Current

Marketing
Practices in
Consumer
Durables in
Rural India
Contents

................................................................................................................................... 1

Contents..................................................................................................................... 2

Introduction................................................................................................................ 3

................................................................................................................................ 3

Indian Rural Market:................................................................................................3

Recent shift in attention from urban to rural market:.............................................3

Special Features of rural markets:..........................................................................4

Methodology............................................................................................................... 6

................................................................................................................................... 6

Questionnaire ............................................................................................................ 7

Responses.................................................................................................................. 8

Respondent 1.......................................................................................................... 8

Respondent 2.......................................................................................................... 9

Respondent 3........................................................................................................ 12

Learnings from the Project.......................................................................................14

Awareness............................................................................................................. 14

Acceptability......................................................................................................... 14

Availability............................................................................................................ 15

Affordability...........................................................................................................15

Conclusion................................................................................................................ 16

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Introduction

Indian Rural Market:

The census of India defines rural market as any inhabitation where the
population density is less than 400 per sq. km., where at least 75% of the
male working population is engaged in agriculture and where there exists no
municipality or board. This definition encompasses 70% of Indian population,
who resides in 6.4 Lakh villages.

Recent shift in attention from urban to rural market:

The Indian rural market has a huge demand base ad offers great
opportunities to marketers. Two-thirds of Indian consumers live in rural areas
and almost half of the national income is generated here. The reasons for
heading into the rural areas are fairly clear. The urban consumer durable
market for products like colour TVs, washing machines, refrigerators and air
conditioners is growing annually at between 7 per cent and 10 per cent.

The rural market is zooming ahead at around 25 per cent annually. "The
rural market is growing faster than urban India now," says Venugopal Dhoot,
chairman of the Rs 989 –crore (Rs billion) Videocon Appliances. "The urban
market is a replacement and up gradation market today," adds Samsung's
director, marketing, Ravinder Zutshi.

'Go rural' is the slogan of marketing gurus after analyzing the socio-
economic changes in villages. The Rural population is nearly three times the
urban, so that Rural consumers have become the prime target market for
consumer durable and non-durable products, food, construction, electrical,
electronics, automobiles, banks, insurance companies and other sectors
besides hundred per cent of agri-input products such as seeds, fertilizers,
pesticides and farm machinery. The Indian rural market today accounts for
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only about Rs 8 billion of the total ad pie of Rs 120 billion, thus claiming 6.6
per cent of the total share. So clearly there seems to be a long way ahead.
Although a lot is spoken about the immense potential of the unexplored rural
market, advertisers and companies find it easier to vie for a share of the
already divided urban pie.

The success of a brand in the Indian rural market is as unpredictable as rain.

It has always been difficult to gauge the rural market. Many brands, which
should have been successful, have failed miserably. More often than not,
people attribute rural market success to luck. Therefore, marketers need to
understand the social dynamics and attitude variations within each village
though nationally it follows a consistent pattern looking at the challenges
and the opportunities which rural markets offer to the marketers it can be
said that the future is very promising for those who can understand the
dynamics of rural markets and exploit them to their best advantage. A
radical change in attitudes of marketers towards the vibrant and burgeoning
rural markets is called for, so they can successfully impress on the 230
million rural consumers spread over approximately six hundred thousand
villages in rural India.

Special Features of rural markets:

Unlike urban markets, rural markets are difficult to predict and possess
special characteristics. The featured population is predominantly illiterate,
have low income, characterized by irregular income, lack of monthly income
and flow of income fluctuating with the monsoon winds.

Rural markets face the critical issues of Distribution, Understanding the rural
consumer, Communication and Poor infrastructure. The marketer has to
strengthen the distribution and pricing strategies. The rural consumer
expects value for money and owing to has unsteady and meager status of
weekly income; increasing the household income and improving distribution

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are the viable strategies that have to be adapted to tap the immense
potential of the market.

Media reach is a strong reason for the penetration of goods like cosmetics,
mobile phones, etc., which are only used by the urban people. Increasing
awareness and knowledge on different products and brands accelerate the
demand. The rural audience are however critical of glamorous ads on TV,
and depend on the opinion leaders who introduce the product by using it and
recommending it.

Opinion leaders play a key role in popularizing products and influence in

rural market. Nowadays educated youth of rural also influences the rural
consumers. Rural consumers are influenced by the life style they watch on
television sets. Their less exposure to outside world makes them innocent
and fascinated to novelties. The reach of mass television media, especially
television has influenced the buying behavior greatly.

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Methodology

The basic aim of this project is to identify the current marketing practices in Rural
India adopted by various consumer durable companies. We can do that by a mere
secondary analysis of the available reports from the research sites.

But we adopt an unconventional methodology for this project. We do not end up

reproducing the current practices but for the betterment, we refine and fine tune
our report to identify how successful the current market practices have been and do
the consumers actually buy because of those marketing practices. Which of the 4As
is dominant in helping the rural consumer make the final purchase and what are the
compulsive factors that have to be present for the final purchase is what we also
analyse along with the current marketing practices.

We formed a questionnaire and questioned 3 different villagers for their take on the
current marketing practices. All the questions in the questionnaire were
strategically chosen considering into account the 4 As and questions were based on
each of the 4As along with some focus on the key influencer and the decision
maker.

After we got the subjective questionnaire filled from the respondents, we analysed
it and thus did a comprehensive 4A study and the drawbacks and the advantages
were quite clearly emerging from the results.

Thus the current marketing practices for consumer durables along with the prime
important characteristic of effectiveness are the two factors that comprehensively
emerge from the report.

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Questionnaire

1. Age:
2. Gender:
3. Income:
4. What consumer durables do you own?
5. Who in the family is the influencer for each of the above mentioned products?
6. Who is the main decision maker in your family?
7. Who goes to make the purchase?
8. How important is the price of the product in your purchase decision?
9. From where do you buy them?
10. Do you buy any brand or are you loyal to a specific brand?
11. Does the proximity of the place from where you buy matter?
12. Do you listen to the retailer or go by your preset mindset?
13. How did you come to know of a particular brand? (Media Vehicles)
14. Whom do you go to for the brand recommendation?
15. Do you buy it anytime of the year or only during certain seasons?
16. How do you bring the product back to your home? (Mode of transport)
17. How do you finance your purchases?

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Responses

Respondent 1
1. Age: 42 years
2. Gender: Male
3. Income: Rs 3-4 lakhs P.A.
4. What consumer durables do you own?
• Television
• Refrigerator
• Washing Machine
• Mixer Grinder
• Inverter
5. Who in the family is the influencer for each of the above mentioned
products?
• Television: Son
• Refrigerator: Wife
• Washing Machine: Wife
• Mixer Grinder: Wife
• Inverter: I Myself
6. Who is the main decision maker in your family?
I Myself

7. Who goes to make the purchase?

I Myself

8. How important is the price of the product in your purchase decision?

As we don’t buy these products often so we don’t give much importance to
price, quality is more important to us.

9. From where do you buy them?

Most of the Consumer durables are available in Revari (a feeder town) which
is 23 Kms from here.

10. Do you buy any brand or are you loyal to a specific brand?

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 We prefer small brands (local) above big brands as these small brands
provide after sales service in the village whereas for the big brands we will
have to go to Jhajhhar (Distt HQ)

11. Does the proximity of the place from where you buy matter?
Yes

12. Do you listen to the retailer or go by your preset mindset?

No, we always decide before going to the retailer

13. How did you come to know of a particular brand? (Media

Vehicles)
• TV
• Radio
• Newspaper
• Friends and family
14. Whom do you go to for the brand recommendation?
• Friends (who own the brand)
15. Do you buy it anytime of the year or only during certain
seasons?
We buy mainly in festive season of Deepawali or during Marriages

16. How do you bring the product back to your home? (Mode of
transport)
• Public transport (Bus Service)
• Private Jeeps
• Motorcycle
17. How do you finance your purchases?
Mainly through our savings

Respondent 2
1. Age: 38 Years
2. Gender: Male
3. Income: 2 lakh pa
4. What consumer durables do you buy?

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 • TV
• Refrigerator
• Washing Machine
• DVD/CD player
• Inverter
• Sewing Machine
• Ceiling and Table Fan

5. Who in the family is the influencer for each of the above mentioned
products?
• TV: Leading Male
• Refrigerator: Leading Male
• Washing Machine: Leading Male+ Opinion from leading lady
• DVD/CD player: Leading Male + Opinion from Children
• Inverter: Leading Male
• Sewing Machine: Leading Lady
• Ceiling and Table Fan: Leading Male

6. Who is the main decision maker in your family?

Leading Male

7. Who goes to make the purchase?

Leading Male

8. How important is the price of the product in your purchase decision?

For most of the items, price is not so important but quality and after sales
service are the essential attributes looked upon while making the final buying
decision.

9. From where do you buy them?

Most of the times nearby towns are preferred but an extra mile can be
travelled if better quality and service can be assured at that place.

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10.Do you buy any brand or are you loyal to a specific brand?
The most important factor on which the final decision depends is the after
sales service, because the item has to be taken back to the service center, in
case no at the door service option is available. But at the door service or a
nearby service centre is the feature we look in for.

11. Does the proximity of the place from where you buy matter?
It does matter but only if quality is same at all places, but if quality is
different than extra distance can be travelled to get a better product.

12. Do you listen to the retailer or go by your preset mindset?

Yes, retailer opinion does effect the buying decision, because he is always
consulted while making the final decision as he is more experienced and
know more about technical specifications.

13. How did you come to know of a particular brand? (Media

Vehicles)
Word of mouth publicity is the most common and reliable source of
information. Apart from it OOH media and on the shop merchandising also
provides lot of information.

14. Whom do you go to for the brand recommendation?

The most important recommendation comes from the previous user or
customer who provides insights about the product.

15. Do you buy it anytime of the year or only during certain

seasons?
Most of the durables are generally given as the gift items to the bride at the
time of marriage but there is also occasional and seasonal buying of Fans,
Mobile phone etc.

16. How do you bring the product back to your home? (Mode of
transport)
Big items are brought by either Bus or sometimes by Tractor

17. How do you finance your purchases?

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 Generally lump sum amount is paid for most of the products and only in case
the item is expensive and easy financing is possible, then financing is
thought about

Respondent 3

1. Age: 44
2. Gender: Male
3. Income: 5 lakhs
4. What consumer durables do you own?
• Refrigerator

• Television

• Washing Machine

• Computer

• Sewing machine

5. Who in the family is the influencer for each of the above mentioned
products?
• Refrigerator: Wife

• Television: Children

• Washing Machine: Got in Dowry (This was the general trend as he

said)

• Computer: Son

• Sewing Machine: Wife

6. Who is the main decision maker in your family?

The working husband (the respondent himself)

7. Who goes to make the purchase?

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 Except the computer, all purchases were made by him. His son went to
purchase the computer.

8. How important is the price of the product in your purchase decision?

He said that price is somewhat important in the decision making process but
for him the Samsung brand mattered a lot in the television buying decision
and he did not mind to pay a higher price for his desired brand.

9. From where do you buy them?

From a nearby bigger village from where he buys all his consumer durables.

10. Do you buy any brand or are you loyal to a specific brand?
He was highly brand loyal.

11. Does the proximity of the place from where you buy matter?
Somewhat but he did not mind traveling.

12. Do you listen to the retailer or go by your preset mindset?

Preset mindset. The retailer push did maintain somewhat, but he went into
the store with an almost preset mindset.

13. How did you come to know of a particular brand? (Media

Vehicles)
Regional newspaper and television are still the major source for media
vehicles in the village that we visited.

14. Whom do you go to for the brand recommendation?

Friends, newspaper ads, television ads, all form an equal source of
inspiration, no particular influencer from outside.

15. Do you buy it anytime of the year or only during certain

seasons?
This person was well to do, so the harvest season did not matter to him but
he did buy during auspicious occasions like Dassera.

16. How do you bring the product back to your home? (Mode of
transport)
Jeep, Bike
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 17. How do you finance your purchases?
Personal income,

Sometimes loans from the neighborhood banks.

Learnings from the Project

Awareness
The rural consumer as we derived from our project comes to know about the
consumer durables from a number of sources like

• Regional & National TV

• Newspapers

• Radio

• Word of Mouth/ Family and friends

• Merchandising at the retailer

• Billboards

So we can clearly see that, Consumers in rural India are becoming more and more
aware as their exposure to various media vehicles is increasing.

Acceptability
1. The quality parameter of the products purchased in case of consumer
durables is rated very high by the consumers. This finding is exact opposite
of the perceived thought that the rural consumer buys cheap and low quality
product.

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 2. Another important attribute of acceptability that we found out from the
respondents was that they buy smaller and lesser known brands only
because of the reason that these brands provide a better after sales service.
Mechanics of these lesser known brands visit the village in case any problem
occurs and they require any assistance. Whereas in case of bigger brands
like LG, Samsung, Sony etc. these people have to take the product to the
district HQ (Jhajhar) in case of any problem.

Availability
As far as the availability of the consumer durables is concerned we came to
following conclusions:

1. Most of the brands are available in the nearby towns that were Rewari, Jhajjar
and Pataudi. Which employees that the distribution is quite effective as most
of the customers can reach the locations easily.

2. Customers are not apprehensive about extra travelling and they are willing to
travel extra distance in order to get a better product

3. Availability of service centre is very important and this is one of the most
important factor to decide the product to buy

4. Home service is always perceived as an added advantage and sometimes a

criterion to buy a product

5. Consumers sometimes do look for specific brand and in case of absence of a

particular brand they may go to a different store

Affordability
The issues and points that were realized during the visit are:

1. Price is not the buying criterion, quality is more important

2. Financing is not looked upon and financing option would not give an extra
advantage
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 3. Most of the products are given as a gift at the time of wedding and hence
uttermost care is given to the brand and quality

4. While deciding the price the company should look at the value it is going to
create for the consumers, because rural consumers always look for value for
money

Conclusion

Thus in the above report we have comprehensively analysed the current marketing
practices that companies undertake in order to effectively lure the rural consumer
into buying the consumer durables. Along with the marketing practices, we also
analyse the effectiveness of the current practices by means of a subjective survey
of three families (dominant males: the decision maker). We then conducted a 4A
analysis and thus have a complete picture of the current marketing practices in
consumer durables and its effectiveness.

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