Rural development aims to improve the economic and social lives of rural communities through collective efforts between rural people and government authorities. It is a process of change that enables rural communities to fully contribute to national programs and improve their conditions. Rural development faces challenges including poor infrastructure, understanding diverse rural consumer mindsets, high promotion costs due to distance and dispersion, and lack of competence among urban-based marketing staff.

1. RURAL DEVELOPMENT

2. Rural development is a strategy designed to
improve the economic and social life of rural poor.
It is a process, which aims at improving the well
being and self realization of people living outside
the urbanized areas through collective process.
Rural Development is all about bringing change
among rural community from the traditional way
of living to progressive way of living. It is also
expressed as a movement for progress.

3. The United Nations defines
Rural Development as:
“Rural Development is a process of change,
by which the efforts of the people
themselves are united, those of government
authorities to improve their economic,
social and cultural conditions of
communities in to the life of the nation and
to enable them to contribute fully to
national programme.”

4. Meaning of Rural
• Collin’s cobuild dictionary describes the
word rural as “places for away from
towns or cities”
• Sociology point of view rural is defined as
a group of people who are traditionalists
in out look, rooted in the land and who
resist change.

5. • The census of India defines rural as that what is
not urban and urban is
– locations with in a municipality/ corporation
– other location that satisfy the following criteria
• 1.minimum population of 5,000
• 2. at least 75% of male workforce engaged
in non- agricultural activities
• 3. a population density of over 400 person
per sq.km.

6. Factors differentiating rural marketing
from urban marketing
• Infrastructure availability :electricity supply,
finance facility, education level, roads
connectivity
• Income streams : in rural areas in is seasonal
and highly unreliable, consumption pattern is
quite different
• Life style: daily routine of consumers is
different

7. • Context : because of variation in infrastructure
and income , an individual exists in rural areas
is different
• Socio – cultural back ground :value system,
goods/services and consumption in general is
quite different
• Accessibility : the cost and logistics is high
• Media reach and habits: different types of
promotional strategy in these two markets.

8. • Nature of competition : the nature and
intensity of competition amongst the
brands is very different in the two
markets
• Consumer behaviour : the consumer’s
response to marketing stimulate differs
widely in two markets

9. Rural India : A Brief profile
• Adi Godrej, chairman, Godrej group .
“ the rural consumer is discerning
and the rural market is vibrant. At
the current rate of growth, it will
soon outstrip the urban market. The
rural market is no longer sleeping but
we are”

10. • Villages are the heart of India
• 75% of population lives in 6,38,365 villages
• 90% is concentrated in the village having
population less than 2000
• Rural segment comprises 13.5 crore
households which constitute 72% of total
households in India
• But the rural market is not homogeneous
across the country
• The consumer willingness to accept
innovation also varies among the rural market

11. Nature and characteristics of the rural
market
1) large and scattered market
• 75 crore rural consumers who live in
approximately – 6,38,365 villages
• 23% have population less than 200
• 21% have population between 200 and 500
• So widely scattered- raise transportation
costs, affects the viability of the distribution
system

12. • 2) Heterogeneous market
• Not a homogeneous
• 24 languages and 1642 dialects- varies every
100 km
• Difficult to develop uniform message – caste,
community, tradition values (from state to
state, region to region differ)

13. • Variations in economic development and
socio-cultural background influence
• Literacy rate in rural south India is higher than
rural north
• Rural consumers in the south are more brand
conscious
• So, variations in behaviour due to the
consumer environment – geographical,
occupational

14. 3) Income from agriculture
• 55% of rural income comes from the
agriculture sector
• Hence rural prosperity is tied with agricultural
prosperity
Recently- gradual reduction in the sole
dependence on agriculture( other sectors
plays significant role in the rural economy)

15. 4) Standard of living
• Lower standard of living
• 70% rural population is employed in small –
scale agricultural and related occupation
• Seasonality’
• As it is unreliability in income- rural consumers
are extremely conscious in their purchase
behaviour
• Low literacy, social backwardness, low savings

16. 5) infrastructural facilities
• Road, warehouse, communication system and
financial facilities are inadequate in rural area
• Roads do not connect nearly 50% villages in
the country
• Inadequate infrastructure is single most
important factor distinguishes urban and rural
• Promotion and physical distribution thus
becomes very difficult

17. Life style of rural consumer
• Haryana that had television(53%) sets
was more than the number of
households that had toilets(44.5)
1) rural consumer is very religious
• The promotional material built
around religious themes is not only
going to last longer, but will be kept
with care by the villager

18. 2) rural consumers prefer to work hard
themselves
• Would not like to be replaced by a
machine
• They are less likely to spend on
products making life a bit easier

19. • 3) strong family ties and respect for
family values
• More conservative in their approach
toward the different socio, economic
issues
• The loose, free flowing hair of a girl
in a shampoo or hair oil
advertisement may actually act as
barrier in the rural market.

20. • 4) likes to play cards and hangs out at choupal
• Whatever promotional message is delivered to
the opinion leaders in a village, gets
transmitted
• Love chatting with friends
• Word of mouth stories develop around easily
and fast
• ITC which has created an e-choupal- using the
internet to bring down any barrier with regard
to technology

21. Profile of rural consumer
• 1) traditional outlook
• Values old customs and tradition
• 2) perception and its influence
• In rural markets, colour, size and shapes are
interpreted differently

22. • The lower literacy levels in the rural markets
increase the importance of visual influence
• 3) less exposure to marketing stimuli
• Low exposure to branded product
• Advertisement
• Source of information and learning
• Low convenient buying
• 4)conscious of value for money

23. • 5) realistic aspiration : he can reach out and
stretch the budget but that is done with in
limits only
• Dual usage 15% of surf and 12% of ariel using
families also use nirma detergent
• 18% of pantene using households also used
clinic plus shampoo
• 6)concept of quality-values for long lasting
“solid), low – cost maintenance

24. • 7)attitude towards prestige products
• Yet they are interested in products adding to
his prestige but the price of a product justifies
the value equation

25. • Rural markets remain untapped because of
three D’s
• 1.distance
• 2.diversity
• 3.dispersion
Challenges in Rural Business

26. The challenges are..
• 1.Distribution: the problems of physical
distribution of channel mgt adversely affect
the service as well as the cost aspect- it is not
commensurate with the returns that the
marketers expect.(poor infrastructure)
• Greatest challenges is reaching out to the
remotest destinations and having a number of
vendors at the retailing end.

27. • 2.understanding the psyche of the rural
consumer
Very distinct from one another
Campaigns have to be tailor-made for each
product category, each region, custom in
region, language and dialects etc..
• 3.limited knowledge
Different research organisations are very
different from one another

28. • 4. communication: comm..barrier due to
language or icons used for advertising
Different interpretation in rural market
Dubbing – not a right solution for rural
audience
The context, story line, narration, idiom,
symbols, appeal need to be examined while
developing an advertisement
Explain directly and clearly

29. • 5. cost per contact
• Comparing the rural promotional cost with the
urban - is the biggest challenge
• Renting a van per day cost more than Rs 3500
and there are 6 lakhs villages spending 500
dialects to cover
• One exposure may not be sufficient
• By simple calculation – we can know that the
total cost will be much more to reach the
entire rural market.

30. • 6. sale of fakes and spurious product
• The retailer pushes imitation products – as
they get better margins (retailer)
• A research undertake by A.C. Neilsen reported
that the sales value of the fake of P&G’s vicks
brand were almost equal to the sale of the
brand
• Secondly , selling face goods in not a criminal
offense in India and it is under civil law
• The only practical way to deal with fake is to
improve the distribution and make the
products available in as many places

31. • Original products imitation
• 1.pond polons
• 2.rin run
• 3.501 bar 509 bar
• 4. brooke bond benson brand
• 5. lifebuoy lifejoy, liteboy

33. • 7.budgetary allocation
• “Corporate sector loves the rural markets, but
when it comes to allocations, the amount of
investment in rural marketing is very limited”,

34. • 8.urban orientation and bias
• Rural people are just like urban ones
• They too have the same needs, desires and
aspirations
• Most of the marketer apply minor
modifications (of the Indian urban market)
• But, these paradigms (patterns) fail

35. • 9.lack of right competence and commitment
at frontline level
• Most of the frontline staff is from the urban
areas
• They are not very comfortable to travel and
interact with the villager
• Solution is recruiting frontline staff from the
rural parts of India