This document outlines a module on rural marketing presented by Jitendra Patel. It discusses key topics such as the evolution of rural marketing, rural consumer profiles, myths around rural marketing, and challenges. It also examines factors influencing rural buying behavior like socio-cultural, technological, economic, and political factors. Finally, it addresses issues like product availability, affordability, and acceptability in rural markets and strategies that companies have used to address these issues through customized and affordable products, innovative distribution models, and local awareness campaigns.

1. Rural Marketing
Prepared by
Jitendra Patel
Assistant Professor, Prestige
Institute of Management and
Research, Indore.

2. Module Description
1. Rural Marketing Overview
2. Rural Share In Stocks Of Consumer Demand
3. Evolution of Rural Marketing
4. Rural Consumer Profile
5. Myth of Rural Marketing
6. Rural Market Attraction
7. Challenges and Constraint Of Rural Marketing
8. 4 A’s of Rural Marketing
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Jitendra Patel, Assistant Professor, PIMR,
Indore
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3. Module Description
9. Buying Model for Rural Customer
10. Factor Affecting Rural Buying Behavior
11. Socio Cultural Factors
12. Technological Factors
13. Economical Factors
14. Political Factors
15. Buyer Characteristics
15.1 Age and lifestyle
15.2 Occupation
15.3 Economic situation
15.4 Personality and Self Concept
15.5 Psychological factors
16. Degree of Buyer Involvement
17. Duplicate and look alike Product
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Indore
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4. The NSSO data showed that while the growth in spending
on goods and services by rural India was 19% during
the two-year period, i.e. 2011-2012 it was 17% for the
urban areas In terms of money, people in rural areas
spent Rs 3.75 lakh crore more during these two years,
significantly higher than the additional Rs 2.99 lakh
crore spent by urban India, a report by Crisil, based on
the data from the National Sample Survey Organization
(NSSO), the rate of growth of consumption in rural
India has outpaced the urban increase in the two-year
period since 2009-10. (Bharat trumps India in
spending, Times of India Bhopal, pg01, 30august2012).
Rural Marketing
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Indore

5. RURAL SHARE IN STOCKS OF CONSUMER DEMAND
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Indore

6. PHASE ORIGIN FUNCTION MAJOR
PRODUCTS
SOURCE
MARKETS
DESTINATION
MARKET
I Before Mid 1960s
(from
independence to
green revolution)
Agricultural
Marketing
Agricultural
Products
Rural Urban
II Mid- Sixties
(Green Revolution
to Pre
Liberalization
Period)
Marketing of
Agricultural
Inputs
Agricultural
Inputs
Urban Rural
III Mid- Nineties
(Post
Liberalization
Period on 20th
Century)
Rural Marketing Consumables
and Durables for
consumptions
and Production
Urban and Rural Rural
IV 21st Century Developmental
Marketing
All Product and
Services
Urban and Rural Urban and Rural
Evolution of Rural Marketing
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Indore

7. Rural Consumer Profile
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Indore

8. • 1. Rural Marketing is Similar to urban
marketing
• 2. Rural Economy is predominately an agrarian
Economy
• 3.Myth related to bottom of pyramid
• 4. The real growth drivers are not what
everyone think
Myth of Rural Marketing
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Indore

9. Rural Market Attraction
• Large Population
• Raising Prosperity
• Growth in Consumption
• Life Style Change
• Market Growth Rates Higher than Urban
• Rural Marketing is not Expensive
• Remoteness is no longer a Problem.
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Indore

10. • Cultural Diversity, language and social norm
• Large numbers of low population density
villages
• Inadequate storage space
• Lack of availability of after sales service
network, authorised spare parts, trained
mechanics
• Fake and look alike products
Challenges and Constraint Of Rural
Marketing
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Indore

11. • Remote and difficult terrains especially in hilly, tribal
and desert areas
• Inhibition to try new products
• Lack of proper knowledge or awareness about
certain products and services
• Highly technical products, making them difficult to
operate and comprehend
Challenges and Constraint Of Rural
Marketing
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Indore

12. • Availability :
• The first challenge in rural marketing is to ensure
availability of the product or service. India's 7,
00,000 villages are spread over 3.2 million sq km;
700 million Indians may live in rural areas, finding
them is not easy. They are highly dispersed. Given
the poor infrastructure, it is a greater challenge
to regularly reach products to the far-flung
villages.
4 A’s of Rural Marketing
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Indore

13. • India's largest MNC, Hindustan Lever, a subsidiary of
Unilever, has built a strong distribution system which helps
its brands reach the interiors of the rural market. To service
remote village, stockists use auto rickshaws, bullock carts
and even boats in the backwaters of Kerala.
• Coca-Cola, which considers rural India as a future growth
driver, has evolved a hub and spoke distribution model to
reach the villages. To ensure full loads, the company depot
supplies, twice a week, large distributors which who act as
hubs. These distributors appoint and supply, once a week,
smaller distributors in adjoining areas.
• LG Electronics has set up 45 area offices and 59
rural/remote area offices to cater to these potential
markets.
What to do then
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Indore

14. • Affordability:
• The second major challenge is to ensure
affordability of the product or service.
• With low disposable incomes, products need
to be affordable to the rural consumer, most
of who are on daily wages.
4 A’s of Rural Marketing
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Indore

15. • Most of the shampoos are available in smaller packs. Sachetisation (selling in
sachets)
• Fair and lovely was launched in a smaller pack.
• Colgate toothpaste/powder launched its smaller packs to cater to and the rural
consumers.
• Godrej recently introduced three brands of Cinthol, Fair Glow and Godrej in 50- gm
packs.
• Hindustan Lever has launched a variant of its largest selling soap brand, Lifebuoy.
• Coca-Cola has addressed the affordability issue by introducing the smaller bottle
priced at Rs 5. The initiative has paid off: Eighty per cent of new drinkers now
come from the rural markets. A series of advertisement for this was run showing
people from diverse backgrounds featuring Aamir Khan..
What to do then
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Indore

16. • Acceptability:
• The next challenge is to gain acceptability for
the product or service. Therefore, there is a
need to offer products that suit the rural
market.
• Customizing products to suit the needs of the
rural folk will help it gain wider acceptability
and thereby lead to increased penetration
within these rural markets.
4 A’s of Rural Marketing
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Indore

17. • LG Electronics have reaped rich dividends by doing so.
In 1998, it developed a customized TV for the rural
market named Sampoorna. It was a runway hit selling
100,000 sets in the very first year.
• Coca-Cola provided low-cost ice boxes in the rural
areas due to the lack of electricity and refrigerators. It
also provided a tin box for new outlets and thermocol
box for seasonal outlets.
• The insurance companies that have tailor-made
products for the rural market have also performed
well. HDFC Standard LIFE topped private insurers by
selling policies worth Rs 3.5 crore in total premium.
• The company tied up with non-governmental
organizations and offered reasonably-priced policies in
the nature of group insurance covers.
What to do then
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Indore

18. • Awareness: A large part of rural India is inaccessible to
conventional advertising media.
• Only 41 per cent rural households have access to TV.
Building awareness is another challenge in rural marketing.
• The media penetration in rural areas is only about 57%. It
has been seen that, two out of five Indians are unreached
by any media - TV, Press, Radio and Cinema put together.
Haats, mandis, melas and Choupal (Villagers meeting place)
are opportunities.
4 A’s of Rural Marketing
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Indore

19. • Hindustan Lever has its own company-organized media.
These are promotional events organized by stockists.
• Godrej Consumer Products, which is trying to push its soap
brands into the interior areas, uses radio to reach the local
people in their language.
• Coca-Cola uses a combination of TV, cinema and radio to
reach the rural households. It has also used banners,
posters and tapped all the local forms of entertainment.
• LG Electronics uses vans and road shows to reach rural
customers. The company uses local language advertising.
• Philips India uses wall writing and radio advertising to drive
its growth in rural areas.
What to do then
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Indore

20. Identified customer
need
Through
Advisement and
Communication
Customer Want
Proper
Distribution and
Sales
Induce Customer
Trial
Offer
Individualised
Product
Customer
Experience with
the Product
Result in
Buying Model for Rural Customer
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Indore

21. Marketing Offer
Product , Place , Price ,
Promotion
Environment
Socio Cultural,
Technological
Economic
Political
Stimuli
Internal
External
Organism
Buyer
Characteristics
Behavior
Decision Making
Action
Consequence
Satisfaction
Cognitive
Dissonance
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Factor Affecting Rural Buying Behavior
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Jitendra Patel, Assistant Professor, PIMR,
Indore

22. Socio Cultural Factors
• Culture
• Social Class
• Groups
• Family
• Role and Status
• Sociability
Occupation
Income
primary
Secondary
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Indore

23. Aspect Traditional Modern
Agriculture Bullock Cart, Low yield
seeds, conventional
manure
Tractors, Harvesters, High –
yielding seeds, pesticides,
fertilizers, pump sets,
motors, generators.
Lifestyle Neem stick, bullock cart Toothpaste, moped
Technological Factors
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Indore

24. • Poverty
• Low income occupations
Economic factors
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25. • Rural Development
• Mnergea
• Pradhan Mantri Road Development
Political Factors
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Indore

26. • Age and Life style
• Occupation
• Economic situation
• Lifestyle
• Personality and self concept
• Psychological factors
Buyer Characteristics
Activities
Interests
Opinions
Perception
Cognition
Motivation
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Indore

27. Brand Name Brand Personality Consumer Personality
Yahama Rugged, dominating ,
youthful, indulgent and
vain
Dominating, youthful,
highly indulgent and
sociable . They are opinion
leaders
Rajdoot Reliable and Rational Accountable , Loyal,
Responsible
Hero Honda Thrifty, dominating,
contemporary and less
rugged
Rational , complex, liberal
and balanced individual
TVS –suzuki Rational, colorful, youthful
rugged and relaxed
Take it easy, colorful but
not flashy, mature ,
complex people
Personality and Self concept
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Indore

28. • Degree of Buyer Involvement
Buying Behavior Patterns
Degree of
differences among
brands
High Involvement Low Involvement
Significant Complex buying
Behavior
Variety Seeking
Buying Behavior
Not Significant Dissonance
Reducing Behavior
Habitual Buying
Behavior
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Indore

29. Product look alike
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30. Look A Like Product
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31. Look A like Product
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32. Look a Like Product
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33. Duplicate Product
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34. Look A like Product
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35. References
1. Aakar, D. A. (2012), “Strategic Market Management” 9th Edition, New
Delhi, India, Wiley India.
2. Boone and Kurtz , Contemporary Marketing, 16th edition, Cengage
Learning, 2014
3. D. Chandra Bose (2010.) “Modern Marketing Principles and Practices”
PHI Learning, 1st Edition.
4. Jitendra Patel and Vivek Goswami (2013). ‘Going Rural_ A literature
Review’ Bauddhik The Journal of Management Vol- 4 Issue 2. ISSN 0975-
4131. May- Aug 2013.
5. O. C. Ferrell and Michael Hartline (2012 ). “Marketing Strategy, Text
and Cases” , South Western Cengage Learning, sixth edition.
6. Philip Kotler and Gary Armstrong (2013 ) “Principles of
Marketing”, 15th Edition, New Delhi, Prentice Hall of India .
7. Philip Kotler, Kelvin Lane, Keller, Abraham Koshi, Mitihlesh Jha.(2011),
Principles of Marketing Management, South Asian Perspective, Pearson
Education, 14th Edition
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