FICCI BRAND SUMMIT SPOTLIGHTS NEED TO GAUGE RURAL CONSUMERS’

DEMANDS WITH COLLABORATIVE NETWORK OF RETAILERS & MEDIA COMPANIES

FICCI-NIELSEN Survey Calls for Addressing Aspirations of Rural India

NEW DELHI, August 5, 2010. A FICCI-Nielsen study on bridging the urban rural divide calls upon
marketers and brand builders to address the aspirations and demands of rural India by focusing
on 4 As, namely, awareness, availability, affordability and accessibility.

Based on responses from 58 FICCI members across location & industry type, the survey reveals
that rural India is catching up with urban India in terms of demand for aspirational products;
50% of them expressing concern over lack of infrastructure in terms of education and sanitation
levels and a third pointing to brain drain due to migration to urban areas.

The survey was released by Mr. Rajan Bharti Mittal, President, FICCI at the inaugural session of
the FICCI Brand Summit here today.

On the awareness front, the survey reveals the respondents favour reaching out to consumers
through self-help type programmes with a win-win agenda and participation in ‘mela’ and ‘rural
haat’ type of programmes.

The survey notes that reach is still an opportunity in India. Since the retail format is mostly
traditional in rural areas, limited space is available in the shop to stock products and there is
war for shelf space. Therefore, the survey highlights the need for increasing the distribution
network, collaborating with NGOs and utilization of government infrastructure as sales
channels.

It calls for addressing the issue of affordability by coming out with products in small packs for
the rural market, providing relevant features and using technology to come up with cost-
efficient solutions.
As regards acceptability, the survey underlines the need for fine tuning the existing offerings,
‘Indovations’ (innovations for India) to provide the relevant features and establishing a price-
benefit equation.

Mr. Rajan Bharti Mittal, in his remarks, pointed out that the big challenge before corporates
and brands was to bridge the gap between the 700 million rural and 300 million urban
consumers. Companies, he said, would have to re-engineer their products for delivery to the
acutely demanding and discerning rural populace. Rural richness, he said, was perceptible,
adding that it was a pure myth that the rural spend was not as much as the spending by urban
dwellers.

Mr. Suhel Seth, Chairman, FICCI Advertising & Marketing Committee and Managing Partner,
Counselage India, stated that “We want cerebral engagement from the people who have
understood the dichotomy between rural and urban India.” Marketers who have understood
the social idiom have done well and if aspirations are not met social tensions would result, he
said.

Mr. Piyush Mathur, President, India, The Nielsen Company, who presented the highlights of
the FICCI Nielsen Survey, said that the rural potential was huge as the size of the market was
daunting with demand for durables higher than in semi-urban areas, rural areas were
collectively rich, contributing to 55% of national monthly per capita expenditure, and the
opportunity for growth was immense as food categories were growing much faster than in
urban India. The market potential, he said, was sustainable with Rs. 535 billion being allocated
for rural development in 2009-10, 90,000 plus NGOs working towards rural upliftment and
corporates focusing on the rural sector.

The day-long summit deliberated on how will brands ever address the widening economic
disparities of the two India’s, would aspirations of a disparate India ever be met through brands
and how ill marketing transform as India grows younger.

MEDIA DIVISION

Taresh Arora
Media Relations Officer
Tel : 23736307 & 23357392 (Direct)
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23753119 (Fax)