Prof. V.R. Kishore Kumar

M.A., M.Phil

INDEXIntroductionEvolution of rural marketingWhy companies go rural?DefinitionClassification of rural marketsCharacteristics of rural marketsProblems in rural marketsConclusion

“ 6,38,667 villages, 597 districts, 700 million

people, myriad of languages, many traditions and

a rich culture. A vibarant land with a long history.

Rural Indian people are known as much for their

warmth as their diversity. Welcome to the land of

mysticism. The Real Bharat”.

EXPLORE THE RURAL MARKETS, DONOT

EXPLOIT THEM

INTRODUCTIONThe rise of rural markets has been the most important

marketing phenomenon of the 1990s, providing

volume growth to all leading companies. Many

corporates have been trying get a grip on rural market.

But challenges are many: how to make the product

affordable, how to penetrate the villages with small

population, languages, brands etc.,

The reasons why companies are going rural are manifold.

Ex: high rural incomes driven by agriculture growth, mass media etc.

Marketers and manufactures are increasingly aware of the burgeoning purchasing power, vast size and demand base of the once neglected Indian hinterland. Efforts are now on to understand the attitude of rural consumers, and to walk their walk and talk their talk.

Definition of Rural:

“Village with a population of less than 5000 with 75%

of the male population engaged in agriculture”

--- IRDA & NCAER

2/3 of consumers in rural areas(700 million)

26% NI generated, increasing purchasing power

India has 597 districts,

6,38,667 villages

32% connected with pucca roads

68% stilled untapped

because of inaccessibility and lack of awareness

etc.,

EVOLUTION OF RURAL MARKETING

THE GLORIOUS PAST(1940-1990)

THE PULS OF THE PRESENT(1990-2000)

THE FURIOUS FUTURE (2000 onwards)

The glorious past(1940-1990)

1949- Asian Paints first entered

1960- HLL entered with Lifebuoy soap,

dominates presence in more than 1 lakh villages,

Colgate, Dabur followed it.

1980- Nirma,Cavincare and Marico entered,

Procter and Gamble also entered.

The pulse of Present(1990-2000)

70% of rural population lies in villages

1% increase in purchasing power leads to

increase of Rs 10,000 crores in government

revenue. Companies launching plethora of

products to cater changing life style in rural India.

The Furious of Future(2000 onwards)

The media explosion and satellite invasion have

brought about drastic changes in the consuming

habits of rural Indians and the future would hold a

lot in store for companies entering rural markets.

Why companies go rural?In the present scenario, companies operating in

India will have only two options: either to go Global or go Rural .

Today rural markets are as critical as urban markets for marketers.

Reasons: urban markets are getting saturated

a huge untapped market

rising disposable income

remittances from abroad and impact of media

Rural Marketing“Rural marketing is 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 achieves organisational

objectives”.

-- Ramkishen.Y

Classification of Rural Markets

URBAN TO RURAL

RURAL TO URBAN

RURAL TO RURAL

Characteristics of Rural MarketsIndia is a big country and its rural markets have varied

characteristics that change from people to people, region

to region. Some of the main characteristics of India's rural

markets are:

Diverse nature

Urban market saturation

Rising disposable income

Rising literacy levels

Spread of cable television

Changing patterns in rural patternsIncreased production of food grainsIncreased exportsBetter banking facilitiesCompanies make a beeline to rural marketsThe power of rural communicationGovernment policiesGovernment employment schemesSocio-political changes in the wake of govt., policies

Credit cards for formersCooperatives and corporate support

Problems in Rural MarketingAlthough the rural market does offer vast

potential, it should also be recognised that it is

not easy to operate there. Rural marketing is a

time consuming affair and requires

considerable investments interms of evolving

appropriate strategies.

Problems Deprived people and deprived markets Lack of proper physical communication facilities Transport Many languages and dialects Dispersed markets Low percapita incomes Low levels of literacy Prevalence of spurious brands and seasonal

demand

Different way of thinking Distribution problem Narrow constraint basket

CONCLUSION

Rural marketing will grow in importance in the coming

years. Some crude estimates point out that rural

markets are growing at the rate of Rs400 crore per

annum (at present the total estimated rural market is

growing is Rs1,00,000crore). Corporates that have

understood the psyche of rural consumers and markets

and how to work it have notched up successes.

Thank You