Segment Indian RuraL Market

PRESENTEDBY

ASHVIN(15MBA1383) and Kanhiya15MBA1608

IntroductionMarketer can target a market with two broad strategies

.

Mass Market Strategy

Market Segmentation strategy

•Market Segmentation is the process of identifying small Markets that exists within a large market .

Segmentation Segmentation is the process of dividing

a heterogeneous market, into several sub-markets or segments, each of which tends to be homogeneous in all significant aspects.

HeterogenityPopulation size, socio cultural difference between regions, difference in income level, family structure.

Segmentation

Market Segment: A group of consumers who respond in a similar way to a given set of marketing efforts.

Market Segments helps distinguish one customer profile from another within a given market.

Segmentation facilitates in understanding the needs of target buyers.

Segmentation

75% of people in rural India are engaged in agriculture, but they cannot all be clubbed under one omnibus category of farmers.

There are; large farmers, medium farmers, small farmers, marginal farmers and agricultural labourers.

Their income levels, lifestyles and behaviour are different from each other.

Prerequisites for Effective Segmentation:

Measurable Accessible Differentiable Substantiable

Degrees of Segmentation: Mass Marketing

Segment Marketing Niche Marketing Micro Marketing(i)Local Marketing(ii)Individual Marketing

Mass Marketing : Most marketers used this in rural markets.All consumers being treated the same.Company could target maximum no. of consumers. First step in marketing-less market knowledge

Segment MARKETING Identifies customers as different groups

Eg1: Colgates 10Rs sache in 2000 aimed rural consumer

Eg2: LG s low cost television Sampoorna(1999) 

NICHE MARKETING Niche marketing is used when there is as small

group with specific need .Our rural market is not matured to this level

Eg: Hero Honda bikes, Nokia mobiles

MICRO MARKETING

Focus on individuals or very small groupsTo satisfy a particular taste or needEg: Dabur launched Anmol,a mustard and amla based hair oil to target rural consumers in northern markets who used loose mustard oil.50 ml pack worthRs 10.

Micromarketing is divided into Two.. i)Local marketingThis involves designing brands and promotions to suit the needs of local customers on the basis of geography and demography.

Eg:Philips promotion programme in TamilNadu Engavettu superstar.In TN Rajnikanth is the superstar.-- Castrol Using Rajani Kanth Too.

In Andra pradesh they launched the campaign maa inti megastar.

In AP Chiranjeevi is the megastar This strategy helped them to increase their television sales by 25-30%

Similarly Coca cola India Used Chiranjeevi in Thumbs Up Promotions.

Eg 2.MRF introduced nylon bullock cart tyres.They used the muscleman symbol as well as their leadership in tyres.Finally the

communication revolved around the brandname and its meaning viz.,

Pahalwan Muscleman.MRF became the leader 

INDIVIDUAL MARKETING

Individual can get the product made exactly to his need

Eg: carpentry,tailoring .

Why is segmentation useful ?

Segmentation helps firm tailor their marketing programs

focuses an actionable and accessible set of the market.

cuts of wasteful expenditures on unwanted consumers

matches needs and wants of specific groups of buyers to firm’s offerings

stimulates demands through multi-products for multi-segments

resource allocation to segment specific marketing mix activities will be made more efficient

Segmentation is a way to plan rather than explain

Bases

Geographic - Rural Urban; metropolis/city/town/village; modern retail stores/kirana stores / mandis/ haats/

Demographic – Age, Family Size (nuclear or joint ), gender,Income, Occupation, Education, SEC, religion, race,Nationality, social class

Psychographic – Use of Psychology and demographics•Lifestyle (AIO) – Nike, Benetton, * Personality – Femina – woman of substance* Values – HiDesign leather accessories – consumerswho hold the value ‘style and elegance in a classical sense’

Behavioral Segmentation – next slide

Basis of Segmentaion

GEOGRAPHIC SEGMENTATION

Geographic Segmentation

NORTHAggressive, Dominant,

Big is Beautiful

EASTSensual, Assertive

Women, Men socialistic, idealistic

SOUTHSensual, Rational,

Diligent

WESTLeisure, Simple

Life, Money is God, Democratic

http://www.facebook.com/mr.fortyseven

Commercial

Open to new product

Simplicity

Cleanliness/Hygiene

Emotionally expressive

Generous

Family centric

Culturally concious

Village Population and Density size of population-a major factor that determines the overall potential demand for a product/service.

Class I-population over 5000.Class II-population between 1000-5000Class III-population less than 1000 

Climate: Climatic conditions play an important role.Eg: talcum powder in hot and humid regions,and health tonics in winter.

Culture: Society and culture provide insights into the attitudes of people and their needs. 

Demographic Segmentation

Age & Life Cycle Family Structure Income Landownership Occupation Education and House Type Religion & Caste

Segmentation Psychographic Segmentation

Social Class Lifestyle

The slowdown experienced by India on account of the IT (information technology),real estate, financial services and automobile sectors was an urban phenomenon .

-15.6 million middle class house holds in rural India-Rural households form 72% of the total households.

The above Factors have made the Manufacturers to come to rural..

Some examples are Affordability Has changed the Life style

-Godrej introduced three brands of Cinthol, Fair Glow and Godrej (soap) in 50-gram packs, priced at Rs 5. 

Adidas and Reebok increased their sales by 50% in rural markets by reducingprices. Size and design changes 

Videocon introduced a washing machine without a drier for US$60; 

Philips launched a low-cost smoke less chulha(stove); 

DCM Shriram developed a low-cost water purifier especially for rural areas.Improving product acceptance --

LG Electronics developed a customized TV (cheap and capable of picking up low-intensity signals) for the rural markets and christened it Sampoorna. It sold 100,000 sets in the first year; 

Coca-Cola provided low-cost ice boxesas regular power outages meant families could not depend on refrigerators. 

Segmentation

Behavioural Segmentation Occasions Benefits Sought User Status Usage Rate Loyalty Place of Purchase

Segmenting the Market: Nirma vs HLL

Until about twenty ago, the rural market in India was considered a homogenous decade of the 1980s was a significant one for Hindustan Level Ltd (HLL), when the giant and undisputed market leader in detergent (Surf) in Indian Suffered significant losses at the hands of a new and small firm , Nirma Chemicals . Nirma immediately caught th fancy of the middle and lower-income customers, who were finding it difficult to make both ends meet with their limited monthly income.Nirma was the lowest –priced branded washing powder available in grocery and co-operatives stores. The middle class house wife was happy as she could choose a lower priced washing powder against Surf, Which was beyond her budget Around 1984 , HLL decided to take a fresh look at the market. Research conducted across the country revealed that different income groups of consumers had varying expectorations from detergent and washing powder. Thus, to counter the attack from Nirma, HLL launched Sunlight (Yellow), Wheel (green) and Rin (blue) detergent powders for different market segments. This strategy of segmenting the market helped HLL win back part of its lost market.

Segmentation by companies T-Series introduced audiocassettes at

unbelievably low price and took away a huge share from the market leader HMV.

Cavin Kare studied the Shampoo market and came out with Chik Shampoo priced at 50 paisa per sachet and the brand became an instant hit in rural areas.

Titan has introduced Sonata brand watches; priced between Rs 350/- and Rs.800/- to meet the requirement of price sensitive rural and semi urban consumers.

ThankYou