Rural marketing and

services
marketing

NAME: Colin Janong-Sooting

ROLL NO.: 585

ROOM NO.: 24

CLASS: B.Com (Hons.), Marketing

Department.

COLLEGE: St. Xavier’s College

(Autonomous)

TOPIC: Illustration of the roles of

Advertising,
Branding and Alternate
Distribution
 Channels of Rural Markets in India
(with
appropriate examples).

RURAL MARKETS IN INDIA:-

The topic of rural marketing apparently seems to be India specific. In reality, the
rural marketing conditions in certain respects are equally applicable to other neighbouring countries in
various stages of economic development. Marketing principles are the same for rural or urban
markets. It is the approach to applying these principles that requires adjustments according to specific
opportunities and constraints resulting from a host of rural conditions in India that a marketer faces.
Many otherwise successful companies, domestic or foreign, consider that Indian rural market has
large and rapidly growing potential but the challenges involved in accessing these markets appear to
be formidable. For example, the rural market is vast and highly scattered, communication facilities are
poor, transportation and warehousing poses difficulties, buying power of most households is very low,
and masses are largely illiterate.
Considering the size of rural population, almost 70 percent Indians live in rural areas.
Census of India reported the total Indian population in March 2001 was 1027 million and growing at
about 1.9 percent. That is, each year Indian population increase by more than the total population of
many countries of the world. Incidentally, the population growth rate in urban areas is less and higher
in rural India. Over the last two decades, the rural population has marginally decreased in terms of
percentage of total population, but has increased in absolute numbers. In 2001, out of total Indian
population the share of rural population was 736 million. A silent revolution is sweeping the Indian
countryside. It has compelled marketing whizkids to go rural. The marketing battle field has shifted
from the cities to the villages. “Go Rural” seems to be the latest slogan. Adi Godrej of Godrej soaps
says:
“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 not sleeping any longer. We are.”

Rural India has become a target for marketers because of the huge potential it offers for
all kinds of products and services. But the lack of understanding of the way the rural markets operate
gets the marketers into road blocks easily. The challenges posed by the difficulties of physical
distribution and uneconomical market size besides lack of mass media reach in many markets,
compound their problem. In spite of all the problems Rural India is growing at a phenomenal rate.
Statistics show that there is a huge income shift taking place in rural India, and the aspiring middle
class, with increasing purchasing power, is the focus of all marketing initiatives by corporates.
While the debate about urban rural divide is still on, there is another issue that is raising
its head and that is of the digital divide or how to bridge the digital divide that can help to overcome
the traditional barriers for exploiting the rural market. Has technology made any impact on the way
the rural folks shop? While there are sceptics who still question the role of technology in the growth
of rural India and rural markets, there is no doubt that the average rural Indian whose life has been
touched by technology has changed for the better. The web based technologies and harnessing of
internet usage for innovative interventions have been quite a boon to the people. Let us look at some
of these initiatives and how they are impacting Rural India.
The Indian Fast Moving Consumer Goods (FMCG) industry began to shape during the
last fifty odd years. The FMCG sector is a cornerstone of the Indian economy. This sector touches
every aspect of human life. Indian FMCG market has been divided for a long time between the
organized sector and the unorganized sector. Unlike the US market for FMCG which is dominated by
a handful of global players, India’s Rs. 460 billion FMCG market remains highly fragmented with
roughly half the market going to unbranded , unpackaged home made products. This presents a
tremendous opportunity for makers of branded products who can convert consumers to buy branded
products.

ADVERTISING IN RURAL INDIA:

In India, the advertising is mostly in English or Hindi. As rural markets widen beyond
the English-and-Hindi knowing people, there are problems of translation into the vernaculars. Good
translations are seldom easy; and there is often the need for thinking out the advertising concepts and
the brand image in the local language itself. Advertising in the local language in the absence of
shortage of professionals, makes success of rural advertising campaigns difficult. The rural market
information gap is wide enough to justify major collaboration between governments, universities,
independent research organizations and business. There is very little appreciation of it as a primary
investment need, its very precondition; and very little money is spent by too few on it.
Advertising caters to rural society with divergent life-styles and value systems presented
an unusual challenge between the strategy of homogenization (overcoming the barriers between
segments), and one of heterogenisation (capitalising the very existence of many small riches). This
sort of advertising involves constraints individual in the form of cost duplication of facilities and
fragmentation. In such areas, the basic objective of advertising and market research may be to find
and develop products, which may cut across heterogeneous preferences with common brands and
similar or common advertising.
Tourist advertising and motivation pose a most fascinating challenge to our country with its old
culture.
Rural India is a set of regional markets where cultural factors play a very important role.
The raw materials come from the soil; and the relatively low productivity of Indian farmers is
reflected in the low purchasing power of the rural buyer. The rural advertising problem in a country
like India is related to political, social and economic problems. With low income from farms the
question that arises is: can we afford the infrastructure of mass media for rural markets? Within a
rural market, there are many mini markets based on caste, religion, language or other differences. All
people living in an around these markets have distinctly different life-styles. The marketing men
know that the cost of distribution increases as the town gets smaller and it is not economical to serve
very small villages. Rural markets are no longer a seller’s market now. Many people have underrated
the strength of the market on the assumption that India’s rural poverty restricts rural purchases only to
those items, which are basic necessities. This has turned out to be a myth now.
In rural India the role that advertisement plays is major. It will enhance demand when
favourable environment conditions have been created. Advertising does not create immediate demand.
There is always an information gap. The biggest single advertising problem is the shortness of the
reach of mass media. As our country is large, the problem is complex, for there is a huge potential
rural market. There are not very many dailies in circulation; nor many a radio or transistor or a TV
set. The mass media gap in India is as conspicuous as the income gap. Therefore, there is a need for
extending basic infrastructure with a view to enlarging the reach of mass media in rural India. The
different approaches to reach rural buyers which may be profitably utilised include mobile publicity-
cum-sales stalls, sales and cinema vans, participation in rural fairs and festivals.
The value of this direct personal propaganda and selling cannot be overestimated,
especially in the rural markets. These are often a potent means of changing habits by means of real
life demonstrations of the goodness of the product and its utility, and by the invaluable personal link
established between the seller and the buyer. In rural markets, persuasion by the opinion-makers, by
the “voice of authority” counts; product messages may be conveyed in print, by the cinema, or in
person by teacher, doctor, and shopkeeper or village headman. In rural areas, the effective approach to
be employed to reach the buyers is to establish contacts with local educators who can influence them
by word-of-mouth. Such local educators are government officials, Block Development and Extension
Officers, and Village Pardhans and School Teachers. To the extent that traditional social institutions
like the panchayats still influence social habits, particularly at the time of marriages and festivals, they
can be useful instruments for mass changes in consumer habits. They are usually strongholds of
tradition: but when the strongholds themselves change, the surrounding societies are quick to follow
suit. This is particularly so when change comes to the culture center of a community, the center from
which new ideas radiate.

BRANDING IN RURAL INDIA:

Promotion of brands in rural markets requires the special measures. Due to the social
and backward condition the personal selling efforts have a challenging role to play in this regard. The
word of mouth is an important message carrier in rural areas. Infect the opinion leaders are the most
influencing part of promotion strategy of rural promotion efforts. The experience of agricultural input
industry can act as a guideline for the marketing efforts of consumer durable and non-durable
companies. Relevance of Mass Media is also a very important factor.

Indian Marketers on rural marketing have two understanding:

(i) The urban metro products and marketing products can be implemented in rural markets with some
or no change.
(ii) The rural marketing required the separate skills and techniques from its urban counter part.

The Marketers have following facilities to make them believe in accepting the truth
that rural markets are different in so many terms:
(i) The rural market has the opportunity for.
(ii)Low priced products can be more successful in rural markets because the low purchasing,
purchasing powers in rural markets.
(iii)Rural consumers have mostly homogeneous group with similar needs, economic conditions and
problems.
(iv) The rural markets can be worked with the different media environment as opposed to press, film,
radio and other urban centric media exposure.

How reality does affect the planning of marketers? Do villagers have same attitude like
urban consumers? The question arises for the management of rural marketing effects in a significant
manner so than companies can enter in the rural market with the definite goals and targets but not for
a short term period but for longer duration. The Research paper will discuss the role of regard. The
strategy, which will be presented in the paper, can be either specific or universally applicable.
Branding correlates with Image Building in an organization vis-à-vis its products
produced/services rendered. To attain a safe platform in Brand activation, the Marketing Managers
pay attention and focus in a diligent manner on the value based credentials of the users in the
Marketing arena. A full-fledged dedicated team with multi focused thoughts only can do the needful
for the successful brand management. Good branding strikes a chord with viewers help them relate
with the product and reflect their aspirations. Rural branding bears quite different stand from urban
branding. The first step towards rural branding is to research and gain insight into the working of rural
markets. Based on this communication campaigns have to be developed with a lot of rural sensitivity.
Rural branding is attained by way of opting to a greater percentage of local media and a smaller
percentage of the mass media. Rural gatherings like temple festivals, melas, cinema halls and so on
can be used as venues to promote brands.
A well-planned rural branding campaign cannot just create brand awareness but help
your target relevant to your brand and promote sales. A long-term campaign will keep your brand at
the top-of-the-mind and build brand loyalty. So the brands are in safe hands. As branding can make or
break a product, marketer should handle it with the same concern as the artisans show in their work.
All the activities that are taken under the umbrella of a brand add to or subtract from the value. The
customer's evaluation of a brand is a result of all the consumer experiences he has had with the brand.
Consumer experience includes product, services, personal contacts, advertising, promotions, word of
mouth, etc. This mix of memories, which are built up over a long time, makes the brand potentially
the most powerful liver of the intangible perceived values. After all the first thought that comes to the
mind of the customer prior to the purchase of the product is 'who has made it', if that brand has good
reputation, it raises the level of confidence on the part of the customer to buy the product.

ALTERNATE CHANNELS OF
DISTIRBUTION:

Direct Selling / Network Marketing are the business of the next millennium
providing a powerful platform for distribution of products. Though construed as different from
Network Marketing, Direct selling is akin to Network Marketing only difference being that while
Network marketing lays more stress on direct recruitment Direct selling lays stress on selling.
While the thought of selling to someone who is not the end-user sounds counterintuitive, the potential
is thought-provoking. Not only can urbanites provide the physical distribution of products to their
rural families, but they also recognize the need for the products and are best suited to teach their
families on correct usage. In terms of a business advantage, a few of the benefits include:
People:
Cities offer a high concentration of potential customers who often visit their rural families and take
gifts and other products with them.
Price:
Social entrepreneurs can avoid the price margin increases from multiple middle-men in the rural
distribution chain. There may also be less need for product financing because it focuses on the
household members making the most money.
Promotion:
City dwellers have an outside perspective of how they could improve the lives of their family, and
may be most likely to recognize the need for BoP-focused products. Marketing and education about
the product can be done in cities where print and media resources are readily available. Sales and
marketing could focus on how the product can help the customer’s family improve their lives, and
show the customer how to teach their family to use it. Ideally, it would go so far as to show the stores
or items in movies and TV shows to get the word out and increase the aspirational value of the
merchandise.
Place:
Products from cities are not perceived as products for the poor, they are products for the rich. They
are seen as aspirational goods, giving each product an additional intrinsic value. Urban shops selling
rural BoP-focused products could be located near main train stations, bus depots and city centers,
making them accessible to family members as they go to visit their home towns.