1. RURAL MARKETING
Assignment – 1:- Spurious products in rural areas
Introduction
Spuriousproduct are those productwhichhave a looklike name, identity,color,pattern,designand
couldhave same identical name.They are counterfeitorfake product.These are productsthat are
similarinshape,size andcolourtothe prominentbrands.Manufacturersof such spuriousbrands
mostlyride piggybackonthe advertisingcampaignof largerplayersandestablishtheirownbrand in
the region.The look-alikessportcolourschemesthatresemblethatof popularbrands,butthe brand
name is totallydifferent.The spell-alikesare more dubiousthanthe look-alikes.
Indianrural marketwithitscolossal size anddemandbase offerstremendousopportunitiesto
marketers.Almost65percentof India’sconsumerslive inrural areasandalmost(or nearlyorabout)
one thirdof the national income isgeneratedfromrural India.Itisonlynatural thatrural markets
forman importantpart of the total marketof India.Everyone seesitasa profusionof opportunities,
whetherformarketingof durables,textile andgarments,personal care productsandfinancial
services.AbstractWhentakingthe subjectof rural marketinginIndia,everyone relatedittothe
enormoussize anddemandbase asit bringshuge opportunitiestomarketers.Huge revenueis
generatedinthisfieldowingtothe majorityof populationresidinginrural areas.Thisbringsabout
the threat of counterfeitsandpass-offs,the knowledge of whichisof utmostimportance tothe
consumersinthispart whotendto go aboutthe purchasingbasedonthe look,designandmany
more featuresof a brand.Recently,researchershave paidincreasingattentiontorural marketing,
but the rural marketingdomainhasunique characteristicsthatrequire industryspecificknowledge
development.Marketersinthisareaface unique challengesineveryaspectof rural marketing.Rural
marketing,fromthe pointof viewof spuriousproductsisanunderresearchedareawithinthe rural
marketingdiscipline.
Objectivesofthe Study
The followingare the objectivesof the studywishestoenquire andunderstandinthe process.To
understandthe role of spuriousproductsinrural retailingwithrespecttothe followingbroad
outlines:
(i) Identifythe majorproblemsdue tospuriousproducts.
(ii) Variousfactorsinfluencingrural consumersinbuyingspuriousproducts.
(iii) Identificationsof spuriousproductsbyconsumers.
(iv) To understandthe spuriousbrandmanufacturermarketingstrategiesandpossible
counteringstrategiestofightagainstspuriousmanufacturers.
(v) Awarenessregardinghazardousnessnature of spuriousproducts.
(vi) Purchase sourcesof spuriousproducts.
2. Research Methodology
Nature of Study:-
The study isexploratoryinnature asit endeavours touncoverthe latentbehavioural
aspectsof rural consumersandretailerswithrespecttothe role of spuriousproductsin
the state of Karnataka.Universe of StudyandPopulationThe universeof the studyis
rural retailersandconsumersinthe rural villagesof Karnataka.The universe of the study
isclassifiedasNorthKarnataka,SouthKarnataka,East Karnatakaand West Karnataka.
The scope of the studyis limitedtorole of spuriousproductsinrural areas.The studyis
basedon the empirical surveyof 200 villagessituatedinthe state of Karnataka.
PrimaryData Source
First-handinformationwasobtainedfromrespondentsthroughastructured
questionnaire.Aninterview schedulewasconstructedtoelicitinformationfromthe
respondents.The researcherhadtoconstruct twosetsof questionnaires;one for
elicitinginformationfromthe rural retail respondentsandanotherdistributedacrossall
strata of consumerrespondents,the stratadecidedbythe distance tothe nearesttown
and everyseventhhouseholdinthe selectedstrata.The questionnaire contained
differentsectionsandeachsectionconcentratedonparticularaspectof the retailing
and buyingbehaviourof spuriousproducts.
PilotStudy:-
Before scalingforfull research,the researcherinitiatedapilotstudywith30 rural retail
respondentsand100 rural consumers.These collectedquestionnaireswereanalysedto
determine whetherthe datacollectedhelpedthe researcherinfulfillingthe objectives
of the study,apart fromtestingthe validityof the questionsputacrosstothe
respondents –bothrural retail respondentsandrural consumers.Inthissection,the
researcherdiscussesthe resultsof the surveywithreferencetothe validityof the
questionnaire andprofilesof the respondents andretailerssimultaneouslywiththe
researcherdiscussthe testingof the proposedhypotheses.The validityof the
questionnaire wasadjudgedusingCronbach’scoefficient(α) calculatedtotestthe
reliabilityandinternalconsistencyof the responses. Cronbach’scoefficienthavinga
value of more than 0.5 isconsideredadequateforsuchexploratorywork.The valuesof
α inthisstudyfor the three reportedquestionswere foundtobe 0.736, 0.805and 0.765
givinganaverage value of 0.768. It impliesthat there isahighdegree of internal
consistencyinthe responsestothe questionnaire.
3. Define Fake Products
Rural marketssufferfromthe problemsof low penetrationandpooravailabilityof branded
products.Hence,althoughthere existsahuge demandforbrandedproducts,there are no
distributionchannelstomake the productreachthe customer.Thishas ledto the growthof fake
brands.Ex-PondshasbeenreplacedbyBond’stalc,Fair& LovelybyFour& Love,Colgate by
Coolgate.
Typesof Fake Brands: -
1. Look-alike-Productswhere the colourschemeonthe packagingmaterial closely
resemblesthatof apopularbrand butthe packcarries a differentname.Lifeboyfor
Lifebuoy,LalitaAmlaforDaburAmla.
2. Spell-alike- Fakesof original brandspackaged incolours anddesignssimilartothose
of the originalsbuthave namesthatare subtlyandcleverlymisspell. E.g., Colgate by
Coolgate,Fair& LonelyforFour& Love.
3. Duplicates- Exactcopiesof original brands.The colour,design,andname onthe
package are the same as those of the original brands.
4. Reason for Rural Exploitation
1. Consumers:The majorvictimsof fake or spuriousproductsare consumersthemselveswhoare
cheatedbymanufacturersof suchproducts againand again.A majorchunkof Indianconsumerslive
invillagesalsowhoisnoteducatedandaware of suchpractices.
2. Transport Problem:Transportationinfrastructure isverypoorinrural India.ThoughIndiahasthe
fourthlargestrailwaysysteminthe world,manyvillagesremainoutsidethe railwaynetwork.Many
villageshave onlykaccharoadswhile manyof rural interiorsare totallyunconnectedbythe roads.
Because of thisthe physical distributionisdifficultinrural areas.
3. CommunicationProblems:Communicationinfrastructure consistingof posts,telegraphsand
telephonesare inadequate.
4. WarehousingProblems:Central WarehousingCorporationandState WarehousingCorporationdo
not extendtheirservicestothe rural parts.The warehousesatmandi levelare managedbyco-
operative societieswhoprovide servicestomembersonly.
5. Many LanguagesandDialects: The numberof language anddialectsvarywidelyfromstate to
state,regiontoregionand evenfromdistricttodistrict.Thoughthe recognizedlanguagesare only
16 the numberof dialectsisaround850.
6. Market Organization&Staff:Rural marketingneedslarge marketingorganizationandstaff to
have an effectivecontrol,whichrequireshuge investment.
7. Non-Availabilityof Dealers:Itisnotpossible tohave directoutletsineachrural market;firms
needtohave service of dealers,whichisnoteasilyavailable.
8. Hierarchyof Market: Rural consumershave identifiedmarketplacesfordifferentitemsof their
requirements.Thus,dependinguponthe purchase habitof rural people,the distributionnetworkof
differentcommoditieshastobe different.
Reason of spuriousIndustry
1 Heavyprofit
2Low income group
3Low level of literacy
4Lack of Awareness
5 Lack of distributionchannel
6 Lack of transportationfacilities
7 Availableof fake products.
5. Strategiesto curb the practices of fake producers
One methodisto strengthenthe distributionnetwork.
Anotherwayto tackle thisproblemistomake the packagingtamper-proof withmore
sophisticatedandcapital-intensive method.
Yet anotherapproachis toorganize consumercontestinhaatsand bigvillagestodistinguish
the original productsfromthe counterfeitsinordertoincrease consumersensitivitytothe
issue.
Finally,anotherapproachtotackle the menace of fake brandsisto initiate legal action
againstthe counterfeiters.
Conclusion
Rural marketinIndiabadlyaffecteddue tosalesof spuriousproducts.Stillrural consumersare
unaware andunable to differentiate the brandedFMCGproductsfromspuriousproductsavailable
at retail shops.Althoughinlastdecade literacylevel of rural consumersrisesfrom59% (Approx.) to
69% (Approx.),butstill availabilityof spuriousproducts indicates the otherfactorsbehinditssales.
Spuriousproductsbadlyaffectthe rural marketsalesof manybrandedFMCG companies.FMCG
companieshave taken some initiativestocounterthembutunable toimplementaholisticstrategy
to counterspuriousproductmanufacturersstrategyinlongrun.
Submittedby
Ankitsha
PG19021
