Meaning of rural marketing:

It is the process of developing,

pricing,promoting,distributing rural
specific goods & services, leading to
exchanges between urban and rural markets,
which satisfies consumer demand & also
achieves organizational objectives.
(Ramkishen.Y)
It is a process which starts with a decision
to produce a saleable farm commodity and
involves all aspects of market
structure.includes pre and post harvest
opeartions,assembling,grading,storage,transp
ortation and distribution.(National
Commission on Agriculture)

Features of Indian rural

Market:
The rural mindset is open to

consumption of newer, more contemporary

categories, as a result driving
consistent growth(Prashant
Singh,VP,Nielsen India)
Large diverse & scattered market
Agriculture is the major source of
Income
Urban market saturation
Rising disposable income of rural
consumers
Change in standard of living
Infrastructural facilities

Problems of Indian rural

Market:
Factors contributing urban-rural

divide

Low literacy rate

Understanding the psyche of the rural

consumers
Sale of fake & spurious products
Traditional outlook
Lack of proper infrastructure
Logistic problem
Seasonal demand
Communication gap

Question for Evaluation:

Assume that you are a manufacturer of

packaged food product like biscuits and

bread. Looking at the rising
opportunity in rural markets, you want
to make an entry into these markets.
Clearly identify what are the
challenges you are likely to confront
in marketing your products in rural
markets.
Note: Answer within 200 words.

Suggested Hints:
"The rural consumers are also looking for

quality. They will not stay with a Parle-G

or Tiger (Britannia's glucose biscuit) for
life. Agricultural income is growing pretty
rapidly and consumers are looking to upgrade
for better consumption experiences,-Varun
Berry, India business head and executive
Director at Britannia.
Britannia Industries, the bakery and dairy
arm of the Wadia Group, is looking to tap in
to India's rural consumption story with its
portfolio of value added biscuits and
cookies.

 Over the last five years the share of glucose

biscuits, a segment that has traditionally

found favour in rural markets, has fallen from
35% to 15% of Britannia's biscuit sales. The
$1-billion company now plans to push its
slightly more premium offerings like Good Day
cookies and Britannia Marie brands in to the
country's hinterland in value packs of Rs 5.
Accordingly, the number of salesmen has been
increased and each person has been given a
smaller portfolio (around 160 of its 320 SKUs)
of products so that they can focus more.
In the rural market, Britannia will focus on
expanding to villages with populations of
5,000 people. We might explore villages with
populations of up to 2,000 people sometime in
the future, Berry said.

 Strategy adopted by ITC:

ITC Foods, the fastest growing business of cigarette

maker ITC Ltd , is aggressively expanding

distribution in small towns and villages, where it
trails rivals such as Britannia Industries Ltd and
Parle Products Ltd . ITC Foods, which makes Sunfeast
biscuits and Bingo chips, expects increased
distribution in rural areas and new product launches
in biscuits and snacks to help it grow sales by 2830% this year, chief executive Chitaranjan Dar.
They created 3,000 stock points instead of 1,000

stock points earlier.

Increasing distribution in rural areas is important

for ITC Foods, which likely accounted for over 11% of

ITCs sales last year

Case Study session:

Points to be noted:
At least 3 member in each group
Summarized the case and suggested
solutions within 500 words
10 minutes time to discus followed
by interactive session
Wrap up session