MARKETING OF FOOT WEAR IN RURAL AREA SUBMITTED TOWARDS PARTIAL FULFILLMENT OF POST GRADUATE DIPLOMA IN BUSINESS MANAGEMENT (Approved

by AICTE, Govt .of India) Academic Session 2011-13

Submitted to: URVASHI MAKKAR Faculty member Ims ghaziabad

Submitted by: Yuvraj Singh (254) Amita Jaiswal (255) subin

CERTIFICATE

This is to certify that these are students of Post Graduate Diploma in Management (PGDM) has successfully completed his project titled Marketing Of Footwear In Rural Market and submits this project in the fulfillment of the requirement of Post Graduate Diploma in Management. This project is submitted following my approval and satisfies the rules and guidelines defined by IMS Ghaziabad for the SIP Project.

Dr. Urvashi Makkar

DECLARATION
This is to certify that these students of Post Graduate Diploma in Management (PGDM) 4th Trimester have personally worked on the project titled Marketing Of Footwear In Rural Market under the guidance of Dr.Urvashi Makkar. I, hereby affirm that the work has been done by me in all its aspects and results reported in this study are genuine and true to best of our knowledge.

Yuvraj Singh (254) Amita Jaiswal (255) Subin Date: Place: Ghaziabad

ACKNOWLEDGEMENT

Words are the dress of thoughts, appreciating and acknowledging those who are responsible for the successful completion of the project. My sincerity gratitude goes to Dr. Urvashi Makkar who assigned me responsibility to work on this project and provided me all the help, guidance and encouragement to complete this project. The encouragement and guidance given by Dr. Urvashi Makkar has made this a personally rewarding experience. I am thankful to her for her support and inspiration, without which, understanding the intricacies of the project would have been exponentially difficult. I would also like to thank our lecturers, faculty members and all those persons who have directly or indirectly helped me in providing the books and amenities which have helped in development of this report, without such help this report would not have been possible.

Yuvraj Singh (254) Amita Jaiswal (255)

HISTORY

The oldest confirmed footwear was discovered in Fort Rock Cave in the U.S. state of Oregon; radiocarbon dating of these sandals woven from sagebrush bark indicates an age of least 10,000 years. However footprints of what looks like ancient sandals have been carbon dated to around the time 500,000 BC.[2] Many people in ancient times, such as the Egyptians, Hindu and Greeks, saw little need for footwear, and most of the time were barefoot. The Egyptians and Hindus at times wore ornamental footwear, such as a soleless sandal known as a "Cleopatra", which did not provide any practical protection for the feet. The ancient Greeks largely viewed footwear as self-indulgent, unaesthetic and unnecessary. Shoes were primarily worn in the theatre, as a means of increasing stature, and many preferred to go barefoot.[3] Athletes in the Ancient Olympic Games participated barefoot and naked.[4] Even the Gods and heroes were primarily depicted barefoot, and the hoplite warriors fought battles in bare feet and Alexander the Great conquered half of the ancient world with barefoot armies. The Romans, who eventually conquered the Greeks, and adopted many aspects of their culture, did not adopt the Greek perception of footwear and clothing. Roman clothing was seen as a sign of power, and footwear was seen as a necessity of living in a civilized world, although the slaves and paupers usually went barefoot.[3] There are many references to shoes being worn in the Bible. During weddings of this period, a father would give his son-in-law a pair of shoes, to symbolize the transfer of authority.[5] During the Middle Ages, both men and women wore patterns, commonly seen as the predecessor of the modern high-heeled shoe,[6] while the poor and lower classes in Europe, as well as slaves in the New World, were barefoot.[3] In the 15th century, choppiness was created in Turkey, and were usually 7-8 inches (17.720.3 cm) high. These shoes became popular in Venice and throughout Europe, as a status symbol revealing wealth and social standing. During the 16th century, royalty started wearing high-heeled shoes to make them look taller or larger than life, such as Catherine de Medici or Mary I of England. By 1580, men also wore them, and a person with authority or wealth was often referred to as, "well-heeled".[6] In modern society, high-heeled shoes are a part of women's fashion, perhaps more as a sexual prop.

Materials

Leather Plastic Rubber Textiles Wood Jute Metal

INTRODUCTION
Indian leather industry is the core strength of the Indian footwear industry. It is the engine of growth for the entire Indian leather industry and India is the second largest global producer of footwear after China. Reputed global brands like Florsheim, Nunn Bush, Stacy Adams, Gabor, Clarks, Nike, Reebok, Ecco, Deichmann, Elefanten, St Michaels, Hasley, Salamander and Colehaan are manufactured under license in India. Besides, many global retail chains seeking quality products at competitive prices are actively sourcing footwear from India. While leather shoes and uppers are produced in medium to large-scale units, the sandals and chappals are produced in the household and cottage sector. The industry is poised for adopting the modern and state-ofthe-art technology to suit the exacting international requirements and standards. India produces more of gents footwear while the worlds major production is in ladies footwear. In the case of chapels and sandals, use of non-leather material is prevalent in the domestic market. Leather footwear exported from India are dress shoes, casuals, moccasins, sport shoes, horrachies, sandals, ballerinas, boots. Non-leather footwear exported from India are Shoes, Sandals and Chappals made of rubber, plastic, P.V.C. and other materials. With changing lifestyles and increasing affluence, domestic demand for footwear is projected to grow at a faster rate than has been seen. There are already many new domestic brands of footwear and many foreign brands such as Nike, Adidas, Puma, Reebok, Florsheim, Rockport, etc. have also been able to enter the market. The footwear sector has matured from the level of manual footwear manufacturing methods to automated footwear manufacturing systems. Many units are equipped with In-house Design Studios incorporating state-of-the-art CAD systems having 3D Shoe Design packages that are intuitive and easy to use. Many Indian footwear factories have also acquired the ISO 9000, ISO 14000 as well as the SA 8000 certifications. Excellent facilities for Physical and Chemical testing exist with the laboratories having tie-ups with leading international agencies like SATRA, UK and PFI, Germany. One of the major factors for success in niche international fashion markets is the ability to cater them with the latest designs, and in accordance with the latest trends. India, has gained international prominence in the area of Colours & Leather Texture forecasting through its outstanding success in MODEUROP. Design

And Retail information is regularly made available to footwear manufacturers to help them suitably address the season's requirement. The Indian Footwear Industry is gearing up to leverage its strengths towards maximizing benefits. Strength of India in the footwear sector originates from its command on reliable supply of resources in the form of raw hides and skins, quality finished leather, large installed capacities for production of finished leather & footwear, large human capital with expertise and technology base, skilled manpower and relatively low cost labor, proven strength to produce footwear for global brand leaders and acquired technology competence, particularly for mid and high priced footwear segments. Resource strength of India in the form of materials and skilled manpower is a comparative advantage for the country. The export targets from 2007-08 to 2010-11 as tabulated below reflects the fact that footwear sector is the most significant segment of the Leather Industry in India. The export targets from 2007-08 to 2010-11 (In Million US$) Product 2006-07 Actual Export Leather Footwear Garments Leather Goods 688.05 1212.25 308.98 690.66 726.85 1967.88 358.53 733.34 105.66 3892.26 785.00 2597.60 372.87 798.69 127.85 4682.01 847.80 3428.83 387.78 870.06 154.70 5689.17 915.63 4526.05 403.30 948.04 187.19 6980.21 2007-08 2008-09 2009-10 2010-11

Saddlery & Harness 81.85 Total 2981.79

India has emerged in recent years as a relatively sophisticated low to medium cost supplier to world markets The leather industry in India has been targeted by the Central Government as an engine for economic growth. Progressively, the Government has prodded and legislated a reluctant industry to modernise. India was noted as a supplier of rawhides and skins semi processed leather and some shoes. In the 1970s, the Government initially banned the export of raw hides and skins, followed this by limiting, then stopping the export of semi processed leather and encouraging local tanneries to manufacture finished leather themselves. Despite protestations from the industrialists, this has resulted in a marked improvement in

the shoe manufacturing industry. India is now a major supplier of leather footwear to world markets and has the potential to rival China in the future (60% of Chinese exports are synthetic shoes). India is often referred to as the sleeping giant in footwear terms. It has an installed capacity of 1,800 million pairs, second only to China. The bulk of production is in mens leather shoes and leather uppers for both men and ladies. It has over 100 fully mechanised, modern shoe making plants, as good as anywhere in the world (including Europe). It makes for some upmarket brands including Florsheim (US), Lloyd (Germany), Clarks (UK), Marks and Spencer (UK). India has had mixed fortunes in its recent export performance. In 2000, exports of shoes were US$ 651 million, in 2001 these increased to 663 million but declined in 2002 to 623 million dollars (See Statistics). The main markets for Indian leather shoes are UK and USA, which between them take about 55% of total exports. India has not yet reached its full potential in terms of a world supplier. This is due mainly to local cow leather that although plentiful, has a maximum thickness of 1.4 1.6mm, and the socio / political / infrastructure of the country. However, India is an excellent supplier of leather uppers. Importation of uppers from India does not infringe FTA with Europe or the USA. The potential is set to change albeit slowly, but with a population rivalling China for size, there is no doubt the tussle for world domination in footwear supply is between these two countries. Few Interesting Facts: The Indian footwear retail market is expected to grow at a CAGR of over 20% for the period spanning from 2008 to 2011. Footwear is expected to comprise about 60% of the total leather exports by 2011 from over 38% in 2006-07. By products, the Indian footwear market is dominated by casual footwear market that makes up for nearly two-third of the total footwear retail market.

Presently, the Indian footwear market is dominated by Men's footwear market that accounts for nearly 58% of the total Indian footwear retail market.

As footwear retailing in India remain focused on men's shoes, there exists a plethora of opportunities in the exclusive ladies' and kids' footwear segment with no organized retailing chain having a national presence in either of these categories.

The Indian footwear market scores over other footwear markets as it gives benefits like low cost of production, abundant raw material, and has huge consumption market. The footwear component industry also has enormous opportunity for growth to cater to increasing production of footwear of various types, both for export and domestic market.

In a Nutshell: There are nearly 4000 units engaged in manufacturing footwear in India. The industry is dominated by small scale units with the total production of 55%. The total turnover of the footwear industry including leather and non-leather footwear is estimated at Rs.8500-9500 crore (Euro 551.3-1723.1 Million) including Rs.12001400 crore (Euro 217.6-253.9 Million) in the household segment. India's share in global leather footwear imports is around 1.4% Major Competitors in the export market for leather footwear are China (14%), Spain (6%) and Italy (21%). The footwear industry exist both in the traditional and modern sector. While the traditional sector is spread throughout the country with pockets of concentration catering largely to the domestic market, the modern sector is largely confined to select centres like Chennai, Ambur, Ranipet, Agra, Kanpur and Delhi with most of their production for export. Assembly line production is organized, and about 90% of the workforces in the mechanized sector in South India consist of women. In fact, this sector has opened up plenty of employment opportunities for women who have no previous experience. They are trained to perform a particular function in the factory itself.

DATA ANALYSIS AND INTERPRETATION Q1- What type of footwear do you wear mostly?
Slipper Shoes Sandals Boots

Sales
BOOTS 7%

SLEEPER 18%

SANDALS 30%

SHOES 45%

INTERPRETATION
From the above diagram, it is clear that mostly people prefer to wear shoes as the percentage is nearly half from rest of the options i.e. 45% people prefer to wear shoes only and 30% of the people prefer to wear sandals. Only 7% of the population prefer to wear boots and rest 18% prefer to wear sleepers as per according to their convenience, comfort and safety.

Q2- How often do you shop for footwear ?

Weekly Fortnightly Monthly Quarterly Half yearly Yearly

Sales
weekly fortnightly monthly 1% 5% 8% halfyearly yearly

44%

42%

INTERPRETATION
From the above diagram, people used to purchase new footwear on an yearly basis i.e.44% of the total population as in the rural area the purchasing power of the people is not that much high. 42% of the population used to purchase footwear half yearly basis and weekly, monthly and fortnightly purchase of footwear is least in the count as people rarely purchase so quickly.

Q3- Where do buy your footwear from? Local market City Both

Sales
local market city both

13% 5%

82%

INTERPRETATION
From the above diagram, it is clear that people prefer to purchase the footwear from the local market as the percentage is very high i.e. 82% as compared to purchasing footwear from city. Some people keep both the option in their hands and go for purchasing from both city as well as from local market too.

Q4- What is the most you would spend on a pair of footwear? 50 100 300 1000 More than that

Sales
50 rs 100 rs 300 rs 1000 rs

5% 22%

30%

43%

INTERPRETATION
From the above diagram, very less number of people like to spend more on footwears costing more than a thousand rupees. It clearly depicts that in rural area people dont have too much to spend so they prefer to take footwear costing Rs. 100 i.e. 43% of the population in the rural area goes for very less expensive footwears. 30% goes for an average cost of Rs. 300 respectively.

Q5- What are some of your favorite brands? Bata Liberty Goldstar Other local brand

Sales
BATA LIBERTY GOLDSTAR LOCAL BRAND

5% 8%

20%

67%

INTERPRETATION
From the above diagram, it is clear that local brand has captured most of the customers in the rural market i.e. 67% people go for local brands.20% go for purchasing goldstar footwear. The people in the rural area does not go for brands like liberty and bata instead they prefer local brands only.

Q6- Which effect you most while buy a footwear? Price Durability Comfort Brand

Sales
PRICE DURABILITY COMFORT BRAND

22%

57%

17%

4%

INTERPRETATION
From the above diagram it is clear that 57% of the people are affected by the brand name as their perception is branded products are expensive thats why they dont go for brands. The price of the footwears is also an important concerned because people in the rural area dont want to go in for purchasing costly items. They basically purchase to fulfill their requirements by spending less. They dont consider durability and comfort as they check only the price are under their range or not.

Response Rate
The response rate was below average. I have used questionnaire method for the financial information of the respondent, most of the people hesitated to provide the required information and also the questionnaire contained some financial terms that were technical in nature, which resulted into reduced response rate. I have visited nearly 70 respondents, out of which only 30 gave proper response. Hence, Response Rate = 30/70 = 42.8%

Sampling frame

Sampling frame is the actual set of units from which a sample has been drawn. In sampling frame, I have used simple random sampling method for conducting survey. In a simple random sample ('SRS') all units from the sampling frame have an equal chance to be drawn and to occur in the sample.

RECOMMENDATION

As rural people more conscious about price and durability of foot wears so marketers having golden opportunity to grab this market by providing such facilities. Still maximum of rural people depend on local footwears as they are price conscious so its a responsibility of companies to more focus on price of product. Rural people find difficulties to go to cities so marketers should provide a retail outlet over there. Rural people are are too much aware about footwear brands. So companies should increase their marketing in rural also. The bottom line of the market research speaks that branded shoes in india has been increasing on day by day basis that sounds good for international as well as domestic market. A special marketing campaign should be started in the unexplored regions where company does not have its reach. Company can exercise separate product mix, marketing mix a n d a differentiated marketing communication mix for the marketing campaign After liberalization, standard of living and purchasing power of rural people is on the rise. There is a great scope in rural market as compared to the urban markets because major portion of urban market is already saturated. By adopting an appropriate rural-marketing strategy, the liberty shoe limited can push up sales up o a great extant.

CONCLUSION The existing market situation for the footwears industries is not very good. Providing products in low cost with quality is difficult for the company Huge opportunity for companies 80 crore people belonging to rural areas. It is an opportunity for Indian company to compete with mncs Indian market is growing day by day so there is huge market in future.