Rural Marketing

Unit I Introduction By Click to edit Master subtitle style Dr.PTV & GB NGI, Coimbatore

4/22/12

Definition -1

Rural Marketing has been defined as the process of developing, pricing, promoting, distributing rural specific goods and services leading to exchange between urban and rural markets, which satisfies consumer demand and also achieve organizational objectives.

4/22/12

Definition -2
Rural

Marketing is a process which starts with a decision to produce a saleable farm commodity and involve all aspect of market structure or system, functional and institutional, based on technical and economic considerations and includes pre and post harvest operations, assembling, grading, storage, transportation and distribution (National Commission on Agriculture).

4/22/12

Definition -3
Rural

Marketing is a process which starts with planning and implementation of marketing function for the rural areas. It is a two way marketing process which encompasses the discharge of business activities that direct the flow of goods from urban to rural areas (for manufactured goods) and vice-versa (for agricultural product) and also within the rural areas (Gopalswamy).

4/22/12

Rural Marketing scope: Flow of goods and services

From / To Rural
1.

Urban

Urban
2. 3.

Consumables and durablesAgricultural Inputs Consumables Consumer durables

1.

Not concerned

Rural

1.

Rural Marketing, services and products 2. Rural artisans and rural industry product.
4/22/12

Agricultural and allied production.

Phase

Time Period

Evolution of Rural Marketing Source

Nature Major Products Market Agricultural Produce Rural

Target Market

From Agriculture Independence to Marketing Green Revolution Green Revolution Marketing of to Preagricultural liberalisation inputs period

Urban

II

Agricultural inputs

Urban

Rural

III

Consumables and Pose-liberalisation Rural Durables for Urban period on 20th Marketing Consumption and and Rural Century production 21st Century

Rural

IV

Development All products and Urban Urban and al marketing services and Rural Rural
4/22/12

Nature and Characteristics of Rural Markets

Large

and Scattered Market Heterogeneous Market Income for Agriculture Standard of living Infrastructural facilities

4/22/12

Large and Scattered Market

Approximately 75 crore rural consumers who live in approximately 6,38,365 villages spread over 32 lakh square kilometre area. About 1,5,098 villages or 23 % of the total number of villages in India, have population less than 200 Another 21 % have population between 200 and 500. Raises the inventory and transportation costs and thus affects the viability of the route schedule operations of the distribution system. But on the other hand, 13% villages have 50% rural population and they possess 60% rural wealth.. Also 41% towns with population less than one lakh buy 4/22/12

Heterogeneous Market

20,000 ethnic groups 24 languages and 1,642 dialects and dialect varies every 100km or so, Division based on caste, community and other hierarchical factor Perceptions, traditions, values vary from state to state and in some cases from region to region within a state also. The non-uniform agriculture growth process no stereotype of rural consumer or rural consumer behaviour. The variations in behaviour due to the consumer environment geographical, occupational, demographical and behavioural

4/22/12

Income for Agriculture

Nearly

55% of rural income comes from the agriculture sector the recent past has seen a gradual reduction in sole dependence on agriculture as other sectors have started playing significant role in the rural economy

4/22/12

Standard of living
Over

70% of the rural population is employed in small scale agricultural and related occupations the rural consumers extremely conscious in their purchase behaviour as they are not confident about their future earnings. the propensity to save for future exigencies makes them spend less to improve their standard of living even when they have good income. Besides this low literacy, social backwardness, low savings, traditional attitude, etc also have contributed 4/22/12 to a lower

Infrastructural facilities
The

infrastructural facilities like roads, warehouse, communication system and financial facilities are inadequate in rural areas. Roads do not connect nearby 50% villages in the country. Promotion and physical distribution thus becomes very difficult in the rural terrain Over 50% rural households have access to electricity as a main source of lighting but 46% still use kerosene for lighting
4/22/12

Size of Rural Market

The

total size of the rural market is estimated at `1,23,000 crores, which includes FMCGs, durables and agri-products.

4/22/12

FMCG Market
53%

of the total consumption in the country. In the consumables market, the rural pie is larger than the urban pie FMCG companies face immense difficulties in logistics, supply and storage while catering to rural customers

4/22/12

Durable Market
Rural

market accounted for 54 percent of total durable ownership. Rural ownership was 3.84 durables per household compared to urban ownership of 8.19. The decadal growth in rural was almost 100 percent whereas in urban it was only 40%.

4/22/12

Profile of Rural Consumers

Traditional

outlook Perception and its influence Less Exposure to marketing stimuli Conscious of value for money Realistic Aspirations Concept of Quality Attitude towards prestige products Suspect of Hype and Fear of being cheated

4/22/12

Traditional outlook
values

for old custom and tradition. resistant to change set of attitudes, which influence their purchases; and these are different from those of the urban consumer. functionality is more important than style and frills.

4/22/12

Perception and its influence

In

rural markets, colours, size and shapes are interpreted differently.

For example, the colour yellow indicates prosperity in the rural south, while in the north, yellow is indicative of sickness and disease (Jaundice).

The

lower literacy levels in the rural markets increases the importance of visual influence.

4/22/12

Less Exposure to marketing stimuli

Less

product exposure, low exposure to branded product. Low exposure, low comprehension of advertisements. Limited source of information and learning. Less convenient buying, low rate of retail outlets per 1000 population.

4/22/12

Conscious of value for money

Very

conscious of value for money. Daily activity routinised and no sense of urgency in his life style. Very high involvement in purchase decisions. This makes demonstration a very important tool of promotion in rural India. Very rational in his purchases and because he is a first time buyer for a large number of product categories, the promotion needs to be more educative.
4/22/12

Realistic Aspirations
Person

with realistic aspirations reach out and stretch the budget done within limits only. Ready to spend more if he sees additional value in terms of tangible benefits and not just psychological ones. The rural youth is more open to fresh concepts than their elderly family members. This difference is leading to dual-usage of product categories. Some of the rural households using premium brands also use mass-market brands.

4/22/12

Concept of Quality
values

the long lasting solid products that are useful and have low-cost maintenance.

4/22/12

Attitude towards prestige products

Interested

in products adding to his prestige. He likes to follow trends, but only if the price of a product justifies the value equation.

4/22/12

Suspect of Hype and Fear of being cheated

The

rural consumer suspect hype and does not want to feel cheated or fooled by the marketing gimmicks at a later stage. Clear information should be provided by marketers especially for innovative products. Instead of Simply advertising on the mass media when the concept is introduced at the market for the first time.

4/22/12

Rural Market Structure

Demographic

Environment Physical Environment Economic Environment Social and Cultural Environment Political Environment Technological Environment

4/22/12

Demographic Environment
Education

and level of demand Household patterns Rural housing pattern Occupational pattern

4/22/12

Education and level of demand

Lower

levels of education in the rural sector (approximately 60 percent of the population lies below the middle education bracket) lead to little or low demand for a range of products such as literary books, magazines, note books, pens/pencils, drawing instruments, calculators, digital diaries, computers etc. The literacy rate in the rural sector has risen 23 percent over the last twenty years. With this growth, the demand for educational products has increased
4/22/12

Household patterns
Family

structure: Rural households have grown by 26 million during the last decade. Average size of the rural family has decreased due to movement of more families from the joint to the nuclear structure Joint families Concept A new concept of individualised joint families With the increasing numbers of individualised joint and nuclear families, the
4/22/12

Rural housing pattern

Over

the last twenty years, the trend in house types has changed dramatically, from less permanent semi-pucca (or) kuccha to more permanent pucca type. Today 40 percent of rural houses are pucca which is growing at a rate of almost 5 percent annually. Most low-income groups live in kuccha houses. However, as incomes increase, the number of kuccha houses is coming down; The low-income groups are gradually moving towards semi pucca houses and then finally 4/22/12 pucca houses.

Occupational pattern
3/4th

of rural household heads are either cultivators or wage earner, whereas 3/4th of urban household heads are salary earners, petty shopkeepers and wage earners. The cultivators disposable income is highly seasonal, with more disposable income available immediately after the harvesting season. This is therefore the time when he is more inclined to make purchases, especially of durables and high-involvement products.
4/22/12

Physical Environment
i)

Rural and Urban Life: Distinguishing features Settlements (Scattered or Clustered): Villages comprise homestead land (abidi) and cultivated land. The settlement pattern of households is either in a cluster in the abidi or individualized land-holdings, or combination of the two.

contd...

4/22/12

Physical Environmentcontd..
The data on inhabited villages provide very rich insights to a marketer. Villages of less than 500 population generally do not have any shop, but the number of such villages have decreased by 5% over the last ten years. Villages in the 2,000 + population. Strata are the most prosperous. The number of such villages is increasing very rapidly. These villages have around 16 shops. 17 percent of villages in the 2,000 + population. Categories account for 50 percent of the rural population and 4/22/12 60

Physical Environmentcontd..
Rural

India linked to towns Many towns are actually overgrown village Social interaction here is a mix of rural and urban. The economy of these small towns is connected to rural area, though agriculture is not the primary occupation. These towns are of great significance to marketers, especially for durables and services. Rural consumers come here in search of information, demonstration and purchase.
4/22/12

Economic Environment
Over

the last ten years, the higher income class in rural has grown six times. Rural per capita income is increasing incomes are also changing expenditure patterns and saving pattern.
Contd.

4/22/12

Changing rural consumers Expenditure Pattern

Per

capita expenditure in rural has increased four times over last twenty years. Rural spending in non-food items is increasing out of total per capita spending approximately 40 percent is spent on nonfood items. This shows an encouraging trend for consumer durables and non-durables (non food items).
4/22/12

Saving pattern
In

absolutes numbers, the 42 million rural households availing banking services far exceeds the 27 million in urban.

4/22/12

Social and Cultural Environment

The

society and polity across the country varies between regions and sub-regions and also between different religious, caste and linguistic groups. Village Community Caste System

4/22/12

Village Community
Historically,

self-sufficient and autonomous agricultural surplus contributed to the sustenance of economic infrastructure The caste based occupations and trades Villages had a council of elders (panchayat), which decided disputes between villages and discussed matters of common interest. Post independence, democratic system of governance.

Contd

4/22/12

Village Community contd..

village

dependent on external factors

The close link of rural produce with the market and industry Gradual shift from subsistence farming to commercial and mixed farming Dependence on goods and services from outside The increasing role of media

Initially,

members from influential village families migrated to towns for better education and employment opportunities In recent years, major migration of rural poor to cities and towns for regular employment in semi-skilled and unskilled 4/22/12

Caste System
Indian

society had a definite scheme of social gradation

Brahmins at the head of the hierarchy followed by Kshtriyas (warriors) Vaishyas (business class and traders) the shudras (involved in odd jobs) at the bottom.

The

castes in themselves have sub castes and cults, each claiming social supremacy over the other. The shudras suffer from social and economic disadvantages and are even treated as untouchables. 4/22/12 Post Independence have initiated changes in

Caste System-contd...
Marketers

have to be sensitive to the caste systems and practices in rural areas While

Developing advertisements Developing brand communication Developing promotion plans

Marketers

should be sensitive, in order to ensure relevance of characters in message.

4/22/12

Political Environment
The panchayat and village pradhan / sarpanch represented rural India Under the panchayats Raj system, all government department form an integrated approach for the development of rural areas. Villages with 5,000 population or a cluster of smaller villages with 5,000 population form a panchayat. The villages are segmented to form wards, from where ward members are elected to the panchayat. The ward members select their leader, who becomes the Sarpanch. The sarpanch represents the village at the tehsil / taluka / block level.

4/22/12

Technological Environment
The

changes in the rural technological environment were triggered off by three major revolutions. Green Revolution White Revolution The NGO Movement

4/22/12

Green Revolution
1967 to 1978 The green revolution generated some notable economic result, such as:

Crop areas under high yield varieties required fertilizer, pesticides, fungicides and other inputs. Farm equipment like tractors with farm implements, diesel pump sets, etc., introduced mechanization in to the farm sector for the first time. The increase in farm production also introduced mechanized processing, spurring growth of the local manufacturing sector. The modernization and mechanism of the farm sector boosted farm productivity, triggered industrial growth, created jobs and initiated a change in the quality of life in villages.

4/22/12

White Revolution
The

white revolution was initiated by the government with the aim of achieving self sufficiency in the area of milk production. Producing milk in the rural areas through producer cooperatives and moving processed milk to urban demand centres. Initiated the process of establishing the much needed linkage between rural producers and urban consumer. The formation of producer cooperatives has played a significant role in institutionalizing milk production and processing. 4/22/12 Socio economic and demographic factor such

The NGO Movement

NGOs

have stepped in to create awareness, build skills, introduce technology and develop capacities for maintenance and sustainability. Government programmes implemented through NABARD, CAPART, KVIC and other are given shape by these organizations. introduction of low cost spindles, weaving machinery, technology for leather processing, natural resources management NGOs have been also active in providing basic health and child care services running 4/22/12 homes for the destitute and the distressed

Constitution of Rural markets

Consumer

can be divided into two broad categories: The household sector The institutional sector (government and non-government establishments)

4/22/12

Consumer Market

Constituents Individuals and Households Products: Consumables: Food products, toiletries, cosmetics, textiles and garments, foot wear. Durables: Watches, Bicycles, television sets, radios, home-appliances, twowheelers etc. Contd
4/22/12

Consumer Market
The household sector is the major consumer / user of most manufactured goods ranging from low-priced durables such as transistors, electric irons, etc., to high priced ones like colour television sets, motorcycles, etc. This sector meets the needs of a wide range of consumers, from rural to urban, from poor to rich, from wage earner to professionals. The diversity within the household sector becomes a challenge for industry in terms of 4/22/12 understanding demand in order to undertake

Institutional Market
Constituents:

Agricultural and allied activities, food processing, poultry farming, fishery, animal husbandry, cottage industries, health centre, schools, cooperative, NGOs, etc. Consumables: Agri inputs (Seeds, fertilizers, pesticides), animal feed, fishnet, fuel (diesel / petrol), engine oil, etc. Durables: Agri implements (tractors, pump sets, threshers, harvesters), boats.

Products:

4/22/12

Services Market
Constitution:

Individuals, household, production firms. Banking, insurance, credit, health care, tution, IT and communication, power etc

Services:

4/22/12

Rural Market Infrastructure

Transport

and Communication Social Infrastructure Agri Infrastructure Marketing Infrastructure Commercial Infrastructure

4/22/12

Transport and Communication

Road

connectivity Post offices Radio Television Press and Print Media Telecom Services Mobile Services Electrification

4/22/12

Road connectivity
The

primary means of supplementing public efforts directed at providing basic health and educational services Infrastructural support for production and trade and commerce at the local village level. Over 50 percent of villages with population of less than 1,000 have yet to be connected by roads.

4/22/12

Post offices
Means

for communication.Under the ministry of communications and information technology. twenty-two postal circles in the country. Each circle is categorized as head, sub and branch post offices. Gramin Das Sewa branch post offices are located in rural areas. Sub post offices and departmental post offices are located in both urban and rural areas. The largest being the general post offices at
4/22/12

Radio
From

six radio stations at the time of Independence Now more than 200 radio stations. Coverage to a population of 98.8 percent spread over 90 percent of the country. All stations of All India Radio broadcast farm programmes and home programmes directed at rural audiences. The thrust of broadcasts is on increasing production of agri-products and various programmes adopted by the Government of India.
4/22/12

Television
Doordarshan

(DD), the national television of India, is one of the largest terrestrial networks in the world. DD-1 operates through a network of 1,042 terrestrial transmitters of varying powers, reaching over 87 percent of the population. In rural areas most of the privately owned televisions sets are also viewed by community Doordarshan has a maximum viewership of 90 percent, the lowest cost per thousand audience.
4/22/12

Press and Print Media

The

reach of newspaper in rural areas is very poor. Only 15 percent of the copies of newspapers (regional languages) reach rural.

4/22/12

Telecom Services
By

2004, over 80 percent of all villages had been connected through 3-4 lakh Village Public Telephones (VPTs). Similarly 1.42 crore telephone connections had been given in rural areas. People who are unable to afford a telephone facility now have access to VPTs in rural areas Almost 84 percent of villages covered with telecommunication facilities.
4/22/12

Mobile Services
Indian

cellular service providers penetrate deeper into underpenetrated rural areas. Out of the 3-6 crore current mobile phone users, nearly 15 percent are in rural areas.

4/22/12

Electrification
To

stimulate the growth of small-scale industries and to promote more balanced and diversified economy Considerable improvement in the pace of coverage of electricity at the household level. By 2002, 5,07,000 villages i.e., 86 percent of the total number of villages electrified

4/22/12

Social Infrastructure
Access

to facilities leading to better health, education, drinking water and sanitation

Health Education Public Distribution System

4/22/12

Health
Rural Health Services: The primary health care infrastructure in rural India has been developed as a three-tier system. Sub Centres: The contact point between the primary health care system and community. Interpersonal communication in order to bring about behavioural change in relation to maternal and child health, family welfare, nutrition, immunization and control of diarrhoea and control of communicable diseases programmes. Contd

4/22/12

Health-contd..

Provided with basic drugs for treating minor ailments and those needed for taking care of the essential needs of women and children. One multi-purpose worker (Male) and Auxiliary nursemidwife (ANM).

Primary Health Centres (PHCs): The first contact point between the village community and a medical officer. Established and maintained by the state government under the minimum needs / basic minimum services programme. One medical officer and is supported by 14 paramedical and other staff.
4/22/12

Health-contd..

Acts as a referral unit for six sub centres and has 4 to 6 beds. curative, preventive and promotive health care as well as family welfare services

Community Health Centres (CHCs): Established and maintained by the state governments. Four medical specialists, i.e., Surgeon, Physician, Gynaecologist and Paediatrician, supported by 21 paramedical and other staff. 30 indoor beds with X-ray, labour room, operation theatre and laboratory facilities for obstetric care and specialist consultations.
4/22/12

Education
The

total number of educational institutions, including colleges both public and private in rural is 1,228,501.

4/22/12

Public Distribution System

The

distribution of essential commodities to a large number of people through a network of FPS (Fair Price Shops) on a regular basis. Wheat, rice, sugar, edible oil and kerosene. Network of about 4-7 lakh FPSs Total number of FPSs, 80% are in rural area. One FPS caters to 1,000 population in rural areas. 16 crore families purchase commodities at ration shops every year.
4/22/12

Agri Infrastructure
The agricultural marketing system in India operates primarily according to the forces of supply and demand. After that, 7,161 regulated markets to which the central government provides assistance Organization involved in agriculture marketing are: Commission for agricultural costs and prices The food corporation of India The cotton corporation of India The Jute Corporation of India There are also specialized marketing boards for rubber, coffee, tea, tobacco, spices, 4/22/12

Agri Infrastructure-contd
Produce is sold often sold at a weekly village market (haat) in the farmers own village or in a neighbouring village. If these outlets are not available, then produce is sold at a nearby town, or in a mandi. The two main things in agri infrastructure are Mandis Agriculture Cooperatives

4/22/12

Mandis
Agricultural

markets set up by state governments to procure agricultural produce directly from farmers. Located in high-production centres of different crops Categorized as grain mandis, cotton mandis, soya mandis and so on. A population of more than 10,000 have mandis and each mandis on an average caters to 1,36,000 populations. Displays the latest commodity prices collected from market sources. Contd
4/22/12

Mandis-contd
To

help buyers with latest market information for common varieties of agro commodities and food stuff. The price quote from the seller may vary depending on factors such as quantity specification, packaging, delivery terms, payment method and a host of other variables.

4/22/12

Agriculture Cooperatives
A

network of cooperatives at the local, state and national levels assists in agricultural marketing in India. The major commodities handled are food grains, jute, cotton, sugar, milk and areca nuts. The National Agricultural Cooperative Marketing Federation of India established in 1958 Large enterprises, mostly handle their own marketing operations independently. Medium and small sized enterprises, such as 4/22/12 rice mills, oil mills, cotton ginning and

Marketing Infrastructure
Haats Melas Shops

4/22/12

Haats
Haats

(periodic markets) play an important role in the rural economy as well as in the social life of villagers. Haats continue to be held in most regions of the country, with the exception of western Rajasthan, Haryana and some parts of the north-east. Some haats have been in existence for a few years while others have been held for as long as 140 years. Contd..
4/22/12

Haats-contd
Haats

play a vital role in the lives of villagers because they provide: 1. A first point contact for villagers with the market. 2. A means of distributing local products and exchanging rural surplus. 3. An opportunity for buying daily necessities as well as farm supplies and equipment. 4. A place for political and cultural contact.

4/22/12

Melas
Serve as the meeting ground for people from different communities and religious groups; for crafts and craftsmen and for displaying various skills. Melas are gathering of people away from their residences for entertainment and for the sale and purchase of goods and services at a particular time. Melas may be classified on the following basis: 1. Religious, Cultural or commercial (Commodity, Cattle, exhibition) 2. Local, regional and national. 3. One day, short duration (2-7 days), or long duration (more than a week).

4/22/12

Shops
Out of the 1.33 crore shops in India, 55 lakhs are in rural areas. The type of outlets found in villages include the grocery store, paan shops, flour mills and tailor, barber and cycle repair shops.

4/22/12

Commercial Infrastructure
Regional

Rural Banks Scheduled Commercial Banks Cooperative Banks

4/22/12

Regional Rural Banks

Set

up under an Act of parliament in 1976 The objective to develop the rural economy through the promotion of agriculture, trade and commerce and industry and by extending credit Particularly to small and marginal farmers, agricultural labourers and small entrepreneurs. The authorized capital of a RRB is `5 crore. The RRBs are scheduled commercial banks, having been included in the second schedule of the Reserve Bank of India Act, 1934.
4/22/12

Scheduled Commercial Banks

Included in the second schedule of the Reserve Bank of India Act, 1934. Out of 65,413 branches of scheduled commercial banks, 37,098 are in rural areas.

4/22/12

Cooperative Banks
Three

tier pyramidal cooperative credit structure in the rural cooperative banking sector to ensure flows of short term credit for production purposes. The state cooperative bank (SCB) at the apex (State) level, The district central cooperative bank at the intermediate (District) level (DCCB) The primary agricultural cooperative society (PACS) at the grass roots (village) level To provide long term investment credit, both federal and unitary systems of land4/22/12

Rural Marketing Opportunities

Rising

Rural Prosperity Lesser Dependence on Agriculture and Monsoon Increasing Rural Consumption Rural Marketing Efforts Increasing sale of Branded products Large population

4/22/12

Rising Rural Prosperity

The

rural consuming class is increasing by about 3-4% per annum Government helps the rural A small improvement in the net funds make a large difference to the purchasing power. Highest income level, 2-3 million urban households against 1-6 million in rural areas Some part of rural India outshined many Aclass metros Rising agriculture income and migration to cities resulted in higher purchasing power
4/22/12

Lesser Dependence on Agriculture and Monsoon

Primarily

Market predictions were made on the basis of the state of the monsoon Trend has changed over the years. Large non-farming sector, which generate almost 45 percent of the rural wealth

4/22/12

Increasing Rural Consumption

sales

of FMCGs from the rural areas accounting for 53% and those of durables for 59%. Just 1 % rise in rural income translates in to `10,000 crore of buying power. For manufacturers of consumer goods, rural markets are the one to look out for. Tax-exemption on rural income enhanced rural purchasing power Rural markets have almost a uniform share of total sales

55 to 58% in toilet soap, tea, washing cake, 4/22/12 washing powder and vanaspati oil, product

Rural Marketing Efforts

Organisations

rural markets Innovative models developed Availability of the branded products to the consumer in the village itself

realising the importance of the

4/22/12

Increasing sale of Branded products

1/3

of premium luxury goods sold in rural markets. Sales of labelled goods overtaken those of non-branded products in villages. Branded goods comprise 65% of sales in villages today.

4/22/12

Large population
The

rural population is very large Growth rate is also high. This huge population will become an attractive market

4/22/12

Challenges in Rural Marketing

Distribution Understanding

Consumer Limited Knowledge Communication Cost per contact Sale of Fakes and spurious products Budgetary allocations Urban Orientation and Bias Lack of Right competence and commitment at frontline level
4/22/12

the Psyche of the Rural

Distribution
The

cost of distributing goods and services not commensurate with the returns that the marketers expect. Physical distribution and channel management adversely affect the service as well as the cost aspect Reaching out to the remotest destinations and having number of vendors at the retailing end.

4/22/12

Understanding the Psyche of the Rural Consumer

Conducting

an in-depth research in different regions of India is not that easy or cost effective Tailor-made Campaigns for each product category and for each region Thorough knowledge of nuances of language and dialect and familiarity with the prevailing customs in the region

4/22/12

Limited Knowledge
The

findings of research organizations and advertising agencies present different pictures of rural markets. so many different figures and data are in existence. Basic figure with regard to the total market size of the FMCG markets supplied by different research organizations are very different from one another.

4/22/12

Communication
Communication

barrier due to difference in the understanding of the language or icons used for advertising a product or service. Different words and images

Totally different interpretations in the rural market as compared to the urban market. Different meanings in the different regions of the highly heterogeneous rural market.

Dubbing

of campaigns created for one particular market may not be the right solution Contd
4/22/12

Communication-contd...
The

context, story line, narration, idiom, symbols, appeal and the contents need to be examined while developing an advertisement for the rural market. Symbolism, emotional appeal and an indirect approach for promoting the product, which might be effective in urban areas, may not work in rural areas Rural consumers want the benefit to be explained directly and clearly.
4/22/12

Cost per contact

High

cost of media per rural contact One exposure may not be sufficient The frequency of the exposure required varies by the product category. Difficulty in tracking the implementation of the promotional effort The mind set to compare the rural promotional costs with the urban promotional costs is the biggest challenge in the way of rural marketing.
4/22/12

Sale of Fakes and spurious products

The retailer pushes imitation products to the illiterate and less aware rural consumer

which are priced less offer better earnings to the retailer

Wholesalers

start manufacturing fakes To deal with fake is to improve the distribution and make the products available in as many places as possible including haats.

4/22/12

Budgetary allocations
Limited

Corporate sector allocations for the rural marketing Allocations for research and promotion of their products in the rural areas. If you do not have a budget, please do not attempt going rural.

4/22/12

Urban Orientation and Bias

Understanding

of the rural consumer by most marketing people is mostly based on the urban consumers.

4/22/12

Lack of Right competence and commitment at frontline level Top managements commitment to

understand and tap the rural markets might exist The competence necessary for interacting with comprehending rural attitudes and behaviour is lacking at the lower, field staff level. Most of the frontline staff is from the urban areas not very comfortable while travelling to remote villages and interacting with villagers. The solution to recruit front line staff from 4/22/12 rural parts of India.

Thank You

4/22/12