Вы находитесь на странице: 1из 25

Evolution of Rural Marketing

Phase – Mid 1960’s – Mid 1990’s

Green revolution transferred many poor villages
into prosperous busy centres.
As a result:
o Demand for agricultural inputs went up
o Better irrigation facilities, soil testing
o Use of HYV seeds, fertilisers, pesticides,
o Employment of machinery like:
o Power tillers, harvesters, treshers etc.
changed rural scenario.
Here marketing of “Agriculture Inputs”
assumed significance
Evolution of Rural Marketing …

Rural Marketing (Mid 1960’s – Mid 1990’s)

From/To Rural Urban
Urban Agricultural inputs Not relevant
Rural Artisan services and products Agricultural produce
o During this period, marketing of rural products,
received considerable attention in the general
marketing framework.
o Agencies like ‘KVIC’ formed.
o Village industries flourished – products like
handicrafts, handloom textiles, soaps, safety
matches, crackers etc. hit urban markets on large
Evolution of Rural Marketing …

Rural Marketing Phase After Mid 1990’s

What was not considered so far
“Marketing of household consumables and
durables” because:
1. There was no rural market as such.
Existing rural markets were not large
enough to attract attention of urban
2. They were in accessible - Small villages /
hamlets widely scattered
Evolution of Rural Marketing …
Rural Marketing Phase After Mid 1990’s
However since 1980’s
o India’s industrial sector gained in strength and
o Due to development programs of central and
state governments, service organisations and
socially responsible business groups like
Mafatfal, Tatas, Birlas, Goenkas etc. rural areas
witnessed all-round socio-economic growth.
o Economic reforms of 1991-92 further
accelerated the process.
Evolution of Rural Marketing …
Rural Marketing - After Mid 1990’s
From/To Rural
Urban Occupational inputs:
o Consumables and durables
Household Goods:
o Consumables and durables
Rural Artisan services and products
Companies Targeting Rural
Markets in India
Company Products Strategy
Bajaj Home Appliances Pricing basic models
Electricals closer to products of
small scale sector
Colgate Dental Cream Tapping 1.4 lac new
Palmolive villages / year
Dabur India Chawanprash etc. Creative awareness
Eveready India Batteries New campaigns / van
Hero cycles Bicycles Modifying product for
different needs of
different region
Companies Targeting Rural
Markets in India …Contd.
Company Products Strategy
Hero Honda Motorbikes, Sub-dealer distribution
Motors Mopeds in villages
HLL Personal products Door to door selling in
and detergents villages of population
under 2000
J.K. Dairy Dairy whitener Selling low unit price
packets (focus – rural
L.G. CTVs Selling high priced TVs
with regional displays
Companies Targeting Rural
Markets in India …Contd.
Company Products Strategy
Mahaan Foods Pickles, Ghee, Launched first T.V. ad
Vadis and Papads campaign to enhance
image in rural areas
Marico Hair oil Selling low price
Consumer Extended integrated
durables communication
campaign from Andhra
Pradesh, Tamil Nadu
to Maharashtra and
Companies Targeting Rural
Markets in India …Contd.
Company Products Strategy
Titan Watches Watches Launched project for
‘Sonata’ – low priced
United Pesticides Targetting farmers,
Phosphorus hiring ad-agencies for
rural campaigns.

Source: Business World, 11 Oct., 1999

Classification of Rural Market
a) Consumer Market
Constituents: Individuals and Households
Consumables: Food products, toiletries,
cosmetics, textiles and garments, foot wear
Durables: Watches, bicycles, radio, T.V.,
kitchen appliances, furniture, sewing
machines, two wheelers etc.
Classification of Rural Market …
b) Industrial Market
Constituents: Agriculture and allied
activities, poultry farming, fishing, animal
husbandry, cottage industries, health center,
school, co-operatives, Panchayat office etc.
Consumables: Seeds, fertilizers, pesticides,
animal feed, fishnets, medicines, petrol /
diesel etc.
Durables: Tillers, tractors, pump sets,
generators, harvestors, boats etc.
Classification of Rural Market …
c) Services Market
Constituents: Individuals, households,
offices, production firms
Services: Repairs, transport, banking, credit,
insurance, healthcare, education,
communication, power etc.
Attractiveness of Rural Market
Rural markets, earlier unattractive, have become
the new targets of corporate enterprises.
a) – Urban markets have become congested
with too many competitors.
- Urban markets have reached near
saturation points.
Now “Big fish eat the small ones.”
b) Rural markets have become mainstreet with
potential for consumption of variety of
products and services.
Attractiveness of Rural Market …
Various Factors which have made Rural
Markets Viable
o Large population
o Raising prosperity
o Growth in consumption
o Life-style changes
o Life cycle advantages
o Market growth rates higher than urban
o Rural marketing is not expensive
o Remoteness is no more a problem
Large Population
The rural population is large and its growth
rate is also high.
Despite rural-urban migration, the rural areas
continue to be the place of living for a vast
majority of Indians.
Males Females Total
Population (‘000) 367,240 344,640 711,880
Work Force (‘000) 271,370 121,820 393,190
Rural Work and Earnings
Aspects Male Female
1. Average no. of days worked casual labour 327 246
2. Average daily earnings (Rs.) 28.24 18.27
3. Earnings per worker (Rs) 9234 4494
4. Earnings per capita (Rs) 4903 1344
5. Rate of Growth of earnings / worker 3.41% 3.52%
6. Rate of growth of earnings / capita 2.71% 1.95%
Rising Rural Prosperity
Income Groups 1994-95 2000-01 2006-07
Above Rs. 1,00,000 1.6 3.8 5.6
Rs. 77,001 – 1,00,000 2.7 4.7 5.8
Rs. 50,001 – 77,000 8.3 13.0 22.4
Rs. 25,001 – 50,000 26.0 41.1 44.6
Rs. 25,000 and below 61.4 37.4 20.2

* Projections based on 7.2% GDP growth.

Source: ………….Business World (11 Oct., 1999)

Growth in Consumption
“Per Capita” Household Expenditure (In Rupees)
Level No. States Expenditure
Punjab 614
Kerala 604
Haryana 546
High (Above Rs. 382) 7 Rajasthan 452
Gujarat 416
Andhra Pradesh 386
Maharashtra 384
Growth in Consumption …Contd.
“Per Capita” Household Expenditure (In Rupees)
Level No. States Expenditure
West Bengal 382
Orissa 381
Average (Rs. 380) 5 Tamil Nadu 381
Uttar Pradesh 373
Karnataka 365
Assam 338
Low (Below Rs. 350) 3 Madhya Pradesh 326
Bihar 289
Facts for You, March 2000
Source: National Sample Survey (Jan-June, 1990)
Growth in Consumption …Contd.
Spend Patterns (Source: Org.-Marg R-Panel, June’99)
Item Percent Rich Poor Average
(Rs.) (Rs.) (Rs.)
Food Articles 44% 147 73 95
Toiletries 20% 67 33 43
Washing Mtl. 13% 43 22 28
Cosmetics 10% 33 17 21
OTC Products 4% 13 6 9
Others 9% 30 15 19
Remoteness – No Longer a
Remoteness is a problem but not
The rural distribution is not much developed.
o Lack of proper infrastructure, such as all
weather, roads, electrification and sanitation.
o Lack of marketer’s imagination and initiative.
Marketers have not exploited to a major
degree rural India’s traditional selling system
Sales Potential of Haats and Melas
Number of Haats 47,000
Average per day sales in Haats Rs. 2,23,000
Average out lets per Haat 314
Average visitors to a Haat 4580 (covers five
Purchase of manufactured goods in a Haat 24.3%
Number of commercial Melas 5,000
Sales per day in a Mela Rs. 25 Lakh

Source: Pradeep Kashyap, Mart, Quoted in A & M (28-2-99)

“Sales Potential of Haats & Melas”

Aspect West North South East

Villages with less 2,00,106 73,585 1,61,982 1,35,936
than 5,000 people
Villages with 78,217 43,102 41,348 44,693
pucca roads
Villages with 9,75,911 9,80,728 10,89,603 6,51,285
number of outlets
Villages with 11,436 3,167 18,905 8,389
number of Haats
By and large, the rural consumers are marked
by a conservative and tradition-bound lifestyle.
But, what is striking today about this matter is
not the basic conservative characteristic, but the
fact that the lifestyle is undergoing a significant
The earlier practice of bracketing all rural
consumers as people with a tradition-bound
lifestyle does not hold good in the present
Lifestyle …Contd.
The Change can be attributed to several
o Growth in income and change in income
o Growth in education.
o Enlarged media reach (particularly T.V.)
o Growing interaction with urban
o Marketers’ efforts to reach out the rural