MODULE 6 RURAL MARKETING 37.

1 RURAL MARKETING ENVIRONMENT

The rural market environment needs a separate examination as it varies significantly from that of the urban market. This subject can be studied under 3 broad segments: 1. The Rural Consumer 2. The Rural Deman AN 3. O!her As"e#!s o$ !he Rural Mar%e! En&'ronmen!

The Rural Consumer

!i"e of the #ural $onsumer %roup:

(o"ula!'on o$ In 'a ))) Rural Vs Ur*an

1+71 1+,1 1++1 -..1

&op 'in ) to &op 'in ) to &op 'in ) to &opulation ) to mill( total mill( total mill( total 'in mill( total #ural 2rban Total *3+., 1,+.1 .*-.1 -, 2, 1,, .,2., 1.0.2 0.-.2 /0.3 23./ 1,, 0*1., 2,3., -**., /0 2* 1,, /*,., 2+,., 1,3., /3 2/ 1,,

/0our#e1 Census o$ In 'a2 3n numerical terms4 3ndia5s rural market is indeed a large one6 it consists of more than /*, million consumers. The above table presents the details of rural vs urban population of 3ndia. 3t can be seen from the table that no7 /3) of 3ndia5s total population is rural. Though over the last 3 decades there has been a marginal reduction in the rural population expressed as a ) of the total population4 there has been a steady gro7th in rural population in terms of absolute numbers. And4 it had reached /*, million by 2,,1. 3n terms

of 88s4 the rural market consists of more than 12, million 88s4 forming over /,) of the total 88s in the country.

MODULE 6 RURAL MARKETING 37.- C3ARACTERITIC0 O4 RURAL CON0UMER GROU( Lo#a!'on (a!!ern
&ractically4 the 7hole of 3ndia4 barring the metros 9 to7ns4 constitutes the 3ndian rural market. 3n other 7ords4 the market is spread through the length 9 breadth of the vast country.

A 0#a!!ere Mar%e!
3t is thus evident that the rural market of 3ndia is a geographically scattered market. :hereas the urban population of 3ndia is concentrated in 32,, cities 9 to7ns4 or less than 1.1)4 have a population of ; .,,, each. <ore than ,.3 million villages4 or ; ..) of the total = of villages4 are in the category of .,, people or less and ; ,.1. villages or 2.) are in the category of 2,, people or less. The inference is clear6 unlike urban demand4 7hich is highly concentrated4 rural demand is scattered over a large area.

0o#'o)E#onom'# (os'!'on
>y 9 large4 rural consumers continue to be marked by lo7 purchasing po7er?lo7 per capita income. !imilarly4 they continue to be a tradition@ bound community4 7ith religion4 culture 9 tradition strongly influencing their consumption habits.
Nearly 0,) of rural income comes from agriculture. #ural prosperity 9 discretionary income 7ith rural consumers are thus linked to a si"eable extent 7ith agricultural prosperity. <ore than A the 88s are in the income category of B2.C per annum4 but about 1*) of the 88s have an annual income that exceeds .,C. #emittances from 3ndians 7orking outside have made a si"eable contribution to the gro7ing rural income?purchasing po7er in some states.

 Analysis reveals that4 in recent years4 rural consumers have been increasingly dra7n into the savings habit. As much as /,) of the rural 88s no7 save a part of their income. The habit is relatively more 7idespread among salary earners.

MODULE 6 RURAL MARKETING

37.3 CULTURALL5 A DIVER0E 6 3ETEROGENEOU0 MARKET
The rural market is not only a scattered market4 but is also diverse 9 heterogeneous. #ural consumers are diverse in terms of religious4 social4 cultural 9 linguistic factors. The diversity is manifest in a more intense manner among the rural segments. 3t can be said that heterogeneity is the =1 hallmark of the rural market D ./,C villages4 A a do"en religions4 33 languages4 10., dialects 9 diverse sub@cultures characteri"e the market.

0!a!e)!o)0!a!e Var'a!'on 'n E7!en! o$ De&elo"men!

There is also a great deal of difference bet7een different states in extent of development. A recent study conducted by 3<#> '3ndian <arket #esearch >ureau( provides some clue on the relative status of the rural areas of different states. The study provides development index points for each state4 after collecting village@level data on various parameters4 such as availability of health 9 education facilities4 availability of public transport4 electricity4 TE transmission4 banks4 post offices4 7ater supply 9 so on. A 7eight 7as decided upon for each facility4 based on the relative importance of that facility in indicating the extent of development of the village.

 According to the study4 7hile the average village in 3ndia has 33 development index points4 villages in Cerala had an average of -- points 7hile those in >ihar had just 226 <&4 #ajastan 9 2& 7ere close to >ihar6 and states like <aharashtra4 8aryana4 Carnataka had points ranging bet7een *, 9 .,.

MODULE 6 RURAL MARKETING 37.8 LIRERAC5 LEVEL9LI4E0T5LE L'!era#: Le&el

3t has been estimated that rural 3ndia has a literacy rate of 2-) compared 7ith ..) for the entire country. The aspects mentioned belo7 need to be emphasi"ed specifically 7ith regard to rural literacy. The "'#!ure has *een #han;'n; o&er !he :ears< as a e#a e a;o '! =as -.>. E&er: :ear a*ou! , m "eo"le ;e! a e !o rural In 'a?s l'!era!e "o"ula!'on. The a ul! l'!era#: "ro;rams laun#he 'n !he rural areas are *oun !o enhan#e !he rural l'!era#: ra!e. In a*solu!e @s< alrea : !here are more l'!era!e "eo"le 'n rural In 'a /16A m2 !han 'n ur*an In 'a /16. m2. The "'#!ure also '$$ers $rom s!a!e !o s!a!e 6 e&en 's!r'#!)!o) 's!r'#!.

L'$es!:le
>y 9 large4 the rural consumers are marked by a conservative 9 tradition@bound lifestyle. >ut4 7hat is striking today about this matter is not the basic conservative characteristic4 but the fact that the lifestyle is undergoing a significant change.

Gro=!h 'n 'n#ome 6 #han;e 'n 'n#ome 's!r'*u!'on. Gro=!h 'n e u#a!'on. Enlar;e me 'a rea#h /"ar!'#ularl: TV2. Gro='n; 'n!era#!'on ='!h ur*an #ommun'!'es. Mar%e!ers? e$$or!s !o rea#h ou! !he rural mar%e!.

MODULE 6 RURAL MARKETING 37.A LI4E0T5LE

>uying >ehavior: To understand the buying behavior of rural consumers4 7e must go to the factors that influence their buying behavior. These factors include:
0o#'o)e#onom'# en&'ronmen! o$ !he #onsumer Cul!ural en&'ronmen! Geo;ra"h'# lo#a!'on E u#a!'on9L'!era#: le&el O##u"a!'on E7"osure !o me 'a 6 enlar;e me 'a rea#h The "o'n!s o$ "ur#hase o$ "ro u#!s The =a: !he #onsumer uses !he "ro u#!s In&ol&emen! o$ o!hers 'n !he "ur#hase Mar%e!ers? e$$or!s !o rea#h ou! !he rural mar%e!

3nfluence of $ulture: $ulture 9 tradition influence perceptions 9 buying behavior. For ex4 the preference in respect of color4 si"e 9 shape is often the result of cultural factors. #ural consumers5 perceptions of products are strongly influenced by cultural factors. %eographical Gocation: #ural consumer behavior is also influenced by the geographical location of the consumers. For ex4 nearness to feeder to7ns 9 industrial projects influence the buying behavior of consumers in the respective clusters of

villages. Het another example 7ill be the lack of electricity in many rural 88s acts as a barrier to purchase of certain consumer durables. Ixposure to urban lifestyles: Ixtent of exposure of rural consumers to urban lifestyles also influences their buying behavior. An increased exposure 9 interaction 7ith urban communities has been the trend in recent years.

MODULE 6 RURAL MARKETING 37.6 LI4E0T5LE

The =a: !he #onsumer uses !he "ro u#!s1
The situation in 7hich the consumer utili"es the product also influences their buying behavior. Gack of electricity automatically increases the purchase of batteries by the rural consumers.

(la#es o$ "ur#hase1
ifferent segments of rural buyers buy their reJuirements from different places?outlets. !ome buy from the village shopkeepers6 some from village markets6 others buy from the to7n that serves as the feeder to the rural area. The marketer therefore must a Juestion to himself:

Bhere $rom o !he: *u: !he "ro u#!s 6 =h:C In&ol&emen! o$ o!hers 'n !he "ur#hase1
3n the past4 the head of the family used to make the purchase decision all by himself. 3n contrast4 the involvement of other members of the family in the purchase decision has been gro7ing in recent years. An
6

increase in literacy coupled 7ith great access to information has resulted in this development.

Mar%e!ers? e$$or!s !o rea#h ou! !he rural mar%e!1

&resently4 many firms have been trying hard to develop a market for their products in the rural areas. This has brought about some change in the 7ay buyers purchase different products. evelopmental marketing has created discriminating buyers 9 hitherto unkno7n demand in the rural market.

MODULE 6 RURAL MARKETING 37.7 LI4E0T5LE Du:'n; *eha&'or un er;oes maEor #han;e
$hanges have been taking place over the years in practically all the factors that have been listed as influencers of the buying behavior of rural consumers. #ural consumers differ from their urban eJuals in their buying habits. This is because of the difference in circumstances. $orporates4 like 8GG4 7hich is a major force in both urban 9 rural markets4 have been talking of a ne7 trend 7ith regard to the role of youth in the rural markets. 3n their perception4 the youth4 urban or rural4 have the same aspirations. 3t may be that the rural youth are not in a position to follo7 their aspirations to the same extent as the urban youth can due to certain reasons.

No s!ereo!:"e rural #onsumer

Kne cannot proceed on the basis of a stereotype of the rural consumer or of rural consumer behavior. This signals problems as 7ell as opportunities for the marketer. The lo7 purchasing po7er?lo7 per capita income?lo7 literacy levels are common traits of rural consumers.

 <arketers also say that the rural consumers are a tradition@bound community4 7ith religion4 culture 9 tradition strongly influencing their consumption habits. None of this4 ho7ever4 constitutes the representative picture of rural consumers as a 7hole. A si"eable segment of rural consumers defy this description. There is thus great scope 9 need for segmenting the rural market on the basis of buying behavior.