Rural marketin1eg

8/7/2019 Rural marketin1eg

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Rural marketing- acc. To National commission on agriculture, rural marketing is a process whichstarts with a decision to produce a saleable farm commodity and it involves all the aspects of marketstructures and system, both technical & institutional based on technical & economical consideration& includes pre and post harvest operations, assembling, grading, storage, transportation &distribution .

The model of RM represents the combination of transactional & developmental approaches : 1)RMprocess is both a catalyst as well as an outcome of the general rural development process outcome.Initiation and mgt of social & economic change in the rural sector is the core of the RM process. 2)Innovation methods for social change for successful transformation of traditional society are vital.Such a change narrows the rural urban divide.3)the growth of the RM can be a planned evolutionaryprocess based on strategies instruments of change rather than for short term opportunity forcommercial gain.4)the exposure of rural to a variety of marketing transactions during the changeprocess puts them in the role of beneficiaries than of just buyers of modern inputs & infrastructuralservices.5)communication should serve to resolve social conflicts, encourage co operation &strengthen competitive spirits during transactions.

Scope of RM- 1)urban to rural a)consumable b) Consumables c)consumer durables d) capital goods2) rural to urban i) agricultural and allied products. ii) rural artisans iii) food iv) industrial RM- 3)rural to rural- rural artisans ,services

Importance of RM- 1)urban to rural 2)rural to urban. A) Compulsions. B) Opportunities.

Rural vs urban marketing -

A)environmental differences -

Urban - 1)the urban marketing- the urban env is characterised by large, contiguous settlement unitsof town or urban agglomerations, mostly concentrated. 2) highly infrastructural level such as road,electricity etc. 3)high density of population per sq.km of space. 4) good physical connectivity, highmobility

Rural - 1)small, contiguous settlement unit of villages widely dispersed. 2) low infrastructural levels.3)low density of population 4) poor physical connectivity with other villages & towns, low mobility.

B )Social relations-

Urban (i n an urban society soci al dy nam ics r ep r ese nt a mor e l i be ra ted syste m 1) large no of interactions with persons. 2) individuals are less known & identify b/w members in the social system.3) social norms are less visible. 4) cast influence( indirect) and less strength generally subjected to

economic influences.

Rural (the out l ook of r ural society is a comb i na tio n of both t ra ditio nal & mode rn, isms ) 1)less no of interpersonal interactions 2)individual better known as identified 3) social norms influencingindividuals are more visible. 4) caste influence direct & strong.



C )Ex posure to marketing stimuli-

Urban ( urban mar kts ar e i n a bette r positio n. They h av e bette r exposu r e to mar keti ng sti mul i ) 1)high prdct exposure & high exposure to branded prdcts. 2)high advertising exposure 3) highexposure to marketing research & multiple sources of information.

Rural ( a diffe r ent an d a pa thetic situ a tio n we fi nd i n r ural mar kets ) 1) low product exposure & lowexposure to branded products 2) low adv exposure,low comprehension of adv, low brandedawareness. 3) low exposure ro marketing researchers and ltd. Sources of information & learning .

D ) dependence on nature-

Urban (i n urban ar ea s depe nde nce o n na tu ral r esou r ces is l ess ) 1) access is a function of purchasingpower 2) most resources to be purchased 3) low dependence on employment and incomes onnatural factors.

Rural - (the r ural l ife is depe nde nt o n -) 1) abundance of natural resources and high dependence forlarge no of household needs. 2) differential access to resources based on caste politics & moneypower. 3) high dependence on employment and income on natural factors .

Rural market in Indian context - The rural market is a profitable proposition for the giantmultinationals for the following reasons: 1) rising rural prosperity- india is now seeking a dramaticshift towards prosperity in rural households. The closest income class will shrink from more than60% in 1994-95 to 20% in 2006-07. The higher the income classes will more than double. Thanks tothe development under the 5 year plans & other special prgms such as land reforms etc. 2) growthin consumption- as a consequence of spread in rural prosperity in 1990s there was growth inpurchasing power in household expenditures is rs.382. 3)lifestyle changes- rural consumersconsidered to prefer local, unbranded & low priced products. However, this is true only in certainproduct categories. There is an up gradation from local or unbranded products to national brands &from low priced brands to premium brands. With increasing literacy levels & media explosion, brandconsciousness is on an upswing exposing the rural population to the rich lifestyles of the urbanhouseholds. This has created awareness and a attraction for the premium products like Surf , Arieletc. 4) lifestyle adv- many products have achieved near maturity in the urban market while in the upcountry, still in the growth phase. The reasons for the variations in the PLC stages maybe beattributed to the different rates of diffusion adoption process in the urban & rural marketing.5)Rural marketing rates higher than urban the growth rates of FMCG market & durables market ishigher in rural areas for many products. The rural market share will be more than 50% for manyproducts like cooking medium, tea, cigarettes etc. 6) rural marketing is not expensive- conventionalwisdom dictates that since rural consumers are mainly scattered, reaching them is costly. However

new research indicates that selling in rural area is not expensive. 7)remoteness is no longer aproblem- the rural distribution is not much developed for the reason,a) lack of proper infrastructureb) marketers imagination & initiative (-) marketers have so far failed to analyse the rural side andexploiting rural India s traditional selling system that is haats and melas.



U nderstanding rural marketing env and its impact on rural marketing operations-

Environment means a set of conditions & given variables within which man or humans beingperforms. Diff rural env are : 1) geographical env- the geo env is the vast rural india influencesdirectly or indirectly on RM. The diff. Factors relating to it are (i) climate (ii) Topography (iii)Riversystem (iv) soil condition (v) land distribution (vi) irrigation 2 )economic env - a) income generation &distribution b)expenditure patterns and habbits c) land ownership & distribution. d) land use patterne) economic development plans & programmes. F) rural credit and financial system (i) productioncredit (ii) consumption credit. g) Occupation patterns. 3) demographic env - a) nature of populationb)ethnic distribution c)religious diversity d) distribution of population 4) socio cultural env . a)customs and traditions b) family structure & familial relations. c) social interactions d) specialposition of elders e) social entertainment & festival pattern 5) administrative environment a)natureand influences of panchayats b)agricultural extension officer (A EO) 6) rural marketing behavioural environment - a) purchase decision b) monetary and non monetary exchange c) dealers in retailoutlets.d) village haats. e) village mandis f) relationship marketing 7 ) infrastructural env. a) physicalb) institutional support.

C haracteristics of rural consumer: 1 ) cultural char - a)culture b) sub-culture c)social milieu 2 ) other consumer characterestics- a) age & life cycle stage b) occupation c) economic situation d) lifestyle e)personality and self concept f) physiological factors

Attitudes of the rural consumer: 1) locality preference 2) Fatalism (believing in GOD) 3) littleambition 4) overdependence 5) scepticism of anything essential. 6) Strong attachment to tradition 7)guided by emotions rather than reasons 8) bound by supervision.

B ehaviour of rural consumers: 1) socio- economic environment 2) influence of cultural env. 3)Influence of geographical location 4) education/ literacy level. 5) Occupation 6) exposure to urbanlifestyle 7) exposure to media. #include model

B uying pattern of the rural consumer:

# model

There are 4 distinct types of buying behaviour based on 2 parameters- 1 ) de gr ee of buye r i nv olv eme nt 2 ) de gr ee of diffe r ence am ong bran ds: A) complex buying behaviour B) dissonancebuying behaviour C) Habitual buying behaviour D) Variety seeking Buying behaviour

Rural Marketing Strategies : 1)rural market segmentation 2)

Product planning strategies : Theodo r Lev itt poi nted out a pr oduct is not a mer e i nan i ma te physic al

thi ng. E ach p r oduct is a comb i na tio n of t ang i bl e & i nt ang i bl e f a cto r s. To a buye r the p r oduct is a compl ex gr oup of val ue s a tisf a ctio n, the tot al pa ck ag e of expect a tio ns & benefits . Pr oduct p lann i ng for r ural mar keti ng is: 1) identity strategy a) commodity strat b) branding stat 2 ) customer valuestrategies a) mass product stat b) premium product. 3)innovation strategy - a) rural urban commonb) special for rural 4) quality strategy - a) improvement strat 5) packaging strategy a) smallpackaging b) combo packaging c) see through packaging 6) brand strategy a) brand extension b)multi brand extension c) co branding strategy d) brand image strategy.



Pricing strategy - depe ndi ng on the co s busi ness o bj ecti v es an d the i nf l ue nces of i nte rnal an d exte rnal f a cto r s, mar kete r s can foll ow a par ticu lar pr ici ng st ra te gy a s a bl end of diffe r ent st ra te gies- 1) optional production pricing 2)captive production pricing 3) low point price 4)production bundlepricing 5) penetration pricing 6)value pricing 7) special event pricing

Promotional strategy for rural market: factors for selecting media in the rural market1)communication 2)cluster habit 3)leisurely life 4) impulsive and emotional habits. 5) hard instincts6)rural pride 7)seasonality.

Logistics: problems of the distribution channels: - l ogistics is the su m tot al of all a cti v ities r e la ted tothe most cost effecti v e mov ement of goods & supp l ies & the h an d l i ng of all pra ctical det a i l s of se rv icean d de l i v er y manag ement . The f a cto r s i n RM ra ise speci al difficu l ties i n r ural dist r i butio n. 1) unevendistribution of population 2) blurred market segmentation 3)bad roads 4)poor electrification 5)poorstorage 6) under developed retail facilities 7) support service is underdeveloped.

Distribution channels used in RM: 1) traditional channel: a) wholesaler b)retailer 2) new channels-a)concentration on specific large villages b) rural co operative society c)public distribution system d)

petrol pumps e)agricultural input dealers f) Haats, mandis, jatras etc. g) mobile vans h) jointdistribution.

Rural marketin1eg

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