Mkt mgt rural-ppt


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Mkt mgt rural-ppt

  1. 1.  Rural India is potentially the largest segment of the Indian market. Executives have long recognized that to build real sales volumes they will have to reach outside the big cities. Case highlights the emerging trends in rural market Case is also about the initiatives taken by companies Like HUL and ITC to target Rural segment › Project Shakti and E-Choupal have been making inroads into rural India for years
  2. 2.  According to MART › Rural India buys 46% of all soft drinks sold, 49% of motorcycles, 59% of cigarettes and 11% of rural women use lipstick. According to NCAER › Rural households form 71.7% of the total households in the country. › Spending in this segment is growing rapidly and consumption patterns are closing in on those of urban India.
  3. 3.  Companies such as Unilever, Phillips and Nestle have long been known to Indias rustic dukaandaars, or merchants. Rural marketing involves persuading people to try and adopt products they may not have used before › Colgate has to build toothpaste by convincing › Coca-Cola is growing at 37% in rural markets, compared with 24% in urban areas. In rural India low penetration rates can be attributed to three major factors › Low income levels › inadequate infrastructure facilities › different lifestyles.
  4. 4.  The objectives of Project Shakti › To create income-generating capabilities for under privileged rural women by providing a small-scale enterprise opportunity, and to improve rural living standards with greater awareness of health and hygiene In 2001, with rural self-help groups (SHGs) started to educate rural women, while also making them part of the companys marketing network This micro-enterprise offers low risks and high returns Direct-to-home distributors A typical Shakti distributor sells products worth Rs 10,000- 15,000 a month & earn Rs 700-1,000
  5. 5.  The Shakti model was piloted in 50 villages of the Nalgonda district in Andhra Pradesh. › Now it has created 26,000 women distributors covering 80,000 villages. › By 2010, the goal is to recruit 100,000 Shakti distributors covering 500,000 of Indias more than 600,000 villages › Shakti project includes Shakti Vani (or voice), a social awareness program, and iShakti, a community portal
  6. 6.  Increase in income Education to children Social Recognition to rural women Knowledge about health and Hygiene Knowledge of urban areas Enhancement of purchasing power ICICI partnership gave micro credit
  7. 7.  ITCs enhanced distribution network came from the recognition that the existing agri-produce distribution channels › The company exports various agricultural products -- soybean, rice and wheat › In 2000, ITC embarked on an initiative to deploy technology to reengineer the procurement of soybeans from rural India E Choupal’s connectivity - both physical and informational -- between the farmer and the market that it facilitated has allowed ITC to use it for distribution of goods and services from the market to the farmer
  8. 8.  The E Choupal infrastructure consists of: › A kiosk with Internet access in the house of a trained farmer, called a Sanchalak › A warehousing hub managed by the former middleman, called a Samyojak. › A collaborative network of companies orchestrated by ITC with a pan- India presence In 2004, ITC introduced the Choupal Sagar › A rural retail outlet at the hub. › First was set up at Sehore in Madhya Pradesh. › This is 7,000 sq. ft. mall sells consumer goods as well as agri-products
  9. 9.  Better content of information Transport Cost Knowledge to access technology Weighing Accuracy Transaction Durations
  10. 10.  Indian rural market is huge just to strengthen the distribution Reliance Infocomm, a mobile services provider. Its network now encompasses 240,000 towns and villages, accounting for 42% of the rural population Godrej Aadhaar -- plans to set up 1,000 stores across India in the next five years.
  11. 11.  Success of HUL & ITC depicts many other MNC widen their base in rural markets. From the Goenkas to the Gulabchands, from the Tatas to the Thapars, every major Indian business group has plans to move into the hinterland The battle for rural wallets will include not just European and U.S. multinationals but also fast- growing Indian companies.
  12. 12.  According to Raju, marketing to rural customers often involves building categories by persuading them to try and adopt products they may not have used before. "A company like Colgate has to build toothpaste as a category, which means convincing people to change to toothpaste instead of using neem twigs to clean their teeth, which was the traditional practice," he says. "This is difficult to do and requires patience and investment
  13. 13.  Companies that have figured this out are doing better in the villages than in the cities. Soft drinks giant Coca-Cola is growing at 37% in rural markets, compared with 24% in urban areas. According to Hansa Research, a market research firm that has published a Guide to Indian Markets 2006, the penetration of consumer durables has risen sharply in Indias villages between