A

Project REPORT
ON
Study on soaps buying behavior of rural consumers

PROJECT BY: AKHILESH KUMAR

UNDER THE GUIDANCE OF
PROF. G. M. JAYSHEELAN

2
 A
Project REPORT
ON

Study on soaps buying behavior of rural consumers

Project BY: AKHILESH KUMAR

UNDER THE GUIDANCE OF

PROF. G. M. JAYSHEELAN

KOHINOOR BUSINESS SCHOOL CENTER FOR

MANAGEMENT RESEARCH (KBSCMR)
KHANDALA (MAHARASHTRA)

3
 DECLERATION

The Live Rural Marketing Project is meant to bridge the gap between the real-life
business and academic Knowledge. It is a simulation of the business environment and
enables to experience the rigors of Rural Marketing Concept.
It provides opportunities to apply the concepts learnt in the class-room to real-life
situations.

Being a Management Student, It is necessary to apply all concepts learnt in the

classroom to Practical situations to analyze things in perfect manner. The Live Rural
Marketing Project gave me opportunity to undergo on field practical training to know the
awareness among the people for ITC LTD and other SOAPS BRANDS in
KHANDKALEY(Pune) in depth.

I completed this practical training at Kohinoor Business School Center for

Management Research, Khandala.This project report of the work consists of the study
of Rural Marketing and various aspects related to Rural Marketing.

Full care has been taken to make this report error free yet the responses collected
through respondent cannot be 100% error free and I hope I shall be excused for that.

Last but not the least I hope this research work will prove to be of some help and
it would applicable to ITC LTD. in formulating an effective and efficient marketing &
financial strategy.

DATE:
SIGNATURE

4
 Abstract

The project “study of soaps buying behavior of rural consumer” is prepared under
the guidelines of PROF. G M JAYSHEELAN (rural marketing faculty, KBS). This
project report provides a bunch of knowledge about the demand of different soaps
available in rural market as well as it also provides detail knowledge about
consumer preference towards different soaps.

The report also provides details about the history of soaps and Shampoos sector in
rural India. there is plenty of data analysis and conclusions are given in research
paper.
On the basis of feedback through questionnaire and observation method, I find out
that rural consumer has changed their strategy towards the products and start to
purchase them basis on their quality. As the result, there is close competition among
the companies. As each of companies are increasing their products, qualities, looks
and providing best services each days. Our analysis is based on sample results. It
was challenging as well as learning experience to gather the information from
respondents by meeting them personally in order to get questionnaire filled .there
was a lot of time pressure and unwillingness of respondent to respond.

AKHILESH KUMAR PROF. GM JAYSHEELAM

(SUPERVISOR)

5
 INDEX

S.n Topic Page

o no.
1 INTRODUCTION 7
2 SCOPE OF STUDY 8
3 OBJECTIVE AND LIMITATION OF 12
STUDY
4 LITERATURE REVIEW 13
5 SWOT ANALYSIS 14
6 RESEARCH METHODOLY 15
7 VILLAGE INFORMATION 15
8 QUESTIONNAIRE 16
9 DATA ANALYSIS 27
10 CONCLUSION 28
11 RECOMMENDATIONS 28
12 ANNEXTURE 30

6
 INTRODUCTION

There was time when FMCG companies ignored rural market, they took no interest
to produce or sell products in rural market in India. It was initial stage of FMCG
companies in India. As per the time had passed, the strategy and marketing style of
FMCG companies had changed.

BACKGROUND OF STUDY:

In 1970, Nirma was the first FMCG company to initiate and produced goods
according to the rural consumer. In early 1970s, when Nirma washing powder was
introduced in low income market, HLL reacted in a way typical of many
multinational companies . however, Nirma’s entry changed all Indian FMCG as
well as soap market scene . it became a great success story and laid the roadmap for
others to follow. MNCs like HLL, which were sitting pretty till then, woke up to
new market realities and noticed the latent rural potential of India.
C.K. Rangnathan started selling shampoos in sachet in initial investment of Rs
15,000 and dare to take on multinationals, HLL and P&G, the unquestioned leader
in segment. He targeted rural and small town consumers who used soap to wash
their hairs. He introduced sachet at 90 paisa and then 50 paisa . and that’s why
multinationals sat and noticed him.
Sales zoomed from 35,000 sachets to 12 lacks. Initially they took any sachet, but
after 3 months they restricted to chik sachets.

Now a days, rural market is most lucrative , opportunistic and most focusing sector
by major MNCs in India. Each and every company is set to invest huge capital to
competes in rural market. According to the FICCI, the number of rural household
using soaps products has grown from 136 million in 2004 to 143millon in 2007, it
is clear indication that rural consumers have shifted from commodities to branded
products . urban consumer, on other hand could go slow on FMCG expenses ,
7
thanks for inflation spiral, rise in fuel cost and costlier credit. The evidence shows
that first time rural market grow faster than urban market in key product category
April- may 2008, the latest month for which information is available , according to
the market research firm AC Nielsen.

NEED FOR STUDY

In those days, rural market is one of the best opportunities in FMCG sector in
Indian market. It is wider and less competitive market for FMCG. As the income
level of rural consumers increasing, the demand of FMCG products is increasing
continuously.
The various needs of study are follows:

➢ To determine the rising demand of Soaps and Shampoos in rural India

➢ Know about the different choices of rural consumers
➢ Rural consumer’s usage habits are deferent to urban
➢ Rural consumer’s buying behavior

PROBLEM DEFINITION:
The study of opportunity of Soaps and Shampoos in rural market is sum total of
deferent analytical survey of different Soaps and Shampoos in rural market. In one
sense, we can say that it is determination of how much market is captured by
different Soap and Shampoo companies.

SCOPE OF STUDY:

8
With the population of 1 bn people, India is a big market for FMCG companies.
Around 70% of total household in India reside in rural area . total number of rural
household is expected to rise from 135m in 2002 to 153m in 2010, which
represents largest potential market in the world.

(Rural and Urban potential)

Urban Rural
Population 2001-02(m household) 53 135
Population 2001-02(m household) 69 153
% distribution (2001-02) 28 72
Market (towns/villages) 3768 627000
Source: Statical outline of India (2001-02), NCAER

9
An average Indian spends 40% of his income on groceries and 8% on
personal care products . a larger part of total spending pie along with
large base(population) makes India largest FMCG market.

CHANGING LIFE STYLE:

Rising per capita income, increase literacy and rapid urbanization has caused
rapid growth and change in demand pattern. The rising aspiration levels,
increase in spending power has led to change in consumption pattern.

LOW PANETRATION AND LOW PER CAPITA CONSUMPTION:

Due to large size of market, penetration in most product categories like
jams, skin care, toothpaste , hair wash etc. in India is low. This is more
visible when comparison is done between rural and urban India. The average
consumption by rural household is much lower than their urban counterpart.
Existence of unsaturated market provides excellent opportunity for industry
players in form of vastly untapped as the income rises.

PENETRATION (%)
Category All India urban rural
Deodorant 2.1 5.5 0.6
Toothpaste 48.6 74.9 37.6

10
Skin care 22 31.5 17.8
Shampoo 38 52.1 31.7
Utensil cleaner 28 9.9 14.6
Instant coffee 6.6 15.5 2.8
Washing powder 86.1 90.7 84.1
Detergent war 88.6 91.4 87.4
Toilet soap 91.5 97.4 88.9

Source: HLL investor meet 2006

OBJECTIVES:
There are following objectives of the project:-

➢ To determine about the rural consumer preference towards soaps and

shampoos
➢ To know about recent demand of different brands soaps and
shampoos in rural India

HYPOTHESIS:
I am also citizen of rural area. I used my experience and perceptions as hypothesis
towards to make this project.

LIMITATIONS:
11
While surveying I encounter with some problems like some people were not ready
to respond and few of them who responded were in hurry hence the active
participation was lacking.
Due to which I faced difficulties in collecting information regarding our
questionnaire. Another problem which I face was that people were hesitating to give
information about their income. Except it, sample size that I have taken was small
(50 respondents) and its difficult task to draw conclusion or reach to exact result on
the basis of limited sample size. Time was very limited go into depth.
Threats to me were that people were hesitant to give income related information so
there is chance to error regarding income.

LITRATURE REVIEW:
Rural market is one of the best opportunity in India for soaps and shampoo sector.
In this sense, I can say that rural market is future of FMCG(soaps and shampoos).
As the research of PURBA BASU (FACULTY OF ICFAI, B. SCHOOL), The
lifestyle of rural consumers is changing. Rural market and marketing strategy have
become latest marketing buzzword for most of FMCG majors. She added the
strategies of different FMCG companies for capturing rural market like Titan’s
sonata watches, coca cola’s 200ml bottles, different marketing strategies of HLL
and Marico Ltd. She takes into consideration the study of national council for
applied economic research (NCAER). According to the NCEAR projections, the
number of middle and high income household In rural India.
India is expecting to grow from 80 million to 111 million by 2007. In urban India
same is expecting to grow from 46 million to 59million. Thus , absolute size of
rural India is expecting to grow double that of urban. increasing demand. Factors
like village psyche, strong distribution network, and market awareness.

12
This implies that rural market has huge potential for marketer to meet up the are
few prerequisites to make dent into rural markets. the model is of the stolid Dutch
Anglo conglomerate UnileverGroup, which has enjoyed century long presence in
India through its subsidiary Hindustan lever Ltd. It was Hindustan lever Ltd which
several years ago popularized Idea of selling its products in tiny packages. Its
sachets of detergent and shampoos are in great demand in rural Indian villages.
Britannia with it low priced Tiger biscuits has become success story in rural
market. The characteristics of rural market in terms of low and spared out
population and limited purchasing power make it difficult market to capture. The
bottom of pyramid marketing strategies and 4 P’s model of availabilities,
affordability, acceptability and awareness provide us with a means of developing
strategies to tackle marketing issues to marketing soaps and shampoos in rural
India. some successful stories like Garmin phone in Bangladesh .
As per concern of my research, it is detail study of soaps and shampoos used by
rural consumers. It will provide the detail information about consumer preferences
towards soaps and shampoos which is too unique and different from above
researches.

SWOT ANALYSIS
FOR ITC LTD.

Strength Weakness
➢ Distribution leadership ➢ Late entrant in personal care
segment
➢ Very deep reach in rural
market

➢ Trusted Brand
➢ Extensive consumer research and
A very rich product pipeline for
the existing category

13
 Opportunity Threat

➢ Various categories products and ➢ High Competition from global

services for rural markets. brands like
HUL,P&G,DABUR ,CAIVIN
➢ Agriculture business product for CARE etc.
rural markets

➢ Large amount of Brand

promotion

➢ Growth in disposable income

➢ Hrithik Roshan to endorse the
shampoo

➢ The total shampoo market is

around Rs2,200 crore

RESEARCH METHODOLY :

Sample design :

sample unit: working people, school students, unemployed and housewives i.e.
males and females irrespective of their education level .
Sample size: 50
Sample region: Khandkaley village
Sampling procedure: Random Sampling (fill up the questionnaire)

DATA COLLECTION METHOD

PRIMARY DATA:
Primary data collected through self administrated questionnaire. The aim of this
questionnaire to gather the information of various branded soaps and shampoos

14
reach among the rural consumers and what are the benefits of products and
accordingly the perceptions of consumers.
SECONDRY DATA:
Secondary data was collected through magazines, research papers and Internet.

QUESTINNAIRE DESIGN:
As questionnaire is self administered one, the survey is kept simple and user
friendly. Words used in questionnaire is easily understandable to all respondent and
technical jargons avoided to make it most worthwhile without any confusion to
respondents.

VILLAGE DETAIL

Village-at post-KHANDKALEY, District -Pune

No. of households- - around 12000
No. of retail outlets/Mandis- - 400
No. of schools/colleges - 7(8TH STD)/3(12TH STD)
Market day - No
Village functions -
Sarpanch: - Sunita Popat

Finding from (50) respondent

15
1. Have you heard of a company called I.T.C.? if yes how?
A) Yes(9)
B) No(41)
➢ Through

1) cigarette wrapper(7) 2)Arshibaad Atta (1) 3) Soap’s wrapper (1)

2. Are you aware Vivel/Superia soaps?

a) Yes(35- Vivel and 8superia )
b) No (7)
3. What are all the soaps u can remember?
1).Lifebuoy (46)
2). Lux (41)
3).Dettol (30)
4). Santoor (10)
5).breez (33)
6).godrej (12)
7) .Sinthol (16)
8). Hamam (10)
9).Nirma (36)
10)Vivel (7)

4. What soap do you use?

1). Lifebuoy (19)
2). Lux (20)

16
3). Dettol (3)
4). Santoor (1)
5). Breez (0)
6). Godrej (1)
7) . Sinthol (0)
8). Hamam (1)
9). Nirma (5)
10) Vivel (0)

5. since when you are using this soap?

1) 1-6 months 2) 6months-1 year 3)1- 2 years 4) above 2 years
1). (5) 2). (9) 3) (17) 4) (21)

7. What soap did u use prior to this?

1).Lifebuoy (16)
2). Lux (8)
3).Dettol (9)
4). Santoor (3)
5).Breez (3)
6).Godrej (1)

17
 7) .Sinthol (0)
8). Hamam (1)
9).Nirma (9)
8. How many people in your family use this soap brand?
1) One member (4)
2) two members (10)
3) three members (3)
4) four members (12)
5) Above four members (21)

9. How many times in a day you use the soap?

1). One time (31) 2).Two times (17) 3). Three times (2)

10. What do you consider while buying the soap?

a) Quality (9) b) color and size (8) c) Brand name (11)
d) Discounts/offers/free gifts (15) e) Price(5)
f) Retailer’s recommendation (3) h). BUZZ (0)

11. During which week of month do you buy the soap?

a).week 1(38)
b) week2(2)
c) week3 (0)
d) week4(10)
12. Where do you buy soap?

18
 a) Retail (39)
b) Haats (2)
c) Mandis (0)
d) Melas (0)
e) Nearby village/town( 6)
f).others (3)
13. Rank the quality preference while buying the soap?
a) Fairness (10)
b) Freshness(31)
c) Softness(4)
d) Beauty and young skin(5)
e) others specify(0)

14. How much money(in Rs.) you spend to buy the soap?
a) Less than 5 (0)
b) 5> 10 (32)
c) More than 10 (18)

15. What do you like in soap?

a)Smell(17) b)fume(22) c) color(11)

15. Have you seen ad of Vivel/Superia? if yes where/how?

a) TV (23)

19
 b) NEWSPAPER (17)
c) Magazine (2)
d) POP display & advertisements (9)
e) Wall painting (2)
f) Hand out/newspaper inserts ( 0)
g) Radio (7)

The 50 respondents in a village are studied using the following scale for
question nos. 18-24
18. Local influential persons are the best source for awareness of FMCG product

OPINION Strongly Agree No Disagree Strongly

Agree opinion Disagree

WEIGHT 2 (11) 1(17) 3(15) -1(5) -2(2)

IV = ((Points in strongly agree X 2) + (Points in agree X 1)) – ((Points in strongly

disagree X -2) + (Points in disagree X -1))

IV = ((11*2) +(17*1) - (2-2) + (5-1)

20
 IV = 35

19. “BUZZ”: are used as a source of information

OPINIO Strongly Agree No Disagree Strongly

N Agree opinion Disagree

WEIGH 2 (14) 1(13) 3(10) -1(8) -2(5)

T

IV = ((Points in strongly agree X 2) + (Points in agree X 1)) – ((Points in strongly

disagree X -2) + (Points in disagree X -1))

IV = ((14*2) +(13*1) - (8-2) + (5-1)

IV = 31

21
20. ”BUZZ” are used to choose a brand

OPINIO Strongly Agree No Disagree Strongly

N Agree opinion Disagree

WEIGH 2 (12) 1(10) 3(15) -1(8) -2(5)

T

IV = ((Points in strongly agree X 2) + (Points in agree X 1)) – ((Points in strongly

disagree X -2) + (Points in disagree X -1))

IV = ((12*2) +(10*1) - (5-2) + (8-1)

IV = 38

22
21. “BUZZ” are reliable for product value

OPINIO Strongly Agree No Disagree Strongly

N Agree opinion Disagree

WEIGH 2 (10) 1(12) 3(14) -1(14) -2(0)

T

IV = ((Points in strongly agree X 2) + (Points in agree X 1)) – ((Points in strongly

disagree X -2) + (Points in disagree X -1

IV = ((10*2) +(12*1) – ((0-2) + (14-1))

IV = 21
22. “BUZZ” are helpful to avoid risk

OPINIO Strongly Agree No Disagree Strongly

N Agree opinion Disagree

WEIGH 2 (10) 1(13) 3(10) -1(12) -2(5)

T

IV = ((Points in strongly agree X 2) + (Points in agree X 1)) – ((Points in strongly

disagree X -2) + (Points in disagree X -1))

IV = ((10*2) +(13*1) – ((5-2) + (12-1))

IV = 19

23. “BUZZ” are mentors in case of product dissatisfaction

23
 OPINIO Strongly Agree No Disagree Strongly
N Agree opinion Disagree

WEIGH 2(20) 1(13) 3(6) -1(5) -2(6)

T

IV = ((Points in strongly agree X 2) + (Points in agree X 1)) – ((Points in strongly

disagree X -2) + (Points in disagree X -1))

IV = ((20*2) +(13*1)) – ((7-2) + (4-1))

IV = 44

24. Advertisements are not considered for decision making:

OPINIO Strongly Agree No Disagree Strongly

N Agree opinion Disagree

WEIGH 2(7) 1(9) 3(7) -1(11) -2(16)

T

IV = ((Points in strongly agree X 2) + (Points in agree X 1)) – ((Points in strongly

disagree X -2) + (Points in disagree X -1))

24
 IV = ((7*2) +(9*1)) – ((16-2) + (11-1))
IV = -1

DATA ANALYSIS:
After a good deal of consumer survey and marketing research, I have collected
worthwhile data to make it valuable information in conclusion. The analysis of
those data’s is given below :-

DATA ANALYSIS FOR THE PREFERENCE FOR THE SOAPS AND

THEIR BUYING INFLUENCING FACOTRS IN RURAL MARKET:
In survey of preference of my target consumers towards soap, I had found different
preferences and different choices of consumers. On the bases of their choices I had
get following data:-

As per given in above chart, 90% of soap market share is captured by HUL. 50%
consumers prefer HUL’s LUX and 30% lifebuoy.

25
 While other companies contribute only 8% in which
ITC’s all soaps brands(de wills, vivel and superia) contribut only 2%to 3% that is
very less compare to HUL.

CONCLUSION:
In this analysis I found that a vast majority of rural consumers prefer LUX and
LIFEBUOY most trusted brands. But all these brands are costlier and entrance of
ITC’s soaps with vast of soaps varieties i.e. Superia for mass and de wills for high
income group population with competitive prices attracting rural consumers to use
ITC’s soaps.
• Advertisement(TV ad) most influences buying behavior of rural consumers
• Local influential persons are the best source for awareness of FMCG product
• “BUZZ” are used to choose a brand
• Low price with good quality products have makeable sales result
• Company should do “UMBRELLA BRANDIND” to set brand name in
consumer’s mind like HUL,DABUR,NIRMA etc.

RECOMMENDATIONS:
1) Company should held awareness campaign about ITC.
2) There should be oil ingredient in soap to replace external oil usage

DATABASE OF RESPONDENT COLLECTED THROUGH SURVEY

26
 ANNECTURE

S. NAME GEND AG CONTAC EDU OCCUPATION INCOME

NO ER E T NO. .
. QUA Lacks/ye
(M/F) (YEAR L. ar
S)

1. SUNITA POPAT F 35 9272189 8th SARPANCH 1.5

396

2. KISHORE M 26 8087806 10TH TAILOR 0.80

GHODEKER 286

3 POPAT M 40 9823551 12TH DECORATOR 2.75

CHAUHAN 114

4 VISHWANATH M 54 9823419 12TH RETIRED FAUJI 1.5

RAM CHANRA JI 844

5 NAMDEV M 33 9637821 8TH FARMER 1.4

KEDARI JI 825

6 ABHISHEK M 19 8730819 12TH JWELLERY SHOP 2.7

RAMESH JAIN 797

7 MADHUBALA F 42 9970825 8TH CONSUMER 1.5

PARIMAR 211 DURABLES
GOOD’S SHOP

8 SAMDEEPGAUR M 24 9272189 5TH VEGETABLES 0.55

AV 399 SELLER

9 MAHENDRA M 21 9325239 10TH MOBILE 1.0

004 ENGINEER

10 ROHIT M 18 9823598 B. STUDENT ----

SINDHEY 280
COM
.

11 MANOJ M 22 9823885 10TH SHOP KEEPER 1.7

CHANDAN 259
MAL JAIN

12 MOHAN M 51 9850296 8TH RESTAURANT 4.5

27
 GANPAT 533 OWNER
DABADE

13 OKAJI GAIKWAD M 32 9766064733 4TH FARMER 0.8

14 PANDURANG M 51 9767135412 4TH FARMER 0.72

GAIKWAD
15 DILIP DEVKAR M 32 9823528166 4TH FARMER 0.90

16 JENENDRA APPA M 23 9764085645 4TH FARMER 0.45

GAIKWAD
17 MOHAN DEVKAR M 30 9823847923 7TH SHOP 1.0

18 SHANKAR MANE M 27 9673931211 8TH SHOP 0.75

19 HEMCHAND M 19 - 5TH SHOP 0.80

DESHMUKH
20 MANOHAR M 29 9665623757 7TH FARMER 0.50

21 SHRIKANT M 28 9049532451 8TH SERVICE 2.0

SHILONE
22 SUNIL NIKAM M 18 9503847062 12TH SRVICE 1.75

23 SACHIN PUJARI M 18 9765982678 10TH SERVICE 2.25

24 TULSIDAS M 26 9823885037 10TH FARMER 0.55

BHIKARI
25 UMESH PAWAR M 21 9623136832 12TH SHOP 0.90

26 VIJAY GHARE M 24 9823396552 12TH SERVICE 1.5

27 VIJAY GAIKHE M 31 9923608505 12TH SERVICE 1.2

28 DINESH M 17 9049373069 10TH SHOP 0.45

PADWARKAR
29 DATTARE M 24 9823851524 10TH SHOP 0.36
PAWAR
30 SUNIL KHADKI M 25 9664911242 7TH SHOP 0.45

31 DHNANJAY M 21 9637394305 9TH SERVICE 2.0

SATHE
32 SANTOSH M 26 - 10TH SHOP 0.35
DEVIDAS
33 SUDAM SOPAN M 36 9673767551 8TH FARMER 0.30

34 DEVKAR M 26 9765943213 4TH FARMER 0.55

28
35 SWAPNIL M 24 9823671021 9TH SERVICE 1.6
PADWAR
36 MAHADEV M 42 - 4TH FARMER 0.7
BOTRE
37 SHRIRANG M 27 9637545230 4TH FARMER 0.35
PANDURANG
38 VISHAL YAWLE M 25 9960855291 8TH SERVICE 0.90

39 SANTOSH M 25 - 9TH SERVICE 0.65

PADWAR
40 SHANKAR TAPE M 29 - 5TH SHOP 0.45

41 YASHWANT TAPE M 22 - 4TH SHOP 0.22

42 THANTARAM M 29 - 6TH FARMER 0.25

GAIKWAD
43 MADHURAM M 45 9765421663 4TH SHOP 0.35
PADWADE
44 SANTOSH M 25 9923457909 10TH SHOP 0.35
KASHIRAM
45 ARUN M 35 10TH FARMER 0.65
THAKARKAR
46 DASHRATH M 26 4TH FARMER 0.70
PADWAR
47 PRAKASH M 24 4TH SHOP 0.40
DESHMUKH
48 RAJU M 27 9823481861 4TH SHOP 0.32
DESHMUKH
49 RAGHUNATH M 33 9673128588 2TH SHOP 0.35
BOTHRE
50 RAJU M 17 9823481861 4TH SHOP 0.25
DESHMUKH

29
30
31