CH INSTITUTE OF MANAGEMENT

AND

COMMUNICATION
Presented to Prof. Anand Sapre Presented by Rakesh chitra Jay Gupta Rahul Goyal

RURAL MARKET SCENARIO

Rural- approx 70% population engaged in agriculture related activity. approx 700 million people 1/3rd of countrys GNP More than 450 districts, 6,30,000 villages A typical village retail environment consists of 5-8 kirana shops, the size of such stores varies depending on the size and population density of village where it serves.

KEY TO SUCCESS IN RURAL INDIA

Physical Distribution

Channel Management

Promotion and Marketing Management

Coca-Cola (coke)

Coca-Cola is a carbonated soft drink sold in stores, restaurants, and vending machines internationally. The Coca-Cola Company claims that the beverage is sold in more than 200 countries. and it is often referred to simply as Coke (a registered trademark of The Coca-Cola Company in the United States since March 27, 1944). Originally intended as patent medicine when it was invented in the late 19th century by John Pemberton, Coca-Cola was bought out by businessman Asa Griggs Candler

COKE IN INDIA
After a 16-year absence, Coca-Cola returned to India in 1993,cementing its presence with a deal that gave Coca-Cola ownership of the nations top softdrink brands and bottling network.

Cokes acquisition of local popular India brands including Thums Up, Limca, Maaza, Citra etc:- a strategic step & success.

COKE RURAL INITIATIVE

It bought down the average price of its products from Rs 10 to Rs 5, there by bridging the gap between soft drinks and other local options like tea, butter milk or lemon water. It also tapped local forms of entertainment like annual haats and fairs and made huge investments in infrastructure for distribution and marketing.

It doubled the spend on Doordarshan.

THANDA GOES RURAL

In 2002, CCI launched a new advertisement campaign: Featuring Bollywood star Aamir Khan. Tagline Thanda matlab Coca-Cola. Targeted at rural, semi urban customers. Idea was to position Coca-Cola as a generic brand for cold drinks. CCI began focusing on the rural market in the early 2000s in order to increase volumes. Rs.5, this pricing strategy closed the gap between Coke and basic refreshments like lemonade and tea, making soft drinks truly accessible for the first time.

THE BETTER DECISION

Flat sales in urban markets.

Huge size of untapped rural market.

Improvement in income and spending power of rural people.

Better physical distribution channel.

Increased awareness due to television reach.

CHALLENGES FOR COKE

Poor rural infrastructure.
Erratic power supply. Different consumption habits. Preference for traditional cold beverages(lassi, lemonade)

Price of the branded beverages

CCIs RURAL MARKETING STRATEGY

CCIs rural marketing strategy was based on three As Availability, Affordability and Acceptability.

The First A Availability emphasized on the availability of the product to the consumer.

The Second A Affordability focused on product pricing.

The Third A Acceptability focused on convincing the customer to buy the product.

AVAILABILITY
Capacity expansion 25 production line . Unique and different distribution strategy hub and spoke distribution.

Coverage of 1,58, 342 villages.

2,00,000 refrigerators to rural retailers.

AVAILABILITY
CCI realized that the centralized distribution system used by the company in the urban areas would not be suitable for rural areas so they adopted HUB AND SPOKE DISTRIBUTION strategy.

AFFORDABILITY
Introduction of 200ml bottle (chota coke).

Priced at Rs. 5, closed the gap between Coke and basic refreshments.

ACCEPTIBILITY

The company put up hoardings in villages and painted the name Coca-Cola on the compounds of the residences in the villages.

CCI also participated in the weekly mandies by setting up temporary retail outlets, and also took part in the annual haats and fairs which was a major source of business activity and entertainment.

ADVERTISING STRATEGY
Commercials showed progression in associating Coke with Thanda in a rural/semi urban context. Ad 1 - Tapori connection of coke with thanda was made. Ad 2 - Hyderabadi shopkeeper shopkeeper equates the word thanda with Coca-Cola. Ad 3 - Punjabi farmer when one asks for thanda, one would get coke.

FUTURE PROSPECTS OF COKE

CCIs volume from rural market increased to approx 30% . Diversification nimbu pani, fruit juice

Focus on rural penetration

Biggest challenge is to increase the market share

Target of reaching 0.1 million more villages

ISSUES IN COKE
Pesticides Issue and building confidence .
Infrastructure in distribution network. Competing with local brands Advertisement spending Diversification

SEGMENTATION
o Geographic Segmentation Region All over India Density of area: Rural

Climate : Temperate, Hot, Humid, Rainy

Demographic Segmentation
Age 10above Sex Male, Female Income : Rs. 2000-above Education : Literate, Illiterate

SEGMENTATION
Psychographic Segmentation Socioeconomic Class: Middle and Upper Lifestyle : Status seekers Behavioral Segmentation Occasions: Regular and Special Benefits: Economy Value for the money Refreshment

PERCEPTUAL MAPPING
High Refreshment

Economy

Expensive

Low Refreshment

Maslows Hierarchy of Needs

Self-Actualization (Self-fulfillment) Ego Needs (Prestige, status, self esteem) Social Needs (affection, friendship, belonging) Safety and Security Needs (Protection, order, stability) Physiological Needs (Food, water, air, shelter, sex)
CB NEEDS 23

TRAIT THEORY
Highly dogmatic Social Character

Other-Directed
Social SelfImage

POSITIONING
Positioning Against Competition Positioning Based on a Specific Benefit