UNDERSTANDING THE RURAL CONSUMER

MEANING OF CONSUMER BEHAVIOR:

All business operations revolve around understanding the

consumer needs, desires, likes, dislikes and preferences and
offering products and services that will give the desired
satisfaction to the consumers

Rural Consumer behavior

More complex Somewhat similar demographics but
complex due to religion ,cast and political
influences, income disparity, Proximity to
towns etc
So Planning for all Strategic marketing steps
becomes difficult.
For high involvement products
role of opinion leaders, reference groups
etc relevant as a credible source of
information also as a status addition
Low involvement productsmore homogeneity in buying behavior as
demographics and psychographics r broadly
similar- wants and needs more common.

 lots of influencing variables to be structured. As

per customs, traditions, beliefs, impacting
decision making
Likings -for -bold and primary colors, - folk
entertainments, clothes , - synthetic, prosperity
green and happiness yellow
Cultural factors- basic determinant of behavior of
any individual. but rural consumer more bound
with framework of traditions /values
Collective social sanctions- fallowing definite ,
norms for conducting in society
Influence of social customs- customs r socially
acceptable norms. Traditional society- touching
feet, Asian paints - buntings
Traditions- long lasting beliefs. dressings,
community invitations.

 Influence of castsupper and lower casts differences still continue. clear

demarcation in housing wards/clusters on economic
status.
Sub cultureregional preferences remain daily affair in rural unlike
urban
Social classificationUrban grid based on occupation and education still not
happenings in rural
SEC classifications - rural grid- ex
basis- house types and education
people with pucca houses make bulk purchases and
kuccha house normally buy from haats.
R-1- r-2 buy lifestyle products as they r more exposed to
urban.
New SEC basis evolved on education and assets
owned- ex
Consumerism is also increasing in rural
Money order economy still exists in coastal and hills

Social factors Reference groups- besides traditional reference

sources opinion leaders informational/ normative,
new one r emerging thru shg, ngo, co-ops,
Family- head ,parent family still a decider.
Roles and status- caste and society status r linked ,
retired army persons, doctors etc play a role as
influencer.
Products and status- tractor owners, pucca houses ,
landlords and cbb.
Sociability- unlike urban no social visits unless some
urgent work
Technological factorsICT expansions changing cbb in rural
Economic factors increasing consciousness of supplementing agro
incomes with other sources.
Increasing bank accounts, kisan credit cards.

Characteristics of rural consumers

Age-Teenagers- bicycles, cinema, 20+ 2 wheelers etc,
Occupation and income- cbb changes
Economic circumstancesLandlords, wage earners differ in cbb.
Lifestyles- well-off, bpl etc. differ in cbb
Personality and self conceptAloofness for rural women
Needs changes- Maslow
Perception and brand belief- lic , sbi r more trusted.
Buying behavior patterns- ex
Buying roles
Role of a opinion leader ex
Understanding rural youths- gateway to job or
livelihood, their role models
Brand loyalty. e.g., stick to lifebuoy
CRM is already built in as integrals, system exists.

 rural consumer- featuresa) cautious buying , checks rechecks prices of new

products, lot free time so delayed decisions
b) cultural factors-shared values, beliefs and perceptions
unlike more individualized in urban, different groups
related to religion, caste ,occupation
c) Traditional life- customs and traditions decides
practices, stitched shirts r still common.
d) traditional occupation- children take up farming and
also fallow same methods
e) traditional belief-depend on fate, past experiences
than new findings, mantras and tantra r used.
f) Family values-obligations fulfillments, Sas-bahu, joint
families,
g) rural income-monsoon ,seasonal, agro. impact,
h) festivals and functions- onam, pongal, diwali
campaigns ,
i) Low educated-media choice, demos best-result or
method,
J) bank influence- saving habits thru coop banks etc.

India-Population Distribution

Population Distribution
RURAL POUPLATION IN
STATES

Landscape & Income distribution

Consumption

Rural India

 About 70% of Indias population Continue living in the

rural areas
There are more than 600,000 villages in India
Consumers in this huge market segment display a vast
differentiation in their purchase decision and product use

 Increase in the literacy and media exposure , the rural

consumers are becoming more conscious, aware,
choosier and more demanding than ever before.
It has become increasingly important for the marketers to
understand rural consumers behavior

Changing- RURAL CONSUMER

BRAND AWARENESS: There has been an increase in
brand awareness. Upgrading of products is been seen from
toothpowder to toothpaste, traditional insect repellent to
mats and coils
BUY LOWER PRICED GOODS: They look value for money,
not cheap products
BUY WHAT THE MARKETER SELLS: Extremely strong
brand loyalty is seen-Colgate
VARIED TASTES: The rural consumers preferences differ
across the nation
INNOVATIVE USE OF PRODUCTS: The rural market is
extremely innovative in the uses of a product- Washing
machine to make Lassi- Iodex for animals

CONSUMER EXPENDITURE

On an average spend about Rs.3203/year for consumer non-durables

Most households consume soaps, washing soap bars, edible oil and teathey buy just the basic products

STUDIES INDICATE:

Rural consumers buy basic products

Personal hygiene considered very important

CHANGES IN RURAL CONSUMER

BEHAVIOR

Increasing rate of literacy

Greater awareness
Younger generation appears to seek variety
They are more discriminative in their buying behavior

LIFESTYLE OF RURAL CONSUMER

Limited educational background
Limited exposure to product as well as brands
Choosing price over product quality
Influenced by WOM communication
Rural consumer is very religious
Rural consumers prefer to work hard themselves

Strong family ties and respect for family values

KEY CHALLENGES TO MARKETER

UNDERSTANDING THE RURAL CONSUMER

1. The factors affecting the buying behavior
2. The factors causing fluctuations in the buying behavior
Environment
Geographical Influences

Occupational Influences

Creative Utility of products

Place of purchase

FACTORS AFFECTING RURAL CONSUMER

Role- behavior expected
of individuals in a group
In rural India,
status is linked
to class

Family
structure
determines
The decision
maker
Upper and lower class
Regional influence-example clothes

Difficult to
ascertain
As they have
changing
occupations in
different seasons.

Primary &
secondary opinion
leaders

FACTORS AFFECTING RURAL CONSUMERS

Telecomm and TV-changed

lifestyle
Increased communication
Allows marketers to easily
reach their TG

Philosophy and decisions

of rural
Party-influences the
fortunes of
Rural people

Increasing prosperity
Non-agricultural income
Women self help groups

STAGES IN BUYING PROCESS

Broadly classified into five stages.

Purchase of high involvement products rural consumer displays different

motives

STAGES IN BUYING PROCESS

ROLE OF RURAL WOMEN

Early Years
No significant role
Not aware of what was happening in the outside world
They hardly left their homes except for social occasions
Current scenario
Status of women changing
Better education/ growing presence of media influence role &
behavior
More empowered today
Therefore their role in family buying decision process - Increasing

BUYING BEHAVIOR

Buying Roles similar in Urban & Rural markets

a.Men usually decide on personal care products and capital investment etc
b.Women decide on utensils and other things of use in the home
c.Purchasing a higher involvement product is a collective decision

FACTORS THAT INFLUENCE RURAL BEHAVIOR

STIMULI
Inputs to any senses
Products
Package
Commercials
Brand image
Reference

PERCEPTION
Depends on

EXPOSURE
E.g.. IFB had not adequately educated farmers
about the Washing machine
They thought it was a churn for making
large quantities of Lassi

ATTITUDE
Consumer belief
Consumer feeling

INTERPRETATION
E.g. Iodex - muscular pain reliever
used on animals.
Godrej hair dye on buffaloes MP

FACTORS AFFECTING CONSUMER

BEHAVIOR -PERSONAL

Lifestyle identification

Psychological factors

Activities

Interests

Opinions

Age & life cycle stage:

FACTS ON RURAL INDIA

85% of population below age group 45 55
Young adults below age of 25years th of consumption base
Age group 25 45 tremendous potential growth

Occupation:
Goods and services (beyond the basic ones) are influenced by occupation &
income of consumer
But rural consumer has more than one source of income.
Therefore income is not a parameter to base buying behavior
Non agriculture occupation groups high consumption segment & rapid growth

Economic Circumstances:
Dictated by disposable incomes, savings, debt
Farmers income depends on monsoon
Daily wage earners varying incomes everyday
Savings & small deposits Banks & Post offices
Rural consumer has more buying power than urban counterpart

Life style:
The Affluent Class
The Middle Class
The Poor

Very rich
Well off
Climbers
Aspirant
Poor

Personality & Self concept

Natural tendency to buy products that match our personality
Marketers provide distinct image to their product
Coca Cola Smart, Youthful, Colorful
Mahindra Tractor Rugged, Relaxed, Dominating

Personality & Psychological factors

Satisfy basic needs
Averse to taking risks
Opinion leaders play significant role
Peer group pressure not very significant

Personality & Brand belief

Perception directly related to level of acceptance and satisfaction
Existing products play a major role
Repetition, Consistency of packaging, Colors, Brand image, Price Reinforce Brand
belief

RURAL CONSUMPTION PATTERN

Peculiar characteristics features of rural markets have compelled the marketers
to develop different marketing strategies for rural markets as compared to
that of urban market.
Some of these factors are discussed as follows:
Product
Message
Media
Channel
Price
Examples which reflect different marketing strategies for rural and urban
markets- castrol, velvette shampoo,etc

URBAN v/s RURAL CONSUMER

Behavior of Rural Consumer

Problem/ Opportunity?
Behavioral bases for segmentation:
Not a problem
Rather an opportunity

Rural India Buys:

Products more often
Smaller packs, Low unit price
Distribution & Pricing Important mantra
Brand competition Less advertisements
Availability key area
Fewer brand choices
Buy value for money, not cheap products

CONCLUSION

Rural India huge opportunity

Rural consumers buying decision influenced by many factors

In rural context: Awareness, Availability, Acceptability, Affordability- play a crucial role

The purchase depends upon income & earning style

Therefore, Marketer must incorporate these factors in his decisions and strategies