A SEMINAR PRESENTATION

On
RURAL MARKETING IN INDIA

SUBMITED BY :
ASHUTOSH SAROJ
2015063108
MBA 2ND YEAR
 INTRODUCTION
The term rural marketing used to be
an umbrella term for the people who
deal with rural people in one way or
other. It got a separate meaning and
importance after the economic
revaluation in India after 1990.

Rural marketing is defined as managing all the activities involved in

assessing, stimulating and converting the purchasing power of the rural
consumers into effective demand for specific products and services and
moving them to the people in rural areas to create satisfaction and a better
standard of living and thus achieving organizational objectives.
 RURAL CONSUMER
The rural consumers are classified into the following groups based on their
economic status:
The Affluent Group
They are cash rich farmers.
Very few in number.
They have affordability but do not form a demand base large enough for
marketing firms to depend on.
The Middle Class
One of the largest segments for manufactured goods.
It is fast expanding.
Farmers cultivating sugar cane in UP and Karnataka fall in this category.
The Poor
This constitutes a huge segment.
Purchasing power is less, but strength
is more.
The farmers of Bihar and Orissa fall under this category .
 It is a two-way marketing process wherein:

Urban to rural - Major part of rural marketing. Includes transactions of

urban marketers who sell their goods and services in rural areas pesticides,
fertilizers, FMCG products, tractors, bicycles, consumer durables, etc.

Rural to urban - Basically falls under agricultural marketing. A rural

producer seeks to sell his produce in urban market like seeds, fruits and
vegetables, forest produce, spices, milk and related products, etc.

Rural to rural - Includes the activities that take place between two villages
in close proximity to each other like agricultural tools, handicrafts, dress
materials, bullock carts, etc.

The word rural is so much associated with agriculture and farmers that
rural marketing is often confused with agricultural marketing but it should
not be so as the latter is only a part of rural marketing.
 Characteristics

The rural consumer has a very high involvement in any product purchased.
He purchases products more often (mostly weekly), usually in small
quantities.
He is very quality conscious but value
for money is of prime importance.
He looks more for functionality of the
product rather than frills associated which
he cannot use but for which he will have
to pay extra.
He is brand loyal. Once loyalty formed is difficult to dislodge .
 Government initiatives

Credit cards (Kisan credit card) to farmers from the public sector banks
which helped them to take short and medium term loans to buy seeds,
fertilizers, etc. This enabled them to produce more thus increasing their
income.

Large inflow of investment for rural development programmes from the

government.

Schemes like IRDP (Integrated Rural Development Programme) and REP

(Rural Electrification Programme) in the 1970s gave a boost to the
agrarian economy. This resulted in changes in peoples habits and social
life. REP gave impetus to the development of consumer durable industry.
 CHALLENGES
Understanding the rural consumer
The biggest challenge is to understand the perceptions, viewpoints and
actual needs of the rural people, which is dramatically different from urban
people.

Low per capita income

India is the fourth largest economy in the world due to a strong economic
growth but still has a low per capita income .
It results in low consumption pattern as compared to the
urban population.

Seasonal Demand
Demand for goods in rural markets depend upon agricultural situation, as
agriculture is the main source of income. Agriculture to a large extent
depends upon monsoon and, therefore, the demand or buying capacity is
not stable or regular.
 STRATEGIES
4 As Approach

1.Availability
Strive to reach at least more villages with a population market penetration.
2.Affordability
Introduce small unit packs
3.Acceptability
Offers products and services that suit the rural market
Easy to understand
4.Awareness
One on one contact programs are extremely efficient.
Educate and try to induce trial.
 SOME NOTEWORTHY SUCCESS
STORIES
"Yaara da Tashan..." add with Aamir Khan
created universal appeal for Coca Cola.
Coca-Cola India tapped the rural market
in a big way when it introduced bottles
priced at Rs 5 and backed it with the
Aamir Khan add.

In 2000, ITC took an initiative to develop

direct contact with farmers who lived in
far-flung villages in Madhya Pradesh.
ITC's E-chaupal was the result of this
initiative.