Advanced Marketing Practicum Assignment

Segmentation of Rural Marketing

SIDDARTH VARSHAN.S
10 AB 35
 RURAL MARKETING IN INDIA
The concept of Rural Marketing in India Economy has always played an
influential role in the lives of people. In India, leaving out a few metropolitan
cities, all the districts and industrial townships are connected with rural markets. 

The rural market in India is not a separate entity in itself and it is highly
influenced by the sociological and behavioral factors operating in the country. The
rural population in India accounts for around 627 million, which is exactly 74.3
percent of the total population. 

The Registrars of Companies in different states chiefly manage: The rural

market in India brings in bigger revenues in the country, as the rural regions
comprise of the maximum consumers in this country. The rural market in Indian
economy generates almost more than half of the country's income. Rural marketing
in Indian economy can be classified under two broad categories. These are:

 The market for consumer goods that comprise of both durable and non-
durable goods
 The market for agricultural inputs that include fertilizers, pesticides,
seeds, and so on

The concept of rural marketing in India is often been found to form ambiguity in
the minds of people who think rural marketing is all about agricultural marketing.
However, rural marketing determines the carrying out of business activities
bringing in the flow of goods from urban sectors to the rural regions of the country
as well as the marketing of various products manufactured by the non-agricultural
workers from rural to urban areas.
To be precise, Rural Marketing in India Economy covers two broad sections,
namely:

 Selling of agricultural items in the urban areas

 Selling of manufactured products in the rural regions

Some of the important features or characteristics of Rural Marketing in India

Economy are being listed below:

 With the initiation of various rural development programmes there have

been an upsurge of employment opportunities for the rural poor. One of the
biggest cause behind the steady growth of rural market is that it is not
exploited and also yet to be explored.

 The rural market in India is vast and scattered and offers a plethora of
opportunities in comparison to the urban sector. It covers the maximum
population and regions and thereby, the maximum number of consumers.

 The social status of the rural regions is precarious as the income level and
literacy is extremely low along with the range of traditional values and
superstitious beliefs that have always been a major impediment in the
progression of this sector.

 The steps taken by the Government of India to initiate proper irrigation,

infrastructural developments, prevention of flood, grants for fertilizers, and
various schemes to cut down the poverty line have improved the condition of
the rural masses.
The Future of Segmentation in Rural Areas

The various bases for segmenting markets underscored the need to understand
consumers. Each segmentation approach has merit and although not all have
exhibited the ability to predict consumers’ purchasing habits, they do enable
marketers to understand better their target markets. When combinations of
approaches are used in aiming at the total marketing problem segmentation
research and be very meaningful. With enhanced understanding comes the ability
to develop more tailored marketing programs. The need to segment markets and
position products effectively is increasingly being recognized by marketing
managers.

 The great deal of attention and interest generated by the concept of market
segmentation is sure to become even more significant in the future. Three
environmental factors are expected to lead to this growth. First, the advance
of the consumerism movement will foster market segmentation.
 A second factor encouraging market segmentation is intensified competition.
With increasingly competitive markets (domestic and worldwide) in the
future, business people will seek untapped segments to gain an advantage
over rivals.
 The third factor stimulating market segmentation is the growing awareness
of non business applications of the technique. It will increasingly be utilized
for marketing in nontraditional areas such as politics religion and public
issues.
 Many consumer characteristics were presented. All of these consumer
attributes were discussed within the framework of market segmentation –
that is an approach to selecting groups of homogeneous consumers as targets
for marketing activity.
 Whereas market segmentation seeks to carve a large, heterogeneous market
into smaller, more uniform subdivisions at the other end of the strategy
spectrum – market aggregation – no subdivision of the market is applied.
Most firms today follow a market segmentation approach. Furthermore, it
was shown that in order for market segmentation to be effective, the target
 group must be identifiable and measurable; accessible; substantial and
responsive.

Positioning in rural market:

 With these criteria in mind, four alternative bases for segmentation are
considered here: demographic, lifestyle, usage, and benefit. In addition, a
number of marketing implications are suggested based upon these variables
influence on consumers’ behavior.
 Although the use of demographic variables is intuitively and widely
available to marketers their record as predictors of consumer behavior is not
very strong. However, the problems in their use seem to be the result of a
state of the art limitation in analysis rather than a fundamental defect in the
technique.
 Marketers must have demographic geographic and socioeconomic
information about any segments chosen if they are to market effectively to
them.
 Techniques may provide a richer portrait of potential customers through
lifestyle usage or benefit segmentation. All of the techniques suggested as
well as others overlap and are complementary. Therefore choices have to be
made regarding the best combination of methods to employ for each product
or service.
 The close interrelationship between market segmentation and product
positioning was also discussed. Several approaches to product and company
positioning were described along with analytical methods for making such
decisions.
 Finally, from this discussion of market segmentation a clearer understanding
should be gained about the who of consumer behavior that consumers are
people of widely varying characteristics appreciation of this fact and an
understanding of the ways in which clusters of consumers with more
homogeneous characteristics may be carved out of the heterogeneous
marketplace should establish a firm foundation for further exploration into
the factors that influence consumer behavior.
Potential of Rural Market in India

 With the far-reaching changes in rural India by means of the agricultural

revolution, spread of education, improved infrastructure, better banking
facilities etc., significant changes have been noticed in the buying and
consumption patterns of the rural consumers.
 All these factors initiated a consumption drive among the rural population.
As a result, a dominant theme emerging over the last few years in Indian
marketing is rural marketing.
 The increasing penetration of electronic media and advertising into rural
areas has also facilitated this. In addition to this, the rural population is also
aspiring for better lifestyles, especially with the increasing disposable
incomes accruing to a significant section of them.
 The Indian and multinational consumer durable and Fast Moving Consumer
Goods (FMCG) companies identified the vast potential of the rural markets
and attempted to target these markets.
 Although the practical constraints in terms of lack of transportation and
communication facilities along with limited rural understanding acted as
constraints in comprehending the rural scenario, some companies did make
inroads into the rural market.
REFERENCES:

1. Rural markets & development by HM SAXENA

2. Rural marketing by T P Gopalaswamy
3. http://www.citeman.com/7868-the-future-of-segmentation-and-positioning/
4. http://www.citefin.com/2801-market-segmentation.html
5. http://www.citehr.com/research.php?q=market-segmentation-in-rural-
markets
6. http://business.mapsofindia.com/rural-economy/state-
development/marketing.html
7. http://www.iupindia.in/206/IJMM_Rural_Markets_and_Exploring_the_Scop
e_for_Consumer_Market_7.html