ACHIEVEMENT OF FMCG’S IN

RURAL INDIA
Pratima Pawar=91
Dinesh Phadtare=92
Shailesh Ranade=93
Neha Raswalkar=94
RURAL INDIA: A BREIF PROFILE
• Villages are the heart of India. Approximately 75% of India’s
population(equaling 12.2% of the world’s population)lives in
6,38,365 villages spread over 32 lakh square kilometers.

• As per the census (2001) rural segments comprises 13.5 crore

household which constitute 72% of total households in India
with 48 crore adults individuals.
.
 Distribution of Population by Age Group
(2001)
Age Groups Rural Urban
0-4 11.5 8.9
5-14 25.7 21.8
15-19 9.5 10.6
20-34 23.1 26.8
35-54 19.7 22.5
55+ 10.5 9.4
Total 100 100
Source: Census of India , 2001
 Education in India
Education Level Rural Urban
Below Primary 31.7 18
Primary but below 29.5 22.9
Middle
Middle but below 16.9 16.3
matriculation
Matriculation but below 18.4 29.6
Graduates
Graduates and Above 3.5 13.2
Source: Census of India , 2001
 Per capita income in rural and urban areas.

12000
9665
10000
7740
8000 6886
6070 Urban
6000
4478 Rural
3795
4000

2000

0
1989-90 1994-95 2001-02
 Nature And Characteristics of the Rural market

• Large & Scattered market

• Heterogeneous Market
• Income from Agriculture
• Standard of living
• Infrastructure Facilities
 Large & Scattered market

• It consist approximately 75 crore rural consumers

who live approximately 6, 38,365 villages.
• Abut 1,45,098 villages or 23% of the total number of
village in India have population less than 200 and
another 21% have population between 200 and
500 .
• But on the other hand 13% villages have 50% rural
population and they posses 60% rural wealth
 Heterogeneous Market

• As many as 20,000 ethnic groups are present

rural India and this poses a formidable
challenges to the marketer.
• There are 24 languages and 1,642 dialects
(boli) varies ever 100 km or so it extremely
difficult to develop a uniform promotional
message.
 Income from Agriculture
• Nearly 55% of rural income comes from the
agricultural hence rural prosperity is tied with
agricultural prosperity to a great extent.
 Standard of living
• Over 70% of the rural population is employed
in small scale agricultural and related
occupations. This dependence on agricultural
and natural factors.
• This unreliability factor in case of rural income
makes the rural consumers extremely
conscious in their purchase behavior,
 Infrastructure Facilities

• The infrastructural facilities like road,

warehouse , communication system and
financial facilities are inadequate in rural
areas. Road do not connect nearly 50% village
in the country.
• Over 50% rural household have access to
electricity as main source of lighting but 46%
use kerosene for lighting.
 FMCG
• Fiscal 2007-08 is likely to witness a hike of 10%
and 6% respectively in FMCG’s rural and semi-
urban market size due to heavy doses of
advertisements that have been pouring into
regional and national media, helping FMCG
products penetrate successfully in this
segment.
• Market for FMCG products in rural India is
estimated at 52%
• Domestic FMCG total size in terms of volume
is currently $15 billion, of which $7.9 billion is
rural contribution as against $4.2 billion of
urban and metros while $2.85 billion is semi-
urban FMCG market
• Over 70% sale of FMCG products is made to
middle class households and over 50% of
middle class is in rural India.
• The sector is excited about burgeoning rural
population whose incomes are rising and
which is willing to spend on goods designed to
improve lifestyle. Also with near saturation
and cut throat competition in urban India,
many producers of FMCG are driven to chalk
out bold new strategies for targeting rural
consumers in a big way.
 List Of FMCG Companies
S NO COMPANY
1 Hindustan Unilever Ltd.
2 ITC (Indian Tobacco Company)
3 Nestlé India
4 GCMMF (AMUL)
5 Dabur India
6 Asian Paints (India)
7 Cadbury India
8 Britannia Industries
9 Procter & Gamble Hygiene and Health Care
10 Marico Industries
 4 A’s
• AFFORDABILITY
• AVAILABILITY
• AWARENESS
• ACCEPTABILITY
 Affordability
• Affordibility does not mean that cheaper products
should be made & marketed,meaning is to reach
customer by satisfying their needs.The customer
should not think that they cannot buy it,that
means it should be their in their buying
capacity.The income earned in rural markets is
from different ways,so by keeping in this mind
most of the companies should design the product
in such a way that it reaches the customer.
 Availability
• The greatest problem in rural market is to
reach the customer or retailer.Its the logistic
way to make the product available there.Once
it reaches retailers shelf then there will not be
any problem.This is because there will be
lesser no. of brands available at market.Most
of the products are promoted well but by the
time it reaches the customer it gets late. So
reching the market should be considered.
 Awareness
• The main way of reaching the customer is
through commercials on media like TV, Radio
& outdoor. The awareness programs should be
conducted at the area where the village heads
meet at the villages.It should contain some
message to audience,there should be some
concern for them & their place.Apart from this
company should think of colour of product
,packaging ,logo ,slogan & so on.
• This should be in such a way that by looking at
the product only the customer should feel that
they can go for that , & they should be in such
a position to differentiate the product from
the copy cat one.
 Acceptability
• The customer should think that they can buy
the product by putting an extra money on
that.They should feel that the product is
designed as per their needs & it should deliver
a great solution to customer.They should think
that the product give some value to them,&it
should serve the purpose what they are
planning to buy for.The customer should feel
the comfort with the product & there should
not be any hesitation to go for it.
 TOOTHPASTE
In the initial years, the rural consumers preferred tooth powers, datoons etc. but from the last decade, the preference of rural consumers towards toothpaste has been changed. A huge number of toothpastes of different companies are sell in rural market. Colgate, Pepsodent are the most popular toothpaste brands in rural market. The rural consumers preference towards the different toothpaste brands are given in following pie chart. As per analyses of above pie chart, we has found that Hindustan Uniliver’s Pepsodent leads the market with 35% rural market share. 30% of rural consumers prefers colgate as their favorite
toothpaste brand, once again Hindustan Uniliver’s close up occupies third position with 15% market share.10% of the rural consumers prefers Dabur’s babool toothpaste and 10% consumers uses other toothpaste brands.
 SOAPS
In the survey of preference of my target consumers towards soap, I had
found the different preference and different choice of the consumers.
On the basis
As per givenofintheir choice,table,
the above I has get
the the
90% following data market
of the soap given inis
following table:-
coverd by the products of Hindustan Uniliver.50% of rural
consumers prefers HUL’s Lux, where as 30% goes towards HUL’s
Lifeboy third position is also acquired by a HUL product where
15% of the market captured by Rexona. 8% of rural consumers
prefers some other soap brands.
CONCLUSION:- In this analysis , I fonnd that a vast majority of
rural consumers prefers Lux as their more faithful brand.
 SHAMPOO
As per concern of shampoo , total 31.9% shampoo uses in
rural market. It shoes a good number of consumers preference
towards shampoo in rural area. From the last few years , the
demand of shampoo sashes as well as medium size bottles has
increased in rural area. Peoples of every age are interested to
use shampoo at regular interval.

The preference of consumers towards shampoo is given in

following table.
The consumers preference towards shampoo are as follows:-
42% prefers clinic plus.
30% consumers prefers sunsilk.
10% consumers go through Calvin Care’s Chick.
8% consumers prefers other shampoos or non shampoo
users.


Preference of shampoo in saches:-

 32% of consumers uses Heads & Shoulders.
 28% goes through Pantene.
 18% prefers sunsilk.
 12 % prefers clinic plus.
 10% includes non shampoo users or users of some other brands,
CONCLUSION:-
This analysis shows that a vast majority of rural consumers prefers HUL’s clinic plus and Sunsilk in high and medium size sample. But on the other hand, in sachet sample there is different story. More than 50% of the rural consumers prefers the brands of P&G (Heads & Shoulders and Pantene).
 DETERGENTS
• Detergent is another more preferencable product for rural
consumers. Approx 87.4% penetration level of detergent is
gone to rural consumers. The preference of rural consumers
towards detergents is given in following table
• As per given in above 2 table , the consumers preference
towards detergents are as follows:-
•  42% consumers prefers HUL’s wheel in mediam or large
sample , but consumers not prefer it in sachet.
• 34% consumers prefers ghari detergent in medium or
large size sample, but not in sachet.
• 13 % consumers prefers P&G’s Tide in medium or large
size sample but it is leading brand in sachet category with
43%.
• Surf excel of HUL is second leading brand in sachet
category with 35% consumer preference which is prefers
only 6% in large samples due to it’s price.
• 5% consumers prefers other local detergents for their
personal use.
• CONCLUSION:-
As given in the above table, lump sum the half of the
detergent market is covered by HUL and P&G products.
Nirma which was the initiator of introduction of detergent
in rural market, is currently out of the market. this condition
shows that the rural consumers are also want to quality
products, only price is a factor in front of them.
 CLEANER
• Utensil cleaner is one of the basic need of the consumers,
because consumers uses it at regular interval. Couple of
months ago, the rural consumers does not uses any utensil
cleaner rather they use primary products like ash, mud or
other things. But at the present time the popularity of utensil
cleaners has been developed in rural market in high
penetration level.
• The consumers preference towards utensil cleaner is given
in following table:-
• As per given in the table, vim is the leading brand in the
utensil cleaner segment. 85% of the rural market is covered
by vim , 10% consumers prefers other brands where as 5%
consumer are those who does not uses any utensil cleaner.
 FAIRENESS CREAM
As per fairness cream is concern, there is not more brands
are in the competition. Only few brands of HUL and emami
captures the market.a brief description is given in the
following table.
The HUL’s Fair & Lovely is most popular brand in the rural
market most of the consumers specially female consumers
uses this brand. Approx 65% of rural consumers uses Fair &
Lovely as their best trusted brand. Second position is also
occupied by HUL’s product (Ponds) which is preferred by
23% of consumers, 10% consumers prefers Vicco and 2%
uses some other brands.
 SHAVING CREAM
Generally in the rural areas the consumers prefers barbers for
the purpose of saving or other relevant purpose. But in the
semi-urban areas and some of the rural areas, consumers are
started to depend on their own saving kit. So what from the
few years, the demand of different savin creams of different
companies has been increased.
A brief analysis of different brands of different companies
is given in following table:-
The preference of consumers towards saving cream is
described as follows:-
42% of the consumers prefers Palmolive as their best
choice.
30% consumers prefers Vjohn.
Gillete which is most demandable brand in urban areas has
very low market share in the rural market due to it’s little
bit high price.
After saving gel is generally not popular in the rural market.

CONCLUSION:-
The analysis of consumer preference toward
saving cream shows that such a vast area of market covered
by Palmolive and Vjohn.
 BISCUITS
Biscuit is one of the major beverage category brand of the
FMCG products for the rural areas. Consumers prefers it for
the many reasons like taking with tea, giving to guests, baby
food etc. there are many companies exists in this segment.
A brief overview of consumers preference
towards biscuits is given in following table:-
Parle-G is very old and most trusted biscuit brand for the
rural consumers. From many years , consumers prefers it due
to it’s low price, good taste, and availability. At the present
time, it captures approx 62% of total rural market share. From
the few years ITC’s Sun feast creats a good demand among
the rural consumers. 23% of rural consumers prefers sunfeast
and also it’s demand is increasing due to it’s taste and good
publicity and distribution. Consumers prefer 10% Britaania
brands and 5% consumers prefers other brands.
 TEA BRANDS
In the segment market, generally consumers had prefer
local tea , but from the few years they starts to use some
brands of the different tea companies because of the
avaibility of tea in small sachets. The following table
provides a brief details about the different tea brands
popular in the rural market.
The data analysis of consumers preference towards tea is
discussed as follows:-
32% consumers prefers taza as their best choice.
26% of the rural consumers prefers tata tea.
21% of the rural consumers prefers double diamond.
11% consumers prefers taj mahal tea.
10% consumers are among those who prefers some other
tea nrands.

CONCLUSION:-
As per given in the above table taza and tata tea are
the leading tea brands in the rural market.
 HAIR OIL BRANDS
The rural consumer preferences towards different hair oil
brands are given in the following table:-
Rural consumers prefers mostly herbal/cool oils, e.g-
Navratna, himtaj, Himgange,etc. 31% of the rural
consumers prefers herbal oils because of their multipurpose
use. They use these oils as medicine also. 25% of the rural
consumers prefers dabur amla, third place occupied by
Maico’s Paraschut which is prefers by 21% of rural
consumers. 18% consumers prefers Bajaj Almond and 5%
prefers some other hair oil brands.
Advertising & Sales promotional
strategies in rural market
 Dabur uses Astra to boost rural sales
Shopkeepers selling Dabur India's consumer products would now learn
marketing through role-plays staged by professional actors at their shops.
As part of a recent initiative titled Astra, advanced sales training for retail
ascendance, FMCG major has recruited 75 sales and HR managers across
the country who would educate over 2,000 distribution channel partners
of the firm about the complexities of sales and distribution through the
audio-visual medium

Dabur has a distribution reach of 25 lakh retail outlets across the

country. About 75 per cent of the company's sales come form rural areas,
hence, it has created the Astra training consultancy module in five
vernacular languages, Bengali, Tamil, telungu, Malayalam and Kannada
Brooke Bond Lipton India Ltd (BBLIL)

Brooke Bond Lipton India Ltd (BBLIL) markets its rural

brands through magic shows and skits. Reckitt and Colemen
uses NGO's in rural areas to educate customers about product
benefits which establishes one to one communication
channels.

HLL's ‘Operation Bharat’ to tap the rural markets. Under this

operation it passed out low–priced sample packets of its
toothpaste, fairness cream, Clinic Plus shampoo, and Ponds
cream to twenty million households. Today, these brands have
a flourishing market in rural India.
 PHILIPS INDIA LTD. - ELECTRONIC ENTERTAINMENT EQUIPMENT

Objective - promote Phillips Electronic Entertainment products, viz., Stereos and

CTVs, among the rural population of Tamil Nadu.

Communication Strategy - Based on information regarding buyer behavior.

'Philips Super Shows' were conducted in five district headquarters with the intention of
motivating dealers as well as opinion leaders to generate word-of mouth publicity, as a first
step.

This was followed by extensive van operation in 5000+ population areas

with audience participation techniques for mouthing the brand, supported
by mass media campaign in regional press (district wise edition), rural
cinemas, radio, wall painting and intensive merchandising activities.
 Marico Industries - Parachute Coconut Oil Pouches

With the objective of creating awareness for Parachute Coconut Oil

pouches in towns with less than 20,000 population in Tamil Nadu, and
in order to convert loose oil buyers into Parachute pouch customers,
Marico Industries launched a van campaign. The communication
Strategy focused on getting women out of their homes to participate in
the van campaign, which was aimed exclusively for them and for the
first time conducted by women.

Result - A study by Marico showed a 25per cent conversion from loose

coconut oil usage to Parachute Pouch Pack, post van campaign and a
substantial increase in sales from the campaign areas
 ACC Limited - ACC Suraksha Cement

In a market dominated by graded cements in the semi

urban/rural areas of Karnataka, ACC Cement ventured out to
establish the superiority of ACC Suraksha blended cement and
build an image of a Premium Cement for the brand.To reach
the opinion leaders viz. Architects, Engineers, Contractors,
etc.,the assistance of the regional local press was sought and
other Direct Marketing efforts such as field meetings with
small groups of masons & customers were used.

Result - A post-campaign study initiated by ACC revealed

tangible improvement in off-take in the state of Karnataka
andan extremely positive response from dealers, who believed
that the campaign helped in strengthening their hands.
Source: Anugrah Madison
Advertising Pvt. Ltd.
 Success Stories in Rural Market
• Lever's Breeze soap
• A1 Tea,
• Britannia's Tiger biscuits,
• LG's Sampoorna
• 502 Pataka Chai, the tea brand.
 Rural Promotion
Promotion is the process of marketing communication to
inform, persuade, remind and influence consumers or users in
favour of your products and service .

The
Buyer
Product

The Channel
Company
 The Promotion Media
• Newspaper : Eenadu(A.P), Dina Thanthi ( Tamil
Nadu), Punjab Kesari (North), Loksatta
(Maharashtra), Anand Bazaar Patrica (West
Bengal), Daink Baskar (North)
• Television: Sun TV (Tamilnadu), Asianet (Kerla),
Eenadu( AP), Aplha Punjabi (North), Aplha
Mararthi (Maharashtra).
• Radio: Radio reach is highest in Kerla (62%)
followed by Tamil Nadu (35%) and Karnataka
(32%). Example : Colgate, Jyoti Labs, Zandu
Balm are some of the company using radio
communication programme.
A ten second spot in Regional station would
cost only about Rs. 2000/-
• Cinema :1. Films on products like Vicks,
Lifeboy, Colgate and Shampoos are shown in
rural cinemas halls.
2.LIC and Private insurance companies have
been showing short movies in rural theatres to
create awareness about life insurance
Outdoor Advertisement
Form of media which includes signboard, wall
painting, hoardings, tree boards, bus boards
etc.
• Direct Mail Advertising:
Mailers for seed and pesticides to be sent as per
agricultural season.
Direct mailers on consumer durables to be sent
during the harvesting season so that the
farmers will,. have money for purchasing the
same.
 Farm to Farm / House to House
• Many LIC agents and companies dealing with
high value consumer durables have tried this
approach with success in rich rural areas.
• ACC representatives retailers make house-to
house visit and give information about
product stability.
 Group Meeting
• The Banker once in a week visit a village get
the villagers in school hall or Panachyat office
and explain to the villagers the various
financial facilities offered by the bank
• MRF conduct tractor owners meet in
association with local distributors.
 Opinion Leaders

• Asian Paints promoted its Utasv brand of paint

by painting the village Sarpanch’s house a few
months prior to the launch to demonstrate
that the paint does not peel off and is an ideal
replacement of chuna.
• The health development assistant of HUL
regularly meets school teachers to promote
Lifebuoy soap in Villages.
 Audio Visual Van
(The van is a mobile promotion station having facilities for screening films, slides and mike publicity.

• Nippo promotes batteries through specially

designed vans called melavans. The van are
equipped with TV/VCR for showing products
awareness films.
• Colgate India makes extensive use of VANs.
• ITC’s mobile Vans take the message of e-
choupal to new village.