IILM Institute for Higher Education

                   School of Business

                         Gurgaon

            ...
INTRODUCTION
India lives in villages, close to 72 percent of Indian population lives in rural areas. In the
country we hav...
quantum jump in the incomes of farmers in the country. Initially the impact of green
revolution could be seen only in the ...
TELEDENSITY: RURAL & URBAN


                                                 TELEDENSITY

                               ...
OBJECTIVE OF THE CASE
To know the market penetration of wireless communication in rural areas.




RESEARCH METHODOLGY
For...
VILLAGE- BUDHERA
This village is 25 Km away from Gurgaon city. In this village schedule caste is
approximately 35% of the ...
Kachha + Pakka house                            -        20% - 25%

1 Storey House                              -         ...
Tractors                        -       60

Motor cycle                     -       80% - 85% of the families owned a moto...
Nuclear Family                 -      90%

Joint Family                   -      10%

Size                           -    ...
This village is 30 Km away from Gurgaon city. In this village schedule caste is
approximately 25% of the total population ...
1 Storey House                              -        80% - 90%

Employment Status

The major source of income in the villa...
Motor cycle                     -       85% - 90% of the families owned a motorcycle.

Cycle                           -  ...
Joint Family                   -      5%

Size                           -      average 6(husband, wife and 4-5 kids)

Fes...
The Key findings of the case are as follow:

Mobile Phone Used:

Information pertaining to the survey indicates that most ...
Brand Consciousness: Rural people are not brand conscious. They normally go for
value for money and features.

Style: Rura...
The present study is confined to 2 villages i.e. Budhera and Chandu of Haryana, and so
the findings may not be applicable ...
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Case Study_ MARKET PENETRATION OF WIRELES COMMUNICATION IN RURAL AREAS

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I have worked on this case study during my college days (Dec \'08). I have choosen 2 village of Gurgaon for this which are Budhera and Chandu.

Please do drop your comments for the same.

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  • sir can you email me a copy of above report at princeoct18@gmail.com. I need it to prepare my report on related topic.
    Thanks
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  • This is very good information....yes i am agree with this,bcz i am also from village.
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Case Study_ MARKET PENETRATION OF WIRELES COMMUNICATION IN RURAL AREAS

  1. 1. IILM Institute for Higher Education School of Business Gurgaon CASE STUDY ON MARKET PENETRATION OF WIRELES COMMUNICATION IN RURAL AREAS Abhishek Tewari Prepared By Mr. Abhishek Tewari.
  2. 2. INTRODUCTION India lives in villages, close to 72 percent of Indian population lives in rural areas. In the country we have 6.36 lakh villages out of which only 13 percent have population above 2000. The rural economy contributes nearly half of the country’s GDP (ETIG 2002-03) which is mainly agriculture driven and monsoon dependant. More than 50 percent of the sales FMCG and Durable companies come from the rural areas. The McKinsey report (2007) on the rise on consumer market in India predicts that in twenty years the rural Indian market will be larger than the total consumer markets in countries such as South Korea or Canada today, and almost four times the size of today’s urban Indian market and estimated the size of the rural market at $577 Billion. Census of India defines rural as any habitation with a population density less than 400 per sq. km., where at least 75 percent of the male working population is engaged in agriculture and where there exits no municipality or board, and the same definition being accepted. A marketer trying to market his product or service in the rural areas is faced by many challenges; the first is posed by the geographic spread and low population density in the villages in the country. The table below gives us the population and village size details in the country. Table 1: Rural Population Statistics Number of Percentage of total Population Villages villages Less than 200 114267 17.9 200-499 155123 24.3 500-999 159400 25 1000-1999 125758 19.7 2000-4999 69135 10.8 5000-9999 11618 1.8 10000 & above 3064 0.5 Total 636365 100 The second challenge is from the low purchasing power and limited disposable incomes in these parts of the country. But this has been changing in the last few decades with agricultural growth rate faster in the 1990’s and 80’s than the 1970’s (CMIE 1996). Green revolution through the introduction of hybrid seeds, fertilizers and systematic irrigation had a major impact on agricultural productivity, and combined with it was a price policy which ensured minimum support price, and in turn insulated the farmers from market risk, cheap input policy and a stable demand (Vyas 2002) . These all lead to a Prepared By Mr. Abhishek Tewari.
  3. 3. quantum jump in the incomes of farmers in the country. Initially the impact of green revolution could be seen only in the prosperous agricultural states of the country but now slowly its influence has spread across the country with the increase in irrigation. Though the income levels overall are still very low there are many pockets of prosperity which have come up in the rural areas in the country. According to NCAER 2002, the number of rural middle class house holds at 27.4 million is very close to their urban counterpart at 29.5 million. The improvement in the support prices being offered to farmers also has an impact on the disposable income with the farmers. And between, 1981-2001 there has been tremendous improvement in the literacy levels, poverty and rural housing in the villages of the country. Rural literacy levels have improved from 36 percent to 59 percent, the number of below poverty houses have declined from close to half to 46 percent and the number of pucca houses have doubled from 22 percent to 41 percent. These figures provide us with a clear picture that rural India with the increase in agricultural income and improving standards is on the verge of becoming a large untapped market which marketers have been aspiring for a very long period of time. Thus the current status of rural markets makes it an attractive market for marketers. The wireless market is growing very fast whereas wire line is declining. Exponential Growth 350 Growth of Telephone Connections 325.43 300.15 WIRELINE WIRELESS TOTAL Connections (In Millions) 300 281.94 250 206.83 256.20 200 140.32 150 157.96 98.41 76.53 100 54.78 44.87 90.14 36.29 28.53 18.68 22.81 50 14.88 52.22 33.69 46.19 50.18 48.87 41.4813.30 42.84 43.95 43.49 0 0.34 0.88 1.20 26.65 1.88 32.713.58 38.336.54 17.80 21.61 14.54 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2008 JUNE Year (as on 31st March) From this graph we can say that wire line connection is declining day by day(43.49mln) and the wireless is increasing substantially(281.94mln) by 31st March 2008. Prepared By Mr. Abhishek Tewari.
  4. 4. TELEDENSITY: RURAL & URBAN TELEDENSITY RURAL URBAN TOTAL 70 65.9 60 50 GROWTH 48.52 40 39.45 30 26.88 26.19 20 20.74 18.31 14.32 12.74 10 10.37 12.2 8.95 9.21 6.94 8.36 7.02 5.11 5.88 2.86 3.58 4.29 0 2.32 0.52 0.68 0.93 1.21 1.49 1.57 1.73 1.86 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 YEAR AS ON 31ST MARCH The graph shows that by 31st March 2008, that tele density (The number of landline telephones in use for every 100 individuals living within an area.) in urban area is 65.9, whereas in rural areas only 9.21. This means that there is a huge potential in the rural areas for the telecom industry. Prepared By Mr. Abhishek Tewari.
  5. 5. OBJECTIVE OF THE CASE To know the market penetration of wireless communication in rural areas. RESEARCH METHODOLGY For the purpose of the study rural consumer, we asked various question so as to know their opinion of what motivates them to buy a mobile and what they think about mobile phones. The present study is based on primary data. The mobile phone consumer belonging to rural area of Budhera and Chandu of Haryana. • Data Source- The present study is based on primary data of Budhera, Haryana. • Research Approach- Survey • Research Instrument- Questionnaire in their local language. • Sampling Plan  Sampling Unit- data collected from mobile user  Sample size- 20 user from both the villages of different ages.  Sampling Procedure- Judgment and convenience basis. Prepared By Mr. Abhishek Tewari.
  6. 6. VILLAGE- BUDHERA This village is 25 Km away from Gurgaon city. In this village schedule caste is approximately 35% of the total population and rest is of different caste. Route Map Gurgaon Sec-10 Hero Hyatpur Honda Pataud Pataud Bus Pataud Kadipur Village Stand i Road i Road i Road Village Chawk Road Farukhnagar Bhureda Gharihar Village suru 3 Km Village Overview of the Village Total area of the village - 1Km in radius. Total population in the village - 5500 people. Total House in the village - 725 families Total Land Holding - 2500 acres Total Voters in the village - 2400  Male - 3300  Female - 2200  Children(M+F) - 3100 Prepared By Mr. Abhishek Tewari.
  7. 7. Kachha + Pakka house - 20% - 25% 1 Storey House - 75% - 80% Employment Status The major source of income in the village is Agriculture (i.e. around 70% of them are either directly or indirectly related to agriculture). Government Services - 30% Private - 30% Own Business (ex-Kirana Shops) - 5% - 10% Labour - 30% Below Poverty Line - 250 families ( Ration card available) Agriculture Total Land Holding - 2500 acres Fertile land Crops Grown  Primary - Bajra, Jawar, Wheat, and Mustard.  Secondary - Rice and other seasonal crops. Cultivation of Flower - Ganda and Jaffrey Contract Farming - Flowers Cattle Owned Cows - 1000 Cows. Buffalo - 700-800 Buffaloes Goat - 100-150 Goats Vehicles Owned Prepared By Mr. Abhishek Tewari.
  8. 8. Tractors - 60 Motor cycle - 80% - 85% of the families owned a motorcycle. Cycle - Each family has minimum 1 cycle (100%). Four Wheeler - 50-60 Infrastructure of the Village School - 2 Govt. School ( 1 Primary and 1 till Class 12) Aangan Wari Kendra (play school) - 3 Hospital - 1 (Dental College near to village) Private Doctors - 3, and no Community Health Center (CHC) Sewing Center - 1 (For women only) Water Supply(Tube well) - 1 Own by the village Panchayat 3 Owned by Govt. Water Tank (sweet water) - 2 (capacity of 3 lakhs gallon) No. of Hrs Electricity Supply - 3 hours during day and 7-8 hours at night. Electricity Transformer - 7 in different locations of the village 1 Booster to withdraw and store water from nearby passing canal. Literacy Level Man & Woman - 70% are matric pass. Higher Studies - 5% - 10% Family Size Prepared By Mr. Abhishek Tewari.
  9. 9. Nuclear Family - 90% Joint Family - 10% Size - average 6(husband, wife and 4-5 kids) Festivals and Celebration Main Festival - Diwali, Holi and dushera. Mela - Navratam Mela (2 times a year). Marriage season - Post Diwali. Other Information Child marriage - No Kiryana Shops - 40-50 shops 100 days of employment Scheme from Govt. has not been implemented yet. Mobile Phone Status Towers in the village - Only Airtel Major Brands Used - Airtel and Idea Minor Brands Used - Bsnl, Vodafone, & Tata Indicom (Reliance very few). Pre-Paid Connections - 95% Post-Paid Connections - Less than 5% Landline User - 200 Families (use mobile phone also) VILLAGE- CHANDU Prepared By Mr. Abhishek Tewari.
  10. 10. This village is 30 Km away from Gurgaon city. In this village schedule caste is approximately 25% of the total population and rest is of different caste. Route Map Gurgaon Sec-10 Hero Hyatpur Bus Pataud Honda Pataud Pataud Kadipur Village Stand i Road i Road i Road Village Chawk Road Farukhnagar y awa Chandu KM Bhureda Gharihar Village 4 Village suru Village Overview of the Village Total area of the village - 1.5Km in radius. Total population in the village - 6000 people. Total House in the village - 900 families Total Land Holding - 3000 acres Total Voters in the village - 3000  Male - 3200  Female - 2800  Children(M+F) - 3500 Kachha + Pakka house - 15% - 20% Prepared By Mr. Abhishek Tewari.
  11. 11. 1 Storey House - 80% - 90% Employment Status The major source of income in the village is Agriculture (i.e. around 75% of them are either directly or indirectly related to agriculture). Government Services - 35% Private - 30% Own Business (ex-Kirana Shops) - 10% - 15% Labour - 20% Below Poverty Line - 300 families ( Ration card available) Agriculture Total Land Holding - 3000 acres (The land is very fertile-black soil) Crops Grown  Primary - Wheat, Mustard, Jawar, and Bajra  Secondary - Rice and seasonal vegetables Cultivation of Flower - Ganda and Jaffrey Contract Farming - Vegetables & Flowers Cattle Owned Cows - 1200 Nos. Buffalo - 800-900 Nos. Goat - 100-150 Nos. Vehicles Owned Tractors - 75 Nos. Prepared By Mr. Abhishek Tewari.
  12. 12. Motor cycle - 85% - 90% of the families owned a motorcycle. Cycle - Each family has minimum 1 cycle (100%). Four Wheeler - 55-60 Infrastructure of the Village School - 2 Govt. School ( 1 Primary and 1 till Class 12) Aangan Wari Kendra (play school) - 3 Hospital - 1 Community Health Centre (CHC) Private Doctors - 2 Nos. (Have Small Clinic) Sewing Center - 2 (For women only) Water Supply(Tube well) - 2 Own by the village Panchayat 1 Owned by Govt. Water Tank (sweet water) - 2 (capacity of 3 lakhs gallon) No. of Hrs Electricity Supply - 4 hours during day and 7-8 hours at night. Electricity Transformer - 8 Nos. in different locations of the village 1 Booster to withdraw and store water from nearby passing canal. Literacy Level Man & Woman - 80% are matric pass. Higher Studies - 10% - 15% Family Size Nuclear Family - 95% Prepared By Mr. Abhishek Tewari.
  13. 13. Joint Family - 5% Size - average 6(husband, wife and 4-5 kids) Festivals and Celebration Main Festival - Diwali, Holi and Dushera. Mela - Teej Ka Mela, 15th Aug Ka Mela. Marriage season - Post Diwali till June Other Information Child marriage - No Kiryana Shops - 60-70 shops 100 days of employment Scheme from Govt. has not been implemented yet. Mobile Phone Status Towers in the village - Vodafone & BSNL Major Brands Used - Airtel and Vodafone, BSNL Minor Brands Used - Idea & Tata Indicom (Reliance very few). Pre-Paid Connections - 90% Post-Paid Connections - Less than 10% Landline User - 300 Families (use mobile phone also) KEY FINDINGS Prepared By Mr. Abhishek Tewari.
  14. 14. The Key findings of the case are as follow: Mobile Phone Used: Information pertaining to the survey indicates that most of the people in ruaral areas have either Nokia phones or Chinese mobile. They prefer Chinese mobile because of their features like fm, music, and camera which they can get at a very cheaper price. They prefer mobile phones ranging from Rs.1000-Rs2500, eg. Nokia 1100. Source of Information The received information pertaining to the survey indicates that rural consumer normally use friends (most of the time), followed by TV commercials, Mobile phone Retailer and Newspaper. Purchase Decision It is interesting that information regarding Purchase Decision indicates that most of the rural people take self decision, followed by family help, sarpanch, and friends to make purchase decision of mobile. Consumer Satisfaction Majority of the people are satisfied with the mobile phones and with the services and yet few of the people are dissatisfied though the reason are not known. (People were asked whether they will recommend their phones to a friend it is assumed that positive answer (yes) will indicate satisfaction and negative answer (no) will indicate dissatisfaction). Motivational Factors Price : Price play an important role for rural areas. They mainly prefer mobile phones between the range of Rs. 1000- Rs 2500. Quality: They are very less quality conscious. Function: They are very less function conscious i.e. as per their knowledge of the product. Prepared By Mr. Abhishek Tewari.
  15. 15. Brand Consciousness: Rural people are not brand conscious. They normally go for value for money and features. Style: Rural people use mobile phones as a status and style symbol. They use it to show people. - LIMITATION Prepared By Mr. Abhishek Tewari.
  16. 16. The present study is confined to 2 villages i.e. Budhera and Chandu of Haryana, and so the findings may not be applicable to other states of the country because of socio- cultural difference. Further Consumer Behaviour being Dynamic in nature, there is every possibilities that over time and space findings of today may become invalid tomorrow. CONCLUSION The father of the nation Mahatma Gandhi rightly stated that India lives in villages and villages constitute the very heart of India. This has been aptly put by a Hindi poet “Bharat Mata Gram Vasisni”, which means, Mother India lives in her villages. In order to utilize the immense potential of rural market in India, companies need to develop specific marketing strategies and action plans taking into account the complex set of factors that influence consumer behavior. Rural marketing cannot succeed if the marketing strategy and action plans are only extrapolations or minor modification of the urban market strategy and plans. Innovative companies who adopted an integrated approach have succeded in utilizing market opportunities that rural areas offer. - Prepared By Mr. Abhishek Tewari.

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