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RURAL MARKETING

RIJO

FARESH

LIJO

SHOBHAARCHANA

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DEFINTION

Rural Marketing is defined as any marketing activity

in which one dominant participant is from a rural

area. This implies that rural marketing consists of

marketing of inputs (products or services) to the

rural as well as marketing of outputs from the ruralmarkets to other geographical areas

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RURAL MARKETING

Rural marketing facilitate flow of goods andservice from rural producers to urbanconsumers at possible time with reasonableprices, and agriculture inputs/ consumer goodsfrom urban to rural.

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PRODUCT GOES TO

1. Urban to Rural: Marketers in rural areas. This

includes: Pesticides,FMCG Products , consumer

durables etc

2.Rural to Urban: They are generally middlemen,

agencies, govt. cooperatives,etc who sell

fruits,vegetables,pulses

3.Rural to Rural: This includes selling of agricultural

tools, cattle's, carts and others to another village in

its proximity.

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FIGURES

FMCG- RS 6500 BN

CONSUMER DURABLES- RS 500 BN

AGRI-INPUTS- RS 4500 BN

AUTOMOBILES(2&4) WHEELERS- RS 800BILLION

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According to Indian market demographics 2004,

approximate size of rural market ranges from 300-

500 million.

Absolute size is becoming bigger than that of urban

population

Purchase of CTV,Washing machine increased by

20%

Since 2002, consumer expenditure in rural India

has risen by 9%.

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FUTURE

IN 2015 RURAL INDIA WILL CONSUME 65% OF

THE GOODS PRODUCED IN THE COUNTRY

IN 20 YRS RURAL INDIAN MARKET WILL BE

LARGER THAN THE TOTAL CONSUMER

MARKETS IN COUNTRIES SUCH AS SOUTH

KOREA OR CANADA TODAY AND ALMOST 4

TIMES THE SIZE OF TODAYS URBAN MARKET

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RURAL AGRI - MARKETING IN INDIA -WITH SPECIAL REFERENCE TOAGRICULTURAL PRODUCE IN INDIA

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ENVIRONMENT

The difference between rural and urban markets on

the basis of various socio economic factors, most

dominant among them being the source of income,the frequency of receipt of income, the seasonal

nature of income and consumption.

Rural markets are small, non- contiguous settlement

units of village relatively low infrastructure facilitates,low density of population, their life styles also being

different.

Rural consumers are mostly farmers whose income

receipts are dependent on the vagaries of nature

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AGRI-MARKETING

Rural population has been increased about 74% of the

total population; the demand for products and services has

increased a lot in rural areas.

Green revolution in the North and white revolution in the

West has brought about a new prosperity in the lives of

rural people.

Government emphasis on rural development has caused

significant changes in the rural scenario. Moreover, the

special attention given for infrastructure development

through the successive Five-year plans has improved the

buying and consumption pattern of rural people.

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THE RURAL AGRO PRODUCTS:

The rural agro-products are

* Fruits & Vegetables

* Grains

* Flowers

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RURALSALEPRODUCTS

Milk & poultry products

Handicrafts and Hand loom products

Tribal village products like tamarind, Lac, soapnut

etc

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PRODUCT STRATEGIES

Existing & New Products

Product features service quality price &

performance relationship

Sense & Simplicity Phillips Global Campaign Urban market successes could be rural market

failures

Appropriate new product development processes

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CORE BENEFIT

BASIC PRODUCT

EXPECTED PRODUCT

AUGMENTED PRODUCT

POTENTIAL PRODUCT

Product Levels

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CONTD

Product Level Characteristics Example Rural Vs Urban

Core Benefit Fundamental

benefit/ services

Entertainment Same

Basic Product Benefit/service

into tangibles

Television Set Same

Expected

Product

Attributes &

conditions

buyers normally

expect

Digital sound,

flat screen

Appearance of

differences in

expectations

Augmented

Product

Exceeding

customerexpectations

Battery

Operated TV

Pleasant

surprise for ruralcustomer

Potential

Product

Encompassing

all

augmentations

&transformations

Jolly Startek TV Uniquely rural

value

proposition

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PRODUCT DEVELOPMENT STAGES

Stage Marketing Activities

Idea Generation Searching for new product ideas

Idea Screening Select the most promising ideas and drop those with onlylimited potential. Study the needs andwants of potential buyers, the environment and competition.

Concept Testing Describe or show product concepts and their benefits to potential customers and determine theirresponses. Identify and drop poor product concepts. Gather useful information from productdevelopment and its marketing personnel.

Business Analysis Assess the products potential profitability and suitability for the market-place. Examine thecompanys research, development, and production capabilities. Ascertain the requirements and

availability of funds for development and commercialisation. Project ROI.

Product Development Determine technical and economic feasibility to produce the product. Convert the product ideainto a prototype. Develop and test various marketing mix elements.

Test Marketing Conduct market testing. Determine target customers Reactions. Measure its sales performance.

Identify Weaknesses in product or marketing mix.

Commercialisation Make necessary cash outlay for production facilities. Produce and market the product in thetarget market and effectively communicate its benefits.

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PRICING STRATEGIES

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ISSUESIN PRICING

Internal & external factors

Selecting pricing methods

Pricing adaptations

Low price points Simple packaging utilityaround packaging material

Highlighting value

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PRICE ADAPTATIONS ( INDICATIVE)

Product sharing services, Example: Tractors

Product Bundle pricing, Example: HUL Operation

Bharat

Free gifts may sometimes not work in rural areas Special event pricing- Hero Honda Rs. 500

campaign

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RURAL DISTRIBUTION CHALLENGES

Large number of small markets

Dispersed population and trade

Poor connectivity

Low availability of suitable dealers

Inadequate banking/ credit facilities Poor product display and visibility

Poor communication of offers and schemes

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LEVELSOF DISTRIBUTION

Level Partner Location

1 Company Depot/ C &FA

National/ State level

2 Distributor/ Van

Operator/ SuperStockist/ Rural

Distributor

District level

3 Sub Distributor/ retailStockist/ sub

stockist/star seller

Tehsil HQ, towns and

large villages

4 Wholesaler Feeder towns, largevillages, haats

5 Retailer Villages, haats

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DISTRIBUTION ADAPTION( INDICATIVE)

Hub and Spoke Model, Example: Coca Cola

Use of Affinity groups, Example: Project Shakti

Haat Activation, Example: Colgate

Syndicated distribution, Example: Cavin Care &Amrutanjan

Use of marketing co-operatives, Example: Warna

Bazaar in Rural Areas

Mobile traders, Example: FMCG companies

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PROMOTION STRATEGIES

Advertising

Sales promotions coupons, contests,

demonstrations and sampling, Example: Tata

Shaktee Haat Hungama

Direct marketing, Example: Videocon

Publicity, Example: Project Shakti and AP Online

Using a direct selling through a sales force,

Example: Swasthya Chetna for Lifebouy

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CONTD

Push strategy sales force and trade

promotion

Pull strategy advertising and consumer

promotion