the following manner:BRANDS LUX DETTOL LIFEBUOY OTHERSPERCENTAGE 36 18 22 24In the survey, it could easily be concluded that LUX, the product of HUL washighly in demand. LUX, the product of HUL covers 36%of the market share.After


LUX, the other brands (EXCEPT LUX, DETTOL, LIFEBUOY) covers 24%ofthe market share. This is then followed by LIFEBUOY, the product of HULwith a market share of 22%,which is then followed by DETTOL, the productof RECKITT BENCKISER with a market share of 18%.This data can be graphically explained with the help of the following bargraph: Which pack u prefers to use? In order to determine the income pattern of the consumers, itwas necessary for the researcher to distribute the consumers on the basisof their demand for the various packs of SOAP brands available in themarket. However, the reaction of people towards various packs of SOAPcan be tabulated in the following manner:PACK OF SOAPS SINGLE PACK FAMILY PACK ( 3 IN 1)Http://vuaccess.blogspot.com

121. Http://vuaccess.blogspot.comPERCENTAGE 56 44In the survey, I tried to differentiate amongst people with below averagehousehold income, average household income &above household income.This classification can be done on the basis of the daily expenditure thatpeople make.56% consumers demand single pack.44% consumers demandfamily packs i.e.3 in 1 pack.This data can be graphically explained with the help of the following bargraph: Which tea u prefers to use? The reaction of people towards various TEA brands can betabulated in the following manner: BRANDS TATA TEA BROOKE TAJ MAHAL OTHERS BOND PERCENTAGE 32 28 18 22In the survey, it could easily be concluded that TATA TEA, the product ofTATA has a market share of 32%.This is followed by, BROOKE BOND, with amarket share of 28%.Followed by other brands (EXCEPT TATA TEA,BROOKEBOND,TAJ MAHAL)with a market share of 22%.This is finally followed by TAJMAHAL, the product of HUL which holds18%of the market share.This data can be graphically explained with the help of the following bargraph: Which tea pack u prefers to use?Http://vuaccess.blogspot.com

122. Http://vuaccess.blogspot.comIn order to determine the income pattern of the consumers, itwas necessary for the researcher to distribute the consumers on the basisof their demand for the various packs of TEA brands available in themarket. However, the reaction of people towards various TEA packs can betabulated in the following manner:TEA PACKS SACHET MEDIUM PACK LARGE PACKSPERCENTAGE 48 32 20In the survey, I tried to differentiate amongst the people, with belowaverage household income, average household income & above householdincome. This classification can be done on the basis of the daily expenditurethat people make. However, it can be concluded that sachets are mostcommonly used by the people .i.e. 48%consumers demand sachet packs.32%consumers demand medium pack. 20%consumers demand large pack.This data can be graphically explained with the help of the followingdiagram: Which tooth paste u prefers to use? In the initial years, the rural consumers preferred tooth powders,datoons etc. But from the last decade, the preference of consumerstowards toothpaste has been changed. A huge number of toothpastes ofdifferent companies are sold in rural market.However, the reaction ofpeople towards various TOOTH PASTES can be tabulated as follows:BRANDS PEPSODENT COLGATE CLOSE UP OTHERSPERCENTAGE 27 35 22 16Http://vuaccess.blogspot.com

123. Projectsformba.blogspot.comIn the survey that the researcher conducted, it could easily be seen thatCOLGATE, the product of COLGATE PALMOLIVE is the market leader, whichcovers 35%of the total market. After that, PEPSODENT, the product of HULis demanded by the customers, which covers 27%of the market share.Followed by


CLOSE – UP, the product of HUL is demanded by thecustomers, which covers 22%of the market share. Which is then followedby others brands (EXCEPT PEPSODENT, COLGATE, CLOSE -UP), which covers16%of the total market share.This data can be graphically explained with the help of the following bargraph: Which coffee u prefers to use? The reaction of people towards various COFFEE brands can betabulated in the following manner:BRANDS BRU NESTLE NESCAFE OTHERSPERCENTAGE 26 32 32 10In the survey, it can be easily concluded that all the brands are facing toughcompetition. NESTLE, the product of NESTLE S.A.& NESCAFE, anotherproduct of NESTLE S.A., shares equal market share of 32%each.This meansthat they are in a very tough competition. This is followed by BRU, theproduct of HUL which holds, 26%of the market share. While the otherbrands hold only 10%of the market share.This data can be graphically explained with the help of the following bargraph: Which cream u prefers to use?Http://vuaccess.blogspot.com

124. Http://vuaccess.blogspot.comThe reaction of people towards various CREAM brands canbe tabulated in the following manner:BRANDS PONDS FAIR & AYUR OTHERS LOVELYPERCENTAGE 28 32 14 26In the survey, that I conducted, it can easily be concluded that FAIR&LOVELY, the product of HUL, holds the major market with a share of32%.This is followed by, POND ’s, another product of HUL, which holds28%of the market share. This is followed by, other brands (EXCEPT, PONDS,FAIR &LOVELY &AYUR), which captures 26%of the market share. This isfollowed by AYUR, the brand of AYURACADEMY OF NATURAL BEAUTY (AANB) which holds 14%of the totalmarket share. This data can be graphically explained with the help of the following bargraph: Which hair oil u prefers to use? The reaction of people towards various HAIR OIL brands canbe tabulated in the following manner:BRANDS PARACHUTE DABUR AMLA DABUR OTHERS VATIKAPERCENTAGE 37 29 19 15In the survey, it can easily be concluded that PARACHUTE, the product ofMERICO captures 37%of the total market share. This is followed by DABURAMLA, the product of DABUR which captures 29%of the total marketHttp://vuaccess.blogspot.com

125. Projectsformba.blogspot.comshare. This is followed by DABUR VATIKA, another product of DABUR whichcaptures 19%of the market. And after that, followed by other brands(EXCEPT PARACHUTE, DABUR AMLA, DABUR VATIKA) captures 15% of themarket share.This data can be graphically explained with the help of the following bargraph: Which biscuits u prefers to use? The reaction of people towards various BISCUITS brands can be tabulatedin the following manner:BRANDS MARIE GOLD GOOD DAY PARLE G OTHERSPERCENTAGE 24 21 38 17In the survey, it can easily be concluded that PARLE-G, the product of PARLE, holds a major market share of 38%.This is followed by MARIE GOLD, aproduct of BRITANNIA which holds 24%of the market share. After that,GOOD DAY, another product of BRITANNIA, holds 21%of the market share.This is followed by other brands (EXCEPT MARIE GOLD, GOOD DAY, PARLE-G) which hold a market share of 17%.This data can be graphically explained with the help of the following bargraph: Which detergent u prefers to use?The reaction of people towards various DETERGENT brands can betabulated in the following manner:Http://vuaccess.blogspot.com

126. Projectsformba.blogspot.comBRANDS SURF RIN TIDE OTHERSPERCENTAGE 27 35 22 16In the survey, it could be easily concluded that


RIN, the product of HULcaptures 35%of the total market share. This is followed by SURF, theproduct of HUL which has a market share of 27%.This is followed by TIDE,the product of PROCTER & GAMBLE which has a market share of 27%.This isfinally followed by other brands (EXCEPT SURF,RIN,TIDE)which captures16%of the market share.This data can be graphically explained with the help of the following bargraph: Which shampoo u prefers to use?The reaction of people towards various SHAMPOO brands can be tabulatedin the following manner:BRANDS CLINIC PLUS SUNSILK HEAD & OTHERS SHOULDERSPERCENTAGE 33 25 28 14In the survey, it can easily be concluded that CLINIC PLUS, the product ofHUL, captures the major portion of the market with a market share of33%.This is followed by HEAD & SHOULDERS, the product of PROCTER&GAMBLE which holds 28%of the market share. This is followed bySUNSILK, the product of HUL which holds 25%of the market share. Finallyfollowed by other brands (EXCEPT CLINIC PLUS, SUNSILK, HEAD &SHOULDERS) with a market share of 14%.Http://vuaccess.blogspot.com

127. Projectsformba.blogspot.comThis data can be graphically explained with the help of the following bargraph: Which pack u prefer to use?In order to determine the income pattern of the consumers, it wasnecessary for the researcher to distribute the consumers on the basis oftheir demand for the various packs of SHAMPOO brands available in themarket. However, the reaction of people towards various SHAMPOO packs can betabulated in the following manner:SHAMPOO SACHET SMALL PACK MEDIUM FAMILY PACKPACKS PACKPERCENTAGE 23 32 28 17In the survey, I tried to differentiate amongst the people, with belowaverage household income, average household income & above householdincome. This classification can be done on the basis of the daily expenditurethat people make. However, 32%consumers demand SMALL PACK. 28%consumers demand medium pack.17% consumers demand large packs.This data can be graphically explained with the help of the following bargraph: Which Television you prefer to use ? The reaction of people towards various television brands can be tabulatedin the following manner:BRANDS ONIDA BELTEK CROWN OTHERSPERCENTAGE 40 23 33 4In the survey, it can easily be concluded that TELEVISION of ONIDA,captures the major portion of the market with a market share of 40%.This isfollowed by CROWN, which holds 33%of the market share. This is followedHttp://vuaccess.blogspot.com

128. Projectsformba.blogspot.comby BELTEK, which holds 23%of the market share. Finally followed by otherbrands (SAMSUNG, LG, SONY etc) with a market share of 4%. This data can be graphically explained with the help of the following bar graph: Which bicycle you prefer to use? The reaction of people towards various bicycle brands can be tabulated inthe following manner:BRANDS ATLAS HERO AVON OTHERSPERCENTAGE 37 33 22 08In the survey, it can easily be concluded that the BICYCLE of ATLAS,captures the major portion of the market with a market share of 37%.This isfollowed by HERO, which holds 33%of the market share. This is followed byAVON , which holds 22%of the market share. Finally followed by otherbrands (EXCEPT atlas, hero and avon ) with a market share of 8%.This data can be graphically explained with the help of the following bargraph: Which refrigerator you prefer to use?The reaction of people towards various bicycle brands can be tabulated inthe following manner:BRANDS GODREJ VIDEOCON KELVINATOR OTHERSPERCENTAGE 38 20 28 14In the survey, it can easily be concluded that the REFRIGERATOR of


GODREJ,captures the major portion of the market with a market share of 38%.This isfollowed by KELVINATOR, which holds 28%of the market share. This isfollowed by VIDEOCON, which holds 20%of the market share. Finallyfollowed by other brands (LG, SAMSUNG etc ) with a market share of 14%.Http://vuaccess.blogspot.com

129. Http://vuaccess.blogspot.comThis data can be graphically explained with the help of the following bargraph: Which wrist watch you prefer to use?The reaction of people towards various bicycle brands can be tabulated inthe following manner:BRANDS HMT MAXIMA TITAN OTHERSPERCENTAGE 26 14 40 20In the survey, it can easily be concluded that the WRIST WATCH of TITAN,captures the major portion of the market with a market share of 40%.This isfollowed by HMT, which holds 26%of the market share. This is followed byMAXIMA, which holds 14%of the market share. Finally followed by otherbrands (EXCEPT HMT, MAXIMA AND TITAN) with a market share of 8%.This data can be graphically explained with the help of the following bargraph: Which fan you prefer to use?The reaction of people towards various bicycle brands can be tabulated inthe following manner:BRANDS LOCAL FANS POLAR KHAITAN CROMPTON FANSPERCENTAGE 32 28 22 18In the survey, it can easily be concluded that the FANS of LOCALCOMPANIES, captures the major portion of the market with a market shareof 32%.This is followed by POLAR, which holds 28%of the market share.This is followed by KHAITAN, which holds 22%of the market share. Finallyfollowed by CROMPTON with a market share of 18%.Http://vuaccess.blogspot.com

130. Http://vuaccess.blogspot.comConclusionsThus looking at the challenges and the opportunities which rural marketsoffer to the marketers it can be said that the future is very promising forthose who can understand the dynamics of rural markets and exploit themto their best advantage. A radical change in attitudes of marketers towardsthe vibrant and burgeoning rural markets is called for, so they cansuccessfully impress on the 230 million rural consumers spread overapproximately six hundred thousand villages in rural India.The rural market is very large in compare to the urban market as well as itis more challenging market. The consumer wants those products which arelong lasting, good, easy to use and cheaper. The income level of ruralconsumers is not as high as the income level of urban consumers that’s whythey want low price goods. It is one of the reasons that the sell of sachet ismuch larger in the rural area in all segments. It is necessary for all the majorcompanies to provide those products which are easy to available andaffordable to the consumers. It is right that the profit margin is very low inthe FMCG products, but at the same time the market size is much large inthe rural area. The companies can reduce their prices by cutting the costson the packaging because the rural consumers don’t need attractivepackaging. Application of 4A* is also a major task for the major companiesin this area.Rural market has an untapped potential like rain but it is different from theurban market so it requires the different marketing strategies and marketerhas to meet the challenges to be successful in rural market.In this report, itHttp://vuaccess.blogspot.com

131. Projectsformba.blogspot.comcan very easily be concluded that HUL, holds major portion of the FMCGmarket. It holds major shares in the soap, detergent, shampoo & cream ’ scategory. HUL’s products are mainly in demand, because they providethese products in different packs. They consider the fact that ruralconsumers do not have that much money to be spent on these products.So, they prefer buying the small or the medium packs. However, large orfamily packs are still been bought by few consumers,


who are from a well –off families. In the case of TEA, TATA holds a major share. In the case ofCOFFEE, NESTLE & NESCAFE holds the major share. Rural consumers favorTATA because it is an old organization &it has gained a lot of BRANDEQUITY which finally creates BRAND LOYALTY. In these products,consumers do get brand loyal, because they do not want to take a risk withtheir tastes. So they prefer sticking to one brand. These organizationssupply their products in various packs (small, medium &large), consideringthe buying capacity of their consumers. As in the case of BISCUITS, PARLE-G holds the major market share.Rural consumers favor PARLE-G because it is an old organization & it hasgained a lot of BRAND EQUITY which finally creates BRAND LOYALTY. Incase of BISCUITS, consumers do get brand loyal, because they do not wantto take a risk with their tastes. So they prefer sticking to one brand. Thoughit is the cheapest biscuit but still the taste is same and unique. “ACHA,SASTA AND TIKAU”.Http://vuaccess.blogspot.com

132. Http://vuaccess.blogspot.comIn the case of TOOTH PASTES, COLGATE PALMOLIVE holds a majormarket share. Consumers are very concerned about their health, so if anyproduct suits them they prefer sticking to that product. And this product isalso available in various packs, so rural consumers can se it according totheir buying capacity. In the case of HAIR OILS, MERICO holds the major market share.MERICO is a much known organization & its product PARACHUTE hasreached all the places. So it is a known product, which has created a goodamount of goodwill for the organization. Consumers have confidence &trust in their product. Therefore, they prefer buying it. And in the case of durable goods like TV, fan etc. in rural areaspeople generally don’t buy the company products, they prefer to buy localproducts because of lack of knowledge and the main factor is because ofincome factor, which is quite low in rural areas. Illiteracy is also a mainfactor. For them there is no such thing – “status symbol”. Although, there isa brand loyalty but the percentage is very low.Http://vuaccess.blogspot.com

133. Http://vuaccess.blogspot.comSuggestions &recommendations The researcher would like to suggest the following points,so that the organizations can easily sell their products to their consumers:1. However, the demand of a product is also affected by its life cycle. If theproduct is in the introduction stage, then it will definitely take some time tocapture the market, because in the introduction stage, consumers are notmuch aware about the product. Therefore, it is the responsibility of theorganization to create awareness amongst the consumers.2. They should adapt rigorous marketing strategies, in order to sustain inthe market.3. There is immense competition in this sector. Therefore, the organizationsshould try to gain competitive advantage against their competitor’s.4. They should try to reach as many people as possible.5. For the organizations that are not much popular amongst the consumersshould adopt Sales Promotion, as their marketing strategies.6. Application of 4A’s has also become an important task for all theorganizations. (*4A=Availability, Affordability, Acceptability, Awareness)Http://vuaccess.blogspot.com

134. Http://vuaccess.blogspot.comAPPENDIX1. Some Facts about the rural market 70 % of India’s population lives in 627000 villages in rural areas. 90 %of the rural population is concentrated in villages with a population of lessthan 2000. According to the NCAER projections, the number of middle andhigh-income households in rural India is expected to grow from 80 millionto 111 million by 2007. In urban India, the same is expected to grow from46 million to 59 million.Packaged consumer products: More than


Rs. 2000 crores.Market for Non-food items: Rs. 20000 crores growing at 2.5% p.a.Consumption of pesticides: 68,000 tonnes, growing at 12%p.a.Share of Rural market in overall consumptionToiletries Safety Razor Blades 48% Premium Soaps 24% Tooth Paste 20% Hair Oil 20%OTC products Medicated dress 25% Cold Analgesic 42% Antiseptic Creams 28%2.) Product Adoption: Hair products were introduced to rural India in anattempt to capitalize on a culture where hair grooming is taken extremelyseriously by women. While rural women may wear faded saris and littleHttp://vuaccess.blogspot.com

135. Projectsformba.blogspot.comjewelry, few step out without ensuring that their hair is in place. Consumergoods companies introduced a transplanted product from developedmarkets, the 2-in-1 shampoo/conditioner. Companies thought that womenwould be attracted to this product because it was cost-effective; however,initial sales were dismal. What companies failed to recognize is that mostrural consumers had previously never used shampoo and did not value orunderstand the full benefits of conditioner. However, several years back,Hindustan Lever focused on product development strategies for ruralconsumers who still did not use shampoo in India. Their research indicatedthat a prevailing consumer habit in rural India was to use soap for hair andbody care. Rather than try to change instilled consumer behavior, productdevelopers focused on creating an opportunity. Consumers wanted aproduct that was convenient and low-cost. The result was a new 2-in-1soap, a product that cleans the hair and body, and is targeted towardsconsumers in rural areas.SOME STRANGE FACTSAmazing innovatorWith a queer psychology of purchase and usage, Indian rural market is stilla puzzle to marketers. In many a case, it stretches its imagination to findsurprisingly different uses of some of the products. And the red-facedmarketers admit that they actually sell their products in areas they wouldotherwise find difficult, simply because there are other uses for them. Forinstance,Http://vuaccess.blogspot.com

136. Http://vuaccess.blogspot.com•Buffaloes displayed at the haats for sale are dyed an immaculate black with Godrej hair dye. •Hotlinks is used as a health beverage to fatten up cattle in Bihar. • In villages of Punjab, washing machines are being used to make frothy lassi in bulk. • Iodex is rubbed into the skins of animals after a hard days work to relieve Muscular pain.3.) Communication Adaptation: Both, washing and for taking bath - onerequires water. Now for rural markets there are three sources of water -wells, hand pumps and ponds. For the first in the history of advertising -these were branded. Special stickers were put on the hand pumps, thewalls of the wells were lined with advertising tiles and tinplates were puton all the trees surrounding the ponds. The idea was to advertise not onlyat the point of purchase but also at the time of consumption. This caseshows that the brand was some how relating to the consumer. It was rightthere when the consumer wants it and responds to his needs whenwanted. So the customer could also see the advertising when he wasbathing or washing. Now, the customers who bought these brands got asense of satisfaction by seeing their choice being advertised in these placeswhile a question was put in the minds of the customers who had boughtother brands.Http://vuaccess.blogspot.com

137. Http://vuaccess.blogspot.comQuestionnaire •Name: •Occupation: •Monthly salary: •a. less than 10,000 •b.10,000 –25,000 •c.25,000 –50,000 •d.More than 50,000 •Address: •Which soap u prefer to use? Lux Lifebuoy Dettol Others •Which pack u prefer to use? Medium pack Family pack •Which tea u prefer to use? Taj mahal Tata tea Brooke


bond Others •Which tea pack u prefer to use? Sachet Small pack Medium packHttp://vuaccess.blogspot.com

138. Http://vuaccess.blogspot.com•Which tooth paste u prefers to use? Colgate Close up Pepsodent Others •Which coffee u prefers to use? Nestle Nescafe Bru Others •Which cream u prefers to use? Ponds Fair and lovely Ayur Others •Which hair oil u prefers to use? Parachute Dabur amla Dabur vatika Others •Which biscuits u prefers to use? Good day Marie gold Parle G Others •Which detergent u prefers to use? Surf Rin Tide OthersHttp://vuaccess.blogspot.com

139. Http://vuaccess.blogspot.com•Which shampoo u prefers to use? Sunsilk Head and shoulders Clinic plus Others •Which pack u prefers to use? Sachet Small pack Medium pack •Which Television you prefer to use? Onida Beltek Crown Others •Which bicycle you prefer to use? Avon Atlas Hero Others •Which refrigerator you prefer to use? Videocon Kelvinator Godrej Others •Which wrist watch you prefer to use? Titan Hmt Maxima OthersHttp://vuaccess.blogspot.com

140. Http://vuaccess.blogspot.com•Which fan you prefer to use? Local fans Khaitan Polar CromptonHttp://vuaccess.blogspot.com

141. Http://vuaccess.blogspot.comBIBLIOGRAPHY •UTTAR PRADESH DEVELOPMENT AUTHORITY •http://business.mapsofindia.com/rural-economy/state-development/ marketing.html •http://www.ibef.org/economy/ruralmarket.aspx •http://en.wikipedia.org/wiki/Rural_markets •http://www.indianmba.com/Faculty_Column/FC213/fc213.html •http://www.123eng.com/forum/viewtopic.php?p=76117 •http://ezinearticles.com/?Challenges-In-Rural-Marketing&id=1092597 •http://www.infibeam.com/Books/info/t-p-gopalaswamy/ruralmarketing-environment-problems-strategies/9788125916178.html •http://www.naukrihub.com/india/fmcg/ •http://www.naukrihub.com/india/fmcg/overview/ •http://www.naukrihub.com/india/fmcg/consumer- class/income/Http://vuaccess.blogspot.com

142. Http://vuaccess.blogspot.com•Aithal K Rajesh, importance &growth of rural markets •Purba basu,research on living style of rural consumers •http://toostep.com/idea/challenges-in-rural-marketing •http://images.google.co.in/images? hl=en&rlz=1W1ADSA_en&q=%20rural%20marketing %20indi a & revid=199480125 8&resnum=0&um=1&ie=UTF-8&sa=N&tab=wi •http://www.articlesbase.com/marketing-articles/ruralmarketing-a-critical-review-1102352.html •http://www.marketresearch.com/product/display.asp? productid=2106282 •http://www.google.co.in/search? hl=e n & rlz=1W1ADSA_e nHttp://vuaccess.blogspot.com

report on to analyze the marketing of consumer products

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