Rural Branding Presented by Sunilkumar D. Hiremath
WHAT DO YOU MEAN BY RURAL According to the census of India, villages with clear surveyed boundaries not having a municipality, corporation or board, with density of population not more than 400sq.km and at least 75 per cent ofthe male working population engaged in agriculture and allied activities would qualify as rural. So, from the above stated conditions, thereare 638,000 villages in the country.Of these, only 0.5 cent has a population above 10,000 and 2 per cent have population between 5,000 and 10,000. Around 50 per cent has a population less than 200.
RURAL MARKETING Rural marketing determines the carrying out of business activities bringing in the flow of goods from urban sectors to the rural regions of the country as well as the marketing of various products manufactured by the non-agricultural workers from rural to urban areas.
What is brand? A brand is “name, term, sign, symbol, or design, or a combination of them, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competition.” Importance of Brands to Consumers Identification of the source of the product Assignment of responsibility to product maker Risk reducer Search cost reducer Promise, bond, or pact with product maker Symbolic device Signal of quality
Why Branding Separate your brand from your competitors in a unique way Relevant and motivating to your customers Prospects and channels-it gives you value and make you special. Enhance your perceived value, there by supporting premium pricing, sheltering you from low price competition. Contributing to share holder value. (Companies like Morgan Stanley look to evidence of brand strength in setting buy ratings.) Provide resilience in times of negative press. Enable you to launch new products more quickly and cost effectively.
Rural Branding In rural India, the branding rules are distinctly different from urban markets. Not only does the cultural landscape differ, the factors that influence purchasing decisions differ too. Price and value for money are high on their list. Rural branding calls for a greater component of local media and less of the mass media. Since these markets have specialized forums of their own like temple festivals, melas, cinema halls, these can be leveraged to promote brands. Direct Marketing and events like road shows, film shows, melas, and street theatre can also be used to promote brands.
Features of Indian Rural Markets Large and Scattered market Major income from agriculture Low standard of living Traditional Outlook Diverse socio-economic backwardness Infrastructure Facilities
Why Rural Market? The Indian rural market has a huge demand base and offers great opportunities to marketers. Two-thirds of Indian consumers live in rural areas and almost half of the national income is generated here. The reasons for heading into the rural areas are fairly clear. The rural market is zooming ahead at around 25 per cent annually. "The rural market is growing faster than urban India now," says VenugopalDhoot, chairman of the Rs 989 -crore (Rs billion) Videocon Appliances. "The urban market is a replacement and up gradation market today," adds Samsung's director, marketing, RavinderZutshi.
The major problems faced Underdeveloped People and Underdeveloped Markets Lack of Proper Physical Communication Facilities Media for Rural Communication Many Languages and Dialects Dispersed Market Low Per Capita Income Low Levels of Literacy Prevalence of spurious brands and seasonal demand Different way of thinking
Regional Brands have good image Cable channels and their network Understanding Lower cost One to one relationship Entrepreneurship
Low Penetration rates in rural markets facilitates opportunities
Four A’s: Availability LG Electronics defines all cities and towns other than the seven metros cities as rural and semi-urban market. To tap these unexplored country markets, LG has set up 45 area offices and 59 rural/remote area offices. To service remote village, stockists use auto-rickshaws, bullock-carts and even boats in the backwaters of Kerela. HLL started Project Shakti in partnership with Self Help groups of rural women.
Affordability Godrej introduced three brands of Cinthol, Fair Glow and Godrej in 50-gm packs, priced at Rs 4-5 meant specifically for Madhya Pradesh, Bihar and Uttar Pradesh – the so-called `Bimaru’ States Hindustan Lever, among the first MNCs to realise the potential of India’s rural market, has launched a variant of its largest selling soap brand, Lifebuoy at Rs 2 for 50 gm Coca-Cola has addressed the affordability issue by introducing the returnable 200-ml glass bottle priced at Rs 5
Acceptability LG Electronics developed a customized TV for the rural market and named it Sampoorna. It was a runway hit selling 100,000 sets in the very first year. Coca-Cola provides low-cost ice-boxes – a tin box for new outlets and thermocol box for seasonal outlets. The customers of Godrej Agrovet product (Ruchira, Bypro) started purchasing the product of Handrix company as the pallets smells like ‘butter of goat’ which makes them familiar to the Handrix company product.
Awareness For generating awareness, events like fairs and festivals, Haats, etc., are used as occasions for brand communication. Cinema vans, shop-fronts, walls and wells are other media vehicles that have been utilized to increase brand and pack visibility. Lux and Lifebuoy and fabric wash items like Rin and Wheel started putting stickers on the hand pumps, walls of the wells, putting on tin plates on all the tree, surrounding the pond which act as the innovative media. HUL used local fairs and festivals Coca-Cola used Doordarshan TV LG Electronics uses vans and road shows to reach rural customers Philips India uses wall writing and radio advertising to drive its growth in rural areas.
Interesting examples of success and failure in rural market Henko failed in Maharashtra. Why? It sound like "Hey Nako" which means No, giving the brand a negative connotation in Marathi. Dabur's health tooth powder containing Tulsi failed. Why? Tooth powder meant spitting the Tulsi out which was considered sacrilege in the rural areas. Although black is not a lively color and has a lot of negative connotation to it, it worked for "Chik" shampoo. How? Perception that if the shampoo is black then the hair would be pitch black too. Dabur traditionally paints the walls of the roads leading to the temples and mosques in the villages. Why? The crowd aggregates during all the major festivals, and the huge traffic to enter the temple and mosque provides the marketer the ideal opportunity to tap into his mind space making use of the wall space available. Dabur did just that
Conclusion Indian rural market is undoubtedly complex but there are some simple truths that we need to accept. The rural consumers are very value-conscious. They may or may not have purchasing power, but they can make a difference to the company's growth if concentrated. The growing power of the rural consumer is an opportunity for the companies to flock to the rural markets. The basic underline for preference for brands in rural areas is the functional and not psychological benefit. With the technological innovations, infrastructure development and enrichment of human capital in rural areas the companies can earn huge profits.