rural marketing final_march 2012

7/31/2019 Rural Marketing Final_March 2012

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RURALMARKETING


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In the India context, the word RURALis so much associated with agricultureand farmers that rural marketing tendsto be seen as a marketing of inputs or

outputs related to agriculture.


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What is Rural Marketing?

Rural marketing is a function which manages allthose activates involved in assessing, stimulatingand converting the purchasing power into aneffective demand for specific products andservices, and moving them to the people in rural

area to create satisfaction and a standard ofliving to them and thereby achieves the goals ofthe organization.


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Rural marketing involves the process ofdeveloping, pricing, promoting, distributingrural specific product and a service leading toexchange between rural and urban market whichsatisfies consumer demand and also achieves

organizational objectives.


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It is a two-way marketing process wherein the transactions can be:

Urban to Rural: A major part of rural marketing falls into thiscategory. It involves the selling of products and services by urbanmarketers in rural areas.

Rural to Urban: Transactions in this category basically fall

under agricultural marketing where a rural producer seeks to sellhis produce in an urban market. An agent or a middleman plays acrucial role in the marketing process.

Rural to Rural: This includes the activities that take place

between two villages in close proximity to each other. Thetransactions relate to the areas of expertise the particular village has


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Nature of Rural Market

Large, Diverse and Scattered Market

Major Income of Rural consumers is from Agriculture

Traditional Outlook

Rising literacy levels

Diverse socioeconomic background

Infrastructure Facilities


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Segmentation


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Factors critical for Segmentation

Differences and variations in climate

Development levels electricity, road connectivity

Differences in Food habits

North v/s south

Cultural differences

Traditional south v/s outgoing north


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Factors critical for Segmentation Intra region differences caste based village Variation in population size and density

Variation on literacy levels Bihar v/s Kerala

Media exposure levels Differences in income levels and patterns of

income flow Farmers v/s daily wage earners


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Comparison of the Lifestyles

Dimensions Urban Rural

Demographics Private schooleducated, salaryearner, nuclearfamily, densepopulation

Govt. school, selfemployed, largefamily, scatteredpopulation,

Activities Office jobs,communicationdriven, shopping,partying

Agriculture, physicalsports, gossip,cinema, religiousfunctions

Interests Outside eating,fashion, self,holidays, diamondjewellery

Milk, bright colouredclothes, goldjewellery, melas,visiting towns


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The rural consumers are classified into thefollowing groups based on their economic

status:

- The Affluent Group: They are cash rich farmers and a veryfew in number. They have affordability but not form a demand

base large enough for marketing firms to depend on

- The Middle Class: This is one of the largest segments formanufactured goods and is fast expanding.

- The Poor: This constitutes a huge segment. Purchasingpower is less, but strength is more. They receive the grants fromgovernment and reap the benefits of many such schemes andmay move towards the middleclass.


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Rural Consumer Classification

Affluent Owning 4 wheelers

Well Off A.C. & or Motor cycle/Fridge/ Colour TV

Climbers Mixer, sewing machine, Audio equipment

Aspirant Bicycles, Fans, Irons

Destitutes

(poor)

Mechanical wrist watches, pressurecooker, audio recorder, radio


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Challenges


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Problems in the Rural Marketing Widely scattered village

Low -level of literacy.

Heterogeneity

Language problems

Unstable & seasonal demands

Inadequate Bank & credit facilities

Lack of infrastructure


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Widely Scattered Village In spite of accommodating 72.2% of countrys

population it is very much very scattered

geographically, which is spread in more than sixlakh villages.

Even within a particular state one can find

villages with a population as high as 10,000 &as low as 5 persons


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Low Level of Literacy Rural literacy rate has shown growth over the

years but still 50% of population is literate.

Low rate of literacy indicate inaccessibility ofvarious media of communications as well as

requirement of more visual component in brandname & packaging..


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Heterogeneity There is no uniformity in rural across the

country. Each village is a complete social unit by

itself with own religion, cultural & socialpressures along with huge economic disparities.

Due to this, a marketer has to makemodification in brand name, packaging, colouretc for the product for different rural areasincreasing marketing expenses for the marketer.


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Language Diversity The number of recognized languages is 16 &

number of dialects is estimated to be around

8500.On and average every district has more orless its own dialect.

This pose a major problem on communicationfront, to ensure effective communication amarketer should prepare communicationmessage in maximum possible dialects,


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Unstable & Seasonal Demand Demand depends upon crop since it is a main

occupation & agricultural yield depends upon

weather, hence it is seasonal.

Agriculture depends on monsoon, which is

unpredictable & adds to risk.


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Inadequate Bank & Credit Facility

The rural retailer has a large proportion ofthe sales on credit. They face problems infinancing their sales on credit.

Because of problems in financing are unableto carry enough stocks results in a lowturnover.

Lack of credit facility pose problem on bothfront, rural retailer as well as consumers


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Lack of InfrastructureInfrastructure comprise of roads, electrification,

housing, communication & storage facility.

No public warehousing exists in rural India. Bad networks of all season roads,All these factors give an indication of extra effort

required on the part of a marketer in terms of

cost & time.


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4 A Approach


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The 4A Approach The rural market may be attractive but it is not

without its problems .

Low per capita income that is large number ofdaily wage earners,

Acute dependence on the monsoon Seasonal consumption

Poor roads Power problems, & inaccessibility to

conventional advertising media.


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Availability Place

Affordability Price

Acceptability Product

Awareness Promotion


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Availability The first challenge is to ensure an availability of

the products /services.

Given the poor state of roads even greaterchallenge to regularly reach the far flungvillages.


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Affordability SECOND CHALLENGE IS TO ENSURE

AFFORDABILITY OF THE PRODUCTS OR

SERVICE. With low disposable income, products need to

be affordable to the rural consumer.


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Acceptability Third challenge is to gain acceptability for the

product/service.

Need to offer the products /services that suitsthe rural market


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Awareness With large part of rural India inaccessible to

conventional media only 41% rural households

have access to TVBUILDING AWARENESS ISANOTHER PROBLEM.


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Types of markets


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Village shop-outlet in village stores very essentialmanufactured goods, required on daily basis like

beedis, cigarettes, tea dust, oil etc. may be offered oncredit.

Weekly Haats assemble on a fixed day at aparticular spot in a specific village. The commoditiesinclude agricultural products, toiletries, & otheressentials agricultural tools .even livestock.


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Primary wholesaler.

Assembly markets/ Mandis market placeto sell his agricultural products soon after theharvest

Mandis are well-established markets forselling & buying agricultural products withnumber of market functionaries.


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Rural consumer might purchase consumableitems at village shop or haats

But will purchase consumer durable items

from district headquarters to the town wherethe primary/secondary markets are located.


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Communication StrategyIn Rural Market


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Advertising go hand in hand with economicgrowth.

Prior to liberalization, the rural market wassellers market.

Due to economic liberalization & increase in

rural prosperity, the marketers are interestedin informing rural population about thebenefits of buying & consuming theirproducts & services.


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Since rural environment is different from

urban, hence communicating to potentialconsumers in rural India is challenging risk.

In many cases, advertising communication,

which is designed for urban area, is extendedto rural area without considering the values &sensitivities of the audience.

This leads to negative perception in the mindsof audience.


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A marketer needs to follow a communicationmix consisting of specific blend ofadvertising, sales promotions, personalselling & public relations

.The communication in rural India goesbeyond these promotional tools.

This is because urbanites who are more orless similar rural folks differ from region to

region.


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Khaitan fans' ad on a horse cart


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The greatest challenge for advertisers andmarketers continues to be in finding the right

mix that will have a pan-Indian rural appeal.Coca Cola, with their Aamir Khan ad campaignsucceeded in providing just that.


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"Yaara da Tashan... ads with

Aamir Khan created universalappeal for Coca Cola


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"Yaara da Tashan..." ads with Aamir

Khan created universal appeal for CocaCola Coca-Cola India tapped the rural market in a big

way when it introduced bottles priced at Rs 5

and backed it with the Aamir Khan ads. Thecompany, on its behalf, has also been investingsteadily to build their infrastructure to meet thegrowing needs of the rural market, which

reiterates the fact that this multinational hasrealised the potential of the rural market is goingstrength to strength to tap the same.

rural marketing final_march 2012

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