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c ccccccccccccccccccccccccccccccccccccccccccccccSubmitted By:
Mr.Abhishake Dutta Dinesh kumar
Regd. No.-10906360
Section RT1903A20
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The emergence of an active cash economy is bound to create is bound to create a


strong rural demand and promote rural consumption. The traditional growth and
dominance of urban industrial centres is undergoing rapid changes. A more equitable
distribution in rural areas would also help in slowing down the rapidly increasing influx of
people from rural to urban areas.

There are two sections of rural population:


0 A large portion has a low income and low consumption levels;
0 The rest are rural rich.

The rural population forms a major portion of the Indian population as seen below:




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Urban
Rural
26%

Urban

Rural
74%

About 75% of the Indian people reside in rural areas. In other words, for every
consumer in the urban area, there are three of them in the rural areas. Though the
proportion of rural population is showing a slight decrease over the years, but in
absolute numbers, the rural population is growing at a higher rate than the urban
population. This large population will require a wide range of consumable and durable
goods and services. At the same time the need of the rural areas does not automatically
guarantee a market, unless it is backed by income and the resultant purchasing power.

For a vast majority of the rural population, the main occupation is agriculture and allied
activities. The graph below gives the distribution of rural population as per their
occupation pattern.


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2% 2% Agriculture

Agricultural Labour
9%
Business
10%
50% Non-agricultural
Labour
Salary Earners
27%

Notgainfully
employed

About half of the rural population own or lease land to cultivate it for their livelihood.
Another 27% are dependent on these cultivators for their jobs as agricultural labourers.
Thus, a total of 77% of rural population depend on land only for their living and land is
their source of living.
The villages are also not uniform in size. Nearly 48% of the villages have a population of
less than 500 persons or about 100 households, which is probably of no consequence
to marketers. This may be acceptable since the proportion of population covered by
these 48% of villages account for only 12% of the total population. Yet it should be
borne in mind that the people of these villages also have land and cultivate and
generate some income.

Thus the location and size of population of villages throw a challenge to marketers. This
phenomenon is not true for the whole country and there are wide variations among the
different states. In states with high irrigation and fertile lands, the concentration of
population is more when compared to states with low irrigation facilities and lack of
arable land.

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ILLITERATE
100
80
LITERATE
60
40
20
0
Rural Urban

Given the distribution of rural and urban population, it can be seen that the number of
literates in rural areas are more than in urban areas. It is an interesting got note that has
been a considerable increase in the number of literate persons in rural areas since the
last two decades. This has its implications in communicating with the rural population. It
appears to prove that communication should not prove to be such a big hurdle. Today,
television has proved to be an effective medium for communication with the rural
masses. The telecasting network in the country today covers about 93% of the
population.
Assuming that the entire urban population is covered by the television but the television,
which is only 23%, then nearly 67% of the rural population will be covered by television.
Thus, television reaches a larger segment of the rural population than any other form of
mass media. Though radio is also very popular, people like to see to believe.

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%c V&c cc#$c'cThe rural market of India is large and scattered
in the sense that it consists of over 63 crore consumers from 5, 70,000 villages
spread throughout the country.

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c 'c Nearly 60 % of the rural income is from
agriculture. Hence rural prosperity is tied with agricultural prosperity. Roughly
speaking, a location is defined as ³rural´, if 75 per cent of the population is
engaged in agriculture related activity. In India, close to 70 per cent of the
population is agrarian and contributes to about one-third of India¶s GNP.

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&c 'c The consumers in the village area do have a low
standard of living because of low literacy, low per capita income, social
backwardness, low savings, etc.

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c  $c 'c The rural consumer values old customs and tradition.
They do not prefer changes.

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c /$+  c 'c Rural consumers have diverse
socio-economic backwardness. This is different in different parts of the country.
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 c ' The Infrastructure Facilities like roads, warehouses,
communication system, and financial facilities are inadequate in rural areas. Hence
physical distribution becomes costly due to inadequate Infrastructure Facilities.

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1. 
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The size of the rural consumer group can be understood from the following
details provided in the table:
 
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Rural v/s Urban: 1971, 1981, 1991 and 2001
 
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23c c 2c c 22c c c c
Rural Population 43.90 cr 82 50.20 cr 76.3 64.1 cr 76 74.2 cr 72.3
Urban Population 10.91 cr 20 15.62 cr 23.7 20.3 cr 24 28.5 cr 27.8
Total Population 54.81 cr 100 65.82 cr 100 84.4 cr 100 102.7 cr 100

Rural population forms a major portion of the Indian population as seen in the table.
If we consider the state level picture, in several states like Uttar Pradesh, Rajasthan,
Madhya Pradesh and Kerala, the rural population constitutes more than 80% of the
total population. In states like Bihar and Orissa 90% of the population is in rural
areas.

2. V 
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The urban population of India is concentrated in 3200 cities and towns and the
rural population is scattered over 6, 38,365 villages. Statistics shows that out of the
6,38,3645 villages have populations of more than 5000 persons each. About 55% of
the villages have population in the range of 500 people or less.
The influence is clear, rural demand is scattered over a large area, unlike the
urban demand, which is highly concentrated.

*V
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It is estimated that there are 23% literate in rural India as compared with 365 of
whole country. The rural literacy in the rural area is on an increase. Among the rural
population Kerala tops with 77%.
The literacy rate has its implication in communication with the rural population.
It appears that communication should not prove a hurdle, provided appropriate
means are chosen.

3. c  
An analysis of the rural income pattern reveals that nearly 60% of the rural
income is from agriculture. Rural prosperity and the discretionary income with rural
consumers are directly tied up with agricultural prosperity. The pre-dominance of
agriculture in the income pattern has one more significance-rural demand is more
seasonal.

4. c
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The rural consumers have been drawn into the saving habit in a big way. The
commercial banks and the co-operative have been marketing the saving habit in the
rural areas for quite some years. Today nearly 70% of the rural households are
saving a part of their income.

The habit is particularly widespread among salary earners and self-employed


non-farmers.

5. )  
It can be seen in general sense low purchasing power, low standard of living,
low per capita income, low literacy level and overall low social and economic
positions are the traits of the rural consumers.

By and large, the rural consumers of India are a tradition bound community; religion,
culture and even superstition strongly influence their consumption habits.
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Very Rich 0.8 1.6 NUMBER OF
HOUSEHOLDS IN
MILLIONS
Consuming 26.8 41.3
Class
Climbers 54.7 63.3
Aspirants 25 14.7
Destitutes 20.9 12.2

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The following conclusions could be drawn:

1) The Language and content must be according to the suitability of rural environment.

2) Background figures are also a deterministic factor.

3) Admissibility of brand ambassadors plays an important role in this regard.

4) Special promotion measures are the strong applicable factors in this regard.c
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