RURAL MARKETING

Module 1

Rural Marketing
Definition: The study of rural marketing comprises all the operations and the agencies conducting them, involved in the movement of farm produced food, raw materials and their derivatives, such as textiles, from the formers to the final consumers and the effects of such operations on producers, middlemen and consumers - Thomson

Rural Marketing
Definition: Rural marketing can be seen as a function which manages all those activities involved in assessing, stimulating and converting the purchasing power into an effective demand for specific products& services, and moving them to the people in rural area to create satisfaction and a standard of living to them and thereby achieves the goals of the organization.

The Rural Marketing Mix

From/To Rural Urban Organized Urban Branded Not concerned consumables& Durables Un-organized Semi-Organized Farm& Non- Handicrafts, Rural Farm goods Handloom textiles, leather products

Evolution of rural marketing Concept& scope

Phase I: (Before mid 1960s)
From/To Rural Urban Agricultural inputs Fertilizers, seeds& pesticides Urban Durables Tractors, Not concerned harvesters, threshers, power tillers, pump sets, oil engines, electric motors Artisans services and Agricultural products bamboo baskets, products: ropes, window& door food grains, cotton, Rural frames, household items by oil, seeds, carpenters, blacksmiths, pot sugarcane etc makers& cobblers

 Phase II (Mid 1960s-Mid 1990s)

From/To Rural Urban Agricultural inputs Fertilizers, seeds& pesticides Durables Urban Tractors, harvesters, Not concerned threshers, power tillers, pump sets, oil engines, electric motors Artisans services and Agricultural products bamboo baskets, products: ropes, window& door food grains, Rural frames, household items by cotton, oil, seeds, carpenters, blacksmiths, sugarcane etc pot makers& cobblers

Phase III (After Mid 1990s) From/To Rural

Household Urban goods: Consumables and durables Artisans Rural services and products

Evolution of rural marketing

Phase I Origin Function Major Products Source market Rural Destination market Urban Since Agricultural Agricultural Independence Marketing Produce Marketing of Agricultural Agricultural inputs inputs

II

Mid-Sixties

Urban

Rural

III

Rural Mid-Nineties Marketing

Consumables& durables for consumption and Urban& production Rural Rural

Components of rural markets

Goods, commodity or service Buyers Sellers Interaction between buyers& sellers Demarcation of area place, region, country or global The existence of price uniformity or competition

Classification of Rural Markets Consumer Market Industrial Market

Services Market

Individuals& Constituents Households Food products, Toiletories, Cosmetics, Textiles and garments, Consumables Foot wear etc

Agri& allied services, poultry farming, fishing, animal husbandry, cottage industries, health center, Individuals, House school, cooperatives, holds, Offices and panchayat office etc production firms Seeds, Fertilizers, Pesticides, Animal feed, Fishnet, Medicines, Petrol/Diesel etc

Durables

Watches, Bi-cycles, Radio, TV, Kitchen appliances, Furniture, Tillers, Tractors, Pump Sewing machines, 2 sets, Generators, wheelers etc Harvesters', Boats etc

Repairs, Transport, Banking, Credit, Insurance, Healthcare, Education, Communication, Power etc

Nature of Rural Marketing

Aspect
Concept Role

Transactional
Consumer Orientation, Marketing Concept Stimulating& conversational Marekting

Development
Society orientation, societal concept Catalytic& transformation agent

Focus
Key task Nature of activity

Product-market fit Product innovations& communications

Commercial

Social change Social innovations& communicaitons

Socio-cultural, economic Government, voluntary agencies, corporate Participants Corporate enterprise, Sellers enterprises

Nature of Rural Marketing

Aspect Development Development projects/schemes/progr Offer Products& services ammes Target group Buyers Beneficiaries& buyers Communication Functional Developmental Profits, Customer satisfaction& brand Market development, Goal image corporate image Time-Frame Short-Medium Medium-Long Profit-motive& Service policy& Motivation business policy ideological/Public policy Transactional

Rural Vs Urban
Aspect Urban

M a Philosophy r Demand k Competition Economy e Infrastructure t Manufacturing Mobility

Rural Marketing& societal Marketing& concepts, Societal concepts, Development Green marketing marketing and relationship relationship marketing marketing High Low Mostly from Among units in unorganised organised sector units Open Closed Abundant& strong Poor& weak High Low High Low

Rural Vs Urban
Aspect Consumers Urban Rural

M Location Concentrated Widely spread Literacy High Low a Per capita Income High Low Expenditure Planned, Even Seasonal (vary) r Needs High level Low Level Protection Easily Available Rarely Available Innovation adoption Faster Slow k Attitude to modernization Ready for adaption& change Tradition bound Family Structure Nuclear Joint e Possession of household assets High Low Occupation Trade, Industry& Services Agri t
Attitude to Life
Exposure

Scientific
High

Fatalistic
Low

Rural Vs Urban
P r o d u c t Sources of Info Any media Awareness of needs High Concept Known Positionsing Easy Usage Method Easily grasped Quality Preference Good Timeliness of supply Timely After sales service Adequate As a status symbol Mostly yes Guidance of usage Needed Features Important Sensitive Yes Word of mouth Low Less Known Difficult Difficult to grasp Moderate Untimely Inadequate Mostly no Not needed Less important Very Much

P r i c e

Level Desired Medium-High

Low-Medium

Rural Vs Urban
D i s t r i b u t i o n Wholesalers, Stockists, Retailers, Supermarkets, Speciality stores& Channels Authorized show rooms Transport Facilities Distribution outlets Good More Village shops, Shandies, Haats Average Fewer

Product Availability

High

Limited

Rural Vs Urban
P r o m o t i o n
Print, Audio-Visual, TV, Radio, Print Media, Out doors, media to some Advertising exhibitions etc extent

Door-to-door Personal Selling frequently

Contests, Gifts, Sales Promotion Price discounts

Occasionally Gifts, Price discounts

Publicity Good oppurtunities Less

Rural Vs Urban Market Differences

Environment different Concentration, infrastructure, population density, Social relations Interactions, identification of individuals, Social norms, Status, Caste Employment& incomes seasonal Occupations, income frequency

Rural Vs Urban Market Differences

Exposure to marketing stimuli Product exposure, Ad exposure& brand awareness, exposure to market researchers, multiple sources of info& learning, convenience of buying, retail outlets per 1000, market reach& availability of range of products Dependence on nature Availability of natural resources, dependence for employment& incomes

Rural Vs Urban Marketing Differences

Marketers Understanding, respectful& humble, patience, courteous& concerned and social skills Philosophy Development marketing Marketing research Durables: income, family structure Research instruments

Rural Vs Urban Marketing Differences

Consumer behavior Value for money Emphasis on functionality rather than frills Collective decision making (opinion driven) Segmentation Variables: 1)family size& income,2) landholding and incomes (crop pattern, rainfall& farming method) Product strategy Functional value not frills Encountering fakes

Rural Vs Urban Marketing Differences

Price strategy Price sensitive Distribution Retailers, co-operatives, haats& melas Promotion Close knit groups Wall paintings, vans with audio-visual, puppetry, street theatre etc

Value addition in rural market

Offer small unit of packing Reinforce quality through service initiatives Hero honda Use local idioms to convey message in a meaningful context BBLIL (Brooke Bond and Lipton India Ltd) Striking core values of brand Cavinkare: Meera, Chic for rural& Nyle for urban Go rural& be rural Anacin Innovative channels Reckit& colman uses NGOs

Practical aspects of rural marketing

Automobiles TATA (display vans, test drives) Hyundai (sales camps AP& Punjab) Maruthi Suzuki (rural executives, sponsoring kabaddi tournaments& tie-up with panchayat members and sales fairs) Pharma Elder pharma (rural executives) Banking SBI (probationary officers in rural area) Retailing ITC choupal sagar Hariyali Kisaan Bazaar (HKB) Godrej aadhar (VAS: banking, pharmacy, postal service)

Practical aspects of rural marketing

Telecommunication Airtel (Haats, rural airtel service centre, VAS) BSNL (Bhoomi project; Tie-up with NFL) VAS: Daily mandi price, soil testing, farming techniques, dairy, weather forecasts in the local language Idea, TATA Reliance (KRIBCO Reliance kisan -Krishak Bharthi Co-operative)

 FMCG DABUR (ASTRA Advanced Sales Training for rural ascendance in local languages); Amla hair oil Coca-Cola (Parivarthan program to train rural retailers)