INNOVATIONS IN RURAL MARKETING

Rural Marketing Definition

Function that manages all activities involved in assessing, stimulating and converting the purchasing power of rural consumers into effective demand for specific products and services to create satisfaction & a better standard of living for achieving organizational goals.

Features of Indian Rural Markets

• Large and Scattered market

• Major income from agriculture

• Low standard of living• Traditional Outlook• Infrastructure Facilities

SIGNIFICANCE OF RURAL MARKETS

1. Large Population

2. Higher Purchasing Capacity

3. Market Growth

4. Development of Infrastructure

5. Insulated from the global

economic slowdown (RMAI)

Some of the facts that will highlight the potentiality of rural market are: - According to a study by the Chennai-based Francis Kanoi Marketing

Planning Services, estimated annual size of market is – In 2001-02 -

     * LIC sold 55% of its policies in rural India.     * 50% of BSNL mobile connections sold were in small towns / villages.     * 41 million Kisan Credit Cards issued were in rural areas (as against 22 million Credit Plus Debit Card in urban).  

   FMCG Rs. 65,000 Crore   

   Consumer Durables Rs. 5000 Crore   

   Agri Inputs (e.g., Tractors) Rs. 45,000 Crore   

   2/4 Wheelers Rs. 8,000 crore   

   Total Rs. 1,23,000 Crore   

WHAT IS INNOVATION?

Innovation may be defined as exploiting new ideas leading to the creation of a new product, process or service.

Another way of putting this is that an innovation lowers the costs and/or increases the benefits of a task. A wildly successful innovation increases the benefits-to-costs ratio

“A marketing innovation is the implementation of a new marketing method involving significant changes in product design or Packaging, product placement, product promotion or pricing.”

Innovative marketing of products is about leveraging the marketing mix, namely, the four P’s: Product (Design and Packaging), Price, Place and Promotion in ways that has not been before by the organisation implementing the innovations.

MARKETING INNOVATIONS

MARKETING INNOVATIONS

• FMCGs have come up with creams and soaps @ Rs 5, hair oil and shampoo sachets @ Re 1 and small Coke @ Rs 5. To develop a product to suit the rural scenario,

• Companies came up with special rural products, like Chic Shampoo sachets @ Re 1, Parle-G Tikki Packs @ Rs 2, customised TVs by LG, Shanti Amla oil by Marico. All these brought positive results for them.

CHALLENGES IN RURAL MARKETING

Low literacy rate Resistance to change Seasonal demand Lack of infrastructure facilities & proper warehousing

facility Threat of spurious products. Communication problems. Problems related to distribution

and channel management.

Rural Marketing Mix

• Rural Marketing Mix refers to the set of actions, tactics, tools or variables that a company uses to promote and sell its brand or product in a Rural markets

The 4Ps of Rural MarketingPRODUCT:

1. Small unit size and low priced.

2. New product designs- sturdy products

3. Brand name.

4. Avoid sophisticated packing – Refill packs,

Reusable packaging

Factors to be considered while designing the product: Specific requirements of Rural consumers. Habits of usage and purchase Income levels Customs, beliefs and taboos.

The 4Ps of Rural Marketing

PRICE:

1. Low priced products

2. Application of value engineering (milk-soya protein)

3. Small sized utility packs

The 4Ps of Rural Marketing

PLACE:

• Segmentation

• Coverage of villages with 2,000 and above population

• Direct Contact with rural Retail

The 4Ps of Rural Marketing PROMOTION: • Television

• Radio• Haats, Melas,

Fairs.• Print media• Cinema• Hoarding/ Wall

Painting • Rural van

Examples of Innovations in Rural Marketing Mix

• ICICI BANK customized their rural ATMs, so they can operate biometric authentication. ICICI rural ATMS are battery operated so that power failure is not issue.

• Nokia develop affordable Mobile phones for rural markets with unique features such as local language capabilities, present time/ call limits.

• Philips develop a TV ‘ Vardaan’ for rural markets. This TV work on the voltage 90-270 volts.

• Philips developed ‘ Free Power radio’ this radio do not require power and battery also. it run on simple winding of level provided in the set. The price of this attractive set is Rs. 995.

Examples of Innovations in Rural Marketing Mix

Learning experience Companies are finding Rural Markets increasingly attractive.

Rural population is gradually getting urbanized and has a great potential and improving purchasing power.

The 4 As- Acceptability, Affordability, Availability,

Awareness has to be effectively adopted in order

To capture the untapped potential of the rural

consumers.

With the initiation of various rural development

programs there have been an upsurge of employment

opportunities for the rural poor.

Learning experience

Rural markets are delicately powerful. Certain adaptations are required to cater to the rural masses; they have unique expectation and warrant changes in all four parameters of product, price, promotion and distribution.

Continuous customization seems a sure shot approach to provide both short and long-term returns in the rural markets.

CONCLUSION

• The rural market in India is vast and scattered and offers a plenty of opportunities in comparison to the urban sector.

• Improvement in infrastructure and reach promise a bright future for those intending to go rural.

• Rural market is not exploited Completely and is

yet to be explored.

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