This document discusses distribution channels and rural marketing in India. It defines distribution channels as interdependent organizations that make products available to consumers. Choosing the right distribution system and planning the channel are important decisions. Rural markets in India are large and growing, but also face issues like lack of infrastructure and data. Common myths about rural markets being homogeneous or having low purchasing power are debunked. The document also provides insights into the emerging rural consumer who aspires to material goods and discusses ongoing improvements in rural infrastructure and connectivity in India that create opportunities for marketers.
This document discusses socio-cultural factors that influence rural marketing. It defines culture and identifies key cultural elements like religion, social class, groups, and family structure that marketers must consider. Culture includes shared behaviors, norms, beliefs, and customs transmitted between generations. Rural consumers are influenced by social class, opinion leaders, family roles in purchasing, and sociability within their communities. Marketers need to understand these socio-cultural factors to effectively target and design products for rural consumers.
This document discusses factors that influence customer purchase decisions and how retailers can target different types of customers. It covers the stages in the buying process, types of customer needs, and how social factors like family, culture, and reference groups affect purchasing. Retailers are advised to segment their markets using approaches like geography, demographics, lifestyle, buying situations, and customer benefits sought. Understanding these influences can help retailers design effective marketing strategies to attract different kinds of customers.
This document provides an overview of marketing channel structure and functions. It discusses how channel members add value through specialization and the division of labor principle. The document also examines different types of marketing channels for consumers and businesses. It explores considerations for selecting and managing multi-channel distribution systems, as well as carefully selecting and developing international channel members. Finally, it summarizes that future distribution channels will be more interactive and challenged by the internet, while international channels will remain important with an adaptive focus on customer preferences.
The document discusses factors to consider when designing distribution channels. It outlines a multi-step channel planning and design process that includes: segmenting and positioning target customer groups; defining customer needs; evaluating alternative channels; selecting and training channel partners; motivating partners; and implementing the channel design. Key factors addressed are defining objectives, costs, roles of intermediaries, partner selection criteria, training, and performance management to ensure the channel meets business goals in an efficient and effective manner.
The document discusses key elements of developing a retail strategy, including:
1) Defining target markets and retail formats to focus on, sources of competitive advantage, and criteria for selecting target markets.
2) Developing objectives, positioning approaches like mass, differentiated, and niche retailing.
3) Considering elements of the retail mix like location, merchandise, pricing, and communication for retailers like Macy's and Walmart.
4) Obtaining resources and considering relationships with vendors, human resources, distribution systems, and store location.
The document discusses distribution channel management. It defines key terms like distribution channel, intermediaries, direct and indirect selling. It describes different types of distribution channels like intensive, selective and exclusive distribution. It also discusses various channel partners like wholesalers, distributors and retailers; and their roles and functions. Factors affecting the choice of distribution strategy are also highlighted.
Bottom of pyramid approach in rural marketing sectorVishalGupta901
This document summarizes a seminar presentation on bottom of the pyramid (BoP) approach in rural marketing. It defines BoP as the largest but poorest socioeconomic group, referring to billions of people living on less than $2 per day. It discusses challenges in marketing to rural/BoP consumers due to factors like cash poverty, distance, and awareness. It provides the Hindustan Liver Limited case study as an example of successfully adapting business models to target rural/BoP consumers in India. The conclusion is that while BoP was previously ignored, it represents a major market opportunity if companies design appropriate products/services to satisfy their needs.
This document discusses socio-cultural factors that influence rural marketing. It defines culture and identifies key cultural elements like religion, social class, groups, and family structure that marketers must consider. Culture includes shared behaviors, norms, beliefs, and customs transmitted between generations. Rural consumers are influenced by social class, opinion leaders, family roles in purchasing, and sociability within their communities. Marketers need to understand these socio-cultural factors to effectively target and design products for rural consumers.
This document discusses factors that influence customer purchase decisions and how retailers can target different types of customers. It covers the stages in the buying process, types of customer needs, and how social factors like family, culture, and reference groups affect purchasing. Retailers are advised to segment their markets using approaches like geography, demographics, lifestyle, buying situations, and customer benefits sought. Understanding these influences can help retailers design effective marketing strategies to attract different kinds of customers.
This document provides an overview of marketing channel structure and functions. It discusses how channel members add value through specialization and the division of labor principle. The document also examines different types of marketing channels for consumers and businesses. It explores considerations for selecting and managing multi-channel distribution systems, as well as carefully selecting and developing international channel members. Finally, it summarizes that future distribution channels will be more interactive and challenged by the internet, while international channels will remain important with an adaptive focus on customer preferences.
The document discusses factors to consider when designing distribution channels. It outlines a multi-step channel planning and design process that includes: segmenting and positioning target customer groups; defining customer needs; evaluating alternative channels; selecting and training channel partners; motivating partners; and implementing the channel design. Key factors addressed are defining objectives, costs, roles of intermediaries, partner selection criteria, training, and performance management to ensure the channel meets business goals in an efficient and effective manner.
The document discusses key elements of developing a retail strategy, including:
1) Defining target markets and retail formats to focus on, sources of competitive advantage, and criteria for selecting target markets.
2) Developing objectives, positioning approaches like mass, differentiated, and niche retailing.
3) Considering elements of the retail mix like location, merchandise, pricing, and communication for retailers like Macy's and Walmart.
4) Obtaining resources and considering relationships with vendors, human resources, distribution systems, and store location.
The document discusses distribution channel management. It defines key terms like distribution channel, intermediaries, direct and indirect selling. It describes different types of distribution channels like intensive, selective and exclusive distribution. It also discusses various channel partners like wholesalers, distributors and retailers; and their roles and functions. Factors affecting the choice of distribution strategy are also highlighted.
Bottom of pyramid approach in rural marketing sectorVishalGupta901
This document summarizes a seminar presentation on bottom of the pyramid (BoP) approach in rural marketing. It defines BoP as the largest but poorest socioeconomic group, referring to billions of people living on less than $2 per day. It discusses challenges in marketing to rural/BoP consumers due to factors like cash poverty, distance, and awareness. It provides the Hindustan Liver Limited case study as an example of successfully adapting business models to target rural/BoP consumers in India. The conclusion is that while BoP was previously ignored, it represents a major market opportunity if companies design appropriate products/services to satisfy their needs.
Core values define how products are used in societies and influence acceptable market relationships and behaviors. Culture includes learned beliefs, values, customs, and responses that direct consumer behavior. Cultural characteristics are learned and shared within groups. Marketers must understand how culture affects consumer pre-purchase activities like information search and post-purchase activities like product use. Culture also influences social classes that are hierarchical groups distinguished by factors like occupation, income, education, and prestige. Understanding differences in subcultures and cross-cultural groups is important for marketers to effectively target various national markets.
This document discusses building and sustaining relationships in retailing. It covers defining value from both the customer and channel perspectives, examining the differences between goods and services retailers, and the impact of technology. It emphasizes that value is the perception of benefits versus price. Retailers must nurture customer relationships through augmented services and analyze customer bases. Effective category management and sharing data with suppliers contributes to strong channel relationships. Services retailing has unique characteristics around intangibility, inseparability, perishability and variability that impact customer perceptions.
Channel Power & Conflict and Channel DynamicsNavin Raj Saroj
This document discusses channel power, conflict, and dynamics. It defines channel power as a member's ability to influence other members' behavior. The five bases of power are reward, coercion, expertise, reference, and legitimacy. Channel conflict can occur vertically between different levels, horizontally between members at the same level, between different types of members, and with multiple channels. Conflicts arise from incompatible goals, unclear roles, and dependence. Managing conflict involves communication, councils, co-optation, arbitration, and mediation. Channel dynamics include gaining member acceptance, physical distribution, legal issues like exclusivity and tying arrangements, and factors like output, lot size, waiting time, convenience, variety, and service.
Marketing applications of reference group, family and cultureAditya Mehta
The document discusses several factors that influence consumer behavior, including reference groups, family and culture. It defines reference groups as individuals or groups that serve as a point of comparison and influence evaluations, aspirations, and behaviors. Reference groups can include family, friends, and celebrities. Family and culture also shape consumer decisions. Culture refers to shared values, norms, and beliefs passed down through generations that impact tastes and preferences. Subcultures within a culture may differ based on attributes like ethnicity, age, religion, and location. Social classes and groups further influence consumer norms and status. Marketers study these factors to understand consumer decision-making.
This document provides an overview of distribution management. It defines distribution management as the efficient transfer of goods from the place of manufacture to the point of sale or consumption. It then lists the names, organizations, and positions of 7 team members presenting on distribution management systems. The presentation goes on to discuss key distribution concepts like product, place, price, and promotion. It also describes different distribution channels including direct selling, indirect selling through wholesalers and retailers, and different distribution intensities. The document concludes with an overview of channel formats like producer-driven, seller-driven, and service-driven distribution.
The document discusses various factors and strategies companies consider when setting prices. It covers internal factors like costs, objectives, and competitors as well as external factors like demand, the market, and regulations. The document also outlines three main approaches to setting prices - cost-based, value-based, and competition-based - as well as various pricing strategies companies use like discounts, price discrimination, and adjusting prices.
Consumer behavior and factors influencing consumer behaviorWish Mrt'xa
The document discusses factors that influence consumer behavior, including cultural, social, personal, and psychological factors. Cultural factors encompass elements like culture, subcultures, and social classes that shape consumer values and preferences. Social factors include reference groups, family influences, and social roles/status. Personal factors pertain to individual characteristics like age, lifestyle, and income that affect purchasing decisions. Psychological factors are motivations, perceptions, learning, and beliefs/attitudes that drive consumer behavior at a subconscious level. Understanding these various influences is important for analyzing consumer decision-making processes.
Product differentiation in indian marketArbaaz khan
This document discusses product differentiation in the Indian market. It defines product differentiation as creating differences between a firm's products and competitors' products. These differences can provide competitive advantage if customers value them. The document then lists and describes various bases for product differentiation, including form, features, customization, performance quality, conformance quality, durability, reliability, reparability, and style. It concludes that durability, features, performance quality, and style are common bases for differentiation in India given the large middle class population and need for affordable yet high-quality products.
Channel power refers to the ability of one channel member, typically the manufacturer, to influence the behavior of other members in the distribution channel. The manufacturer can exert different types of power over intermediaries, including coercive power through threats, reward power by providing incentives, legitimate power by enforcing contracts, expert power through product knowledge, and referent power through their reputation and image. Proper use of these powers allows manufacturers to motivate channel partners to perform as needed, but excessive or improper use can damage relationships and trust over time.
Rural India is characterized by low per capita income, low productivity, low literacy and low rate of industrialization along with absence of basic amenities. The unprivileged class is set back by a lack of educational opportunities that could empower them to confidently pursue economic progress and overcome the debilitating effects of low literacy and rigid social hierarchies. India’s rural markets are growing at double the rate of urban markets. The retail revolution is going to act as a catalyst. So, the new concept that is hitting the market today is the "Rural Retailing".
Sales management involves planning, directing, and controlling personal selling activities like recruiting, selecting, training, assigning, supervising, motivating, and compensating a company's salesforce. It is integrated with marketing management as sales planning must align with marketing planning. A company's marketing team consists of a field selling team that contacts customers, and a headquarter marketing team that supports the field team through activities like promotion, marketing research, logistics, customer service, and coordination. Relationship management in sales includes transactional, value-added, and collaborative selling. Sales roles vary and include deliverers, order takers, sales support, technical support, order getters/creators, and solution vendors.
This document discusses market segmentation and target marketing. It defines market segmentation as dividing a market into subgroups with distinct needs and characteristics that may require separate products or marketing mixes. The document outlines different levels of market segmentation from mass marketing to niche and individual marketing. It also discusses various bases for segmenting consumer markets, including geographic, demographic, psychographic, and behavioral factors. Finally, it covers strategies for evaluating and selecting target markets, such as undifferentiated, concentrated, and differentiated approaches.
This document discusses distribution channels and strategies. It defines distribution channels as the set of organizations involved in making a product available to consumers. Common channel members discussed include manufacturers, distributors, retailers, and consumers. The document also summarizes the functions of marketing intermediaries like brokers and wholesalers in facilitating the flow of products. These intermediaries help reduce the number of transactions needed to make a sale. The summary concludes by briefly mentioning wholesaler marketing decisions around target markets, product selection, pricing, promotion, and place.
The document discusses pricing strategies for rural markets in India. It notes that affordability is determined by income and price. It then outlines various internal and external factors that influence pricing, including costs, objectives, customers, suppliers and competitors. It describes several pricing strategies used by companies to attract rural consumers with lower incomes, such as low price points, no-frills products, refill/reusable packaging, credit facilities, discounts and value engineering.
Government initiatives for rural development provided a boost to the rural economy. But
The fact remains that the rural market in India has great potential,
…..............which is just waiting to be tapped.
1. The document outlines six criteria for selecting effective brand elements: memorable, meaningful, likeable, transferable, adaptable, and protectable.
2. It provides examples to illustrate each criterion, such as a healthcare brand using images of green leaves and greenery to represent its herbal products in a meaningful way.
3. The criteria are intended to help providers choose brand elements that will earn positive customer relationships and recognition by taking into account what resonates with consumers.
The document discusses various ways to segment the rural market in India. It describes segmenting by geographic, demographic, psychographic and behavioral factors. It provides examples of companies like Nirma, HLL, T-Series that segmented and targeted specific rural market segments successfully. It also discusses segmentation approaches for the rural market based on village population size, location relative to towns, and landholding size of farmers.
This document discusses product packaging. It provides background on the history of packaging dating back to 1035 AD. It defines packaging and packing, and outlines key objectives of packaging such as protection, marketing/promotion, communication, convenience and containment. The document discusses essential qualities of good packaging like attractive appearance, safety, product description, recognizability and transport economies. It also covers functions of packaging like protection, preservation, communication and promotion.
Rural markets in India offer significant opportunities for companies due to the large population size and increasing purchasing power. However, rural consumers have unique needs and preferences compared to urban consumers. Successful rural marketing strategies require understanding rural consumer behaviors and leveraging existing rural infrastructure like local markets. Examples of companies that have effectively tapped the rural market include Escorts, HLL, ITC, and BPCL through tailored approaches like focused local advertising, introducing smaller product packages, and establishing rural retail points of presence.
Social entrepreneurship series: Product distribution in Rural IndiaTiE Bangalore
In this workshop, Vernie explored various product distribution models for Rural markets. He discussed ways of building a last mile distribution network, managing relationships & partnerships, training and cultivating the supply chain up to providing comprehensive after sales service. While presenting the roadblocks and challenges that can (and have) upset this kind of distribution, he pointed out the ‘low hanging fruits’ that can be leveraged.
He discussed alternative models through market segmentation and targeted distribution and also highlighted the role of the end consumer in the distribution chain.
Presentation by Vernie Sannoo
Managing Director
Barefoot Power* India
Core values define how products are used in societies and influence acceptable market relationships and behaviors. Culture includes learned beliefs, values, customs, and responses that direct consumer behavior. Cultural characteristics are learned and shared within groups. Marketers must understand how culture affects consumer pre-purchase activities like information search and post-purchase activities like product use. Culture also influences social classes that are hierarchical groups distinguished by factors like occupation, income, education, and prestige. Understanding differences in subcultures and cross-cultural groups is important for marketers to effectively target various national markets.
This document discusses building and sustaining relationships in retailing. It covers defining value from both the customer and channel perspectives, examining the differences between goods and services retailers, and the impact of technology. It emphasizes that value is the perception of benefits versus price. Retailers must nurture customer relationships through augmented services and analyze customer bases. Effective category management and sharing data with suppliers contributes to strong channel relationships. Services retailing has unique characteristics around intangibility, inseparability, perishability and variability that impact customer perceptions.
Channel Power & Conflict and Channel DynamicsNavin Raj Saroj
This document discusses channel power, conflict, and dynamics. It defines channel power as a member's ability to influence other members' behavior. The five bases of power are reward, coercion, expertise, reference, and legitimacy. Channel conflict can occur vertically between different levels, horizontally between members at the same level, between different types of members, and with multiple channels. Conflicts arise from incompatible goals, unclear roles, and dependence. Managing conflict involves communication, councils, co-optation, arbitration, and mediation. Channel dynamics include gaining member acceptance, physical distribution, legal issues like exclusivity and tying arrangements, and factors like output, lot size, waiting time, convenience, variety, and service.
Marketing applications of reference group, family and cultureAditya Mehta
The document discusses several factors that influence consumer behavior, including reference groups, family and culture. It defines reference groups as individuals or groups that serve as a point of comparison and influence evaluations, aspirations, and behaviors. Reference groups can include family, friends, and celebrities. Family and culture also shape consumer decisions. Culture refers to shared values, norms, and beliefs passed down through generations that impact tastes and preferences. Subcultures within a culture may differ based on attributes like ethnicity, age, religion, and location. Social classes and groups further influence consumer norms and status. Marketers study these factors to understand consumer decision-making.
This document provides an overview of distribution management. It defines distribution management as the efficient transfer of goods from the place of manufacture to the point of sale or consumption. It then lists the names, organizations, and positions of 7 team members presenting on distribution management systems. The presentation goes on to discuss key distribution concepts like product, place, price, and promotion. It also describes different distribution channels including direct selling, indirect selling through wholesalers and retailers, and different distribution intensities. The document concludes with an overview of channel formats like producer-driven, seller-driven, and service-driven distribution.
The document discusses various factors and strategies companies consider when setting prices. It covers internal factors like costs, objectives, and competitors as well as external factors like demand, the market, and regulations. The document also outlines three main approaches to setting prices - cost-based, value-based, and competition-based - as well as various pricing strategies companies use like discounts, price discrimination, and adjusting prices.
Consumer behavior and factors influencing consumer behaviorWish Mrt'xa
The document discusses factors that influence consumer behavior, including cultural, social, personal, and psychological factors. Cultural factors encompass elements like culture, subcultures, and social classes that shape consumer values and preferences. Social factors include reference groups, family influences, and social roles/status. Personal factors pertain to individual characteristics like age, lifestyle, and income that affect purchasing decisions. Psychological factors are motivations, perceptions, learning, and beliefs/attitudes that drive consumer behavior at a subconscious level. Understanding these various influences is important for analyzing consumer decision-making processes.
Product differentiation in indian marketArbaaz khan
This document discusses product differentiation in the Indian market. It defines product differentiation as creating differences between a firm's products and competitors' products. These differences can provide competitive advantage if customers value them. The document then lists and describes various bases for product differentiation, including form, features, customization, performance quality, conformance quality, durability, reliability, reparability, and style. It concludes that durability, features, performance quality, and style are common bases for differentiation in India given the large middle class population and need for affordable yet high-quality products.
Channel power refers to the ability of one channel member, typically the manufacturer, to influence the behavior of other members in the distribution channel. The manufacturer can exert different types of power over intermediaries, including coercive power through threats, reward power by providing incentives, legitimate power by enforcing contracts, expert power through product knowledge, and referent power through their reputation and image. Proper use of these powers allows manufacturers to motivate channel partners to perform as needed, but excessive or improper use can damage relationships and trust over time.
Rural India is characterized by low per capita income, low productivity, low literacy and low rate of industrialization along with absence of basic amenities. The unprivileged class is set back by a lack of educational opportunities that could empower them to confidently pursue economic progress and overcome the debilitating effects of low literacy and rigid social hierarchies. India’s rural markets are growing at double the rate of urban markets. The retail revolution is going to act as a catalyst. So, the new concept that is hitting the market today is the "Rural Retailing".
Sales management involves planning, directing, and controlling personal selling activities like recruiting, selecting, training, assigning, supervising, motivating, and compensating a company's salesforce. It is integrated with marketing management as sales planning must align with marketing planning. A company's marketing team consists of a field selling team that contacts customers, and a headquarter marketing team that supports the field team through activities like promotion, marketing research, logistics, customer service, and coordination. Relationship management in sales includes transactional, value-added, and collaborative selling. Sales roles vary and include deliverers, order takers, sales support, technical support, order getters/creators, and solution vendors.
This document discusses market segmentation and target marketing. It defines market segmentation as dividing a market into subgroups with distinct needs and characteristics that may require separate products or marketing mixes. The document outlines different levels of market segmentation from mass marketing to niche and individual marketing. It also discusses various bases for segmenting consumer markets, including geographic, demographic, psychographic, and behavioral factors. Finally, it covers strategies for evaluating and selecting target markets, such as undifferentiated, concentrated, and differentiated approaches.
This document discusses distribution channels and strategies. It defines distribution channels as the set of organizations involved in making a product available to consumers. Common channel members discussed include manufacturers, distributors, retailers, and consumers. The document also summarizes the functions of marketing intermediaries like brokers and wholesalers in facilitating the flow of products. These intermediaries help reduce the number of transactions needed to make a sale. The summary concludes by briefly mentioning wholesaler marketing decisions around target markets, product selection, pricing, promotion, and place.
The document discusses pricing strategies for rural markets in India. It notes that affordability is determined by income and price. It then outlines various internal and external factors that influence pricing, including costs, objectives, customers, suppliers and competitors. It describes several pricing strategies used by companies to attract rural consumers with lower incomes, such as low price points, no-frills products, refill/reusable packaging, credit facilities, discounts and value engineering.
Government initiatives for rural development provided a boost to the rural economy. But
The fact remains that the rural market in India has great potential,
…..............which is just waiting to be tapped.
1. The document outlines six criteria for selecting effective brand elements: memorable, meaningful, likeable, transferable, adaptable, and protectable.
2. It provides examples to illustrate each criterion, such as a healthcare brand using images of green leaves and greenery to represent its herbal products in a meaningful way.
3. The criteria are intended to help providers choose brand elements that will earn positive customer relationships and recognition by taking into account what resonates with consumers.
The document discusses various ways to segment the rural market in India. It describes segmenting by geographic, demographic, psychographic and behavioral factors. It provides examples of companies like Nirma, HLL, T-Series that segmented and targeted specific rural market segments successfully. It also discusses segmentation approaches for the rural market based on village population size, location relative to towns, and landholding size of farmers.
This document discusses product packaging. It provides background on the history of packaging dating back to 1035 AD. It defines packaging and packing, and outlines key objectives of packaging such as protection, marketing/promotion, communication, convenience and containment. The document discusses essential qualities of good packaging like attractive appearance, safety, product description, recognizability and transport economies. It also covers functions of packaging like protection, preservation, communication and promotion.
Rural markets in India offer significant opportunities for companies due to the large population size and increasing purchasing power. However, rural consumers have unique needs and preferences compared to urban consumers. Successful rural marketing strategies require understanding rural consumer behaviors and leveraging existing rural infrastructure like local markets. Examples of companies that have effectively tapped the rural market include Escorts, HLL, ITC, and BPCL through tailored approaches like focused local advertising, introducing smaller product packages, and establishing rural retail points of presence.
Social entrepreneurship series: Product distribution in Rural IndiaTiE Bangalore
In this workshop, Vernie explored various product distribution models for Rural markets. He discussed ways of building a last mile distribution network, managing relationships & partnerships, training and cultivating the supply chain up to providing comprehensive after sales service. While presenting the roadblocks and challenges that can (and have) upset this kind of distribution, he pointed out the ‘low hanging fruits’ that can be leveraged.
He discussed alternative models through market segmentation and targeted distribution and also highlighted the role of the end consumer in the distribution chain.
Presentation by Vernie Sannoo
Managing Director
Barefoot Power* India
The document discusses rural marketing in India. It outlines the evolution and opportunities of rural marketing, noting that 60% of India's population lives in rural areas. It discusses myths and challenges around rural marketing, including infrastructure, distribution, and promotion. Strategies discussed to overcome challenges include last-mile distribution using auto rickshaws or boats, introducing small pack sizes for affordability, and using opinion leaders and folk media for promotion. The case study of ITC e-Choupal is presented as an example of effective rural marketing.
Rural marketing issues, opportunity and challengesMD SALMAN ANJUM
This document discusses the rural marketing landscape in India. It notes that the rural market has grown significantly, with over 740 million rural residents accounting for more than urban consumers. Key opportunities in rural marketing include low product penetration, growing incomes and expenditure among certain demographic segments. Challenges include reaching remote villages, increasing incomes overall, and making effective use of existing rural infrastructure. New forms of large-scale rural retail are emerging as corporates increase long-term commitments to rural areas through dedicated strategies and partnerships.
Rural and urban marketing comparetive analysistrupti soni
This document compares and contrasts rural and urban marketing in India. It finds that while the urban population makes up 27% of India's total, the rural population accounts for 73% and is spread across 570,000 villages. Rural markets remain largely untapped and are growing faster than urban ones at 25% annually. Many major consumer brands generate 40-60% of their revenues from rural areas now, showing the economic potential of rural consumers. Both markets present opportunities but also challenges - rural markets require strategies for transportation, literacy and tailored promotion while urban markets face high competition and expenses. Overall, the future is promising for marketers who understand rural dynamics and can successfully reach rural consumers.
Rural and urban marketing comparetive analysistrupti soni
This document compares and contrasts rural and urban marketing in India. It finds that while the urban population makes up 27% of India's total, the rural population accounts for 73% and is spread across 570,000 villages. Rural markets remain largely untapped and are growing faster than urban ones at 25% annually. Many major consumer brands generate 40-60% of their revenues from rural areas now, showing the importance of rural marketing. Both markets present opportunities but also challenges - rural markets face issues like traditional mindsets, lack of infrastructure and education while urban markets see high competition and expenses. The future potential of rural marketing is seen as very promising if marketers understand rural dynamics and consumers.
742 million Indians constituting 138 million households reside in 6, 38,365 villages (Census, 2001). the size of rural market itself speaks of its potential.The current marketing environment and economic scenario have brought the corporate under contemporary roofs of modern India, which is challenging the current standards of segmenting, targeting and reaching the customers. Realistically, India as a nation has come a long way from the place where only urban population which constitutes 20 per cent of customer base for companies are responsible for 80 per cent of their profits. Also rural markets have acquired significance, as the overall growth of economy has resulted into substantial increase in the purchasing power of the rural communities. A survey by India's premier economic research entity, National Council for Applied Economic Research (NCAER) indicates that rise in rural incomes is keeping pace with the rise in urban incomes.
Rural marketing involves planning and implementing marketing functions tailored to rural areas. It differs from urban marketing in several key ways, including infrastructure availability, income patterns, lifestyle and culture, accessibility, and media habits. The case study describes Akashganga, a computerized dairy management system that helps farmers increase efficiency and transparency in milk collection and payment. By offering trials, responsive service, and hiring local people, the company was able to gain farmers' trust and succeed in the rural market.
Rural marketing involves assessing, stimulating, and converting purchasing power in rural areas to create demand for products and services. India's vast rural market offers potential for marketers facing urban competition. Rural consumers have customs and behaviors that differ from urban areas. Improving rural incomes, infrastructure, health, education, and employment opportunities can help realize the vision of a modern rural economy. Marketers have entered rural markets by extending existing product distributions or developing separate rural strategies. The growing interest in rural markets is due to their large size, untapped potential, and increasing incomes.
RURAL MARKETING DOCUMENTARY@RAVENSHAW UNIVERSITY AVILASH MOHAPATRAAvilash Mohapatra
This document discusses rural marketing strategies in India. It notes that rural markets offer large potential due to their size and growing incomes. However, rural consumers have different behaviors and needs than urban consumers due to factors like lower literacy, occupation in agriculture, and lack of infrastructure. Successful rural marketing requires understanding these differences and segmenting the rural market. Strategies discussed include developing small, affordable product packages; sturdy products that can withstand infrastructure issues; and promoting brands through local leaders.
This document discusses the rural market in India. Some key points:
- Rural India constitutes 69% of India's population and has seen growing incomes and consumption.
- Rural markets now account for significant portions of sales across many product categories like FMCG goods, motorcycles, cigarettes.
- Factors driving rural market growth include increasing rural incomes, education levels, IT and infrastructure development, and government policies promoting rural development.
- Reaching rural consumers requires tailored marketing strategies that consider local languages, culture, purchasing behaviors. Promotions through TV, word of mouth, and community events are important.
- Some companies have found success targeting rural consumers through affordable product sizes, distribution models, and relevant celebrity
1. The document discusses rural marketing in India, noting that rural markets are large but scattered, heterogeneous, and have lower standards of living compared to urban areas.
2. It identifies several opportunities in rural markets, including rising rural prosperity as incomes become more reliable and dependent on non-agricultural sectors, and increasing rural consumption and marketing efforts by companies.
3. However, the document also notes several challenges to rural marketing like poor infrastructure, understanding diverse rural consumer behaviors and communication barriers, and the high costs associated with reaching widespread rural populations.
This document provides an overview of opportunities and challenges for marketing in rural India. It begins with 12 questions to consider about rural India's economy and demographics. The majority of India's population lives in rural areas and depends on agriculture. Rural marketing can generate profits by developing new markets, driving innovation, and strengthening value chains. However, challenges include poor infrastructure, fragmented markets, and lack of supply chains. Successful rural marketing requires innovations tailored to local needs as well as focused execution through strategies like aggregating demand and minimizing distribution costs. The rural market potential is large but also heterogeneous, requiring an understanding of regional differences. The document examines myths and realities about rural consumers and expenditures. Opportunities exist due to rising incomes and changing consumption patterns
The document discusses rural marketing in India. It defines rural marketing and describes the two-way flow of products between rural and urban areas. Rural marketing involves transactions between urban marketers and rural consumers as well as agricultural marketing from rural producers to urban markets. Rural marketing has evolved over phases from agricultural marketing pre-1960s to developmental marketing in the 21st century. Key aspects of rural marketing include segmentation, lifestyle analysis, and defining target markets. The rural market plays a significant role in the Indian economy as rural areas account for 74% of India's population and over half of India's income.
Strategy for rural pharma marketing India_ver2.0Rajesh Kumar M
This document provides an overview of the rural pharmaceutical market in India. It notes that rural India accounts for around 25% of the total pharmaceutical market and is growing at a faster rate than urban areas. The rural market is large, with 73% of India's population of over 720 million living in rural areas, and economic indicators suggest rural incomes and consumption will continue rising significantly. However, the rural market also faces challenges such as lack of distribution networks and unreliable infrastructure. To succeed in rural India, companies must tailor their products, packaging, pricing, and distribution to address the specific needs and differences compared to urban markets.
How to succeed in Rural Pharma Market-IndiaRajesh Kumar M
This document provides an overview of the rural pharmaceutical market in India. It notes that rural India accounts for around 25% of the total pharmaceutical market and is growing at a faster rate than urban areas. Several factors are driving this growth, including rising rural incomes, improving economic indicators, and government development initiatives. Successful companies targeting rural customers adapt their products, packaging, pricing, and distribution strategies to address the specific needs and challenges of rural communities. These include lower literacy, less developed infrastructure and transportation networks.
This document discusses rural marketing in India. It begins by defining rural areas according to different government agencies and organizations. It then discusses what constitutes rural marketing and some of the key reasons for companies to target rural markets, such as large untapped market size and rising incomes. It provides examples of companies that have found success in rural India. The document outlines characteristics of rural markets, including diversity across villages, and challenges such as low awareness, infrastructure issues and geographic spread. It also discusses encouraging indicators for rural market growth and profiles the rural consumer. Finally, it covers aspects of developing a rural marketing strategy, including segmentation, targeting, positioning, product, price, distribution, sales force management and communication considerations.
The document discusses rural marketing in India. It defines rural as areas with populations under 5,000 and where 75% of males work in agriculture. Rural marketing involves all aspects of bringing a farm commodity to market. Key features of rural markets include their large, scattered size; diverse socioeconomics; agriculture-based income; and traditional outlook. The document outlines strategies for rural marketing, including addressing availability, affordability, acceptability, and awareness. It also discusses the rural consumer profile and strategies to motivate rural consumers.
The document discusses rural marketing in India. It defines rural marketing and discusses the rural consumer market, including classifications of rural consumers based on economic status. It also covers characteristics of rural consumers and marketing challenges in rural areas. Some key points made include that rural marketing became important after economic liberalization in the 1990s in India, and that understanding rural consumers who differ from urban consumers is a main challenge for marketers. Distribution remains a large problem for reaching rural areas due to infrastructure issues and remoteness. The document also provides examples of successful rural marketing strategies and initiatives by companies like ITC and HUL.
Rural marketing in India is growing in importance as rural populations and incomes rise. Some key points:
- Rural markets now account for over 50% of sales for many FMCG products and are growing faster than urban markets.
- Many major companies have implemented rural marketing strategies like training rural sales agents (Hindustan Unilever) or building rural retail stores (ITC).
- Rural consumers have different characteristics than urban consumers in terms of occupation, income sources, media access, and brand awareness. Successful rural marketing requires understanding rural consumer behavior.
- Segmenting the rural market by factors like geography, demographics, and behaviors is important for effective targeting and positioning of products. Companies must consider
how to find online competitors? Identifying competition is one of the key area for planning digital marketing strategy for business. The presentation deals with how to identify competitors, key metrics to analyze and digital tools to accomplish analysis
The document discusses product life cycles and how they can be used for strategic marketing planning. It describes the typical stages a product goes through - development, introduction, growth, maturity, decline, and withdrawal. During each stage, different marketing strategies are most effective, such as high promotion during introduction, market share growth during maturity, and cost reduction during decline. Understanding a product's life cycle helps companies plan when to support, redesign, or withdraw a product.
The document discusses various branding strategy options including individual brands with no connections, blanket brands to pull new products through channels, and separate family brands. It also discusses brand extension, multibranding/proliferation, and brand repositioning strategies. Additional sections cover developing brand names, building brand value through various marketing activities, defining an effective brand using the "5 Cs", and designing branding strategies using corporate vs. brand dominance.
Brand equity refers to the added value a brand provides to a product or service. It is defined as the differential effect that brand knowledge has on consumer response to the marketing of that brand. Strong brand equity provides benefits like greater brand loyalty, higher prices, and more effective marketing. Customer-based brand equity specifically relates to how consumer knowledge, perceptions, and feelings about a brand influence how they respond to its marketing. Building strong customer-based brand equity involves creating brand awareness and favorable associations through marketing programs and linking the brand to positive entities.
Groupon was presented by four individuals. It was launched in 2008 as a deal of the day website in Chicago and has since expanded globally. Andrew Mason conceived of the idea, which was developed by Eric Lefkofsky. Groupon's business model involves offering group coupons in each market, working like an assurance contract to reduce risk for retailers. The company earns about 50% of what customers pay. While it provided an online marketing tool and benefits to consumers, its model did not encourage repeat visits. Competitors include LivingSocial, Gilt City, and Amazon Local.
This document provides an overview of distribution and channel management. It discusses marketing channels and the functions they perform in bringing products from producers to consumers, such as making products available, providing information, promotion, and taking on risks. It also covers types of channel members like wholesalers, retailers, and agents. Key factors that affect channel decisions are described, like the type of product, customer, market environment and a company's internal considerations. Channel conflict that can arise between members is also summarized.
This document discusses cost-volume-profit (CVP) analysis, which managers use to estimate future revenues, costs, and profits to help plan operations. CVP analysis examines how profits change with sales volumes, costs, and prices. It is used to determine the sales levels needed to achieve profits or avoid losses, and to analyze the appropriate cost structure given operational risk. The document then provides an example of how CVP analysis could have helped Coleco better forecast demand for its products and prioritize production to avoid losses and missed profit opportunities.
The vCE Charter Study found that on average 31% of digital display ads across 18 campaigns were not in-view, meaning they had no opportunity to be seen. In-view rates varied significantly both across campaigns (ranging from 55% to 93% in-view) and sites (ranging from 7% to 100% in-view). While targeting basic demographics generally achieved audience delivery goals, targeting behavioral segments showed stronger potential, with some campaigns achieving 67% of impressions to the target behavioral audience. The study also found that 72% of campaigns had some impressions on sites with objectionable content, and 0.16% of impressions on average were fraudulent. However, ad pricing did not correlate with in-view rates or audience targeting
The document provides sample questions related to financial management concepts. It includes multiple choice questions testing understanding of topics like capital asset pricing model, bonds, risk, time value of money, capital budgeting techniques, and cost of capital. The highest level of information is that the document assesses knowledge of basic to intermediate level financial management and investment concepts through multiple choice questions.
The document contains 13 problems related to valuation of securities such as stocks and bonds. Key details include calculating stock prices given dividend growth rates, required rates of return, bond yields and prices given coupon rates and maturities. The problems require using concepts like present value, dividend discount model, yield to maturity and understanding how interest rate changes affect bond prices.
Bond values can be discussed in terms of dollar price or yield to maturity, which are equivalent. Bond yields include the coupon rate, current yield, yield to maturity, modified yield to maturity, yield to call, and realized yield. Duration is a measure of bond price volatility that accounts for time to maturity and coupon payments. It indicates the sensitivity of price to changes in yield. Modified duration adjusts for the holding period yield. Convexity measures the curvature of the price-yield relationship.
Rectangles are consolidation patterns that signify indecision between buyers and sellers. They form when price ranges between high and low barriers with alternating highs and lows, and volume tapers off over time. The breakout from the rectangle is reliable, with prices unlikely to return once broken. Target price moves are usually the height of the rectangle. Flags are short, slight price trends within a larger movement that last 1-2 weeks. Rounding bottoms form at market bottoms as investor interest wanes, signaling a reversal from bearish to bullish.
Technical analysis uses statistical data from market activity, past prices and trading volumes to identify patterns and indicators that can predict a security's future performance. Hundreds of techniques exist, including chart patterns like bar charts, candlestick charts and point and figure charts that consolidate supply and demand forces into a visual representation. Technicians believe prices move in predictable trends and patterns until a change causes the trend to reverse, and chart analysis helps identify support and resistance price levels as well as common patterns like double tops/bottoms and head and shoulders formations that can signal trend reversals.
The document discusses risk and return in investments. It provides an example of how to calculate percentage return on a stock investment using capital gains from price appreciation and dividends. It also includes a table showing average annual rates of return and risk premiums for different types of investments like Treasury bills, bonds, and stocks over different time periods, with common stocks providing the highest returns and risk premiums. It defines maturity premium and market risk premium and explains how the rate of return on common stocks is calculated using Treasury bill interest rates and market risk premium. Finally, it lists some common ways to measure investment risk like standard deviation and variance.
This document discusses various techniques for financial statement analysis, including ratio analysis. It outlines different types of ratios such as traditional ratios calculated from the balance sheet and income statement, as well as functional ratios related to liquidity, leverage, activity, and profitability. Specific balance sheet, income statement, and composite ratios are defined, such as current ratio, quick ratio, debt-to-equity, gross profit ratio, and return on equity. Formulas and components of key ratios like current ratio and quick ratio are provided. The interpretation and limitations of ratios are also addressed.
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ISO/IEC 27001, ISO/IEC 42001, and GDPR: Best Practices for Implementation and...PECB
Denis is a dynamic and results-driven Chief Information Officer (CIO) with a distinguished career spanning information systems analysis and technical project management. With a proven track record of spearheading the design and delivery of cutting-edge Information Management solutions, he has consistently elevated business operations, streamlined reporting functions, and maximized process efficiency.
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His expertise extends across a diverse spectrum of reporting, database, and web development applications, underpinned by an exceptional grasp of data storage and virtualization technologies. His proficiency in application testing, database administration, and data cleansing ensures seamless execution of complex projects.
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Date: May 29, 2024
Tags: Information Security, ISO/IEC 27001, ISO/IEC 42001, Artificial Intelligence, GDPR
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2. Distribution’s Function
• The major purpose of marketing is to satisfy
human needs by delivering products of various
types to buyers when and where they want them
and at a reasonable cost.
• The “when and where” is the function of
Distribution
3. What is a Distribution Channel?
• A set of interdependent organizations
(intermediaries) involved in the process
of making a product or service available
for use or consumption by the consumer
or business user.
• Marketing Channel decisions are among
the most important decisions that
management faces and will directly
affect every other marketing decision.
4. Why are Marketing Intermediaries
Used?
• The use of intermediaries results from their
greater efficiency in making goods available
to target markets.
• Offer the firm more than it can achieve on it’s
own through the intermediaries:
– Contacts,
– Experience,
– Specialization,
– Scale of operation.
• Purpose: match supply from producers to
demand from consumers.
10. Conventional Distribution Channel vs.
Vertical Marketing Systems
VerticalVertical
marketingmarketing
channelchannel
Manufacturer
Retailer
ConventionalConventional
marketingmarketing
channelchannel
Consumer
Manufacturer
Consumer
Retailer
Wholesaler
Wholesaler
11. Types of Vertical Marketing SystemsTypes of Vertical Marketing Systems
Corporate
Common Ownership at Different
Levels of the Channel
Corporate
Common Ownership at Different
Levels of the Channel
Contractual
Contractual Agreement Among
Channel Members
Contractual
Contractual Agreement Among
Channel Members
Administered
Leadership is Assumed by One or
a Few Dominant Members
Administered
Leadership is Assumed by One or
a Few Dominant Members
12. Vertical Marketing Systems
• Corporate systems - total ownership
• Administered - strong leadership
• Contractual - legal relationships
13. Planning the Channel of
Distribution
• Determining the structure
– Marketing mix strategy
– Organizational resources
– External environmental factors
– Market characteristics
– Consumer preferences and behavior
– The nature and availability of Intermediaries
– Other environmental factors
18. Rural Market: A Snap Shot
742 million people, largest potential market in the world
Rural is bigger than urban
FMCGs 53%
Durables 59% Source: NCAER, IMDR 2002
Estimated annual size of the rural market
FMCG Rs 50,000 crore
Durables Rs 5,000 crore
Agri-inputs (incl tractors) Rs 45,000 crore
2 / 4 Wheelers Rs 8,000 crore
Total Rs1,08,000 crore Source: Francis Kanoi, 2002
19. Some impressive facts about the rural sector
In 2001-02, LIC sold 55 % of its policies in rural India
Of two million BSNL mobile connections, 50 % in small towns/villages
Billing per mobile in small towns in A P is higher than in Hyderabad
Rural Market: A Snap Shot
The 24 million Kisan Credit Cards (KCC) issued in rural exceed the
17.7 million credit-plus-debit cards issued in urban. A whopping
Rs 52,000 crore has been disbursed under the KCC scheme
Of 20 million Rediffmail signups, 60 % are from small towns. Similarly
the 1,00,000 who have transacted on Rediff online shopping site, 50
per cent are from small towns
20. Share of agriculture sector in electricity consumption has grown
From 17.6 % (1980-81) to 29.2% (1999-2000) of total consumption.
Industry share during same period is down from 58.4% to 34.8%
Rural Market: A Snap Shot
Growing rural incomes
Annual HH income
Urban Rs 1,02,963
Rural Rs 56,630
Source: NCAER, IMDR 2002
21. Changing Rural Aspirations
Changing lifestyle – restraint to release philosophy among youth
Youth and women are the demand generators
Buy value for money, not cheap products (branded consumption in FMCGs
accounts for 80% of sale, brands could be national or regional) Source: ORG-MARG
Land and gold (traditional symbols of security) being replaced with
modern financial savings instruments
1999-00 Urban Rural (million HHs)
Investments made 6.23 6.18
Of these, New Investors 2.53 (40%) 5.13 (80%) Source: NCAER
For marketers this means money liquidity and access to formal funds by rural customers
for purchase of high ticket items
22. What Constitutes Rural?
Census of India Definition
i. Revenue villages with clear surveyed boundaries not having a
Municipality, Corporation or Board
ii. Density of population not more than 400 per sq km; and
iii. At least 75% of the male working population is engaged in
agriculture and allied activities
But for most companies
In FMCG category up to 20,000 pop
For Durables up to 50,000 pop
23. Distribution of Villages in India
Population No of villages % of total villages
Less than 200 1,14,267 17.9
200-499 1,55,123 24.3
500-999 1,59,400 25.0
1,000-1,999 1,25,758 19.7
2,000- 4,999 69,135 10.8
5,000- 9,999 11,618 1.8
10,000 & above 3,064 0.5
Total no. of villages 6,38,365 100.00
Source: Census 2001
24. Distribution of Towns in India
Town Class Population No of towns % of total towns
Class I 1 lac and above 423* 8.4
Class II 50,000-99,999 498 9.9
Class III 20,000- 49,999 1386 27.5
Class IV 10,000- 19,999 1560 31.0
Class V 5,000- 9,999 1057 21.0
Class VI less than 5000 110 2.2
Total no of
towns
5034 100.0
*10 lac+ – 27
5-10 lac – 42
1- 5 lac - 354
Source: Census 2001
25. Issues in Rural Marketing
Inadequate data on rural markets
Lack of understanding of rural consumers
Reaching products / services to 6.4 lac villages
Poor infrastructure
Only 40% villages connected by all weather road
Though > 90 % villages electrified, only 1/3rd
rural homes have electric
connections
Poor availability of shops in smaller villages (figures in %) Source: IMRB
Shops
villages
None 1-4 5-15 16+
< 500 pop 26 56 15 3
500-1,999 pop 7 41 42 10
2000+ pop 2 8 44 46
26. Issues in Rural Marketing
Low levels of literacy
Rural Literacy 59.4%
Urban Literacy 80.3%
Source: Census 2001
Poor reach of mass media
Source: NRS
15 official languages and tremendous cultural diversity
23
26
36
57
Press Cinema TV All Media
%
27. Myth 2: Purchasing power is low
Number of middle class HHs (annual income Rs 45,000- 2,15,000)
Rural 15.6 million
Urban 16.4 million Source: NCAER
For same income level, disposable surplus in rural is much higher than
urban
Rural Myths
Myth 1: Rural market is a homogeneous mass
15 languages, 4 religions, cultural diversity, vastly varying rural
demographics
Literacy (Kerala 80%, Bihar 35%)
Population Below Poverty Line (Orissa 62%, Punjab 14%)
28. Myth 3: Reaching 6 lac+ villages is a distribution nightmare
Consumption in villages but purchase from towns
Durables: 95% bought from 20k+ towns ( 4,000 nos)
FMCGs: bought from 2,000+ pop villages ( only 84,000, or 13% of
total villages) where 50% of rural population lives, the more affluent.
Smaller villages very poor and lack shops
Rural Myths
Myth 4: Marketers/Ad agencies believe in TV for rural
TV reach 36% only, media dark area of 240 million in Bihar, Orissa,
East UP, MP and Rajasthan
During sowing and harvest time electricity for agriculture but no
time to watch TV, after harvest when farmers are free, electricity
is diverted to industry
29. Myth 5: Urban ads are equally suitable for rural audiences
Rural Myths
Myth 6: Individuals decide about purchases
Decision making process is often collective for expensive items
Purchase process- user, influencer, decider, buyer, one who
pays can all be different.
So marketers must address brand message at several levels
30. Myth 7: Western market research methodology suitable for rural too
Visuals/colors more effective than numerical scales for ranking/rating
Source: MART
Mother of All Myths : The rural boom is over
Market size has grown rapidly
Below normal monsoons and weak agricultural prices in last 2 years
Rural Myths
31. Rural Market: Macro Scenario
Flow of Institutional Credit to Agriculture
Ninth Plan (1997-02) Rs 2,33,700 crore
Tenth Plan (2002-07) Rs 7,36,570 crore
Kisan Credit Cards
Issued 24 million (cumm loan Rs 64,000 cr)
Target (2004-05) All Eligible Farmers (50+ million ?)
Source: NABARD
Road construction programme to connect 1,90,000 villages
during Tenth Plan, thus total villages connected will be 70%
Source: Planning Commission
35. Urban Rural All india
Hair Oil (ml) 211 47 93
Toilet Soap (gram) 887 266 439
Tooth Powder (gram) 51 15 25
Tooth Paste (gram) 191 32 76
Washing Powder (gram) 2523 872 1331
Detergent Cakes (gram) 2138 641 1057
Per Capita Consumption of key Categories
Period : 2002-03
Source : ORG
Enormous scope to increase consumption!
36. Opportunity in Rural India
Source: ORG
Value in Rs
Cr**
Contribution
to All India –
2003
Population in
Cr
Per Capita
Consumption
in Rs
URBAN 33100 69% 28.52 1161
RURAL 14700 31% ** 73.92 199
TOTAL 47800 102.44 467
** Value in packaged/branded
FMCG Market Size
1381282Rental
455101Education
211103Clothing
851414Health
22461175Other food items
929844Cereal
UrbanRuralHead
Fig in Rs
PER CAPITA ANNUAL EXPENDITURE
• Raising Disposable income
Low rental & Education cost
• No.of of Middle Income House Holds
Urban is 1.6 cr & Rural is 1.5 cr
(Middle income is annual house hold income
of Rs.45k to Rs.215k: Source NCAER)
50% of Rural consumption happens through whole sale coverage from
near by feeder markets
38. Emerging Rural Consumer: An Insight
• Not only economic indicators are encouraging, we have observed
significant changes in values and aspirations of rural consumers
• The earlier stereotypical picture of a rural consumer is giving way
to a new, ambitious and impatient consumer who clearly seems
to be in a hurry to get ahead in life.
• Values such as ‘satisfaction and contentment’ are becoming passé
and the emerging values seem to be:
Indulgence
Materialism
Ambition – urge to get ahead in life in a hurry
Transition to Partnership from Dominance (Especially with
women)
Source: Various Qualitative studies commissioned by Dabur
39. • The successful communication to rural consumers needs to be
simple, not necessarily stereotypical
• Functionality does dictate brand-choice; but there can be smart
use of emerging aspirations in communication and product
development to create better connect with rural consumers
• While rural consumers have a desire to use quality, branded
products, the task remains to deliver products that are in line with
their changing life-style aspirations at a price affordable to them
Emerging Rural Consumer: An Insight
41. Change & Continuity in Rural
• Increased Disposable income
Subsidy by the Government
Minimum Agriculture Price fixed
Agricultural committees (MSP)
• Increased literacy levels
Educational Policies ( Free & Mid day meals)
Rural Literacy rates jumped from 44.7% to
59.4% in 2001 over 1991
• Increased consumption
Rural Markets are prosperous & accessible for FMCG
42. • Better Transportation & infrastructure
Rail & Roads
More than Rs. 4600 cr allocated to Pradhan
Mantri Gram Sadak Yojna (PMGSY) : with a
vision to connect all villages above 500 pop
by 2007
• Better Communication (Project SARI*)
Telephone Internet
Teledensity per 100 people : 0.3 (1995-96) to
1.5 (2003-04)
Television through village panchayats
*Sustainable access in Rural India
Change & Continuity in Rural
Rural Markets are prosperous & accessible for FMCG
43. Growth in Rural Infrastructure
• 60 % villages - connected by all-weather roads
• 73 % villages - electrified
• >35000 branches of commercial banks
• 35 lac outlet for consumer goods
• 3,05,499 fair price shops
• 111.5 million Households
44. Challenges in Rural Distribution
• COST OF COVERAGE
Viability & Frequency
High whole sale dependence
Logistics in coverage
Cost of Infrastructure
• MAPPING ROUTE PLAN
Identifying the towns and routes
Digitized Maps
• AVAILABILITY OF RIGHT CHANNEL PARTNERS
Understanding the channel needs in Rural, like, ROI ,
Appropriate credit policy, etc
Thrust in STR & Coverage
• Synergy & Scale is critical for Rural Distribution
• Appropriate hygiene in terms of Market rates is equally vital
46. Source ORG
IN LACS
ZONE URBAN RURAL TOTAL OUTLETS
NORTH 4.8 10.4 15.2
EAST 3.5 10.3 13.8
WEST 4.2 7.2 11.4
SOUTH 4.4 7.1 11.5
TOTAL 16.8 35.0 51.8
OUTLETS PER LAC POP
ZONE URBAN RURAL TOTAL DENSITY
NORTH 171 218 203
EAST 137 208 190
WEST 193 209 203
SOUTH 172 209 195
Universe of Outlets
Outlet Density
Zonal Distribution Spread
47. FMCG companies also responding positively to exploit the potential
• Increased thrust on Direct coverage
Big Companies operate with two models
Van operation
Sub Stockist
• Making products more affordable
Emergence of Sachet SKUs
Rs.5/- & Rs10/- price segments to increase the penetration in
smaller markets
Reduced Unit selling price
The FMCG Thrust
48. Prevalent Rural Distribution Models
VAN/
SUB STOCKIST
RURAL MARKET
RETAIL
FEEDER TOWNS –
WHOLE SALE –
RETAIL
WHOLE SALE
Smaller companies adopt whole sale activation route owing to
lack of viability
49. Van Operation
• Stockist from near by Urban Market covers 4 to 5 rural markets per
day
• Distance covered per day will be max of 60 to 70 km (both ways)
• Operated mostly on cash as per the desired frequency
• It can be exclusively for the division or company as a whole
Sub Stockist Operation
• Gets stocks from Super Stockist’s appointed in the district
• Super Stockist covers typically 10 to 15 Sub Stockist’s in the
district
• Sub Stockist covers all outlets in his village like regular Stockist by
extending credit and services
• Local person in the Market results in Better Market information & Service to
outlets
• Sub Stockist can cover another 4 to 5 satellite markets near by.
• Better control on distribution
The Two Distribution Models
50. Designing Rural Distribution Network
PCS
MPV
The most prevalent Rural distribution models like Van & Super
Stockist operation can be adopted effectively only with the
above studies
Two Concepts:
51. Introducing the concept of P.C.S
PER CAPITA SALES = ___________
ANNUAL SALES
TOWN
POPULATION
52. HIGH LOW
MULTIPLE VAN SINGLE
VAN
SUBSTOCKIST
OPERATION
SUBSTOCKIST
OPERATION
WHOLE SALE
ACTIVATION/ FEEDER
MARKET
IDENTIFICATION
PER CAPITA SALES ( PCS)
POPULATIONDENSITY
HIGH
LOW
Ideal Distribution Model for RURAL with
PCS STUDY
53. Haryana – An Example
HISSAR
SIRSA
BHIWANI
KAITHAL
JIND
MAHENDERGARH
WHOLE SALE
ACTIVATION/FEEDER MARKET
IDENTIFICATION
ROHTAK
REWARI
JHAJJAR
SONIPAT
SUBSTOCKIST OPERATION
SUBSTOCKIST OPERATION
PANCHKULA
GURGAON
AMBALA
KARNAL
FARIDABAD
KURUKSHETRA
PANIPAT
YAMUNANAGAR
VAN OPERATION
Population DensityHIGH
HIGH
DISTRICTPCSLOW
LOW
HIGH LOW
POP
DENSITY
1020 0
DIST. PCS 23.65 0
54. MPV – A study by RK Swamy BBDO
MPI
(Market Potential Index)
Contributions of
Agriculture
+
Industry
+
Infrastructure
To the economic status of
the district is used to measure
Market potential
Adjusted to
population
MPV
(Market potential value)
Market Potential Value is the potential that the StateDistrict has
based on these parameters
55. MPI Parameter
• Agriculture
Value of output of major crop averaged over three year
No. of cultivator/ labor
No. of large landowner
• Industry
Bank advances to Industry
No. of workers employed in mining & quarrying
• Infrastructure to All India GDP
Bank Deposit
Bank credit to trade
Petrol & Diesel consumption
Literate Population
Urban Population
56. 0
500
1000
1500
2000
2500
MPV
ZONES
MPV
MPV 2393.77 1372.19 2352.42 1877.14
NORTH EAST WEST SOUTH
STATE UT MPV All India Rank
Uttar pradesh 800.41 2
Punjab 507.58 6
Delhi 498.37 7
Rajasthan 279.37 12
Haryana 230.74 13
Himachal Pradesh 42.97 18
Chandigarh 34.33 19
North 2393.77
West Bengal 724.2 3
Bihar 333.7 11
Orissa 154.77 15
Assam 108.04 16
Tripura 14.68 20
Meghalaya 8.23 22
Nagaland 7.64 23
Arunachal Pradesh 7.31 24
Manipur 7.2 25
Mizoram 4.08 26
Sikkim 2.34 28
East 1372.19
Maharastra 1532.09 1
Gujarat 412.84 8
Madhapradesh 357.31 10
Goa 47.4 17
Daman & Diu 1.6 30
Dadra & Nagar Haveli 1.18 31
West 2352.42
Andhra Pradesh 630.37 4
Tamilnadu 629.99 5
Karnartaka 381.21 9
Kerala 221.78 14
Pondichery 8.65 21
Lakshadweep 3.48 27
Andaman & Nicobar 1.66 29
South 1877.14
North and West have the highest MPV
Source RK SWAMY
58. Both PCS and MPV have high Correlation
HIGH LOW
PANCHKULA
GURGAON
AMBALA
KARNAL
FARIDABAD
KURUKSHETRA
PANIPAT
YAMUNANAGAR
VAN OPERATION SUBSTOCKIST OPERATION
ROHTAK HISSAR
REWARI SIRSA
JHAJJAR BHIWANI
SONIPAT KAITHAL
JIND
MAHENDERGARH
SUBSTOCKIST OPERATION W/S ACTIVATION &
Feeder markets
DISTRICTPCS
POPULATION DENSITY
HIGHLOW
MPV RANK
GURGAON (599.7)
AMBALA (544.5)
KARNAL (506.3)
FARIDABAD (1020.2)
ROHTAK (539.8)
SONIPAT (603.8)
VAN
OPERATION
KURUKSHETRA (541.11)
PANIPAT (763.13)
YAMUNANAGAR (541.11)
SUBSTOCKIST
OPERATIONS
HISSAR (386.1)
SIRSA (260.4)
SUBSTOKIST
OPERATION
REWARI (483.16)
BHIWANI (298.1)
KAITHAL (408.9)
JIND (440.12)
MAHENDERGARH
(437.15)
WHOLESALE
ACTIVATION
59. Key Challenges in the Future
Increasing occasions for use in FMCGs (consumption)
Reaching the product to remote rural locations and entering more rural
homes (penetration)
Increasing rural incomes (market growth)
Communicating with diverse rural audiences speaking diverse languages
Making effective use of the large available infrastructure
Post Offices 1,34,000
Haats (periodic markets) 47,000
Melas (exhibitions) 25,000
Mandis (agri markets) 7,000
Public Distribution Shops 3,50,000
60. Rural Markets: The Future
Technology will play a key role in transforming markets
ITC’s e-choupal and other IT initiatives (EID Parry, Amul Dairy
Information System Kiosk)
STD revolution/ mobile connectivity
Proliferation of large format rural retail stores
DSCL Haryali stores
M & M Shubh Labh stores
TATA/Rallis Kisan Kendras
Escorts rural stores
Warnabazaar, Maharashtra (annual sale Rs 40 crore)
61. Developing Distribution Tactics
Selecting Channel PartnersSelecting Channel Partners
Reward or
Coercive
Power
Reward or
Coercive
Power
Legitimate
Power
Legitimate
Power
Economic
Power
Economic
Power
Managing the Channel of Distribution
Channel Leader Power
Managing the Channel of Distribution
Channel Leader Power
Distribution Channels & the Marketing MixDistribution Channels & the Marketing Mix
63. Decision Making Framework
Prospects
of
Destructive
Conflict
Importance of threatened
channel in terms of current or
potential volume or profitability
High Low
High (FIRE) Act to avert or address
conflict
Allow threatened
channel to
decline
Low
(Smoke)
Look for opportunities
to reassure threatened
channel and leverage
your power
Do nothing
64. Channel Conflict: Identifying
Threats
• First, are the channels really attempting to
serve the same end users?
• Second, do channels mistakenly believe
they are competing when in fact they are
benefiting from each other's actions?
• Third, is the deteriorating profitability of a
griping player genuinely the result of
another channel's encroachment?
• Fourth, will a channel's decline
necessarily harm a manufacturer's
profits?
65. Managing Channel Conflict
WHEN TWO OR MORE CHANNELS TARGET
THE SAME CUSTOMER SEGMENT
• Differentiate the Channel offer.
• Define Exclusive Territories.
• Enhance or Change the Channels Value.
66. Managing Channel Conflict
CHANNEL ECONOMICS DETERIORATE
• Change the channels economic formula: (Grant rebates
if an intermediary fulfill certain requirements; Adjust
margins between products to support different channel
economics; and Treat channels fairly to create level
playing field)
• Create Segment Specific Programs (certain services
not available via direct channels)
• Complement value proposition of the existing channel
by introducing a new channel
• Foster consolidation among intermediaries in a
declining channel.
67. Managing Channel Conflict
THREATENED CHANNEL STOP
PERFORMING OR RETALIATE AGAINST
THE SUPPLIER
• Leverage Power (eg. Strong Brand) against
the channel to prevent retaliation
• Migrate volume to winning channel
• Back off