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Segmentation Features

Life style change

STP

Pitfalls

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Major Segmentation

To select the best product mix and target market ,major segment variables of rural markets are to beunderstood. These are:

1) Region ( North / East / West / South)

2) Size of population ( 1000 / 1500 / 5000 )3) Climate ( hot / cold / moderate /rainy)

4) Demography( age / family size / gender)

5) Income ( 2000 to 5000 / 5000 to 10000 / 10000 to

50000 / above 50000 per month)6) Education ( Literate / semi literate / illiterate)

7) Occupation ( agriculture / non agriculture)

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Factors for Segmentation

The other factors are:

1. Psychographics

Lifestyle ( rigid / changing / imitating)

Personality ( authoritarian / ambitious)2. Behavioural

Looks for benefits or quality

3. Others :

User status/ usage rate /loyalty rate/ attitude to product/ occasion

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Rural Market Positioning

Rural Market Positioning could be:

1. Value for money( in which product benefits andprices are highlighted)

Eg. : Kevin care shampoo @ Rs12. Life style ( in which product is demonstrated to

check fitness) Eg. : pajama- kurta-jacket for a teacher

3. Health Platform ( in which the product/ service

highlights the linkage with health)Ex. : fat free food / diet coke

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Rural Product Classification

Rural Products are classified into:1) FMCG ( Brand such as HUL, Dabur, Colgate, Marico,

Cavin care, Coke, Pepsi etc.)

2) Consumer Durables ( further categorised in three

price range --- refer next slide)3) Services ( telecom services, health care, life insurance,

general insurance, banking)

4) Agri Inputs ( seeds, pesticides, tractor, implements,

fertilisers)

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Rural Consumer Durables Portfolio (NCAER Study)

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NCAER Study

Number of product categories stocked by rural and urbanstores do not vary much (19 v/s 27)

What does vary is no. of company's products (42 vs 92)

Shop census indicates that shops in rural and urban do not

vary in size (100 to 250sft) Largest brand by value in rural market are also the largest

brand in urban India

The truth is that there will be no rural or urban customers

in India both will blend to leave one Indian customer intime to come

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Social & Behavioral Influence Rural consumer is influenced by environment and

by his wants and perceptions. These greatly affectthe product, pricing, distribution, media the

whole marketing strategy

Cultural and social practices have major influenceson the behavior of rural customers. Therefore,marketer has to:

Develop products that suit cultural practices

Design media & message that reflect social behaviour Influence the perception by making available products

where consumer usually makes his purchases

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Social and Behavioral InfluenceAttitude to quality and price

Small pack size gets acceptance from daily

labourers and small earners. He will buy somethingthat has small unit price but will not certainly buy acheap brand

Brand preference and loyalty

Consumptions of branded items account for 80%of sales. But brand pricing has to take into accountboth income level and income level

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Attraction Factors Global service providers (GSP) is making inroads to the

mass base of rural market. The characteristics for attractingGSP are:

1) Growing population2) Needs and wants are skyrocketing

3) Growing sense of consumerism

4) Replication of urban life style

5) Increasing literacy6)Augmented growth in agriculture

7) Influence of cross culture

8) Liberalized government rules

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New Approach

Non conventional media are extensively used to targetrural consumers

But before that, following aspects are to be kept inmind:

The target audience Social class and intentions

Receptivity

Brand consciousness

Lifestyle

Purchase needs

Dont sell dreams demonstrate is the new mantra

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Control the Pitfalls Dont adopt a quick fix strategy

Dont strip the frills offered to urban consumers and

think that product is ready for rural market Dont do cosmetic modification to the packaging

(changing to vernacular language)

Do not offer meaningless sales promotion give-ways