Rural Marketing

Rural Marketing Introduction

Definition and Scope of Rural IndiaLet us take at some of the points with respect to Rural India as per CensusPopulation density of less than 400 per sq.km.At least 75% of the male working population is engaged in agriculture.No municipality or board.If we go by statistics, roughly around 70% of the Indian population lives in the rural areas. That is almost 12 % of the world population. To expand the market by tapping the countryside, more and more MNCs are foraying into Indias rural market.

Average MPCE (Rs.)NSS RoundMPCEURP

MPCEMRP

MPCEMMRP

RuralUrbanRuralUrbanRuralUrban66th(2009-10)

927.701785.81953.051856.011053.041984.4668th(2011-12)

1278.942399.241287.172477.021429.962629.65

Proliferation of large format Rural Retail Stores, which have been successful also -DSCL Haryali StoresM & M Shubh Labh StoresTATA / Rallis Kisan KendrasEscorts Rural StoresWarnabazaar, Maharashtra (Annual Sale Rs. 40 crore

ExamplesBelow are the few points why organizations are looking at rural marketing with a positive attitudePopulationRising rural prosperityGrowth in consumptionChange in life style and demandMarket growth rate higher than urbanLife cycle advantageDecision making unitsRural Mktg 2nd video.mp4Contd.According to the National Commission on Agriculture: Rural Marketing is a process which starts with a decision to produce a saleable farm commodity and it involves all the aspects of market structure and system, both functional and institutional based on technical and economic considerations and includes pre and post harvest operations, assembling, grading, storage, transportation and distribution. Definition of Corporate Rural MarketingRural Marketing can be defined as a function that manages all activities involved in assessing, stimulating, and converting the purchasing power of rural consumers into an effective demand for specific products and services and moving these products and services to the people in rural areas to create satisfaction and a better standard of living and thereby achieving organizational goals.

Definition of Rural MarketingThe 4 A's of Rural Marketing

AffordabilityAvailabilityAwarenessAcceptability

Rural vs. Urban MarketsURBAN MARKETMostly concentratedHigh infrastructural levelHigh density of population per sq kmGood physical connectivity and high mobilityIncomes are more stable and permanentOccupations are government employment, business, industry etc.Income received at regular interval.

RURAL MARKETWidely spread and scatteredLow infrastructural levelLow density of population per sq kmPoor physical connectivity and low mobilityPeople work in less certain environmentMostly agricultural occupationAcute seasonality in income receiptsContd.Large number of interactions with persons and less frequent between same personsSocial norms are less visible

Caste influence indirect and less visibleHigh exposure to variety of productsHigh brand awarenessHigh exposure to marketing researchers and multiple source of informationMore convenient buying, more retail outlet per 1000 population

Less number of interactions with persons and more frequent between same personsSocial norms influencing individualsCaste influence direct and strongLow exposure to variety of productsLow brand awarenessLow exposure to marketing researchers and limited source of informationLess convenient buying, less retail outlet per 1000 population

Area of coverage--Local Market--Tehsil level Markets--Regional level Markets--National level MarketLocation--Village Market, Primary Market, Wholesale Market, Terminal MarketVolumes of Trade--Retail Markets, Wholesale MarketsTime Span --Short Period Market, Long Period Market, Permanent Markets

Classification of Rural MarketsNumber of Commodities--General Market, Specialized MarketType of Transactions--Spot or Cash Markets, Forward MarketsDegree of Competition--Perfect Markets, Imperfect MarketsNature of Commodities--Commodity Markets, Capital MarketsGovernment Intervention--Regulated Markets, Unregulated MarketsContd.200 million rural mobile users, more than the total number of subscribers in Brazil14 million DTH connections in rural areas, out of a total 20 million87 million Kisan Credit Cards issued, which exceeds the total number of (credit+debit) cards in urban areasRural India is growing faster that Urban India --- Durablers (25% vs 10% urban growth in2009), FMCGs (18% vs 12% urban growth in2009)11% car sales coming from rural areas and small townsThere are 42,000 rural supermarkets (haats) in India, which exceed the total number of retail chain stores in the United States (35,000) --Rural Marketing by P. KashyapSome Startling Facts