Rural market covers all marketing activities ascertain the demand, product planning, distribution and facilitating the entire marketing process, with aim of satisfaction of rural consumer. Rural market includes all business activities which involved in flow of goods and services from producers to rural consumers.
Rural market offers growth opportunities as the urban markets are increasingly becoming competitive and in many products even getting saturated. Now income level and standard of living is increasing rapidly in rural areas. The demand of branded products is also increasing.
Census of India 2011 defines “ The rural market has been defined as a place where the population is not more than 5,000, the density of population is not more than 400 per square kilometre and at least 75 per cent of the male working population is engaged in agriculture”
Learn about:- 1. Meaning and Definition of Rural Market 2. Need for Rural Market 3. Features 4. Importance 5. Marketing Strategies 6. Classification 7. Difference between Urban and Rural Market Research 8. Types of Promotional Tools 9. Market Index 10. Issues.
Rural Market: Meaning, Definition, Need, Features, Importance, Promotional Strategies, Issues and Classification
ADVERTISEMENTS:
Contents:
- Meaning and Definition of Rural Market
- Need for Rural Market
- Features of Rural Market
- Importance of Rural Market
- Marketing Strategies for Rural Market
- Classification of Rural Market
- Difference between Urban and Rural Market Research
- Types of Promotional Strategies for Rural Market
- Rural Market Index
- Issues Concerning the Rural Markets
Rural Market – Meaning and Definition
The rural population in India is around 70 per cent. Of the total population, 62 per cent of consumer expenditure in India comes from rural market. The rural market in India is not a separate entity in itself and it is highly influenced by the sociological and behavioural factors operating in the country. Rural markets are tomorrow’s market and marketers should know how to penetrate these markets. Rural markets are the new markets which are opening up for various product categories.
Rural market offers growth opportunities as the urban markets are increasingly becoming competitive and in many products even getting saturated. Now income level and standard of living is increasing rapidly in rural areas. The demand of branded products is also increasing. The rural market in India brings bigger revenues in the country, as the rural regions comprise of the maximum consumers in this country. The rural market in Indian economy generates almost more than half of the country’s income.
Rural market covers all marketing activities ascertain the demand, product planning, distribution and facilitating the entire marketing process, with aim of satisfaction of rural consumer. Rural market includes all business activities which involved in flow of goods and services from producers to rural consumers.
ADVERTISEMENTS:
The definition of rural as given by the Census of India is not being Urban. There could be several approaches to understand the rural market. It will not be an exaggeration to state that if the whole of India excluding the metropolitan cities, various district headquarters and the large industrial townships is considered as the rural market.
Rural market is not an independent entity by itself. In fact, there are sociological and behavioural factors which affect the economy of rural market. By and large, markets may be described as an environment of the country side and the habitants thereof. People are the market for marketers.
In that sense, India is the second market in the world. As per 1991 Census, the population of India is 844 million. It is growing at the rate of 2.00 per cent every year. The rural population of the country is at 627 million, accounting for 74.3 percent of total population.
The Indian rural market, with its vast size and demand base, does offer great opportunities to marketers. More than three-fourth of country’s consumers live in rural areas and more than half of the national income is generated by them. It is only natural that rural India should occupy an important position in the total market of India.
ADVERTISEMENTS:
The rural market is made up of two broad components:
(1) The market for consumer goods which includes both durable and non-durable goods, and
(2) The market for agricultural inputs (fertilizers, pesticides, seeds, etc.) and other investment goods.
The market for agricultural inputs is predominantly rural and relatively well established.
ADVERTISEMENTS:
Marketing in rural areas has a varied conceptual dimension as the events occurring in markets are necessarily taking place in a set of conditions affecting the rural dwellers and institutions hinterlands. Many marketers seem to take rural market as agricultural marketing, but it is a wrong view of the subject.
In fact, by rural market, we mean the performance of business activities that direct the flow of goods from urban to rural areas (for manufactured goods) and vice versa (for agricultural produce) and products manufactured by rural non-agricultural workers.
There are different definitions for the term rural market:
1. Census of India 2011 – The rural market has been defined as a place where the population is not more than 5,000, the density of population is not more than 400 per square kilometre and at least 75 per cent of the male working population is engaged in agriculture.
ADVERTISEMENTS:
2. Reserve Bank of India – Locations with population up to 10,000 will be considered as rural and 10,000 to 1,00,000 as semi-urban.
3. Planning Commission – Places with population up to 15,000 are considered as rural.
4. NABARD – All locations irrespective of villages or towns, up to a population of 10,000 will be considered as rural.
5. Most Companies in the FMCG would define rural as any place with a population up to 20,000.
ADVERTISEMENTS:
6. Consumer Durable Companies would consider any town with a population below 50,000 as rural.
7. A Simple Definition from Marketers’ View would be, “any market that exists in an area with less than 10,000 population, low density of population and without significant infrastructure facilities is a rural market”.
Rural Market – Basic Reasons for which Rural Market is Needed
Around two-third of Indian consumers live in rural areas generating half of the national income. This reflects that Indian rural market has a huge scope of demand base and offers great opportunities to marketers. That is why it is obvious and fair to enter and involve in rural areas. The consumer durable market in urban areas for products like colour TVs, washing machines, refrigerators and air conditioners is growing annually from 7% to 10%.
The growth rate of rural market is at high pace which is around 25% annually, Rs. 989 crore (Rs. billion). According to Venugopal Dhoot, Chairman of the Videocon Appliances “The rural market is growing faster than urban in India now.” Followed by, Ravinder Zutshi, Samsung’s director, marketing, says that, “The urban market is a replacement and up gradation market today.”
ADVERTISEMENTS:
It is transparent that from past few years, the rural market sector has projected tremendous growth when compared with urban markets.
There are some basic reasons that are given below:
1. Socio-Economic Changes (Lifestyle, Habits and Tastes, Economic Status):
The change in lifestyle and economic status is one of the most important factors that have driven the rural sector towards the improvement. The source of information and awareness of the rural people have changed their habits, tastes and preferences. AH these factors have together contributed towards the improvement in the rural sector.
2. Literacy Level:
Another major factor for the improvement of rural sector is the increase in literacy level of the rural people. Before independence, the literacy rate was around 25% but from past decade it has been traced that there is a huge improvement in the sources of information and education up to 69%.
3. Increase in Expectations:
With the media reach and high income level the awareness and preference of the rural people has been developed when compared to their urban counterparts. Their demand towards quality products with better pricing has increased. Instead of being price conscious the rural people are also expecting good quality products and are aware of branded products.
4. Increase in Income:
The growth in rural markets has reduced the complexity of its functions. With the increase in income level of rural people their purchasing power and economic status of living have also developed. This in turn leads to the further development of rural marketing activities in the Indian economy.
5. Infrastructure Facilities:
ADVERTISEMENTS:
Infrastructure and communication plays a vital role in bringing the improvement of rural sector. Well-developed roads, hi-tech media and electricity leads to the improvement of the entire marketing activities. In the current’ scenario, the rural market has also been facilitated with such infrastructural facilities.
Rural Market – 19 Distinct Features of Indian Rural Markets
The following feature of rural markets differ in a big way when compared with urban markets:
Feature # 1. Infrastructure:
In rural sector, infrastructural facilities such as, all-weather roads, telecommunication, better logistic facilities, electricity and other financial support are not in adequate position. Although the government has been implementing many development schemes to improve rural infrastructural facilities such as – Pradhan Mantri Gram Sadak Yojna (PMGSY), Rural Electricity Supply Technology (REST), Pradhan Mantri Gramodaya Yojna (PMGY), it has not reached the entire rural population. So, still we have to move a long way.
Infrastructure is one of the most important factors which differentiate the rural and urban markets like poor logistic facilities create more problems in product distribution, improper road connectivity that delays their reach and so on.
Feature # 2. Heterogeneous Market:
India is the home for a number of languages, dialects and sub-cultures which vary from region to region, state to state or even place to place. In India we have twenty four official languages and the dialects range more than thousand six hundred. It puts pressure on the marketer to plan different schemes to promote their products in different consumer segments instead of framing uniform promotional strategy. Existence of different communities, caste system, traditions, values and beliefs are also the reason for the heterogeneity of rural market. This creates a wide range of regional disparities and inequalities.
If we take the states like Punjab and Bihar as an example, the per capita income of Punjab is high (Rs. 78,171) whereas the situation is contrast in the state of Bihar (Rs. 15,268).
Consumer preferences are more influenced by the factors like literacy level, socio-cultural background and their economic conditions. That is why the difference exists among rural and urban consumers while accepting new ideas and innovative products.
For example if we consider the demand for branded products, it is more in urban sector than in rural sector because of increased urban literacy level and well developed socio-cultural background.
The above given factors contribute towards the heterogeneous nature of rural market. So, there is very less chances for the existence of monotony behaviour of rural consumers. The behaviour of consumer varies due to the factors of demographic environment like education & literacy level, density of population, household patterns, occupational patterns, lifestyle etc.
Feature # 3. Large and Widely Spread Markets:
As we are all aware that Indian rural market is large and widely spread. In India, there are around 6, 40,867 villages approximately spreading over 32 lakhs sq. kms. which accounts nearly 75 crores rural consumers.
Based on the survey conducted by the Census of India, 2011, approximately 91,552 villages in India have population less than 200 on a whole which accounts nearly 16%; and another 21% have population in between 200 – 500. Due to the nature of huge and widely scattered market, the transportation cost goes up in order to reach the less population per settlement. This creates major problem for the corporate while planning their distribution strategies.
Feature # 4. Agricultural Income:
More than fifty per cent of rural income belongs to the agriculture and allied activities which is highly dependent on monsoon. So, the majority of the rural prosperity is dependent on climatic conditions. Anyhow, from the last decade the higher dependency on agricultural sector is getting down and simultaneously the other sectors contribution is increasing to improve rural income.
Feature # 5. Living Standard:
Agri-based activities are all seasonal oriented and it plays an important role in the living standard of the rural people who are majorly engaged in the agricultural and allied activities. The imbalance in season reflects uneven streams of income that makes the rural population price conscious and affects their purchasing power.
Even though they have higher seasonal income, they have lesser disposable surplus. Some other factors like, traditional attitudes, higher illiteracy level, down trodden life, also lead to lower standard of living.
Feature # 6. Occupation Pattern:
Majority of the rural population is holding agriculture and other related activities as their main occupation. The major source of income for about 77% of the population is land. Minority of the population are engaged in business and other services range about 10% and 2% respectively.
Other 2% of population has to be focused on those who are not engaged in any sort of occupation that turns to be profitable. Thus, it is transparent that agriculture is the sector on which the entire economic prosperity depends.
Feature # 7. Literacy Level:
The literacy level in rural areas is about 69% when compared with urban areas which have high literacy level around 85%. The different languages spoken adds to the difficulties in rural communication system. The education is one of the most vital factors that create awareness about technical advancement.
Feature # 8. Large Number of Consumers:
Although the income and purchasing power play a major role in determining the demand in rural areas, the number of consumers is also an important feature that characterizes rural markets. There are states like U.P., M.P., Bihar, Rajasthan and Odisha where rural population varies from 80 to 90%. Thus, large number of consumers add to huge scope in rural marketing activities.
Feature # 9. Media Reach:
In rural household the media reach is very low. In statistical terms it is indicated that the reach of Print media is 10%, TV is 31%, and Radio is 32% and followed by Cinema which is 36%. Therefore, the rural specific promotion media and methods to reach the villagers have to be primarily considered by the marketers.
Feature # 10. Rural Electrification:
For agricultural operations and small industries in rural areas the electricity is an important resource. About 5 lakh villages have power supply leaving behind the large number of villages that are not supplied with electricity at all. This has increased the demand for electric supply which in turn has increased the demand for electric motors, pumps and agricultural machinery.
Feature # 11. Communication and Transport Facilities:
The communication facilities in rural markets are really backward that is reflected in many states where about 20% of the six lakh villages are without telephone facility even today. The state like Maharashtra has poor telephone facility in around 12,000 villages. 14,200 villages in MP, 17,600 villages in Rajasthan, 7,000 villages in Gujarat and 6,000 villages in Orissa are not benefited with telephone facilities. When we take transportation into account the result is considerably the same.
About 50% of the markets are not connected by road. Most of the roads are kachha and become unusable during rainy season. Where it becomes difficult for the farmers to travel by bullock carts which is very risky, expensive and time consuming.
Feature # 12. Medical Facilities:
Lack of hospitals in remote villages also characterizes the rural markets where medical facilities are quite inadequate for which the villagers have to travel long distances for getting medical treatment.
Feature # 13. Slow to Adopt Brands – Slow to Give them Up:
In order to compete with their urban counterparts, the rural consumers are slow to adopt brands as well as to give up the brands. Retaining consumer loyalty becomes a major issue for the marketers in rural sector. Hence, the marketers have to plan for longer lead times before they go for investments in order to gain high returns. The rural consumers do not give up the brands when compared with urban consumers. This enables the marketers to gain their loyalty before initial brand investment.
Feature # 14. Higher Receptivity to Advertising, with Lower Persuasion:
Marketing that touches the rural consumers directly, such as personal experience, seeing others using it, or live demonstrations of the brand in action are highly persuading them.
It is important for mass media to be complemented by activities aiming at real life demonstrations of the brand in action. As the retailer in rural markets is not just a distribution node, but also a communication channel, the retailer education also plays an important role. The retailers can help endorse the brand, educate or even demonstrate to consumers on its benefits with proper training facilities if given.
For example, Unilever’s Lifebuoy soap used a ‘germ glow box’ that highlighted the germs in hands and make consumers aware that ‘visual clean was not safe clean’. This was done through a demo kit to highlight the importance of washing hands with an anti-bacterial soap as part of the brand’s central proposition.
Feature # 15. Information Hungry; but Entertainment Starved:
The scope of entertainment programs is very limited in rural community. It makes it easier for marketing communications to generate higher levels of involvement by making their communications more entertaining. Packaging brand information through entertainment in well design manner not only makes the communication more effective and can improve understanding and absorption of key brand information.
In case of Nokia who has successfully used a highly engaging radio drama to communicate it’s ‘one year warranty’ in South Africa, and has developed category benefits of mobility to first time buyers in India.
Feature # 16. Expenses are Yearlong; Income is Seasonal:
Seasonality of demand is a unique feature of the rural market. Being predominantly agrarian, rural income tends to be highly skewed towards a couple of months in a year. Thus demand is highly concentrating on seasonal fluctuations throughout the year. It is therefore important that marketers focus their marketing activities during times in which incomes reach on the peak level rather than distribute them over the year, as they would do in urban markets.
Feature # 17. Cultural Diversity and Heterogeneity of Market:
There are 5, 70,000 villages, half a dozen religion, 33 languages, 1650 dialects and diverse subculture makes Indian rural market a heterogeneous market.
Feature # 18. Commercially Profitable and Socially Acceptable:
Business minded companies have to be very careful while dealing with the rural consumers when they try to be very aggressive in pushing out their products. Very profit oriented or commercial companies may try to dump their inferior products and unsold stocks in rural markets. This approach of these types of companies may bring black mark for the goodwill of the company.
Rural consumers are very simple and can generally be easily convinced. Companies should take care to build their image and trust among the rural consumers for long lasting impact on them.
Here are some examples which explain the big giants like HUL, Colgate and Nokia etc., have entered the rural market to sell their products by building trust and image on rural consumers.
Feature # 19. Untapped and Unexploited:
There has been a rise of employment opportunities for the rural poor due to the introduction of various rural development programs. One of the biggest cause behind the stable growth of rural market is that it is not exploited and also yet to be explored.
There are several obstacles standing in the development of rural sector like instability of social status in rural area, imbalance of income level and literacy rate with high superstition and outdated techniques.
Rural Market – Importance
The rural markets are estimated to be growing firstly compared to the urban markets. The potentiality of rural markets is said to be like a ‘woken up sleeping giant’. These facts are substantiated in a study of market growth conducted by various researches. In recent years, rural markets have acquired significance in countries like China and India, as the overall growth of the economy has resulted into substantial increase in the purchasing power of the rural communities.
On account of the green revolution in India, the rural areas are consuming a large quantity of industrial and urban manufactured products. In this context, a special marketing strategy, namely, rural marketing has taken shape. Sometimes, rural marketing is confused with agricultural marketing – the later denotes marketing of produce of the rural areas to the urban consumers or industrial consumers, whereas rural marketing involves delivering manufactured or processed inputs or services to rural producers or consumers.
The importance of rural market are as follows:
1. Increase in population and hence increase in demand.
2. A marked increase in the rural income due to agrarian prosperity.
3. Standard of living is also increasing in rural areas.
4. Large inflow of investment for rural development programmes from government and other sources.
5. Increased contact of rural people with their urban counterparts due to development of transport and wide communication network.
6. Increase in literacy and educational level and resultant inclination to sophisticated lives by the rural folks.
7. Inflow of foreign remittances and foreign made goods into rural areas.
8. Change in the land tenure systems causing a structural change in the ownership patterns and consequent changes in the buying behaviour.
9. Rural markets are laggards in picking up new products. This will help the companies to phase their marketing efforts. This will also help to sell inventories of products out dated in urban markets.
Rural Market – Marketing Strategies for Rural Market
We now present certain aspects of marketing strategies for rural markets.
1. Product Management:
In marketing strategy, product strategy occupies a pivotal place. A marketer has to decide whether he should modify a product slightly to suit the rural consumer needs and perceptions or market a totally separate product or brand for rural market. Marketing a totally separate product or brand for the rural market may not be possible in some cases.
Whereas in some cases it may very well be possible to develop entirely different brands to suit rural market. For example consumer non-durables or convenience products can be developed exclusively for rural markets. It may be difficult to carry out the same exercise for consumer durable products.
Where different branding strategy is not possible marketers may try on products aspects such as packaging and quality. For instance there may be a greater preference for smaller packs due to the lower income levels and therefore, in product design it would be appropriate to go for smaller packs for rural markets.
On the quality front, a rural consumer may not be given great promises, maintaining a consistent and assured quality.
In planning products for villages, irrespective of the country, it is important to ensure that the packaging is sturdy and robust. Products meant for rural markets have to travel longer distances and the external packaging should withstand frequent handling. Moreover, considering the poor purchasing power of the weakest rural consumers, small pack sizes containing enough product for a day or a week are essential.
It would be of great relevance to discuss the role of branding in rural marketing as a part of product strategy. Majority of the rural consumers are illiterate or less literate. Against this background the importance of brand, logo and even the pack would be highest.
A rural consumer may not be able to read the name of a brand but having heard the brand name and having seen he would be able to recognise the brand easily. Therefore, a firm, while deciding upon its branding strategy, should carefully underscore the preferences of rural consumers.
This leaves an immense scope to marketers to develop brand loyalty in the rural market. Therefore, distinct colours, logos, and pack facilitating an easy identification of the brand is a must in rural marketing.
2. Price Management:
Pricing is crucial element in the rural marketing mix. The price of a product should be reasonable and should be in tune with the afford ability of rural consumer. If the product is over-priced, it may necessitate the marketer to modify the price or to withdraw the product.
The price of the product is thus a critical determinant of the fate of a product in the rural market. The market share and volumes of the company are influenced significantly by the price of the product.
Price revolves around two elements—utility and value. Utility is the generic property of the product to satisfy a need or want of the consumer. Value is the quantitative worth the consumer attaches to the product for which he is willing to part with a certain quantum of money.
In rural market both the elements of pricing, i.e. the utility factor and the value factor are equally important due to the limited disposable incomes with the rural consumer. The villager seeks products which not only meets his need but also gives a fair exchange for the money that is parted with.
The task of selling products in the villages is rather onerous and demands attention to a number of other variables like distribution, propaganda, demonstrations, publicity etc. It is, therefore, pragmatic for a company to simplify its pricing policies by maintaining the same price, throughout the country. It can introduce variations in the price through other mechanisms like promotions and discounts.
The pricing objectives pursued by a company in the villages depend on a number of factors, viz., the marketing goals of the company, the life cycle stage of the product and the financial objectives of the company. As a regards price management, it is proved that, by and large, the rural markets are price conscious.
If rural market for a product is to be tapped a sound and relevant price strategy is required, undoubtedly, penetration pricing will score an edge over the skimming strategy in rural market. The rationale for penetration strategy in rural market is due to income level and structure of the market.
Not only economic factor but also psychologically, a rural consumer compared to urban consumer would aim to save more and more in his purchase decisions.
The rural purchaser mostly does haggling over each purchase. This is because of want of price uniformity and lmpopularity of Agmarking and ISI marking. As a consequence, personal inspection also becomes a habit. Perhaps, these factors made, Westfall and Boyd conclude that, “Indians are great bargainers” and majority of the Indian consumers are rural consumers.
In spite of the advent of green revolution, the discretionary buying power is not likely to be much with most of the villagers. Hence, necessities of life as well as other products must be low- priced. The village customer will prefer dust tea as against leaf tea, tooth-powder as against toothpaste and Bharat blades as against Topaz on account of cheaperness.
It is the cheap, single band, medium wave, battery operated, portable transistor which meets the needs of a village family. The chairman of Hindustan Lever Ltd. says that, “we will also need to take another look at our product and market strategy.” Some clear preference—low unit price for example —already distinguish the rural from urban consumers.
Therefore it may recognised that price is a key element in the marketing strategies for rural market.
3. Promotion Management:
Promotion Management involves developing communications and sales promotion strategies residing upon the media mix. Developing communication is a tricky exercise. There is a need to talk of not only rural language that even dialect specific in rural messaging. The marketers need to indulge in a thorough research prior to the communication decision.
The use of a model, the tone, in print or outdoor advertising, the colours used, projection of logo will all make a severe impact. All these have to be developed keeping the rural consumer personality in view. The marketing communications must match the rural consumer aspirations and culture.
The communications strategy of a marketer therefore has to be in tune with the rural consumer psychology.
As the rural consumer are price sensitive, the impact of sales promotion may be highly significant. Innovative sales promotion measures would surely induce a rural consumer to try a brand. A constraint one may face would be in terms of retailer cooperation. The retailer has to be properly motivated, monitored and persuaded to effect sales promotion measures announced by a company.
As regards media, thanks to satellite televisions, the rural consumer is actively competing with his urban counter-part in terms of product and brand awareness. The penetration of TV into the rural market has been of a high order leading to informational boom in the country.
However compared to urban consumer a rural consumer is likely to stick on to the main two or three TV channels. A focussed media research would enable marketer to facilitate his media mix decisions.
Promotions in villages consist of participation in local rural activities like fairs, festivals, carnivals, religious functions and sports events. Rural promotions should ideally be conducted in the post- harvest period when the farmers are flush with money from the sales proceeds of their crops.
Promotions should be avoided during the sowing period when the farmer is investing heavily in agricultural inputs and is spending time in the field?
In promotion management a marketer may have to go beyond the conventional media and try to reach rural consumer.
Media Mix in the Rural Context:
I. Formal/Organised Media:
a. Press and other print media.
b. Direct mail.
c. Radio.
d. Cinema.
e. TV.
f. PoPs.
g. Outdoors.
II. Non Formal/Rural Specific Media:
a. Audio-visual vans or publicly vans.
b. Demonstrations.
c. Puppet shows, dance-dramas, rural art forms like Harikatha and Villupattu performed at village melas and temple festivals.
d. Study classes.
e. Mike announcements, processions.
f. Carrying advertisement panels, decorated bullock carts carrying ad panels.
g. Music records.
h. House-to-house campaigns by special promotion squads. Information centres giving free advice on company’s product/services
4. Channel Management:
There are at least three problems pertaining to channel management viz., transportation, warehousing and communication. The transportation facilities still continues to be poor in rural India, which makes the delivery of the product extremely difficult proposition, and same is the case with warehousing.
The rural consumers should have access to products at their doorsteps. For this, retail outlets become necessary in the rural areas. But, marketing is not an important activity in rural India. In fact, there is some evidence that urban markets, dose to the centres of production, are increasingly favoured over rural markets because high transport costs are involved in moving goods to the villages.
The cities and towns can readily absorb whatever is produced. This is a pity because greater attention needs to be given to the requirements of rural areas, where newly affluent farmers have disposable cash in respect of both product development and distribution.
While the rural retailer have meager communication facilities, the problem is to some extent solved in the recent years. In the light of this it becomes mandatory to marketers to design his own transp9rtation system and warehousing.
It is extremely relevant and necessary to train and organise rural retailer to make him fall in line with the philosophy of the company. A retailer in rural markets is less or unprofessional in his approach to consumers. Owing to illiteracy and ignorance and also due to credit needs of rural consumers, rural retailer may develop the tendency of consumer exploitation.
A two pronged approach is therefore necessary in rural markets, one is to bring about behavioural change in retailer, developing a professional outlook, and the second is to awaken the rural consumer continuously by mass educational campaigns to make him exercise his choice in his own way.
It was identified in a study that there is a need to get deeper into the distribution mode—communication to arrive at the right media/ messaging mix. It is found that as much as 81 per cent of visitors to haats are on regular basis, and as much as 85 per cent attribute that buying at haats leads to the better pricing.
So a haat is a better opportunity for promotion than for brand building. Bargain-hunters are more likely to remember the product, brand for price-off; than for image or positioning. A large captive audience at haats is also ideal for product demonstrations and even sampling.
Consumer product companies need to learn a great deal about selling in rural markets. The trouble with most rural marketing campaigns is that they centre on retail outlets, a very urban phenomenon: Although most villages have small shops, they are used infrequently.
Villagers usually prefer to make all their purchases at weekly haats or at melas. And yet, few companies participate in such bazaars or fairs. Instead of trying to change the shopping habits of the rural consumer, companies should tune their distribution and merchandising to rural habits.
Mobile traders serve the needs of remote villages having low density of demand and are to be found in most districts of the country. This channel of sale continues to be popular despite the development of rural areas and offers excellent possibility for relationship marketing. But it has been completely ignored by the corporate sector.
These mobile traders who may not cost much can be employed by companies to market their brands, it may be direct marketing, for a cluster of villages one trader may be appointed with a given schedule. In this a credit policy also may be designed by companies to attract rural consumers.
The logistics of feeding two million outlets spread over 6,30,000 villages is a daunting task indeed. But, perhaps, this is not necessary if we realise that the average monthly sale per village shop is a mere Rs. 5,000 which is a low sale volume and restricts the variety and range of products stocked.
Moreover, since a significant portion of the sale is on credit, it puts most village shops in a self-limiting sales cycle. Companies need to, therefore, focus on the 2,000+ population villages only, totalling 60,000 for their distribution efforts.
About 47,000 haats and 25,000 melas are held in rural India. In spite of the development of permanent shops, haats play a vital role in the village economy. Most haats are held once a week, the average number of stalls is 300 and the sale exceeds Rs. 2 lakh per haat day.
Each haat caters to the needs of about 4000 people from minimum 10 to a maximum 50 villages. Larger haats are generally held in larger villages because of better road and transport connections and higher purchasing power available in these villages.
Of the total 47,000 haats, 4,300 are held in the 5,000 + population villages and another 10,300 in the 2,000-4,999 population villages. On an average people come from 20 villages to a haat, by targeting just 14,600 distribution points, a consumer company can hope to reach almost 50 per cent of the rural population.
Only commercial melas are of interest to corporate India. The average number of stalls per mela is 854, the average sale per mela per day (this offers a better idea of a mela’s commercial importance than the total sale, since the duration of a mela varies from one to 45 days) ranges from a low of Rs. 0.6 lakh in Assam to Rs. 88 lakh in Haryana, the average number of visitors is 7.6 lakh per mela.
Unlike haats which cater primarily to the essential needs of the local people, melas cater to a much larger population, both rural and urban, not only for their basic needs but also for the purchase of the more sophisticated factory-made products. In fact, almost half the outlets at melas sell manufactured goods.
Companies should pick the melas closest to the largest villages, where people are relatively more urbanised and therefore already exposed to brands. The list of the longer duration, regional and national level commercial melas is unlikely to exceed 500 all over India.
By using these melas as mileage building events, a company can hope to reach almost half the population of rural India, a fraction of the cost when compared with TV, video vans or other equally expensive media options.
Rural Market – Classification: Consumer Market, Institutional Market and Service Markets
Traditionally rural people regularly use to visit different markets for different commodities. For example –
i. Vegetable markets
ii. Grains markets
iii. Fruits markets
iv. Cotton markets
v. Animal fares
vi. Tea & coffee etc., have separate markets.
Rural consumers visit these markets often, meet and consult the commission agents need to understand wholesalers etc., to get the feeling of the markets. Marketers’ had to understand the purchasing power of the rural consumers and plan their distribution and promotional activities.
But as the rural India is progressing and the new type of markets have come to existence.
The rural market can be broadly classified into 3 groups:
1. Consumer Market:
Consumer market constituents include individuals and households and Consumer market products consist of consumables and durables. The consumables include Fast Moving Consumer Goods (FMCG) which includes food products, personal care products (body care, hair care, cosmetics, textiles and garments, footwear, toiletries, etc.,) and household care (fabric wash and household cleaners) and durables like home appliances, watches, bicycles, television sets, radios, audio and video players, automobiles, furniture etc.
2. Institutional Market:
Industrial market constituents include agricultural and allied activities, food processing, poultry farming, animal husbandry, fisheries, cottage industries, schools, NGOs, co-operatives, etc., and industrial market products also consists of consumables and durables.
The consumables and durables are classified as given below:
i. Consumables – Agri inputs, animal feed, fuel, engine oil, etc.
ii. Durables – Agri implements like tractors, power tillers, pump sets, generators, harvesters, sprinklers, boat, etc.
3. Service Markets:
Service market constituents include individuals, households, production firms and offices and services are like banking, insurance, credit, retail, healthcare, repairs, IT, power, communication, transport, education etc.
Rural Market – Difference between Urban and Rural Market Research
There are various differences between urban market and rural market. So, it is necessary to make different market research design for rural areas as compared to urban market.
The various difference between urban and rural market research are as follows:
Difference # Urban Market Research:
1. Respondents – Literate, brand aware, individuals respond individually.
2. Time – Willing to respond, have time pressures, spare little time for researchers.
3. Accessibility – Easy to access
4. Secondary data source – Internal data, syndicate research, published media, many sources & large data.
5. Primary data source – Large number of middlemen, experts, sales force, consumers, opinion leaders.
6. Sampling – Respondents form relatively homogenous group. Income can be a criterion.
7. Data collection – Use of sophisticated instrument, style and administration. Respondents are comfortable with number ratings and timeliness.
Difference # Rural Market Research:
1. Respondents – Semi-literate or illiterate, brand unaware generally group responses.
2. Time – Hesitant but devotes time.
3. Accessibility – Tough to access, geographical distances and psychological approaches are barriers. Do not speak easily to outsiders.
4. Secondary data source – Very few sources and less data.
5. Primary data source – Less number of all categories.
6. Sampling – Heterogeneous groups. Income and land holding to be carefully applied.
7. Data collection – Require simplified instruments. Respondents comfortable with colour, pictures and stories.
Rural Market – Types of Promotional Tools for Rural Markets
Some of the promotional tools for rural markets, which can be adopted by rural marketers, are as follows:
1. Mass Media:
In the present world, mass, media is a powerful medium of communication. Mass media with its known and perceived to be efficient cost per contact is the most favourite medium to spread the promotional message. The benefit of mass media is its huge reach and the easy tracking in comparison with other below the line promotional activities. It could be TV, cinema, print Media, radio and so on. It is necessary to examine the sustainability of each to rural areas for promotion and communication process.
TV is the most preferred mass media and Doordarshan leads the pack of mass media option available with the marketer for the rural market. MNC’s like Samsung were spending Rs.40 crores on advertising in the semi-urban areas. A significant part of this budget goes to Doordarshan, because no other medium has that wide a reach across the country.
Some of mass media options are:
i. Television – As of now, Doordarshan telecast network nearly covers the entire country. In addition, there are a number of satellite channels in operation, telecasting programmes in regional languages which can be perceived anywhere in the country with dish antenna and cables. Community viewing of TV or watching it at a neighbour’s house also increases the percentage view ship in rural areas.
ii. Radio – Irrespective of literacy levels, topography, geographical location or area of residence, radio reaches people easily. It continues to be an important source of information for many rural people, either through habit or through choice. Earlier, the Indian Radio industry was limited to state broad caster-All India Radio (AIR), today with the rise in the number of FM radio stations, the radio has truly matured as a medium of rural communication.
iii. Cinema – Cinema is an important communication media in many parts of the country, due to its universal appeal that cut across the barriers of geography and language. Films in theaters attract large rural audiences and provide an opportunity to disseminate product information by way of short advertisement films and cinema slides. LIC and other private Insurance Companies have been showing short movies in rural theaters to create awareness about life insurance.
2. Outdoor Media:
Large number of outdoor media option is available with the media planner to take the message to the rural market. Different options can be selected based on the demographic profile of the population of a region. Available infrastructure of the post offices, weekly markets, exhibitions, public distribution system, co-operative societies and banks could help in strengthening the existing promotional efforts. A vast network of 1.38 lakh rural post offices and 22,000 primary health centers need to be tapped imaginatively for education and information.
Some of the available outdoor media are described below:
(a) Wall Paintings:
They are an effective and economical medium for advertising in rural areas. Retailer normally welcomes paintings of their shops, walls, and name boards, because it makes the shop look cleaner and better. This has been widely used in case of agricultural inputs. It has been observed that rural persons have more time to see and watch the hoardings than the urban persons.
(b) Video Vans:
Video van concept started with the political parties who were not getting access on Doordarshan to have contact with the rural masses. The video van is one of the very effective means of reaching out physically to the rural consumers and providing them with touch and feel of product and the brand.
The promotion using these vans create a lot of word of mouth publicity for a brand in the region which is much more effective than the promotional campaign run on any mass media. If conducted in a proper manner then the promotional campaign can be the regular discussion at choupal for many days.
The commercial operation for video-on-wheels, a pioneer in this field, was started in 1989 from a tiny one van which became a network of 125 vans in ten years with a business to the tune of rupees eight crores. Rural Communications and Marketing (RC&M) joined the bandwagon in 1990 and had 50 vans and with a turnover of the Rs.2.7 crores in 1999. Other organizations offering this facility are Sampark Marketing and Advertising Solutions and Video express.
(c) Rural Games:
Focus of rural marketers can be on events like Quila Raipur Olympics and Nehru Boat Race, which are annual extravaganzas for promotion of their brands. Nearly one lakh spectators turn up to watch the rural sports at Quila Raipur village being played out in three daylong events.
Punjab has 250 popular festivals in the year, which include sports festival, agriculture as well as cultural festivals, in addition to the religious festivals. It is here that the rural marketers need to focus their attention, as the eyeballs of captive audience are available at these meets. The latest estimates are that in most of these festivals 50,000 visitors turn out on an average.
Rural games and tournaments are hugely popular in rural areas and are attended by rural people in large numbers. These tournaments can be sponsored at a reasonable price and could be utilized as a platform to put the company’s stall for brand building and demonstration. The company’s products could also be given as the prizes to increase the brand awareness. These products, given as prizes would lead to lot of word of mouth publicity in the rural areas as it would be talk of many villages for good number of days.
(d) Primary Health Centre:
The primary health centers are very good platform to promote products that have to be sold on health and hygiene grounds. The campaign in these centers can be executed in co-ordination with the NGO’s, state health departments, Medical Council or Dental Associations and even international aid agencies.
Swasthya Chetna Campaign to promote the habits of washing of hands by HLL in rural areas is a good example of this form of promotion; this would have directly or indirectly promoted sale of lifebuoy, its leading brand, in rural areas.
(e) Schools:
Young children are emerging as the change agent in the rural areas. Organisations like HLL and Colgate are targeting the children in the schools. They are not only educating them about the product benefits but are also demonstrating the benefits offered by their brands for the health of children and the entire family.
3. Unconventional Media like Shandies/Haats/Jathras/Melas:
These are the places where people from remote, underdeveloped area and villages congregate on the pre appointed day or period as a rule. These are places where there will be a captive audience for a fairly long period and it is certainly beneficial to promote with the help of an outdoor mobile publicity van with audio/video equipments.
4. Special Campaigns:
Marketers have to be really innovative, when it comes to promoting a product in the rural market depending on the product category and the target market. The organizations can select innovative promotional campaigns. TAFE tractor launched a direct contact campaign to strengthen the bond with existing customers through direct contact exercise in 44 centers in a state. It involved activities like farmers contact and dealer contact and tractor rally. It resulted in tremendous customer response and sales increased by 12% after one month of campaign.
Direct contact with individuals and groups such as the panchayats and other village groups helps in arousing the villager’s interest in their own problem and motivating them towards sowing them and in the process of leading to their self-development.
During crop harvest and marketing seasons, it is beneficial to take up special promotion campaigns in rural area. ‘Tractor owners meet’ (TOMEE) conducted by MRF Ltd. is one such example. Appropriate timing of these campaigns is more important since the promotion should not only result in awareness but also in adoption and purchase.
5. Personal Selling and Opinion Leaders:
In the context of rural marketing, this approach is necessary for both high value consumer durable items and capital agriculture inputs. It has been found by experience that the rural consumers do not decide on the bests of information provided by the companies or their advertisements. They prefer to consult others who actually possess the various brand of the product and also get their experience in using them.
Rural consumer makes well-considered buying decision for a specified brand often after lot of consultation with the opinion leaders. But opinion leaders change with the product category.
While for agri-inputs, the opinion leaders group consists of progressive farmers, agri-extension workers and village leaders, for other product categories, the opinion leader group consists of friends, well-informed relatives(particularly those working in nearly towns), educated youth and to an extent traditional village leaders. Dealers to play a major role in influencing the choice of a brand at the point of sale.
The electricians, mechanics and technicians which are found in almost all villages to service and repair products could be provided with free accessories, tools and their shops could be painted with company logo and brand name. These persons considered as specialists in their field could act as local brand ambassadors and could promote the products for the company as they are acting as opinion leaders for products in their field and their advice is sought by the villagers and given weight age in the purchase decision.
The following play the role of opinion leader in the case of corresponding product category:
(a) Successful farmer – for farm inputs
(b) Village youth who go to city – for lifestyle products
(c) School children – for personal care products
Asian paints launched its Utsav range during the Pre-Diwali season. Salesmen selected the opinion leaders in village and painted the village post office, library, or the house of the pardhaan to demonstrate that paint does not peel off. Salesman organized meets at the local dealers, where village painters were invited.
Integrated campaigns, which are – low cost, scalable, offer multiple contacts, and are interactive in nature, help in increasing brand penetration and frequency of usage need to be developed for the rural market.
Promotional activity must generate a lot of word of mouth publicity so that the brand is on top of mind when rural consumer purchases a product. Therefore, touch and feel aspect must be built into promotional activity. Brooke-bond organized marches in rural areas with band, music and caparisoned elephants to promote their brands of tea.
6. Folk Media:
There is a good audience available for different folk media in the rural world. Marketer can effectively utilize some of these to take his message to the rural audience. Different folk’s media are popular in different regions; therefore the folk medium selected must be popular in the region; then only it will be able to provide the desired level of audiences, some of the folk media, which can be used as a promotion vehicle, are described here below.
(a) Puppetry:
In rural India puppetry is an avenue for entertainment and creative expression, which might be ritually scared and meaningful as a means of social communication and vehicle of social transformation.
It is an excellent way of storytelling through the moving images called puppets. The cost of this medium is very less and is very popular in Rajasthan, Orissa and Haryana. People of all ages and genders can be targeted by incorporating the product in the narrative.
Song and Drama Division of the Government of India makes wide use of puppets in its campaigns to promote various government projects, several other organizations, government, semi-government and private, have also used puppets in support of individual schemes.
For example – Life Insurance Corporation of India used puppets to educate rural masses about Life Insurance. These plays were shown to the audience in villages in UP, Bihar and MP. The number of inquiries at local offices of LIC during the period immediately following the performance was compared with normal frequency and found to be considerably higher. The field staff of the corporation also reported a definite impact on the business.
(b) Folk Theatre:
Folk theaters are mainly short and rhythmic in form. The simple tunes help in informing and educating the people in informal and interesting manner. It has been used as an effective medium for social protest against injustice, exploitation and oppression. Government has used this media for popularizing improved variety of seeds, fertilizers, etc.
(c) Nautanki:
It is a folk dance drama which is performed in Uttar Pradesh on a make shift stage surrounded by a tent. It is a prime attraction in the village fairs amongst all age groups because of its narrative style and rustic humour. This folk media provides captive audience and marketers can use it as a platform to promote their products as rural audience believes that the performers are more credible than conventional media like TV or radio.
(d) Tamasha:
It involves seductive Lavni dance drama and interactive session with the audience. As only males are the audience therefore products meant for males can be effectively promoted through this media. The script can be modified to incorporate the product benefit, advantages and its availability.
(e) Birha:
Started during the freedom struggle to promote and develop the independence movement through the medium of songs, Birha is song about the current social realities of the day and is sung at gatherings, which draw big crowds. It is a musical night organized in the state of Uttar Pradesh and is popular amongst all the sections of the society. This is a very effective medium to deliver social messages and can be used for promotion of products that are very relevant for the rural masses.
Cultural practices and traditions of villages should always be given adequate weight age while deciding on the promotional strategies. A broad generalization is less likely to deliver effective results in the rural areas. Therefore, it is important to pilot-run a campaign and measures its effectiveness at a very small scale in one or two villages before launching a large-scale operation in similar socio-cultural settings. It is quite possible that a promotional campaign, which was successful in one area, might not only be ineffective but also boomerangs in the other.
While any one can think of ideas for below the line activities it requires conscious efforts by professionals to connect with the audience with the right communication package-which takes the core message of the brand and communicates it in a language, idiom, style and situations, which is easily understood by the target audience
7. Hiring Strategy:
Top management’s commitment to tap the rural market exists in most of the organizations but the lower levels that have to implement plans in rural areas have exposure mostly to urban markets. They are not very comfortable in rural setting. Urban and semi urban based salesmen are not able to tap the full potential on the villages. The whole process of reaching out to the rural markets can be made effective if corporate sector hires professionals from a rural management institutes or universities.
In a similar manner the salesman and brand promoter at grass root level in rural markets should be selected from the educated unemployed villagers, trained well and then appointed as salesman. They can be hired on the pay role of HR outsourcing company to avoid increasing the head count.
The following characteristics are essential requirements for a professional to effectively cater to the rural needs and develop image in between rural retailers and consumers:
(a) Fluency in Local Language – In India, as many as 18 languages are spoken, with hundreds of dialects. If the sales people speak the local language and dialect, then only local population can connect with them and their promotional message. As this make them believe that salespersons are like them only.
(b) Capacity to work for extended hours – There are 20 lakh rural outlets spread over a very large area that would involve a lot of travelling and that too away from one’s family and house for days at large.
(c) Adjustability with inadequate Boarding and Lodging facility – The sales people has to stay in small hotels and can have to put up with the problem like mosquitoes, dirty linen, unclean rooms etc.
A deeper understanding of the rural areas in needed for which the people with rural exposure are required. The focus should be on infecting marketing culture into the villages.
8. Social Strategies:
Social marketing is the application of marketing principles and technique to market and considering the social cause or idea or behavior. This developments approach not only builds the bonding with a given brand but it also develops the population on different socio-economic parameters.
Social marketing now holds an important place in the activities of many companies and is viewed as a social obligation. In the rural setting it is not just going and selling the products made by an organization but in the process they also have to create the buying capacity for those products. Social development role is extremely important in rural areas where people value the relations and see these investments positively.
Some of the social strategy initiatives, which could be adopted by corporate world to develop demand for their brands, are given below:
(i) Employment of Rural Youth – Provision of employment opportunities in sales and distribution of product in rural areas to rural youth would increase the goodwill of the company in the eyes of the villagers. This would increase their disposable income. The rural youth can be in a better position to sell the product after an adequate sales training programme.
(ii) Partnerships with NGO for Education Programmes – This would also influence consumer behaviour, generate goodwill towards the company as well as create a market for the products. The educated customers are likely to have better employment prospects and hence additional disposable income. They can be expected to make more rational and informed decision. They would be more open to new ideas and can easily distinguish the difference between the genuine and fake products.
(iii) Encouraging primary education in the villages – This can be a key to influence consumers to change their habits and use a company’s products. The underlying motive is to influence people’s behaviour. This could be done through a V-sat connection, as being pilot tested by HLL in Maharashtra. HLL believes that such an education effort to improve sanitary habits will create more awareness of hygiene and cleanliness which will in turn have a direct impact on the sale of its territories.
Rural Market – Important Rural Market Index to Understand Rural Consumer Needs
To understand the rural consumer needs and type of markets to enter, the companies depend on rural market index. The database of rural sector is available in the software form. Advertising companies and rural marketing consulting organizations use this information for various purposes such as – where to invest in rural sector, which ate the potential rural markets and which media will fit to promote their product in rural areas.
Some of the important market indexes are explained in detail below:
1. Thompson Rural Market Index:
The first successful attempt in the way to appraise the capacity of rural markets was made by Hindustan Thompson Associates Limited (HTAL). They developed the “Thompson Rural Market Index” as a guide to the rural marketers to project the rural market potential, in the year of 1972.
Initially, total number of parameters identified by them were 11 and different weightages also assigned for those factors to assess the rural market potential. For this research, totally 334 districts in India were selected and maximum data collected from those district level itself because of more easiness and reliability of data. However, this was not considered to be a satisfactory approach.
So, again another attempt was made in the year of 1986. At this stage, they added 15 more parameters (i.e., totally 26 parameters) and considered 383 districts in India for their research purpose and the report was published in the year of 1986, as ‘Thompson Market Index’. This database provides exhaustive data with respect to the Market Potential Value (MPV) of a particular district.
Following are the main parameters considered for Thompson Rural Market index:
Area of the District in (Sq. Km.):
i. Demographics –
Population – Rural numbers
ii. Males – Number
iii. Females – Number
iv. Density per sq. km.
v. Percentage distribution of population-by-population strata
vi. Number of villages
vii. Percentage distribution of villages by population strata
viii. Literate – Rural numbers
ix. Percentage of literacy
x. Literate – Males
xi. Literate – Females
Occupation pattern –
Cultivators – Number
Agricultural labours
Non-agricultural labours
xii. Agricultural related data – Gross cropped area (in hectares) Gross irrigated area (in hectares)
Area under non-food crops (in hectares) Average size of operational holdings (in hectares)
xiii. Agricultural inputs data
xiv. Pump sets and tube wells: Number
xv. Fertilizer consumption (in metric tonnes)
xvi. Number of tractors
xvii. Rural electrification data
xviii. Percentage of villages electrified
xix. Commercial Banks data –
Number of rural branches
Deposits (in Rs. Lakhs)
Advances (in Rs. Lakhs).
2. MICA Rural Market Index:
Mudra Institute of Communication, Ahmedabad (MICA), ranks districts according to seven basic parameters like:
i. Population
ii. Bank advances
iii. Cropped area
iv. Irrigated area
v. Number of cultivators
vi. Fertilizer consumption and
vii. Total value of agricultural output.
For this, data were collected from 1991 census reports and was priced at Rs. 35,000 in 1991.
Linquest:
Marketing mapping tool from AP Lintas was the predecessor of Lincompass. It considered totally 42 variables to rank the districts. It was priced at Rs. 75,000 in the year 1991.
NCAER consolidate this complete information based study in a routine basis. Very large samples are taken for this research purpose. Its 10 year White Book gives detailed information with respect to different classes of income, trends in the durables etc.
This is a Chennai based research unit and ranked 500 districts based on purchasing power potential (which includes agricultural zones also).
Lintas’ specialized rural marketing division, Linterland, has developed a software tool, Lincompass which maps the rural market.
While taking decisions with respect to the area of transportation and distribution applications, territory planning, dealer development, etc., this tool is very useful for the analysis of accessibility, coverage and penetration.
This knowledge based intelligence system relates 5, 87,962 villages as digitized points on the maps depicting the market potential of an area as a cluster. It generates different kinds of maps like, agricultural maps, socio-cultural maps, national and state highway maps, river maps etc. It identifies potential markets from state to district to village or town.
Rural Market – 4 Major Issues Concerning the Rural Market
Manufacturers and marketing experts have to pay special attention to the question whether rural consumers constitute a distinct market from urban consumers. It is clear that the rural market as a whole has different features from the urban market.
Differences seem to arise mainly on account of certain external factors that shape the rural market rather than due to the real tastes of consumers themselves. In what follows, an attempt is made to present some of the issues concerning the rural market.
Issue # i. Product Planning:
One of the prevailing beliefs is that the rural buyer imitates his urban counterpart. Does this mean that the same products can be sold in two different markets? Some manufacturers who tried to enter the rural market have however, found to their utter dismay that this is not the case. Goods have to be specially designed to meet the tastes and preference of the rural consumer.
Before one embarks on a programme of rural marketing, one should have a sound idea about rural consumer attitudes, habits, social standards, important festivals, marriages, crop seasons, significance of astrology, local institutions which have an impact on daily life, and importance of gold, etc. An understanding of these would help in designing the marketing strategies effectively for rural areas.
Issue # ii. Retail Outlets:
Most marketing managers believe that rural families mostly buy their manufactured consumer goods in towns or mandi markets. While in the case of some durables this might be true. It is not necessarily true for consumer products which have a high frequency of use like soaps, hair oils, tea, tobaccos, biscuits etc.
For products which cannot be taken up for sale by either the general stores or the kirana stores, mandi markets became the most suitable place to locate the retail outlets.
For radios, transistors, cycles, kerosene stoves, etc., which call for a degree of servicing and stocking of spare parts, it seems essential that retail outlets are not located away from the consumers, though the costs of penetration will have to be taken into account.
Issue # iii. Branding:
Some marketing analysts believe that no special branding is required and that sophisticated brand names will catch up in rural areas. This is seldom true. Therefore, marketers may have to give their products names which can be easily remembered and pronounced with wrappers printed in local languages.
On account of high proportion of illiteracy and lack of persistent publicity, branding carries practically little importance in remote villages. The rural consumer does not make brand discrimination but once induced to buy and use a product he becomes loyal to the brand, provided he is satisfied about the functional utility.
Issue # iv. Promotion and Advertising:
Yet another belief that exists is that strategies adopted in promotion and advertising for urban consumers can be replicated with only minimal changes for use in the rural areas. For instance, manufacturer deals without regard to the difference between market segments.
Today, even the biggest rural marketer’s service just upto the block town level, with the village coming out not reaching there. The marketers who swear by their marketing have singularly failed to exploit rural India’s traditional selling system their near-obsession with just duplicating the urban type network and that to with vary limited success, has kept the find to the obvious.
Till now corporate India has based itself just catering to the needs of the affluent rural elite, paying no attention whatsoever to the marginal/small former. No one ever thought of landing a brand specifically for the rural market, let alone liked seriously at the marginal rural classes as consumers.
Firms are increasingly realizing the importance of weekly markets, fairs and melas, and mobile publicity vans. For certain consumer products, market experts have successfully tried to use mobile publicity vans as sales outlets with the idea of making these self-paying, thus reducing the burden of the additional expense on promotion.