International Journal of Management and Social Sciences Research (IJMSSR)
Volume 5, No. 1, January 2016
Opportunities and Challenges for Rural Marketing in India
Neha Garg, Research Scholar, Haryana School of Business, Guru Jambheshwar University of Science & Technology,
Hisar
ABSTRACT
The heart of India lives in its villages and the Indian rural
market with its vast size and demand base offers great
opportunities to marketers. The rural market of India
started showing its potential in the 1960s. The 70s and 80s
witnessed its steady development. And, there are clear
indications that the 21st century is going to see its full
blossoming. In the recent years, rural market has acquired
significance and attracted the attention of marketers as
68.84% population of India reside in 6,38,000 villages and
overall growth of economy has resulted into substantial
increase in the purchasing power of the rural
communities. Rural markets are becoming attractive for a
number of reasons. Rural incomes are growing due to
green revolution, rise in agri-produce prices, Skilled India
programmes, financial inclusion, etc. and consumers are
buying discretionary goods and lifestyle products,
including mobile phones, television sets and two-wheelers.
The rush to rural markets is not a recent phenomenon and
companies have been testing these markets. The present
study focuses on understanding the present scenario of
rural market, opportunities and challenges in the rural
market with the help of secondary source of data- various
journals, newspapers, websites, etc. Through this study, it
has been analysed that rural market has huge potential
and has developed a lot over years. Various opportunities
and challenges in rural marketing have been found
through this study.
Keywords
Rural Market, FMCG, Rural Consumers, Rural
Marketing, Opportunities, Challenges.
INTRODUCTION
The heart of India lives in its villages and the Indian rural
market with its vast size and demand base offers great
opportunities to marketers. The rural market of India
started showing its potential in the 1960s. The 70s and 80s
witnessed its steady development. And, there are clear
indications that the 21st century is going to see its full
blossoming. Between 2009 and 2012, spending in rural
India reached $69 billion, significantly higher than the $55
billion spent by the urban population. The rural FMCG
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market expanded at a CAGR of 13.2 per cent to US$ 100
billion during 200915. The Fast Moving Consumer
Goods (FMCG) sector in rural and semi-urban India is
estimated to cross US$ 20 billion by 2018 and US$ 100
billion by 2025.In rural markets, durables like refrigerators
as well as consumer electronic goods are likely to witness
growing demand in the coming years as the government
plans to invest significantly in rural electrification. Credit
Suisse estimates that nearly 75% of the factories that
opened in India in the past decade were built in rural areas;
they now account for almost 55% of the countrys
manufacturing GDP and 70% of all new manufacturing
jobs. As a result, per capita GDP in the countryside has
grown at a compound annual rate of 6.2% since 2000,
eclipsing the 4.7% urban growth rate. Rural markets are
becoming attractive for a number of reasons. Rural
incomes are growing due to green revolution, rise in agri-
produce prices, Skilled India programmes, financial
inclusion, etc. and consumers are buying discretionary
goods and lifestyle products, including mobile phones,
television sets and two-wheelers. The rush to rural markets
is not a recent phenomenon and companies have been
testing these markets.
WHAT IS RURAL MARKET?
Planning Commission of India defines rural as a town
having upto 15000 population.
The Census of India defines rural as habitation where there
is less than 400 per sq. Km. population density and atleast
75% of the male working population is engaged in
agriculture, and where there is no municipality or Board.
NABARD defines all locations with a population up to
10,000 considered as rural area.
Government agencies like IRDA (Insurance Regulatory
and Development Authority) and NCAER (National
Council for Applied Economics Research) define rural as
a village with a population less than 5000 with 75% male
population engaged in agriculture.
The difference between rural and urban consumers always
exists in India. Most of Indian rural consumers are
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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 5, No. 1, January 2016
illiterate and poor. Illiteracy and unawareness leads to
inability to identify brand differences and read basic text
on packages. Moreover products are sold lose, giving high
competition to branded sealed products. Irregular income
induces the rural consumers to buy in small quantities. The
rural consumers are scattered thus, leading to high cost of
marketing.
EVOLUTION OF RURAL MARKETING
The term rural marketing has evolved over time. It got
separate meaning and importance over passage of time. It
has been explained as follows:
(Before 1960): During this period, rural marketing
dominantly included the activities related to the
selling of rural products in rural and urban markets
and agricultural inputs in rural markets, i.e., mainly
agricultural marketing. A totally unorganised
market prevailed in that era, where all banias and
mahajans (local business people) dominated that
market.
(1960-1990): During this period, due to scientific
farming, green revolution took place that resulted in
conversion of poor villages into prosperous
business centres. As a result, the demand for
agricultural inputs went up and as a result,
marketing of agricultural inputs took the
importance. Agencies like Khadi and Village
Industries Commission, IFFCO, KRIBHCO, etc.
promoted rural products. In this era, two separate
areas of marketing had emerged- marketing of
agricultural inputs and agricultural marketing.
(After mid 1990s): The third phase of rural
marketing started post liberalization. In this era, the
economy was opened and due to the development
programmes of the central and state governments,
service organizations and business groups; the
economic position of rural market improved and
thus, the shape of rural marketing got changed and
new dimensions had emerged and new
categorization was- marketing of consumer goods
(consumables and durables) and marketing of
agricultural inputs. Rural marketing includes the
activities of attracting and serving the rural markets
to fulfill the needs and wants of persons,
households and occupations of rural people.
NEED OF THE STUDY
Urban markets have saturated to some extent for the
marketers and the rural market has the huge potential to be
exploited that was untapped to much extent. But tapping
the rural market is not so easy task. It is not similar to
urban market. It provides different opportunities and poses
different challenges for the marketer which needs to be
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studied deeply so as to make suitable marketing strategies.
So, this study is imperative to understand the present
status of rural market and their opportunities and
challenges.
STATEMENT OF THE PROBLEM
People in rural India are spending more than those in
urban areas, according to a study by Accenture, a
multinational management consulting, technology services
and oil company.
Many corporations are recognizing this enormous
opportunity and stepping up efforts to gain a strong
foothold in Indias rural markets. But they are meeting
with mixed results. Dynamics of rural markets differ from
other market types, and similarly, rural marketing
strategies are also significantly different from the
marketing strategies aimed at an urban or industrial
consumer. So, different opportunities and challenges
prevail in rural market which needed to be studied
spontaneously so as to avoid failure and to face
competition. So, in this context, the present study focuses
on the present scenario of Indian rural market, its
opportunities and challenges.
OBJECTIVE
The paper aims:
To study the present scenario of rural market in
India.
To identify the major opportunities available in the
rural market in India.
To study the major challenges faced by marketer in
Indian rural market.
RESEARCH METHODOLOGY
The Research design in this study is Descriptive research
design. In order to achieve the research objectives, the
study is based on secondary data. The data has been
collected from various websites, newspapers and reputed
journals.
ANALYSIS
According to Census of India, India is a big country with a
huge population of 121 crore, out of which a large part
resides in rural areas, i.e., population of 83.3 crore spread
across nearly 6,38,000 villages. Rural population forms
68.84% of the total population of India as compared to
31.16% urban population showing huge potential in rural
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International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 46
Volume 5, No. 1, January 2016

market and it has also increased by 9.1 crore from 2001 to

2011 showing increase in the opportunities for the
marketers.

Table 1: Share of rural population in total population

2001 2011
(in (percentage) (in (percentage) Difference
crore) crore) (in crore)
India 102.9 100 121.0 100 18.1
Urban 28.6 27.79 37.7 31.16 9.1
Rural 74.3 72.20 83.3 68.84 9.0
Source: Census of India 2001 & 2011

PRESENT STATUS OF RURAL MARKET

IN INDIA Graph 1: Showing growth in the rural FMCG market
over years
Indian Rural markets are now dominating the urban
market in terms of demand and potential. The rural Table 2: Showing difference in rural-urban demand of
consumable items (figures in 000 tonnes) for the year
population is nearly three times of the urban market. The
2001-02 and 2009-10 and its percentage increase (%)
rural society is also urbanizing gradually with the increase
in literacy rates and exposure to global trends. Its Items Market 2001-02 2009-10 Percentage
showing interest in branded products and services. The (figures in (figures in increase
consumption trend in rural areas has shown a paradigm 000 tonnes) 000 (%)
shift from price-driven to quality-driven products. About tonnes)
68.84% or 833 million people are living in rural areas, Edible oils urban 2328.0 3986.5 71.24
consisting over 40% of the Indian middle class, and about rural 4681.6 666.2 42.3
half the countrys disposable income. Further, there has Health urban 96.5 223.4 131.5
been a shift from an agricultural economy to beverages rural 37.0 88.9 140.2
manufacturing and service economy and this development Packaged urban 550.4 1091.0 98.2
biscuits rural 294.4 521.6 77.1
has been resulted into increasing job opportunities, income
Shampoos urban 13.6 31.4 130.8
and demand for goods and services in rural markets. Rural
rural 6.7 16.3 143.2
Indians are trading up. Commodities are giving way to
Toilet Urban 335.9 464.2 38.1
branded products, and more-expensive goods are replacing soaps Rural 469.4 657.7 40.1
entry-level versions, as consumers gain more disposable Washing Urban 510.7 616.5 20.7
income. Rural consumers have more aspirations, today this cakes Rural 1351.7 2104.5 55.6
segment of buyers consumes large variety of products, Washing Urban 847.1 1485.4 75.3
both durable and non-durables and willing to pay right powders Rural 1005.2 1847.8 83.8
price for right products. Their increased purchasing power Source: The Great Indian Market, National Council of
is largely due to the steady migration of manufacturing Applied Economic Research
jobs to the countryside. According to recent Nielsen
estimates, consumption in rural areas is growing at 1.5 From table 2, it is clear that there has been increase in the
times the rate in urban areas, and todays $12 billion demand of consumable items in rural market over years
consumer goods market in rural India is expected to hit but the demand of items like- health beverages, shampoos,
$100 billion by 2025 as shown in graph 1. toilet soaps, washing cakes, washing powders in rural
market have increased at a rate more than the rate of their
percentage increase in urban area. While in edible oil and
packed biscuits increase in demand is more in urban area
as compared to rural area. Thus, we can say that in many
segments, the rural market has been progressing more than
urban markets thus attracting more and more marketers.

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International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 47
Volume 5, No. 1, January 2016

Table 3: Showing difference in rural-urban usage pattern of consumer durable items for the year 2001-02 and
2009-10 and its percentage increase (%)

Items Market 2001-02 2009-10 Percentage increase

(Number of (Number of (%)
households owning households owning
durables per '000 durables per '000
households) households)
Scooters urban 194.0 188.2 -2.99
rural 32.8 40.1 22.26
Motorcycles urban 123.6 404.6 227.35
rural 49.8 227.3 356.43
Mopeds urban 100.5 121.5 20.90
rural 29.2 48.0 64.38
Cars/Jeeps urban 98.4 266.0 170.33
rural 2.9 12.3 324.14
Automotives urban 516.5 980.3 89.80
rural 114.7 327.7 185.70
Televisions urban 834.9 1121.1 34.28
rural 301.4 414.4 37.49
Other white goods urban 724.2 1207.1 66.68
rural 57.6 109.5 90.10
Fans urban 1435.3 2366.1 64.85
rural 554.3 1029.4 85.71
Low cost items urban 4137.0 5353.7 29.41
rural 2330.2 3417.5 46.66
Source: The Great Indian Market, National Council of Applied Economic Research

From table 3, it is clear that there has been increase in the number of households owning consumer durables per 000
households in rural market over years but the rate of increase is more than that in urban market, thus, signaling a positive
sign for high market potential and making rural marketing more viable.

Graph 2: Showing rural-urban pattern of household FMCG consumption volume growth from 2013 to 2015

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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 5, No. 1, January 2016
From graph 2, it is clear that during 2015, leaving personal
care products (which showed tremendous growth in 2014
i.e.4.4% as compared to -0.2% of 2013); all other
products, i.e., household care products, food & beverages
and overall FMCG have shown growth as compared to
2013 and 2014. During 2013, rural market has performed
better than urban market. During 2014, urban market has
performed well as compared to the rural market. During
2015, rural market has outperformed the urban market,
thus, becoming the centre of attraction for the marketers.
So, overall it can be said that rural market is growing.
OPPURTUNITIES
The Indian growth story is now spreading itself to Indias
hinterland, not just witnessing an increase in its income
but also in consumption and production. The economy is
vibrant, income is rising, and the habits, tastes,
preferences, and attitudes are changing rapidly. With
urban markets getting saturated for several categories of
consumer goods and with rising rural incomes, marketing
executives are fanning out and discovering the strengths of
the large rural markets as they try to enlarge their markets.
According to recent Nielsen estimates, consumption in
rural areas is growing at 1.5 times the rate in urban areas,
and todays $12 billion consumer goods market in rural
India is expected to hit $100 billion by 2025. Major
opportunities that are available in rural market are as
follow:
Increase in population: There has been increase
in the rural population over years as can be seen from table
1. From 74.3 crore in 2001, it has increased to 83.3 crore
in 2011, i.e., an increase of 9 crore. This increase in
population enhances the potential market for the marketers
and tempts them to make more innovative products so as
to tap this increasing population and make more and more
money.
Increase in literacy rate: Awareness is must for
the progress of a market and literacy is the key to that.
Literacy rate in rural India is increasing. As can be seen
from table 4 , the literacy rate was 68.9% in 2011 as
compared to 58.7% in 2001. The increase in literacy rate is
more in rural area as compared to urban area showing
huge enlightenment in the rural areas. This brings social
and cultural changes in buying behavior of the rural
customers Increase in literacy level enhances the
understanding level of the consumers and the literate
person make more rational decisions as compared to
intuitional decisions and thus, in this way rural market can
be tapped more easily as literate consumers can be awared
more easily as compared to illiterate ones. Due to increase
in literacy rate they get jobs in nearby towns. They earn
urban salaries but continue to live in self owned homes in
the villages, they have high purchasing power and prefer
to buy branded product.
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Table 4: Showing increase in literacy rate from 2001 to
2011
2001 (%) 2011 (%) DIFFERENCE
INDIA 64.8 74.0 +9.2
URBAN 79.9 85.0 +5.1
RURAL 58.7 68.9 +10.2
Source: Census of India 2011
Huge market size: The rural market in India is
vast and scattered and offers a plethora of opportunities in
comparison to the urban sector. The rural market has huge
size. As can be seen from table 1, the rural population
composes 68.84% of the Indias total population in 2011,
which is a very big chunk. It provides a huge potential
market and opportunity to the marketers. Table 5, shows
the estimated annual rural market size which is huge. The
huge size of rural market tempts the marketer to exploit
the situation.
Table 5: Estimated annual size of the rural market
FMCG Rs.65,000 Cr.
DURABLES Rs. 5,000 Cr.
AGRO INPUTS Rs. 45,000 Cr.
TWO-FOUR WHEELERS Rs. 8,000 Cr.
Source: NCAER Report, 2011
Increase in IT penetration: Rural consumers are
better networked. They are better connected in digital
sense as compared to earlier. Technological developments,
particularly deeper penetration of mobile telephony and
direct to home (DTH) television into Indias hinterlands,
have also reshaped the lifestyle and consumption patterns
among rural consumers. The total number of telecom
subscribers (mobile plus landline) in rural India crossed
378 million in July 2014 and of the 205 million internet
users in India in 2013, 68 million lived in rural areas. Even
more impressive, one fourth of the 100 million people in
India who access the internet using mobile devices live in
rural areas. Increased IT penetration in rural market makes
it more attractive as products can be promoted easily then.
Improvement in infrastructure: Infrastructure
is also developing fast, leading to the better connectivity
by road (67% villages are connected by all-weather roads),
by phone (30% tele-density in rural areas), and access to
mass media through television. Increased electrification of
households (60%) has opened up the rural market for
durables. All these factors have increased the purchasing
power and the demand base for and access to new goods
and brands, as seen over the past decade. Over the next
decade, it is expected that the rural infrastructure will
improve drastically, with approximately100% road
connectivity, electrified villages, literacy, television
households, 80% pucca households and 50% mobile
penetration. The government has spent INR 480 billion in
the year 2010-2011 on Bharat Nirman Programmes,
leading to rapid infrastructure development. The
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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 5, No. 1, January 2016
government has the target to create 10 million hectares of
additional potential, to provide allweather connectivity to
all habitants with over a 1,000 population, to provide
electricity to 1,25,000 villages and to construct six million
houses in rural areas, and to connect telephonically all
habitants. The infrastructure development attracts the
marketers in rural areas.
Rise in disposable income and prosperity: Per
capita GDP in the countryside has grown at a compound
annual rate of 6.2% since 2000, eclipsing the 4.7% urban
growth rate. Rural markets are becoming attractive for a
number of reasons. Rural incomes are growing due to
green revolution, rise in agri-produce prices, Skilled India
programmes, financial inclusion, etc. and MNREGA
spending and consumers are buying discretionary goods
and lifestyle products, including mobile phones, television
sets and two-wheelers. Future predictions of income are
very positive, suggesting that the present income will
change as the proportion of the poor earning less than
USD 1 per day drastically shrinks over the next decade to
almost half. The majority of the rural population will be
earning between USD 1to 5 per day, and the proportion
with the incomes of over USD 5 per day will increase
three-fold. Rural India is fastly moving from poverty to
prosperity. The rural population earning more than USD 5
per day per capita income holds great promise for the
marketers. Rural income constitutes around 56% shares of
the total income in India. The per capita in rural India has
increased from INR 4860 in 1994-95 to INR 15,173 in
2010. The middle class grew six fold in this decade and
expected to grow from 32 million in 2005 to 208 million
in 2025. Income growth per households is expected to
accelerate from the current 2.8 percent to 3.6 percent by
2025. Good monsoons and two-fold increase in the
support price of food grains in the last decade have
contributed to improving agriculture prosperity which
benefitted 40 to 45 million farmers. A major shift to cash
crops will increase the income from agriculture. The
continuing increase in prosperity leads to increase in the
demand of consumer and non-consumer goods in rural
areas. An increasing labour force participation in non-
farming activities has led to more income earning
opportunities, and this trend is likely to grow in future,
which further promote the marketers to enter into the rural
market.
Reduction in risk during recession: Dont put
all the eggs in a basket is always recommended for the
businessmen. It has been generally observed that the
marketers who deal in both urban and rural markets are
more insulate to the market risks as compared to those
who deal in only urban market as the impact of recession
is more strong in urban market as compared to rural
market. The demands for goods in the urban market often
follow a cyclical pattern whereas in the rural market the
pattern is steady. So companies can safeguard themselves
from the harmful effects of recession after entering in the
rural market.
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Competition in urban areas: The heat of
competition in the urban market actually serves as the
strong driver behind the growing interest of corporate in
the rural market. Rural market acts as a boon to those who
cannot keep up with the urban competition. This market
provides opportunities to the urban marketer.
Increasing rural consumption: There has been
significant increase in rural consumption over years. This
has resulted in more attraction towards the rural market.
According to recent Nielsen estimates, consumption in
rural areas is growing at 1.5 times the rate in urban areas,
and todays $12 billion consumer goods market in rural
India is expected to hit $100 billion by 2025 as shown in
graph 1. The rural market contributes to 35% of total sales
of the consumer packaged goods industry and has grown
at a faster clip than the urban sales for the past two years.
The budget of 2013 increased allocation for the
MGNREGA to Rs. 34,699 crore from the current Rs.
34,000 crore. Urban consumption has been stagnant for
years now, given the high cost living, and discretionary
purchases flagged. A recent IMRB study showed that rural
areas were the engine behind the FMCG sales in 2013-14.
Now, with increased impetus on rural income, companies
and analysts say that it will bring back acche din for them.
The latest survey from market research firm IMRB
suggests that consumption data for 2014 suggest that
demand in rural India, the mainstay for many FMCG
companies in previous years, shrank three percent (in
volume terms) from zero growth in 2013.
CHALLENGES
The rural market offers a vast untapped potential. As much
as Rural India presents a great opportunity, there are still
many challenges that have to be overcome. Dispersed
population and trade, large number of intermediaries in the
value chains leading to the higher costs, scarce bank and
credit facilities for rural customers and retailers, highly
credit driven market and low investment capacity of
retailers are the other roadblocks. Thus, there are several
roadblocks that make it difficult to progress in the rural
market. Marketers encounter a number of problems like
dealing with physical distribution, logistics, proper and
effective deployment of sales force and effective
marketing communication when they enter into the rural
segments. Some of the prominent ones are:
Scattered market: The large population base and
number of households indicates a widely spread out
market and it is a challenge for the marketer to service this
dispersed market. The number of the villages is more than
five lakhs and is not uniform in size. Nearly half of the
population lives in middle sized villages which have a
population ranging from 1000 to 5000 persons. These
types of distribution of population warrants appropriate
distribution and promotion strategies to decide the extent
of coverage of rural market.
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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 5, No. 1, January 2016
Limited knowledge of rural market: the
findings of research organizations and advertising
agencies sometimes, present different pictures of rural
markets. Thus, so many different figures and data are in
existence for the same thing at the same time that
sometimes, it becomes difficult to pick one to believe.
Also, the rural market has not been tapped so much, so the
research about rural market has not been undertaken at
large extent. This poses challenge for rural marketer.
Seasonal demand: The demand for products in
rural market is seasonal. Since, the rural economy is
agriculture based economy, so, the income of the rural
consumers depends upon the agricultural output and the
agriculture is based upon the monsoon which is uncertain
or variates very much. So, their income also variates. Also
the income comes to the farmers after harvesting and thus,
mostly the demand is high in harvesting season. Demand
for agricultural inputs arises during sowing season. So, it
can be said that rural demand is seasonal and rest of the
year, the marketer has nothing to do that poses a challenge
for the marketer to survive and grow.
Distribution problem: Although the rural areas
are getting connected to urban areas with all weather
roads, but the reality is different. The roads are not made
of good material and after some time, pits appear on the
roads in which water stagnates during rainy season, thus
making it difficult to distribute goods to rural areas during
rainy season. One of the greatest challenges for rural
marketing lies in reaching out to the remotest destinations
and having a number of vendors at the retailing end. The
challenges for the suppliers is the small size of each
villages with low throughout per outlet, coupled with the
high cost of distribution since these villages are some
distance away from distributors. These factors make high
quality distribution unviable.
Warehousing problem: Since there is time gap
between the production and consumption of commodities
as the agricultural commodities are produced in particular
season but demanded over the whole year, so there is need
for storage facilities. But rural area lacks appropriate
warehousing facilities so as to safely store the produce.
There are no facilities for public as well as private
warehousing. Marketers face problems of storage of their
goods.
Sale of fake and spurious products: It is a big
challenge for the marketer. Generally, in rural market,
imitation of popular products is available in large number
and at low prices like- Magic instead of Maggi. The
retailer pushes imitation products (which are priced less
and offer better earnings to the retailer) to the illiterate and
less aware rural consumer. Actually with the increase in IT
penetration in rural market, the awareness levels of brands
is quite high, but the original brands of many product
categories are not available at a large number of rural
retail outlets. So, all this poses a great challenge in front of
the rural marketer to deal with the situation.
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Lack of right competence: While the top
managements commitment to understand and tap the rural
markets might prevail, the competence necessary for
interacting with and comprehending the rural attitudes and
behavior is lacking at the lower, field staff level. Most of
the frontline staff is from the urban areas and they are not
very comfortable with travelling to villages and interacting
with villagers. This spoils the whole marketing effort to
tap the rural markets.
Variation in languages and dialects: India is a
country of many languages and this leads to the problem
in communication. It becomes barrier in effective
communication. The languages vary from state to state,
region to region and district to district, etc. So,
understanding these languages and communicating with
the rural consumers in that language is a big problem for
the marketer.
Banking and credit problems: The rural
consumers are not so financially strong that they can buy
products of high value in cash and also they possess cash
only after harvesting of crops but need products during the
whole year. So, they require credit facilities from the
marketer and this credit is mostly risky. Also, the retailers
in the rural areas are not financially strong so they require
banking and credit facilities from the manufacturers. So,
this poses challenge for the rural marketer who wants to
tap the rural market.
Inadequate media coverage: Media have lots of
problems in rural areas. Radio and television are the good
source of media to convey message to rural people. But
the main problem in using these medias is the non-
availability of power and majority of the people cannot
gets the benefit of these and other various medias.
Packaging: It is the first important step of
product processing. If the packaging cost is high, it will
increase the total cost of products. It is suggested that the
marketers should use cheaper materials in packaging for
the rural markets. For example, small poly pack of refined
oil is more popular than in containers of the same product
due to its lowest cost. One more important factor is the
size of package e.g. the size of the package should be
small.
Rural market presents distinct challenges for marketers
who are interested in tapping this goldmine, the path to
which is paved with thorns. The marketers need to be
aware of the challenges that create hurdle in their way and
should be adequately equipped with the strategies and
tactics in order to combat them.
SUGGESTIONS TO COPE UP WITH THE
CHALLENGES
Product redesign from the beginning can be done.
Marginal changes to existing product will not work
effectively.
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International Journal of Management and Social Sciences Research (IJMSSR)
Volume 5, No. 1, January 2016
To check the sale of fake and spurious products, the
only practical way is to improve the distribution
and make the products available in as many places
as possible including haats as mostly the sale of
fake products is prevalent due to non availability of
original product at large number of rural outlets.
Products can be priced to build up volume in the
rural market, especially for smaller pack size.
The challenge of lack of right competence and
variation in languages and dialects can be cope up
with recruiting frontline staff from rural parts of
India instead from the urban part. Even the frontline
managers can be recruited from the rural
management institutes and agricultural universities.
Products should be made available in small packs
as the rural consumers are not able to buy high
priced products due to lack of much finance.
Promotion should be made through those Medias
which are more prevalent in rural areas.
CONCLUSION
Rural market is the market of the new millennium. The
rural market is where the markets of the future are likely to
be. Urban markets are becoming increasingly competitive
for many products. In some cases they are even saturated.
Opportunities and challenges go hand in hand. Rural
market provides various opportunities like- huge market,
increase in literacy rate, improvement in infrastructure,
etc. Along with opportunities, it poses some challenges
like- scattered market, seasonal demand, lack of right
competence, etc. which need to be cope up. Marketers will
have to understand the rural customers before they can
make inroads into the rural markets. The size of the rural
market is fast expanding. The rural market is fascinating
and challenging at the same time. It offers large scope on
account of its large size. It is often said that markets are
made, not found, this is especially true of the rural market
of India. It is a market for the truly creative markets.
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