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By

 


Lecturer
  

Noida


  
Lecturer
 
   

Noida
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J rece t years, rural markets of J dia have acquired sig ifica ce, as the overall growth of
the J dia eco omy has resulted i to substa tial i crease i the purchasi g power of the
rural commu ities. O accou t of gree revolutio , the rural areas are co sumi g a large
qua tity of i dustrial a d urba ma ufactured products. J this co text, a special marketi g
strategy, amely, rural marketi g has emerged. Rural J dia with its traditio al perceptio
has grow over the years, ot o ly i terms of i come, but also i terms of thi ki g. The
rural markets are growi g at above two times faster pace tha urba markets; ot
surprisi gly, rural J dia accou ts for 60% of the total atio al dema d.|

Today, rural market occupies a larger part of our eco omy a d it is expected to grow at
least four times the existi g size. A other co tributi g factor for rural push was growi g
saturatio i urba markets. |

ë!"
  


# 
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% Selli g of agricultural products i the urba areas

£ Selli g of ma ufactured products i the rural regio s|

J prese t situatio , our huge populatio is helpi g marketers to thi k ew marketi g

strategies. 630 Billio rural populatio s are greater tha total co sumi g markets of ma y
cou tries like Ca ada, South Korea, etc.|

Tappi g the rural market is o e of the most importa t marketi g strategies followed by
various MNCs a d J dia compa ies ow-a-days. |

A umber of compa ies i FMCG, co sumer durables as well as telecom sector have
adapted strategies to expa d their base i rural market. Amo g those who have already
take remarkable i itiative i rural market are HLL, Colgate, LG Electro ics, Philips, BSNL,
LJC, Cavi Kare, Brita ia a d Hero Ho da. Rural Marketi g i simple word is pla i g a d
impleme tatio of marketi g fu ctio for rural areas. Rural marketi g has bee defi ed as
the process of developi g, prici g, promoti g, distributi g rural specific products a d
services leadi g to excha ge betwee urba a d rural markets which satisfies co sumer
dema ds a d also achieves orga izatio al objective |
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* Products more ofte (mostly weekly) ;

* Buys small packs, low u it price more importa t tha eco omy ;
* J rural J dia, bra ds rarely fight with each other; they just have to be prese t at the
right place ;
* Ma y bra ds are buildi g stro g rural base without much advertisi g support, like
Shampoos, deterge t etc.
* Fewer bra d choices i rural areas; umber of FMCG bra ds i rural areas is half that of
urba .
* Buys value for mo ey, ot cheap products |

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* 630 millio people ;

* Accordi g to a study by the Che ai-based &
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 , estimated a ual size of market is -|

FMCG| Rs. 65,000 Crore |

Co sumer Durables| Rs. 5000 Crore |
Agri J puts (e.g., Tractors)| Rs. 45,000 Crore |
2/4 Wheelers| Rs. 8,000 crore |
Total| Rs. 1,23,000 Crore |

* J 2001-02, LJC sold 55% of its policies i rural J dia.

* Of the two millio BSNL mobile co ectio s, 50% are i small tow s / villages.

* Of the six lakh villages, 5.22 lakh have a Village Public Telepho e (VPT).

* 42 millio rural households are availi g ba ki g services i compariso to 27 millio

urba households.

* J vestme t i formal savi gs i strume ts: 6.6 millio s households i rural a d 6.7 millio
i urba J dia.|

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#(" $Approximately 75% of J dia's populatio resides i arou d 6,38,365
villages of J dia spread over 32 lakh square kilometer. 41% of J dia's middle class resides
i rural areas ;

* #
(
 #"$Purchasi g power of rural people is o rise;

* 
*
$ Market is growi g at a rate of 3-4% per a um. |

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* 
' ,
, was set up by -

 ) to facilitate
sale of agri-i puts such as fertilizers, pesticides, farmi g equipme t, seeds, a imal feed,
etc.

* ë 's i ter et-e abled rural i terface to help sale of agri outputs, 
 ", is
prese tly operatio al i 6 states a d there are 5200 kiosks.

* ëc .
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, a rural agri-i puts store ru by ë
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#

 
 ) i the sugarca e belt of U.P., is also used to sell ceme t a d FMCG
products.

* )'s (
+'ë - Through the state gover me ts a d NGOs i volved i micro-

fi a ce, wome e trepre eurs i villages are ide tified to act as local distributio a d sales
poi t for HUL products.|

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* Low literacy rate.

* Traditio al outlook of rural co sumers due to which they are resista t to cha ge. Their
buyi g decisio is low a d delayed.

* Dema d i rural market depe ds o the agricultural situatio as it is the mai source of
i come. Agai agriculture depe ds o mo soo . So buyi g capacity of rural co sumers
varies a d it becomes difficult to predict dema d.

* Lack of i frastructure facilities.

* Retailers pushi g imitatio or fake products i place of bra ded o es for better
commissio .

* Commu icatio problems.

* Problems related to distributio a d cha el ma ageme t |

The jour ey of markets to the rural markets has i deed bee o e of surmou ti g o e
hurdle after a other; these i clude the 4 As - Availability, Affordability, Accepta ce &
Aware ess - adopti g themselves to the rural atmosphere marketers. So, i the co text of
growth aspects of the Rural markets a d their adoptio a d applicatio by major MNCs a d
J dia compa ies, J wa t to take this Project as my Research Project so that J could go i to
the i -depth study of the rural markets- their future scope, challe ges etc. i the co text of
J dia

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†. Similarly i case of
a y research study u dertake , i itially the objectives of the same are determi ed a d
accordi gly the further steps are take o .|
A research study may have ma y objectives but all these objectives revolve arou d o e
major objective which is the focus of the study. |

J this study, the focus is o the emerge ce of Rural markets as the most happe i g
market o which every marketer has a eye. A d so this study will be based o studyi g
the emerge ce of rural market i various co texts. The followi g are the objectives of this
research study :-|

* To study the emerge ce of Rural markets i the co text of J dia.

* To study the prese t sce ario of rural marketi g i J dia.
* To study the future prospects of rural markets a d their scope for the MNCs a d J dia
compa ies, i J dia.
* To study the challe ges faced by rural marketers i J dia.
* To study the reaso s of popularity of rural markets i J dia.|

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* The Marketi g Mastermi d (2003), Hindustan Lever rural marketing Initiatives by "A
Muku d" Marketi g Mastermi d has give the perspectives i which HLL has approached
towards rural markets.

* The Eco omic Times (2003), "The rural market likes it strong" the stre gth of rural
markets for J dia compa ies. Fi a cial express, Ju e 19, 2000 has published the strategy
about FMCG majors, HLL, Marico J dustries, Colgate Palmolive have formula had for rural
markets

* Rama atha V, Sudhamathi S, Brand Building Exercises Adopted by Life Insurance

Companies in Indian Rural Markets; Jcfai U iversity Jour al of Rural Ma ageme t : "The
very ature of eco omic activities of rural market exte di g the provisio of quality access
to fi a cial solutio s is vital for the developme t of people residi g i rural areas".

* Kha N. A., Building Competitiveness in Small-Scale and Rural Industries in India; Jcfai
U iversity Jour al of Rural Ma ageme t : "The sig ifica ce of competitive ess i the rural
marketi g was eglected for a lo g time i J dia, but ow it is bei g recog ized".

* Dr. N. Raje dhira , Rural Marketing - A Critical Review ; Jcfai U iversity Jour al of Rural
Ma ageme t : " The success of a bra d i the J dia rural market is as u predictable as
rai . Jt has always bee difficult to gauge the rural market. Ma y bra ds, which should have
bee successful, have failed miserably. More ofte tha ot, people attribute rural market
success to luck".c  
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 :-

* Socio-eco omic cha ges (lifestyle, habits a d tastes, eco omic status)
* Literacy level (25% before i depe de ce ± more tha 65% i 2001)
* J frastructure facilities (roads, electricity, media)
* J crease i i come
* J crease i expectatio s

* Ariff Peer Mohamed, Babu Dhi esh, Emerging Trends in Rural Marketing ;
i dia mba.com/facultycolum /articles : Rural market has the followi g facts substa tiate
their future growth :

* 742 millio people.

 * J 2001-02, LJC sold 55 % of its policies i rural J dia.
* Of two millio BSNL mobile co ectio s, 50% i small tow s/villages.
* Of the six lakh villages, 5.22 lakh have a Village Public Telepho e (VPT).
* 41 millio Kisa Credit Cards issued (agai st 22 millio credit-plus-debit cards i
urba ) with
cumulative credit of Rs. 977 billio resulti g i treme dous liquidity.
* Of 20 millio Rediffmail sig ups, 60 % are from small tow s. 50% tra sactio s from
these tow s o
Rediff o li e shoppi g site.
* 42 millio rural HHs availi g ba ki g services i compariso to 27 millio urba HHs.
* J vestme t i formal savi gs i strume ts: 6.6 millio HHs i rural a d 6.7 millio i
urba

* Dr. Ve katesh Tamlurkar, Assessing the Marketing for Rural India ;

i dia mba.com/facultycolum /articles : J ma y villages, o e ca see today the alter ate
use of the products other tha for their actual purpose. People i the state of Bihar feed the
cattle with Horlicks as a health dri k to fatte them! Similarly, people i Pu jab use washi g
machi e ot for washi g clothes but to make frothy lassi i huge qua tities! A imals are
rubbed with Jodex o their ski s to relieve them from muscular pai s after a day's hard
work. Pai ts mea t for houses are used o the hor s of cattle for easy ide tificatio a d
theft preve tio .

* Pa kaj Dhi gra, Rural Paradise for Corporates - Get, Set and Go;
i dia mba.com/facultycolum /articles :This article published some facts about Rural
Markets validati g the otio of its pote tiality:-

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Colour TV| 30.4| 4.8| 12.1|
Refrigerator| 33.5| 3.5| 12|
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Shampoo| 66.3| 35.2| 44.2|
Toothpaste| 82.2| 44.9| 55.6|

/Accordi g to a study by the Che ai-based &
 '
#(#

 , estimated a ual size of market is - |

FMCG| Rs. 65,000 Crore |

Co sumer Durables| Rs. 5000 Crore |
Agri J puts (e.g., Tractors)| Rs. 45,000 Crore |
2/4 Wheelers| Rs. 8,000 crore |
Total| Rs. 1,23,000 Crore |

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Companies in Indian Rural Markets; 

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|
 


Lecturer
  

Noida


  
Lecturer
 
   

Noida
||