Rural Marketing Strategies, Market Research


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Rural Marketing Strategies, Market Research
Presentations By Rajendran Ananda Krishnan,

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Rural Marketing Strategies, Market Research

  1. 1. Rajendran Ananda Krishnan. things
  2. 2.  Researching Rural market: Sanitizing rural market, Research design – Reference frame, Research Approach, Diffusion of Innovation, Development studies, PRA Approach, The need for PRA Sampling, Operational aspects of data collection
  3. 3. The American Marketing Association defines market research as: „The systematic gathering, recording and analysing of data about problems related to marketing of goods and services.a) Reactive Approach – These organisations do not conduct research, but follow what others do and see it as a way to keep up with competition.b) Proactive Approach – These organizations anticipate developments in the market and introduce new ideas and methods to exploit opportunities or to minimise problems so as to get ahead of competition.
  4. 4.  Low literacy levels – Literacy level in rural India are low, due to which villagers often find it difficult to understand the questions, or respond to Western ratings and ranking tools. Poor media exposure, low product and brand awareness – Media penetration, whether electronic or non-electronic, is very low in rural areas. Therefore, awareness regarding products and brands is very low, making brand studies virtually impossible. Local language communication – There are 15 official languages, making communication extremely difficult for the researchers. Scattered and Remote villages; inaccessible roads – Tiny villages are remotely located, scattered and have almost inaccessible roads. Sampling such villages is a really painful task for researchers.
  5. 5.  Social taboos; difficulty in interacting with women respondents – Women in some parts of the country like Rajasthan and some parts of UP remain behind purdah. If the respondents include women, then this makes the job difficult for the researchers. Interview timing – Normally, younger men go to the fields in the morning and come back only in the evening. Women are busy in the morning and evening with cooking and other household chores. Researchers need to plan the day according to availability of the respondents. Rule out revalidation of data – The possibility of validating data over the telephone in rural areas is eliminated as telephone penetration per household is extremely low and physical validation is not feasible because villages are remote and scattered.
  6. 6.  Defining problems Determining the research budget Choosing Research design (exploratory, descriptive or causal; qualitative or quantitative and based on primary data or secondary data) Determining sampling method and size Selecting appropriate data analysis tools Preparing the research proposal Organizing field work Analysing and reporting findings
  7. 7.  Research problem definition involves an understanding of the information needed by managers and specifying the area of enquiry.Various components of problem definition Management objective : To increase the market share of televisions from the current rate of 20% to 23%. Management problem : Whether the new model that it is proposing to introduce will be a success? Research problem : What are the perceptions of consumers requiring a new model? Decision criteria : The company will introduce the model if 70% of the consumer responses are favourable. Hypothesis : Consumers favouring the new model are equal to or more than 70%.
  8. 8.  The principle guiding the budgeting decision is “Conduct marketing research only when the expected value of perfect information is greater than the cost of obtaining it.” As such, the budget decision involves two steps:1. Specifying the approximate value of information.2. Determining the maximum amount that can be spent.
  9. 9.  A company is interested in marketing its products in the rural market for the first time. The marketing manger is interested in knowing whether rural markets are attractive. He prefers a small-scale survey, a sort of pilot study to assess the attractiveness of the rural market. If the results are positive, he will order for a descriptive research, a large scale survey to assess the market potential and identify the strategic options. In the final stage, he may undertake experimental research to test market his product in a few select villages to predict the success of the product. If the result is positive, he will implement his marketing plan for the entire rural market.
  10. 10.  When a manager is unaware of the phenomenon, he may initiate exploratory research to gain a basic understanding of it. Next, he may go for descriptive research to have a thorough and analytical view of it. He may opt for experimentation before making huge investments on it.
  11. 11.  In rural markets, the research is more exploratory in nature as many companies are looking for information to make entry decisions. FMCG companies that have already spread their wings in rural areas such as HUL, Godrej, Colgate, LG, Philips and others are interested in assessing consumer preferences, consumer behavior and brand loyalty. Hence, they require descriptive and analytical studies. Agri-input companies selling seeds, pesticides, fertilizers and farm equipment will be interested in going from the laboratory to the field and conducting real-life experimental studies to know how well their product works and how will it be received by the farmers.
  12. 12.  Quantitative research is numerically oriented. It requires respondents to give specific answers that are measurable. For eg. BSNL might ask its customers to rate its overall service as excellent, good, poor or very poor. Such scaling techniques cannot be used in rural areas as the respondents are less educated. In qualitative research, there are no fixed set of questions but instead, a topic guide is used to explore various issues in-depth. The discussion between the interviewer and the respondent is largely determined by the respondent‟s own thoughts and feelings. For eg. HUL personnel may stop a consumer who has purchased LUX and ask him or her why he or she has chosen the soap.
  13. 13. Qualitative Research can be done by: Observation Interviews Group Discussion Focus groups Participatory Research methods
  14. 14.  Industry, commerce and trade associations – FICCI, CII, ASSOCHAM Marketing research agencies and associations – Rural Relations, MART, Anugrah Madison, Sampark, Rural marketing Association of India Companies – Colgate, HUL, ITC, Rallis India NGO‟s – RASS (AP), Rural Innovations Network (Chennai), CARE (New Delhi) Government Agencies – NCAER, RBI, Ministry for Rural Development, Mandal Revenue Offices, Panchayats.
  15. 15.  Educational Institutions – Institutes like NIRD (AP), and NIRMA (Gujarat) Media organs – The Economic Times, The Financial Express, Hindu Business Line, yojana, Kurukshetra, RMAI journals and other periodicals Worldwide organizations – World Bank, IMF, IFAD, FAO and ILO
  16. 16.  Census of India – Largest compilation of rural demographic data NCAER (National Council for Applied Economic Research) – Largest sample surveyor in the country, compiles data on demographics, durables and non- durables. NSSO (National Sample Survey Organization) – Consumption and expenditure-related data on major products and services. DRDA (District Rural Development Authority) – Compilation of district-level data on government- aided projects. ICDS (Integrated Child Development Scheme) – Compilation of village-level information mainly on health by anganwadi workers.
  17. 17.  Sampling is an easy process in urban areas due to marked similarity. This is a result of high mobility and exposure facilitated by infrastructure facilities, regularity of income receipts, savings patterns moulded by tax problems and time schedules and incomes. Differential and limited development of infrastructure, geo-physical differences, variation in literacy levels and differences in proximity to towns have contributed to the heterogeneity in the rural market place.
  18. 18.  In some places, toothpaste and soap are luxuries, whereas in some other places, it is necessity. In Haryana and Punjab, hair dye has been used on buffaloes, and washing machines have been used for making lassi. In some parts of Rajasthan, utensils are cleaned with ash and sand due to water scarcity. A washing powder would face competition from these alternatives that need very little water. Hard water in most villages in Bikaner is the reason for the low acceptance of soap.
  19. 19. A variable such as income cannot be used to stratify rural samples. The reason is that incomes are uncertain and unaccounted. In the urban context, the income category is the primary criterion for grouping consumers. Often, rural market research utilizes land holding as an indicator of wealth and income. The land holding has to be balanced with the productivity and realizations from the crop mix.
  20. 20. Village could be selected on the basis of : Population Proximity to highway or remote location Occupation profile Religion : Hindu-dominated or muslim- dominated villages Tribal population : tribal or non-tribal.
  21. 21. Factor Large SmallTime available More LessAccuracy High LowCost High LowPopulation Heterogeneous Homogeneous
  22. 22.  The time-tested sophisticated tools fail to evoke the required response in rural market. Likewise, detailed questions need to be asked to simplify the inquiry and to pin down the response. Rural consumers are comfortable with colors, pictures and stories. Rural researchers make use of participatory research methods.
  23. 23.  Secondary data sources Observation Interviews Diagrams Stories and portraits
  24. 24.  PRA is a Data collection technique in rural market that gets the participants of the research process (respondents) to be actively involved in the research. PRA is a set of approaches and methods to enable rural people to share, enhance and analyse their knowledge of life and conditions, to plan and to act. Therefore, it arouses the curiosity and interest of people and they voluntarily and eagerly get involved in the process and they enjoy sharing and analysing about themselves. PRA involves local people and outsiders from different sectors and disciplines. Outsiders facilitate local people in analysing information, practicing critical self-awareness, taking responsibility and sharing knowledge of life and conditions to plan and to act.
  25. 25. Participatory Rural Appraisal Focus Group DiscussionLarge and heterogeneous in nature, Typically small and homogeneous inensuring participation from all walks of life. nature.As expression is both verbal and non-verbal, A verbal channel – outspokeneven less assertive people can express their individuals dominate the discussionviews.Moderator‟s role is low, hence information Moderator‟s intervention can be highflow is more natural. in evoking response and from all sections.Attitudes and behavioral change oriented. Action oriented.On-the spot analysis by participants. Analysis done by moderators.Cross checking and validation of data can FGD needs to be verified with morebe done on site by involving other members FGD till a consensus is reached.or groups.
  26. 26. Key Principles : Participation and Empowerment – Relies heavily on participation by the communities, as partners to the research team and sources of information. Flexibility – Makes use of different techniques for collecting information. Teamwork – It is best conducted by a local team with a few outsiders present. Optimal ignorance – It avoids unnecessary details, and irrelevant data. Systematic – Alternative methods have been developed to ensure the validity and reliability of the findings. Inclusiveness – Method allows researcher to involve different people.
  27. 27.  Time deadlines – Insufficient time is allowed for the team to relax and mingle with the local people, to listen to them and to learn about the more sensitive issues under consideration. Credibility – Individuals unfamiliar with participatory research methods may raise questions about the credibility of the PRA findings. Hijacking – PRA agenda will be externally driven. This results in legitimacy problems. Disappointment – Unnecessary local expectations may be raised. Local communities may view it as a wasteful exercise.
  28. 28. The type of analysis and the choice of analysis technique depend on the following factors : Purpose of research Type of data – quantitative or qualitative Number of variables being examined – one or more Type of measurement scale used – interval, nominal, ordinal Number of samples to be compared – one or more Nature of samples – dependent or independent Size of the sample – small or large
  29. 29. The elements of a research proposal are : Executive Summary / abstract Background / introduction Objectives and hypothesis Methodology Time schedule Research staff and equipment Cost estimates – recurring and non-recurring Appendices
  30. 30.  Preparation of data collection plan that specifies :1. Number of supervisors2. Number of field investigators3. Period of data collection and schedule4. Budget Organization of research effort1. Selecting investigators and supervisors2. Training the staff3. Allocating work4. Briefing the investigators5. Compensating the staff for the work turned out Controlling :1. Supervising the data collection with respect to time and cost2. Checking the data for validation3. Carrying out corrections, if any, or repeating the data collection wherever necessary
  31. 31. Aspect Characteristics of respondents DosAppearance Simple and culture bound Dress simplyGreetings Greetings and conversations Make a courteous greeting with are informal. They try to relate respect to age mentioning a and show affection when relationship. interacting with others.Language Most of them are not literate Speak in the local language. Ifand culture and unfamiliar with the English possible, become familiar with the language local dialect.Rapport Rural people like to be related. Engage the respondents in They are open to known interaction by inquiring on personal people. and general issues in a casual way showing concern and respect.Investigatio Rural people are sensitive. Be slow in questioning and gettingn They are slow in understanding responses. Be patient. and exploring.Overcoming Villagers speak in groups. They Encourage group interaction. Afterlimitations look for social support and gaining trust, obtain individual approval. opinions.
  32. 32.  Don’t pretend – Villagers look at a newcomer with some degree of apprehension. Avoid promising benefits that you cannot offer. Avoid direct inquiry – Do not ask direct questions when conducting an interview in the presence of others. Don’t touch – Touching the arm or placing a hand on the shoulder of a villager without first establishing an intimate relationship is not desirable. Avoid suspicious behaviors – Villagers are traditional in their outlook. In view of this, male researchers should not talk to women without a female assistant. Don’t become controversial – Avoid speaking about village politics or raising controversial issues that may lead to heated arguments and disputes.
  33. 33.  Mindset – It is important for the rural market researcher to be able to think from the rural perspective, to constantly evaluate responses and to mould his communication accordingly. Effective communication – For more effective communication and to elicit accurate responses in rural research, a working knowledge of and familiarity with local dialects is desirable. Discerning Ability – Researcher must know when to ask a specific question and when to put an end to the general discussion. He must also be able to discern between sensitive and non-sensitive issues and topics. Good Memory – Since the researcher is advised not to carry any writing material , he is expected to memorize all the relevant information. Patience – Researcher needs to have a lot of patience to get specific responses from villagers because they tend to get involved in their own repeat things.
  34. 34.  Title page Table of contents Executive summary Introduction Methodology Findings Limitations Conclusions and recommendations Appendices Bibliography
  35. 35. Simple, easy to understand techniques to indicate varying preferences and feelings have been evolved by rural researchers. Ladder – For rating purposes, a typical Likert scale on the ascendancy is achieved by the steps on the ladder. The respondent is asked to place a visual card corresponding to the product or preference on a rung according to his ranking or 1 rating. 2 3 4 Images of faces – The images of faces with varying expressions (smiling to wailing) is another useful tool that is used to ascertain preferences and liking. Colour wheels – Colours are very strong indicators and forms of expressing feelings in the rural areas. The selection of colors is done on the basis of the association of rural people with colors.
  36. 36. Colour Rating AssociationDark Green 5 Represents a good crop or hariyali and hence represents prosperity. It is considered to be the best.Light Green 4 Represents a Not very good cropYellow 3 Represents Dry sand or a dry fieldOrange 2 Represents Setting sun and the end of the dayRed 1 Represents danger
  37. 37.  Dice – Dice are wooden or plastic piece with 6 faces with varying number of holes or dots ranging from 1 to 6. A face value of 1 is the lowest and a face value of 6 is the highest. Carrom coins – Fifteen coins are given to the respondents and they are asked to distribute them among the brands under study in order of their preferences – more coins for the most preferred brand. Playing Cards – The face cards with K,Q,J,10 and 9 represent a descending order in terms of values. As such, they are assigned ranks from 1 to 5 in that order. 3-Point Rating Scale – Researchers interested in conventional scales may use three-point scales (agree, neutral, disagree), especially when the respondents are school educated.
  38. 38. Aspect Urban RuralRespondents Literate, brand aware, individuals Semiliterate or illiterate, brand unaware. respond individually. Generally group responses are available.Time Willing to respond. Have time Hesitant, but devotes time. pressures. Spare little time for researchers.Accessibility Easy to access, though many Tough to access; geographical distances suffer from research fatigue. are barriers. Don‟t speak to outsiders.Secondary data Internal data, syndicate research, Very few sources and less data.sources published media.Primary data Large number of middle men, Fewer number of all categories.sources experts, sales force and consumers.Sampling Respondents form relatively Heterogeneous groups. Income and homogeneous groups. Income can landholding to be carefully applied. be a criterion.Data collection Individual focused, use of Participatory approaches. Require sophisticated instrument. simplified instruments.
  39. 39.  Retailshop / STD Booth Tea stall Playground Chaupal Haat
  40. 40.  Questions should be simple and direct. Eg. Why do you think you don‟t need to use a mobile phone? (not direct)Would you consider using a mobile phone? (direct) Questions should be self-explanatory. Questions should not be ambiguous. Eg.Do you like the mobile phone? (not clear)Are you satisfied with the performance of the mobile phone? (clear) Questions should have a logical flow, moving from general to specific and from macro to micro. Questions should be in the local language. The accuracy of translations should be checked by persons from the same region to ensure that there is no shift in meaning or nuance.
  41. 41. Thank you..