ISSN 0975 – 5942Brand Awareness in Rural Area – a Case Study of Fast Moving Consumer Goods in Chittoor District of Andhra Pradesh B. Amarnatha and Vijayudub a Associate Professor, Department of Management Studies, Sri Venkateswara University, Tirupati-517502, AP, India b Research Scholar, Department of Management Studies, Sri Venkateswara University, Tirupati-517502, AP, India Corresponding author: email@example.com Abstract The purpose of this study is to examine the brand awarenessin rural area and to study the interest of consumers in brandedproducts of Fast Moving Consumer Goods (FMCG). The brandawareness is showing increasing tendency everywhere and Chittoordistrict is not an exception to it. To examine the validity of thisgeneral statement that is being discussed day in and day out by theresearcher, market managers, producers, consumers, advertisers,etc., a case study of brand awareness in rural area of Fast MovingConsumer Goods in Chittoor district of Andhra Pradesh is taken up.Keywords: Brand Awareness, Rural Area, Consumer Goods
231Introduction ‘The Fast Moving Consumer Goods (FMCG) sector is acorner stone of the Indian economy. This sector touches every aspectof human life. The FMCG producers have realized that there is ampleopportunity for them to enter into the rural market.’1 Today we noticethis shift towards branded FMCGs in rural areas as a result of SocioEconomic & Political changes in the last 5 years. This has made ruralareas more viable markets even compared to urban areas. The Socio Economic and Political changes contributed to agreat extent for changes in the life styles of countryside people whopatronized branded FMCG products. In Andhra Pradesh the rapidgrowth of Engineering & Degree colleges and rural Polytechniccolleges are bringing education to the doorsteps of rural people,greatly contributing to a shift towards branded FMCG products. TheGovernment policies to promote education in rural areas enhancedtheir brand awareness due to the presence of at least one highereducation pursuing student in their family or neighbouring family. The populist schemes introduced by A.P. state Governmentlike Loans to Dwakra women at concession interest rate of 25 paiseand 100 days assured work in a year for rural people contributed inenhancing people’s income followed by a change in their lifestylesresulted in patronizing the branded products. The residential pattern in Andhra Pradesh has witnessed anear metamorphosis in last 5 years due to the construction ofreinforced concrete houses, in place of thatched (huts) or housesconstructed with country material. The moment they started living inPacca (permanent) houses with amenities like kitchen and bedrooms,their lifestyle has changed. And this has paved way for brandedproducts invading in the rural areas. The introduction of sachets made rural people who aretraditionally not accustomed for bulk purchase, to buy brandedFMCG products like Rs1/- shampoo, nut powders, oils, beverages,readily available in the ready availability of instant foods, beverages,cosmetic products, edible oils, bath soaps, detergents, cleaningpowders & liquids, tooth pastes, etc. in rural shops. This changed thepattern of buying from traditional products to branded products.
232 ‘According to the National Council of Applied EconomicResearch (NCAER), with about 74 per cent of population living invillages, India has perhaps the largest potential rural market in theworld. It has as many as 47,000 haats (congregation markets),compared to 35,000 supermarkets in the US. And of the total FMCGsdemand in India, nearly 53 per cent comes from the rural market.’2The Educative, Effective, Informative and Repetitiveadvertisements through electronic media can increase thepotential customers for such products The advertisements are telecasting especially during the dailyserials, competitive programs like Songs Competition amongchildren, Anthyaksharies, Women programs like Bhagyashree,Ranulu Maharanulu, Maa Inti Vanta, etc. being watched byhousewives and such advertisements will definitely influence thissection of people who in turn will influence their better halves andmake them to buy a particular brand Product justifying the reason forgoing in for such branded product bringing in the salient features inthat particular advertisement quoting the names of brands by reputedand well known personalities. At present the same products in different brands are availableand this makes people to know about different brands. This definitelycreates brand awareness among the people and provides differentalternatives for a single product. This is the situation where theadvertisements place a decisive role in shifting the opinion of peoplein favour of a particular brand.Brand Awareness and Rural Consumer‘Brand awareness refers to a consumer knowing of a brandsexistence; at aggregate (brand) level it refers to the proportion ofconsumers who know of the brand.’3 ‘Extent to which a brand is recognized by potentialcustomers, and is correctly associated with a particular product,Expressed usually as a percentage of target market, brand awarenessis the primary goal of advertising in the early months or years of aproducts introduction.’4Fast Moving Consumer Goods (FMCG), are products that are soldquickly at relatively low cost. Though the absolute profit made on
233FMCG products is relatively small, they generally sell in largequantities, so the cumulative profit on such products can be large.Examples of FMCG generally include a wide range of frequentlypurchased consumer products such as toiletries, soap, cosmetics,teeth cleaning products, shaving products and detergents.’5‘Nondurable goods or soft goods are the opposite of durable goods.They may be defined either as goods that are used up when usedonce, or that have a lifespan of less than 3 years. Examples ofnondurable goods include cosmetics, food, cleaning products, fuel,office supplies, packaging and containers, paper and paper products,personal products, rubber, plastics, textiles, clothing and footwear.’6Health & Beauty ‘Exporters India contains a large list of categorieslike: ayurvedic products, beauty equipments, dental equipments,health equipments, herbal products, medical equipments, surgicalinstruments etc. under the main category Health & Beauty. Thehealth and beauty market is a segment displaying high growth.According to the report, sales of goods used as part of health andbeauty regimes (HBRs) substantially outperformed the level ofgrowth seen in the markets in which they were found - includingskincare, hair care and nutraceuticals.’7Indian FMCG Sector Growth Drivers Category Trends 2008 –09 ‘The fourth largest sector in the Indian economy is all set for 16%growth during 2008-09, from a base of Rs. 85470 crores, as predictedby FICCI. Going forward, as anticipated by CRISIL, FMCG sectorwill touch around Rs. 140000 crores by 2015.’8Rural FMCG Sales: The growth engine ‘Rural India clocked19.1% growth for hair oils in April-September against 11.4% inurban markets by volume. Similarly, among toothpaste, the all-Indiarural volume growth was a healthy 17% compared with just 6% inall-India urban markets. The gap in growth rates was even wideramong candies. In the April-September period, rural marketsregistered 26.5% growth against a minuscule 3.6% growth in urbanIndia. It was the same story with value growth.’9Industry watchers say the increased consumption is also the result ofa growing middle class base in these markets. The total number of
234rural household is expected to rise to 153 million in 2009-10 from135 million in 2001-02, suggesting a huge market.Objectives of the study To assess the impact of electronic media in popularizing branded products in rural areas To know the reasons for preferring branded products in rural areasScope and Need for the Study FMCG products are substantially used to enhance and protectthe health and physical appearance and also the dignity of the peopleamong their counterparts. The spending on FMCG productsespecially in the rural areas is showing an increasing tendency in thelast 5 years. This is due to increase in income levels, fascinationtowards urban culture, good connectivity to near by towns & cities,improvement in sanitary conditions, beauty awareness amongteenagers of rural areas emulating their counterparts in the urbanareas led to the increased usage of FMCG products particularlybeauty & health care products in this region. With this backdrop thebrand awareness in rural areas with reference to FMCG products isthought of. The study is confined only to Madanapalle Revenue Divisionregion. It is believed that the findings in this region are fairlyrepresentative of the other parts of the district. Since the lifestyle andother parameters are not much different from what exist in the area ofsurvey.Methodology Chittoor District is basically a rural oriented district about 72percentage of population living in villages. The district comprises ofthree Revenue Divisions namely 1) Chittoor Revenue Division(CRD), 2) Tirupati Revenue Division (TRD) and 3) MadanapalliRevenue Division (MRD). Out of these three revenue divisions,MRD is selected for the purpose of conducting survey to study theBrand Awareness among rural people since MRD contains morebackward villages and clusters compared to the other two revenuedivisions. Due to paucity of time and financial constraints 10 villagesare chosen for survey adapting purposive sampling technique. In all240 respondents are chosen from different age groups classifying
235them on the basis of literacy with the help of structured &unstructured interviews & discussions with these respondents theinformation for this survey is gathered. In all the villages chosen forsurvey four categories of FMCGs namely,Health and Beauty care products, subdivided into (1) Bath Products (a) Bath soaps (2) Hair Care Products (a) Hair Shampoos (b) Hair Oils (3) Oral Care Products (a) Tooth Paste (b) Tooth Brush (4) Essential Oils (a) Edible OilsSampling TechniquePurposive sampling technique is adapted to collect primary data. Theconsumers are divided into two categories on the basis of Literacyand Age, namely Literates and Illiterates, and persons below the ageof 30 years and 30 years & above.Data Analysis and FindingsNull Hypothesis 1: There would be no significant differencebetween Low & Middle Income groups and Above Middle & HighIncome Level Groups to have a Brand Awareness.Z- Test 1: Significant test on brand awareness between Low &Middle Income groups and Above Middle & High Income groups Standard Income Groups Tests Mean T test Deviation Low & Mid 65 1.7 0.46 Above Mid & High income 55 4.58Finding: 1 The survey data reveals that the income effect is almost nil onaware of FMCG products. All income groups namely Higher, AboveMid, Middle and Lower income groups have not shown anysignificant difference on aware of these products. If not words theyhave symbols to express about a particular product brand. Package isplaying a vital role in choosing and recalling and to find a product bya customer.
236Null Hypothesis 2: There would be no significant differencebetween below the age of 30 years and 30 years & above to have aBrand Awareness.Z- Test 2: Significant test on brand awareness between below theage of 30 years and 30 years & above Standard Age Groups Tests Mean T test Deviation below the age of 30 68.9 9.297 4.386 30 years & above 60.5 9.848Finding: 2 The survey data reveals that the age effect is high on aware ofFMCG products. Below 30 years age group is showing a significantdifference on aware of these products. Most of them being educatorsand having trust on branded products influenced to shift towardsbranded products. And it is also influencing the 30 years & aboveage group.Null Hypothesis 3: There would be no significant differencebetween below the age of 30 years and 30 years & above to have aPreference for a Branded Product.Z- Test 3: Significant test on Preference for branded productbetween below the age of 30 years and 30 years & above Standard Age Groups Tests Mean T test Deviation below the age of 30 38.9 7.5 3.029 30 years & above 36 5.95Finding: 3 The survey data reveals that the age effect is high onpreference for a branded product. Below 30 years age group isshowing a significant difference on branded products. Readilyavailability of a branded product in expected form and price ismaking this segment to shift to branded products.
237Fig: 1 Histogram showing relationship between income groups and preference for branded product Low Income Mid Income Above Mid Income High Income 19 respondents Number of 20 15 12 13 7 8 8 9 10 4 5 6 4 5 1 0 0 2 0 2 0 0 0 0 No Brand Cheap / Augmented Specific Brand Premium Brand Regional Brand Brand Different Income groups with their selective brandFinding: 4 Through Histogram (1) we can see that most of therespondents are moving towards augmented brand (which is above toexpectation of a customer and satisfying a common customer). And itis proving that all levels of income group people are concentrating onone above to expected product for the same price. (Vide to Fig: 1)Fig: 1 Different Income Level Groups and their dependance on to have a Brand Awareness and Brand Usage T.V. Friends Educated Children Shopkeeper 20 18 Respondents Numerof 15 13 12 10 9 6 7 5 5 5 5 4 2 3 2 0 0 Low Income Mid Income Above Mid Income High Income Different Income Level GroupsFinding: 5 The survey data reveals that the countryside consumers ofFMCG products were influenced by advertisements in Television,
238influenced by friends and relatives particularly their children gettingeducation in near by Engineering and Degree colleges. As alreadystated in this paper the influence of own children getting education inrural based colleges has changed the consumption pattern of ruralfolk. (Vide Fig:2) However, the influence of local shopkeepers on these FMCGconsumers is also quite noticeable since the local shopkeepersinvariably happen to be friends and relatives of end consumers whomthe shopkeepers can very easily educate and influence to use aparticular brand. The shift from one brand to the other is evident with a changein income level. For example; it is noticed that people using popularbrands of soaps which are moderately priced like Hamam & Luxshifted to premier brand like Dove. Even though there is noticeablechange in its price just to show that they are using such soaps as astatus symbol rather than a necessity. Illiterate people who are in the age group of 30 & above arealso changing over to branded products on the advice of friends andrelatives or educated children in the house in preference to traditionalproducts. The time taken for preparation for traditional products, theavailability of branded products with the same ingredients at acomparatively cheaper prices, influenced people to shift towardsbranded products. Further these branded products are tested clinicallyand found to be not harmful to health, motivated people to shift theirconsumption pattern from the traditional products to brandedproducts. The promotional activities undertaken on a massive scale bythe producers of FMCG products like soaps, detergents, shampoos,oils influenced the people to a great extent in buying these products.For example: Vivel soaps advertisement showing as 125 gramsinstead of 100gms for the same price.Conclusions & Suggestions The brand awareness in rural areas particularly in respect ofbeauty care and health care products is showing an increasingtendency. (85% of the people in the age group of below 40 years both
239from illiterate & literate groups prefer branded products with thebelief that quality is assured as the manufacturers are reputedcompanies. For Ex: Colgate Tooth Paste, Head & Shouldershampoo). People are not worried about the price of the product. Theyare showing willingness to spend higher price when they realize thatthey can afford to spend. Since the usage of branded products ofreputed companies will elevate their status as well as stature in thatvillage. This change in the attitude to spend more on the highly pricedbranded products (Example: Dove Soap, Gorniour Hair Oil) amonghigh income groups in rural areas clearly suggests that there is aample scope for such products to capture the markets in this areas byincreasing the supply of these products. The marketing agencies are advised to conduct healthawareness programs by educating the people about the need to usethe health care products to arrest tooth decay, hair fall, dry skin, etc.These products can be made more popular and acceptable among therural people.
240References 1. John Mano Raj S (2007), Social Changes and the Growth of Indian Rural Market: An Invitation To FMCG, International Marketing Conference on Marketing & Society, 8-10 April, 2007, IIMK, pp 01- 08. 2. http://www.prpundit.com/knowledge/workshop8pdf/Rural%2 0PR.pdf 3. D.Aaker and E.Joachimstahler, 2000, Brand leadership, Chapter 2, The Brand Identity – the cornerstone of brand strategy, Free Press, pp 62 – 64. 4. Jean noel kapferer, 1992, Strategic Brand Management, Free Press, pp 31 -54 5. Moorthi Y.L.R., September 2004 , Branding Principles – Application to b2b branding, Journal of Business-to-Business Marketing, Volume 11, Issue 3 pp 79 - 102 6. Moorthi Y.L.R., 2002, “An approach to branding services”, Journal of services Marketing, Vol 16, No. 3, pp 259-274, 7. http://health-beauty.exportersindia.com/. 8. FICCI and technopark, 2009, FMCG sector the road ahead, Market Report, 9. http://fmcgmarketers.blogspot.com/2008/07/fmcg-growth- drivers-and-category-trends.html