ISSUES AND CHALLENGES RURAL MARKETING : BY : Sandeep Singh Rathore ( 1080 ) Marketing 1
Rural marketing framework :
1. THE RURAL TO URBAN TRANSACTIONS
These mainly include agricultural products like food grains ,oilseeds, cotton ,sugarcane etc.and finished products like handlooms, textiles, earthenware, brass- ware etc by rural industries, craftsmen and artisans that find a market in the urban areas.
2. THE RURAL TO RURAL TRANSACTIONS
Here production and consumption is limited to rural areas. It includes agricultural tools,baskets,ropes, household goods, earthenware etc produced by artisans like blacksmiths ,carpenters and cobblers.
3. URBAN TO RURAL FLOW
It is the flow of manufactured traded goods namely consumables ,durables and agricultural inputs etc.
IMPORTANCE OF RURAL MARKETING
1. Urban markets are becoming increasingly complex, competitive and saturated.
2. Large size of rural markets –
742 million people (73 % of the population)
200 million households (70% of total households)
1. Agriculture revolution
Consistent good monsoons
Better procurement prices fixed for various crops.
Better yields due to many research programs (HYV seeds provided by the government)
2. New improved tax structures
3. Spread of education
4. Improved infrastructure
5. Better banking facilities
(financial assistance given by NABARD)
6. Government schemes
Contd.. 7. Increased penetration of electronic media
9. Life style changes
50 % of today’s rural income is not coming from the agriculture sector.
Up gradation from local brands to branded ones and from low priced bands to premium ones.
Increasing influence of the youth in the buying decisions.
HURDLES IN RURAL MARKETING
High distribution costs
Low per capita disposable income that is half the urban disposable income.
Large no. of daily wage earners
Dependence on the monsoons.
5. Poor roads,power problems
6. Banking and credit problems
7. High initial market development expenditure
8. Wholesaler and dealer network problems
9. Highly dispersed and thinly populated markets 10. Social and cultural backwardness of the rural masses. 11. Low level of exposure to different product categories and product brands. 12. Cultural gap between urban based marketers and rural consumers. Contd.
First and the foremost challenge
India's 6,38,365 villages are spread over 3.2 mn.sq.kms.
720 mn people-reaching them is not easy
Given the poor state of roads ,it is an even greater
Companies like H.U.L has made strong distribution Networks. To service remote villages stockiest use Rickshaws, carts and even boats in the back waters of Kerala.
With low disposable incomes, products need to be affordable to rural consumers ,most of them are on daily wages.
Some companies have addressed the affordability problem by introducing small unit packs :
GODREJ Introduced Cinthol and Fairglow in 50 gram packs priced at rs.4
coca-cola introduced Sunfill ( a powdered soft drink concentrate ) 25 gram pack priced at rs.2
N ext challenge is to gain acceptability for the
product or service.
Therefore there is a need to offer products that suit the rural markets and conditions.
coca-cola is providing low cost ice-boxes
because of the lack of electricity and refrigerators
in the rural areas.
With large parts of rural India inaccessible to conventional advertising media, building awareness is another challenge.
Companies like H.U.L uses posters, banners and Wall paintings to create awareness.
STRATEGIES FOR RURAL MARKETING
Being first on the shelf
It is very important because the brands rarely fight with each other as the retailers generally stock a single brand in a product category.
Different means of advertising
A. H aats and melas
A survey by MART (marketing and research
team revealed that 47000 haats and 25000
melas take place every year in India.
B. Performance arts including theatres,songs,dance puppetry, magic shows etc.
Large visitor turnaround.
These melas are held during post harvest season,
when the purchasing power of the people is more.
The companies provide touch and feel demonstrations and distributed free samples.
This company first come out with the concept of sachets and it revolutionize the whole market, making the Chic shampoo the 2 nd largest selling shampoo in India
What followed was the flood of products in small packing ranging from toothpaste, facecreams, soaps, hairoil etc.
This company introduced the innovative technique of using video vans for marketing Nirma products .
Reach to interior parts
Offer opportunity for personal interaction .
Similar strategies helped Ghadi to become the 3 rd largest selling detergent.
The company introduced its igo range of t.v’s
priced cheaply at rs.5000 for 14 inches particularly to cater to the backward states like Bihar, and Uttar Pradesh.
Looking at the challenges and the opportunities which rural markets offer to the marketers ,it can be said that the future is very promising for those who can understand the dynamics of rural markets and exploit them to their best advantage.