Rural Marketing

What is Rural?
Rural is defined as villages with a population <5000 with 75% male population engaged in agriculture NABARD- All location up to a population of 10,000 will be considered rural From marketing perspective concept of rural is very dynamic

What is Rural Marketing?

Rural marketing is a function which manages all those activates involved in assessing, stimulating and converting the purchasing power into an effective demand for specific products and services, and moving them to the people in rural area to create satisfaction and a standard of living to them and thereby achieves the goals of the organization.

Rural v\s Urban

OCCUPATION: Rural: Cultivators n few non agricultural pursuits. Urban: manufacturing,trade,commerce,professions

Density of population
Rural:density of population is lower than urban

Mobility
Rural:social mobility less.More migration from villages to town. Urban:social mobility inreases with urbanity.

System of interaction
Rural:less numerous contacts per man.Predominance of personal & relatively durable relations. Urban:Greater complexity,superficiality & standarized formality in relations.

Attractiveness of rural market

Rural markets have become the new targets to corporate enterprises for two reasons : 1. Urban market has become congested with too many competitors. 2. The market have reached a near saturation point.

Various factors which have made rule markets viable:1. Large population 2. Raising prosperity 3. Growth in consumption 4. Life-style changes 5. Market growth rates higher than urban 6. Rural marketing is not expensive 7. Remoteness is no longer a problem

Reasons for Going Rural

Size of the market--- extremely diverse Largely untapped Too crowded urban market Increase in disposable income Income from other than agriculture Better exposure---- media penetration

Profile of Rural Consumer

Low literacy level Low income level Massive geographic spread Reference group:- Doctor, Teachers, Panchayat members etc. Occupation- farming, trading, handicrafts, cattle & poultry farming Radio T.V. popular Rigid in behaviour

Rural Product
FMCG- HLL, Dabur, Marico, ColgatePamolive, Coke, Pepsi. Consumer Durables- TV, Fridge, Fan, Coolers , Pressure Cooker , Cycle , Two Wheelers, Sewing machines , Watch, Mixer Grinder, Radio, ( Philips, LG, Videocon) Services Telecom, Banking, Health Care, Insurance Agricultural inputs- Seeds, pesticides, tractors

 In 1998 HuLs personal products unit initiated Project Bharat, the first and largest rural hometo-home operation to have ever been prepared by any company. The project covered 13 million rural households by the end of 1999. During the course of operation, HuL had vans visiting villages across the country distributing sample packs comprising a low-unit-price pack each of shampoo, talcum powder, toothpaste and skin cream priced at Rs. 15. This was to create awareness of the companys product categories and of the affordability of the products.

Khaitan fans' ad on a horse cart

 The greatest challenge for advertisers and marketers continues to be in finding the right mix that will have a pan-Indian rural appeal. Coca Cola, with their Aamir Khan ad campaign succeeded in providing just that.

"Yaara da Tashan... ads with Aamir Khan created universal appeal for Coca Cola

 "Yaara da Tashan..." ads with Aamir Khan created universal appeal for Coca Cola Coca-Cola India tapped the rural market in a big way when it introduced bottles priced at Rs 5 and backed it with the Aamir Khan ads. The company, on its behalf, has also been investing steadily to build their infrastructure to meet the growing needs of the rural market, which reiterates the fact that this multinational has realised the potential of the rural market is going strength to strength to tap the same.

 For HLL, a one rupee or a five rupee sachet or the Kutti Hamam (the small Hamam) helps in giving the consumers a trial opportunity. While it does help in generate volume but not in terms of values. "Till the time that volume value equation is managed better. Ultimately, the ball lies in the court of rural marketers. It's all about how one approaches the market, takes up the challenge of selling products and concepts through innovative media design and more importantly interactivity.

 Amul is another case in point of aggressive rural marketing. Some of the other corporates that are slowly making headway in this area are Coca Cola India, Colgate, Eveready Batteries, LG Electronics, Philips, BSNL, Life Insurance Corporation, Cavin Kare, Britannia and Hero Honda to name a few.

Satellite dish antennas reach rural India

In 2000, ITC took an initiative to develop direct contact with farmers who lived in farflung villages in Madhya Pradesh. ITC's Echoupal was the result of this initiative.

 So the fact remains that the rural market in India has great potential, which is just waiting to be tapped. Progress has been made in this area by some, but there seems to be a long way for marketers to go in order to derive and reap maximum benefits. Moreover, rural India is not so poor as it used to be a decade or so back. Things are sure a changing

Typical shop in rural India stocked with sachets, etc

Characteristics of Rural Products

Easy to use After sales support Conveniently packed (success of sachets) Product literature to be simple Logo photo representation Attarctive packaging

Rural Price
Key for success of a product Should have long run perspective Low cost Volume to take care of margins Value engineering

Methods of Pricing
Cost plus pricing Value pricing Power pricing Differential pricing Price Gap- Competitive prices range Penetrating pricing

Promotion
Haats or weekly markets Melas Wall paintings Customer contact Van campaigns Folk media Interactive games

Promotion

Promotion by Colgate

Stall put up

Promotion

Promotion

Place
Physical distribution Transporting goods from warehouse to customer Channel of distribution Geographical spread Few dealers Financial viability

Distribution channel

Door to door sale of product very much preferred