REGIONAL COLLEGE OF MANAGEMENT

A PROJECT REPORT ON

“FINDING OUT THE NEW BUSINESS OPPORTUNITY IN SUNDERGARH

DISTRICT OF RURAL ORISSA FOR DABUR INDIA LTD.”

PROJECT REPORT SUBMITTED AT

REGIONAL COLLEGE OF MANAGEMENT,

BHUBANESWAR UNDER BIJU PATTANAIK UNIVERSITY OF TECHNOLOGY TOWARDS
PARTIAL FULFILLMENT OF REQUIREMENT FOR THE AWARD OF THE DEGREE OF
‘MASTER OF BUSINESS ADMINISTRATION’

SUBMITTED BY
JITENDRA KUMAR NAYAK
REGD.NO- 0806247076

UNDER GUIDANCE OF
MUKESH MISHRA
SENIOR LECTURER
R C M, BHUBANESWAR

DABUR INDIA LIMITED

 DECLARATION

I, Jitendra Kumar Nayak hereby declare that the summer project

entitled “TO FIND OUT NEW BUSINESS OPPORTUNITY IN
SUNDERGARH DISTRICT OF RURAL ORISSA FOR DABUR INDIA
LTD.” submitted by me in partial fulfillment of Degree in Business
Administration, Regional College of Management, under Biju Pattanaik
University of Technology(BPUT), is my own. This work has not been
submitted to any other university nor has been published ever before.

I would like to declare that the information provided in the project

report is authentic to best of my knowledge, as it has been obtained
through market survey done entirely by me and verified by the concerned
authority.

DATE: 22.10.09 JITENDRA KUMAR NAYAK

PLACE: BHUBANESWAR REGD. NO: 0806247076

MBA (2008-2010) RCM.

2
 ACKNOWLEDGEMENT
IT IS MORE A LIABILITY FOR ME TO OWE MY DEEP
SENSE OF ACKNOWLEDGEMENT AND GRATITUDE TO
THE FACULTY OF MY DEPARTMENT, WHO HAS LENT ME
ESTEEMED SUPPORT IN HIS ENDEAVOR. I WOULD LIKE
TO PAY MY GRATITUDE TO MR.MUKESH MISHRA (SR.
LECTURER) FOR HELPING THROUGH THROUGHOUT THE
COURSE CURRICULUM FOR THE SUCCESS OF THE EVENT.

I am deeply indebted as, every stands on its own nerves, which

lies beneath the skin. And his work is no exception; the person who is
constantly seen into my success, is my guide MR. DHEEMAN
BHATTACHARYA. [A.S.M. DABUR INDIA LTD.] He is not only my
guide but also a constant motivator.

Lastly, I have the pleasure of presenting this seminar report to my

Department of M.B.A (RCM) and thankful to them for their kind
consideration and timely responses.

JITENDRA KUMAR NAYAK

Regn. No: 0806247076

M.B.A. (RCM)

3
 CONTENTS

TOPICS PAGES
I. To whom it may concern 5
II. Certificate of training 6
III. Introduction 7
IV. Company profile 27
a. Dabur business structure 30
b. Manufacturing facility in India 35
c. Distribution network 38
d. Sustainability report 39
e. Technology absorption 41
f. Strategic intent 42
V. Objective of the study 43
VI. Research methodology 44
VII. Sampling technique 45
VIII. Tools to analysis 46
IX. Method of data collection 47
X. Data analysis
a. Analysis based on availability 48
b. Analysis based on coverage 49
c. Analysis based on mod e of transportation 50
d. Analysis based on market share 52
e. Analysis based on availability of different product 53
f. Village status 55
i. Villages having high sale 56
ii. Villages having low sale 60
XI. Findings 64
XII. Suggestion 65
XIII. Conclusion 68
XIV. Bibliography 69

4
 Guide Certificate
This is to certify that the work entitled “TO FIND OUT NEW
BUSINESS OPPORTUNITY IN SUNDERGARH DISTRICT OF RURAL
ORISSA FOR DABUR INDIA LTD.” is a piece of term project done by
JITENDRA KUMAR NAYAK of M.B.A (4th trimester) under my
Guidance and supervision for partial fulfillment of MBA curriculum
Of Regional college of management ,Bhubaneswar.

To the best of my knowledge and belief the term project

Report:-
1) Embodies the work of the candidates them self.
2) Has been duly completed.
3) Is up to the standard both in respect to contents and language for
being referred to the examiner.

DT: DHEEMAN BHATTACHARYA

AREA SALES MANAGER
DABUR INDIA LTD.

5
 Guide Certificate
This is to certify that the work entitled “TO FIND OUT NEW
BUSINESS OPPORTUNITY IN SUNDERGARH DISTRICT OF RURAL
ORISSA FOR DABUR INDIA LTD.” is a piece of term project done by
JITENDRA KUMAR NAYAK of M.B.A (4th trimester) under my
Guidance and supervision for partial fulfillment of MBA curriculum
Of Regional College of Management, Bhubaneswar.

To the best of my knowledge and belief the term project

Report;
1) Embodies the work of the candidates them self.
2) Has been duly completed.
3) Is up to the standard both in respect to contents and language for
being referred to the examiner.

DT: Mukesh Kumar Mishra

SR. LECTURER
RCM [BHUBANESWAR]

6
 III. INTRODUCTION
For quite some time now, the lure of rural India has been the subject
of animated discussion in corporate suites. And there is a good reason too.
With urban markets getting saturated for several categories of consumer
goods and with rising rural incomes, marketing executives are fanning out
and discovering the strengths of the large rural markets as they try to enlarge
their markets. Today, the idea has grown out of its infancy and dominates
discussions in any corporate boardroom strategy session.

Rural India with its traditional perceptions has grown up over the
years, not only in terms of income, but also in terms of thinking. The rural
markets are growing at about two time faster pace than urban markets, not
surprisingly, rural India accounts for 60 per cent of the total national demand.

'Go Rural' is the slogan of marketing gurus after analyzing the socio-
economic changes in villages. The Rural population is nearly three times the
urban, so that Rural consumers have become the prime target market for
consumer durable and non-durable products, food, construction, electrical,
electronics, automobiles, banks, insurance companies and other sectors
besides hundred per cent of agri- input products such as seeds, fertilizers,
pesticides and farm machinery. The Indian rural market today accounts for
only about Rs 8 billion of the total ad pie of Rs 120 billion, thus claiming 6.6
per cent of the total share. So clearly there seems to be a long way ahead.
Although a lot is spoken about the immense potential of the unexplored rural
market, advertisers and companies find it easier to vie for a share of the
already divided urban pie.

The success of a brand in the Indian rural market is as unpredictable

as rain. It has always been difficult to gauge the rural market. Many brands,
which should have been successful, have failed miserably. More often than
not, people attribute rural market success to luck.

7
 Therefore, marketers need to understand the social dynamics and
attitude variations within each village though nationally it follows a consistent
pattern looking at the challenges and the opportunities which rural markets
offer to the marketers it can be said that the future is very promising for
those who can understand the dynamics of rural markets and exploit them to
their best advantage. A radical change in attitudes of marketers towards the
vibrant and burgeoning rural markets is called for, so they can successfully
impress on the 230 million rural consumers spread over approximately six
hundred thousand villages in rural India.

Companies face many challenges in tackling the rural markets. Some of the
more critical being- understanding rural consumer, reaching products &
services to remote rural location & communicating with vastly heterogeneous
rural audiences. Sadly, not many companies have invested sufficient effort &
money in research and nor have they spent enough time in field to
understand rural consumers, their values, aspirations, needs and usage
habits. Marketing is all about ‘getting to know your customer ‘but having
largely ignored this cardinal principle, most corporate in rural markets find
that success has eluded them.

Rural consumers are fundamentally different from their urban

counterparts & different rural geographies display considerable heterogeneity,
calling for rural-specific & region-specific strategies. In the absence of
marketplaces, shopping complexes, & malls, marketers will have to abandon
the known and the familiar and instead understand where rural consumers
buy their rural goods & products.

To meet the wants & needs of selected customers, it is important to

understand consumer behavior. It is this behavior that guides & directs the
entire set of activities that constitutes the marketing programme.Consumer
behavior in the rural markets is even more perplexing because of a singular
lack of consistency in groups which are homogeneous in parameters of
demographics- age, occupation, education & income.

8
CONCEPT

In recent years, rural markets have acquired significance, as the overall

growth of the economy has resulted into substantial increase in the
purchasing power of the rural communities.

On account of green revolution, the rural areas are consuming a large

quantity of industrial and urban manufactured products. In this context, a
special marketing strategy, namely, rural marketing has emerged.

The census of India defines rural as any habitation with a population

density of less than 400 per sq.km, where at least 75percent of the male
working population is engaged in agriculture & where there exists no
municipality or board. Of the nearly 6.4 Lakh villages in India, only 20000
villages have population more than 5000.Most companies in the FMCG sector
has defined rural as any place with a population up to 20000.

The rural agricultural production and consumption process plays a

Predominant role in developing the Indian economy. This has designed a new
way for understanding a new process called Rural Marketing. The concept of
rural marketing has to be distinguished from Agricultural marketing. Rural
marketing basically deals with delivering manufactured or processed inputs or
services to rural producers, the demand for which is basically a derived
outcome. Rural marketing scientists also term it as developmental marketing,
as the process of rural marketing involves an urban to rural activity, which in
turn is characterized by various peculiarities in terms of nature of market,
products and processes.

9
 Rural marketing differs from agricultural or consumer products
marketing in terms of the nature of transactions, which includes participants,
products, modalities, norms and outcomes. The participants in case of Rural
Marketing would also be different they include input manufacturers, dealers,
farmers, Opinion makers, government agencies and traders. The existing
approach to the rural markets has viewed the markets as a homogeneous
one, but in Practice; there is a significant buyer and user difference across
regions as well as within that requires a differential treatment of the
marketing problems. These differences could be in terms of the type of
farmers, type of crops and other agro-climatic conditions.

Rural marketing is an evolving concept, and as a part of any economy

has untapped potential; marketers have realized the opportunity recently.
Improvement in infrastructure and reach, promise a bright future for those
intending to go rural. Rural consumers are keen on branded goods nowadays,
so the market size for products and services seems to have burgeoned. The
rural population has shown a trend of wanting to move into a state of gradual
urbanization in terms of exposure, habits, lifestyles and lastly, consumption
patterns of goods and services. There are dangers on concentrating more on
the rural customers. Reducing the product features in order to lower prices is
a dangerous game to play.

Gone are the days when rural consumer went to nearby city to buy
’branded products and services’. The rural consumer is growing and this is an
opportunity to grab the market share for all the global players in the market
whether it is into Fast Moving Consumer Goods (FMCG) sector or retail sector
(either insurance or banking or for that sake any other sector).

The FMCG sector includes companies like Indian Tobacco Corporation

(ITC), Godrej, Hindustan Lever Limited (HLL), Gujarat Cooperative Milk
Marketing Federation (GCMMF-Amul) and Dabur India Limited. All these have
shown a strong global presence in the rural sector and it can be said that all
the FMCG companies should target the rural sector.

10
 According to a survey conducted by Mckinsey in 2007, rural India with
a population of 630 million (approximately) would become bigger than total
consumer market in countries such as South Korea or Canada in another 20
years and it will grow at least four times from its existing size.

WHY RURAL MARKET?

The Indian rural market has a huge demand base and offers great
opportunities to marketers. Two-thirds of Indian consumers live in rural areas
and almost half of the national income is generated here.

The reasons for heading into the rural areas are fairly clear. The urban
consumer durable market for products like color TVs, washing machines,
refrigerators and air conditioners is growing annually at between 7 per cent
and 10 per cent.

The rural market is zooming ahead at around 25 per cent annually.

"The rural market is growing faster than urban India now," says Venugopal
Dhoot, chairman of the Rs 989 - crore (Rs billion) Videocon Appliances. "The
urban market is a replacement and up gradation market today," adds
Samsung's director, marketing, Ravinder Zutshi.

WHAT RURAL MARKET BUYS?

Rural India buys small packs, as they are perceived as value for
money. There is brand stickiness, where a consumer buys a brand out of
habit and not really by choice. Brands rarely fight for market share; they just
have to be visible in the right place. Even expensive brands, such as Close-
Up, Marie biscuits and Clinic shampoo are doing well because of deep
distribution, many brands are doing well without much advertising support —
Ghadi, a big detergent brand in North India, is an example.

11
REASONS OF IMPROVEMENT OF BUSINESS IN RURAL AREA

Socio-economic changes (lifestyle, habits and tastes, economic status)

Literacy level (25% before independence – more than 65% in 2001)

Infrastructure facilities (roads, electricity, media)

Increase in income

Increase in expectations

MART, the specialist rural marketing and rural development

consultancy has found that 53 per cent of FMCG sales lie in the rural areas, as
do 59 per cent of consumer durable sales, said its head Pradeep Kashyap at
the seminar. Of two million BSNL mobile connections, 50 per cent went to
small towns and villages, of 20 million Rediffmail subscriptions, 60 per cent
came from small towns, so did half the transactions on Rediff's shopping site.

SPECIAL FEATURES OF RURAL MARKET

Unlike urban markets, rural markets are difficult to predict and possess
special characteristics. The featured population is predominantly
illiterate, have low income, characterized by irregular income, lack of
monthly income and flow of income fluctuating with the monsoon
winds.

Rural markets face the critical issues of Distribution, Understanding the
rural consumer, Communication and Poor infrastructure. The marketer
has to strengthen the distribution and pricing strategies. The rural
consumer expects value for money and owing to has unsteady and
meager status of weekly income; increasing the household income and
improving distribution are the viable strategies that have to be adapted
to tap the immense potential of the market.

Media reach is a strong reason for the penetration of goods like
cosmetics, mobile phones, etc., which are only used by the urban
people. Increasing awareness and knowledge on different products and
brands accelerate the demand. The rural audience are however critical
of glamorous ads on TV, and depend on the opinion leaders who
introduce the product by using it and recommending it.

12

Opinion leaders play a key role in popularizing products and influence
in rural market. Nowadays educated youth of rural also influences the
rural consumers. Rural consumers are influenced by the life style they
watch on television sets. Their less exposure to outside world makes
them innocent and fascinated to novelties. The reach of mass
television media, especially television has influenced the buying
behaviour greatly.

CREATING BRANDS FOR RURAL INDIA

Rural markets are delicately powerful. Certain adaptations are required

to cater to the rural masses; they have unique expectation and warrant
changes in all four parameters of product, price, promotion and distribution.

A lot is already emphasized on adapting the product and price in terms

of packaging, flavouring, etc and in sachets, priced to suit the economic
status of the rural India in sizes like Rs.5 packs and Re.1 packs that are
perceived to be of value for money. This is a typical penetration strategy that
promises to convert the first time customers to repeated customers.

The promotion strategies and distribution strategies are of paramount

importance. Ad makers have learnt to leverage the benefits of improved
infrastructure and media reach. The television advertisements to lure rural
masses, and they are sure it reaches the target audience, because majority of
rural India possesses and is glued to TV sets!

Distributing small and medium sized packets through poor roads, over
long distances, into deep pockets of rural India and getting the stockiest to
trust the mobility is a Herculean task. Giving the confidence those
advertisements will support. Sales force is being trained to win the confidence
of opinion leaders. Opinion leaders play an important role in popularizing the
brand. They sometimes play the role of entry barriers for new products.

13
 The method of promotion needs to be tailored to suit the expectations
of the market. Techniques that have proved to be successful are Van
campaigns, edutainment films, generating word of mouth publicity through
opinion leaders, colourful wall paintings. The Wide reach of television has
exposed the otherwise conservative audience to westernization. Panchayat
televisions in Tamilnadu carries message that are well received and contribute
to community development.

Dynamics of rural markets differ from other market types, and similarly
rural marketing strategies are also significantly different from the marketing
strategies aimed at an urban or industrial consumer. This, along with several
other related issues, have been subject matter of intense discussions and
debate in countries like India and China and focus of even international
symposia organized in these countries.

Rural markets and rural marketing involve a number of strategies,

which include:

Client and location specific promotion

Joint or cooperative promotion

Bundling of inputs

Partnership for sustainability

Client and Location specific promotion involves a strategy designed to

be suitable to the location and the client. Joint or co-operative promotion
strategy involves participation between the marketing agencies and the client.
'Bundling of inputs' denote a marketing strategy, in which several related
items are sold to the target client, including arrangements of credit, after-sale
service, and so on. Media, both traditional as well as the modern media, is
used as a marketing strategy to attract rural customers.
Partnership for sustainability involves laying and building a foundation for
continuous and long lasting relationship. Innovative media can be used to
reach the rural customers. Radio and television are the conventional media
that are reaching the rural audience effectively. But horse cart, bullock cart
and wall writing are the other media, which can carry the message effectively
to the rural customers.

14
 STRATEGY

Dynamics of rural markets differ from other market types, and similarly
rural marketing strategies are also significantly different from the marketing
strategies aimed at an urban or industrial consumer. This, along with several
other related issues, have been subject matter of intense discussions and
debate in countries like India and China and focus of even international
symposia organized in these countries.

Rural markets and rural marketing involve a number of strategies,

which include:-

Client and location specific promotion

Joint or cooperative promotion..

Bundling of inputs

Management of demand

Developmental marketing

Unique selling proposition (USP)

Extension services

Business ethics

Partnership for sustainability

Client and Location specific promotion involves a strategy designed to

be suitable to the location and the client.

Joint or co-operative promotion strategy involves participation between

the marketing agencies and the client.

Bundling of inputs denote a marketing strategy, in which several related

items are sold to the target client, including arrangements of credit, after-sale
service, and so on.

Management of demand involve continuous market research of buyer’s

needs and problems at various levels so that continuous improvements and
innovations can be undertaken for a sustainable market performance.

15
Developmental marketing refer to taking up marketing programmers
keeping the development objective in mind and using various managerial and
other inputs of marketing to achieve these objectives.

Media both traditional as well as the modern media, is used as a marketing

strategy.

Unique Selling Propositions (USP) involves presenting a theme with the

product to attract the client to buy that particular product. For examples,
some of famous Indian Farm equipment manufacturers have coined catchy
themes, which they display along with the products, to attract the target
client that is the farmers. English version of some of such themes would read
like:

The heartbeats of rural India

With new technique for a life time of company

For the sake of progress and prosperity

Extension Services denote, in short, a system of attending to the missing

links and providing the required know-how.

Ethics in Business. Form, as usual, an important plank for rural markets

and rural marketing.

Partnership for sustainability involves laying and building a foundation for

continuous and long lasting relationship.

WHY DIFFERENT STRATEGIES?

Rural markets, as part of any economy, have untapped potential.

There are several difficulties confronting the effort to fully explore rural
markets. The concept of rural markets in India is still in evolving shape, and
the sector poses a variety of challenges. Distribution costs and non-availability
of retail outlets are major problems faced by the marketers.

16
 The success of a brand in the Indian rural market is as unpredictable
as rain. Many brands, which should have been successful, have failed
miserably. This is because most firms try to extend marketing plans that they
use in urban areas to the rural markets. The unique consumption patterns,
tastes, and needs of the rural consumers should be analyzed at the product
planning stage so that they match the needs of the rural people.

Therefore, marketers need to understand the social dynamics and

attitude variations within each village though nationally it follows a consistent
pattern. The main problems in rural marketing are: -

Understanding the Rural Consumer

Poor Infrastructure

Physical Distribution

Channel Management

Promotion and Marketing Communication

Dynamics of rural markets differ from other market types, and

similarly, rural marketing strategies are also significantly different from the
marketing strategies aimed at an urban or industrial consumer

Examples

HLL started '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.

ITC is setting up e-Choupals, which offers the farmers all the

information, products and services they need to enhance farm
productivity, improve farm-gate price realization and cut transaction
costs. Farmers can access latest local and global information on
weather, scientific farming practices as well as market prices at the
village itself through this web portal - all in Hindi. It also facilitates
supply of high quality farm inputs as well as purchase of commodities
at their doorstep.

17

BPCL introduced Rural Marketing Vehicle (RMV) as their strategy for
rural marketing. It moves from village to village and fills cylinders on
the spot for the rural customers. BPCL considered low-income of rural
population, and therefore introduced a smaller size cylinder to reduce
both the initial deposit cost as well as the recurring refill cost.

STRATEGIES TO BE FOLLOWED

Marketing Strategy

Marketers need to understand the psyche of the rural

consumers and then act accordingly. Rural marketing involves more
intensive personal selling efforts compared to urban marketing. Firms
should refrain from designing goods for the urban markets and
subsequently pushing them in the rural areas. To effectively tap the
rural market, a brand must associate it with the same things the rural
folks do. This can be done by utilizing the various rural folk media to
reach them in their own language and in large numbers so that the
brand can be associated with the myriad rituals, celebrations, festivals
and other activities where they assemble.

Distribution Strategy

One of the ways could be using company delivery van which can
serve two purposes - it can take the products to the customers in every
nook and corner of the market, and it also enables the firm to establish
direct contact with them, and thereby facilitate sales promotion.

Promotional strategy-

Annual "meals" organized are quite popular and provide a very

good platform for distribution because people visit them to make
several purchases.

18
 According to the Indian Market Research Bureau, around 8000 such
meals are held in rural India every year. Rural markets have the practice of
fixing specific days in a week as Market Days (often called ‘Haats’) when
exchange of goods and services are carried out. This is another potential low
cost distribution channel available to the marketers. Also, every region
consisting of several villages is generally served by one satellite town (termed
as "Mandis" or Agri-markets) where people prefer to go to buy their durable
commodities. If marketing managers use these feeder towns, they will easily
be able to cover a large section of the rural population.

Firms must be very careful in choosing the vehicle to be usedfor

communication. Only 16% of the rural population has access to a vernacular
newspaper. So, the audio visuals must be planned to convey a right message
to the rural folk. The rich, traditional media forms like folk dances, puppet
shows, etc., with which the rural consumers are familiar and comfortable, can
be used for high impact product campaigns.

WHAT MAKES RURAL MARKET ATTRACTIVE?

Rural market has following attributes and the following facts substantiate this

742 million people

Estimated annual size of the rural market -

FMCG Rs. 65,000 Crore

Durables Rs. 5,000 Crore

Agri-Inputs (including tractors) Rs. 45,000 Crore

2 / 4 Wheelers Rs. 8,000 Crore

19

In 2001-02, LIC sold 55% of its policies in rural India.

Of two million BSNL mobile connections, 50% are in small

towns / villages.

Durables Urban Rural Total (% of Rural HH)

CTV 30.4 4.8 12.1

Refrigerator 33.5 3.5 12.0

FMCGs Urban Rural Total (% of Rural HH)

Shampoo 66.3 35.2 44.2

Toothpaste 82.2 44.9 55.6

20

Marketers can make effective use of the large available
infrastructure -

Post Offices 1,38,000

Haats (periodic markets) 42,000
Melas (exhibitions) 25,000
Mandis (agri markets) 7,000
Public Distribution Shops 3,80,000
Bank Branches 32,000

Proliferation of large format Rural Retail Stores, which

have been successful also -

 DSCL Haryali Stores

 M & M Shubh Labh Stores
 TATA / Rallis Kisan Kendras
 Escorts Rural Stores
 Warnabazaar, Maharashtra (Annual Sale Rs. 40 crore)
 Of the 6.0 lakh villages, 5.22 lakh have a Village Public Telephone (VPT).
 41 million Kisan Credit Cards have been issued (against 22 million credit-
plus-debit cards in urban), with cumulative credit of Rs. 977 billion
resulting in tremendous liquidity.

 Of the 20 million Rediffmail sign-ups, 60% are from small towns. 50% of
transactions from these towns are on Rediff online shopping site.
 42 million rural households (HHs) are availing banking services in
comparison to 27 million urban HHs.
 Investment in formal savings instruments is 6.6 million HHs in rural and
6.7 million HHs in urban.

21
 RURAL CONSUMER INSIGHTS

 Rural India buys -

• Products more often (mostly weekly).

• Buys small packs, low unit price more important than economy.

 In rural India, brands rarely fight with each other; they just have to be
present at the right place.

 Many brands are building strong rural base without much advertising
support-

• Chik shampoo, second largest shampoo brand.

• Ghadi detergent, third largest brand.

 Fewer brand choices in rural areas; number of FMCG brand in rural is half
that of urban.
 Buy value for money not cheap products

OPPORTUNITIES

 Infrastructure is improving rapidly -

• In 50 years only, 40% villages have been connected by road, in

next 10 years another 30% would be connected.
• More than 90% villages are electrified, though only 44% rural
homes have electric connections.
• Rural telephone density has gone up by 300% in the last 10
years; every 1000+ pop is connected by STD.

22
  Social indicators have improved a lot between 1981 and 2001 -

• Number of "pucca" houses doubled from 22% to 41% and

"kuccha" houses halved (41% to 23%).
• Percentage of BPL families declined from 46% to 27%.
• Rural literacy level improved from 36% to 59%.

 Low penetration rates in rural areas, so there are many marketing

opportunities .

FACTORS AFFECTING RURAL MARKETING

Reach

For a product to reach six lakh villages, one need to know that 700
million villages are spread over 3.2 million sq. metre of area. The road
conditions are usually poor. It is, therefore, important for the marketer to
have a good distribution system.

Pricing

Pricing of... a product needs to be low and affordable. For example,

FMCGs have creams and soaps@ Rs 5, hair oil and shampoo sachets @ Re 1
and small Coke @ Rs 5. To develop a product to suit the rural scenario, the
focus should be on items of necessity.

Product Awareness

This is very important for the marketer to induce a trial. Rural

consumers visit high congregation areas like haats/fairs etc. where product
awareness can be created. Therefore, the right product needs to reach the
right person at the right time and place.

23
Hurdles

The rural population is spread over a large area where reach is

expensive and the mass is heterogeneous. The spending power of rural
population fluctuates with the agri-yield. Hence, demand is not consistent.
Besides this, low level of product exposure, poor standard of living, spurious
products with high margins for retailers and lack of infrastructure leads to low
penetration.

Strategies

The base work should be extremely clear — distribution, visibility and

the right communication can make a product. One needs to educate the
target audience and pick up self-help groups/villages between
entrepreneurs/literate unemployed youth for sustainable distribution channel.

Consumer Behaviour

Over the years, the attitude and lifestyle of rural folk has changed due
exposure through TV and awareness through an increase in literacy level.
Also, consumers are becoming brand loyal.

With the constant invasion of corporates, the rural customer has

started taking in “what was educated to him”, the media, newspaper, cable,
IT developments, mobiles have lead to increased awareness. Besides, due to
increase in purchasing power and literacy level of a section, the rural
consumer has become more receptive. S/he is highly influenced by “word of
mouth” and has started looking at value for money.

With the changing market scenario, introduction of new products,

increasing awareness amongst customers and the overall development in
rural sector, required a change in corporate marketing strategies, and this
was done. The sales team was asked to be more aggressive. With distribution
in place, communication was simpler and had a regional flavour.

24
 The strategy to tap the rural market has to be more customized,
simpler and based on one-to-one communication. One has to reach the
doorstep of the rural consumer to educate him on brands. It is said that
brand loyalty is higher in the rural customer. S/he might not be able to read
but would ask Parle ka glucose biscuit dena or would recognize the pack by...

SIGNIFICANCE

In recent years, rural markets have acquired significance in countries

like China and India, as the overall growth of the economy has resulted into
substantial increase in the purchasing power of the rural communities. On
account of the green revolution in India, the rural areas are consuming a
large quantity of industrial and urban manufactured products. In this context,
a special marketing strategy, namely, rural marketing has taken shape.
Sometimes, rural marketing is confused with agricultural marketing – the later
denotes marketing of produce of the rural areas to the urban consumers or
industrial consumers, whereas rural marketing involves delivering
manufactured or processed inputs or services to rural producers or
consumers. Also, when we consider the scenario of India and China, there is
a picture that comes out, huge market for the developed products as well as
the labor support. This has led to the change in the mindset of the marketers
to move to these parts of the world.

Also rural market is getting an importance because of the saturation of

the urban market. As due to the competition in the urban market, the market
is more or as saturated as most of the capacity of the purchasers has been
targeted by the marketers. So the marketers are looking for extending their
product categories to an unexplored market i.e. the rural market. This has
also led to the CSR activities being done by the corporate to help the poor
people attain some wealth to spend on their product categories.

25
 Here we can think of HLL (now, HUL) initiatives in the rural India. One
of such project is the Project Shakti, which is not only helping their company
attain some revenue but also helping the poor women of the village to attain
some money which is surely going to increase their purchasing power. Also
this will increase their brand loyalty as well as recognition in that area.
Similarly we can think of the ITC E-Chaupal, which is helping the poor farmers
get all the information about the weather as well as the market price of the
food grains they are producing. In other view these activities are also helping
the companies increase their brand value. So as it is given above the
significance of the rural market has increased due to the saturation of the
urban market as well as in such conditions the company which will lead the
way will be benefited as shown by the success of HUL and ITC initiatives.

Conclusion

Thus, looking at the challenges and the opportunities, which rural

markets offer to the marketers, it can be said that the future is very promising
for those who can understand the dynamics of rural markets and exploit them
to their best advantage. A radical change in attitudes of marketers towards
the vibrant and burgeoning rural markets is called for, so they can
successfully impress on the 230 million rural consumers spread over
approximately six hundred thousand villages in rural India.

26
 IV. COMPANY PROFILE

The evolution of Dabur is quite interesting and its root

takes us back to the 19th century where it all started in Bengal by a visionary

by name Dr. S.K Burman, a physician by profession. His mission was to

provide effective and affordable cure for ordinary people in far-flung villages.

With missionary zeal and fervour, Dr. Burman undertook the task of preparing

natural cures for the killer diseases of those days, like cholera, malaria and

plague. Soon the news of his medicines travelled, and he came to be known

as the trusted 'Daktar' or Doctor who came up with effective cures. And that

is how his venture Dabur got its name - derived from the Devanagri rendition

of Daktar Burman. The name is formed by joining the first half of Daktar and

Burman.

27
• Largest Herbal & Natural Portfolio

• 4000 Distributors in India

• Retail Reach 2,500,000

• 5 Umbrella Brands

• 350+ products

• 4000 employees

• 15 Manufacturing Plants

JOURNEY SO FAR . . .
1884 The birth of Dabur

1972 The company shifts base to Delhi from Kolkata

1986 Registered as Public Limited Company

1994 Listed on the Bombay Stock Exchange

1998 Professional team inducted to run the company

2000 Crosses Rs 1000 Crore Turnover

2003 Pharmaceutical Business de-merged to focus on

core FMCG

2004 Profit exceeds Rs.100 Crore

2005 Acquires Balara strengthening Oral care &

provided entry into Home care segment

2006 Dabur Figures in Top 10 Great Places To Work

2007 Dabur ranked among 'Asia's best under a Billion'

enterprises by Forbes

2008 Acquired Fem Care Pharma entering the

mainstream Skin care segment

2009 Strong growth momentum continued in spite of

general economic downturn

28
 AWARDS & ACHIEVEMENTS (2008-09)

Dabur India Ltd placed in the Dabur ranked 28th in ET- NDTV profit Business
List of “20 Stocks You Must Brand Equity Most Trusted Leadership awards2008
own”, Brands 2009 list for FMCG
Prepared by Forbes India

Dabur At-a-Glance

Dabur India Limited has marked its presence with

significant achievements and today commands a market leadership status.
Our story of success is based on dedication to nature, corporate and process
hygiene, dynamic leadership and commitment to our partners and
stakeholders. The results of our policies and initiatives speak for themselves.

Leading consumer goods company in India with a turnover of Rs.

2834.11 Crore (FY09)
3 major strategic business units (SBU) - Consumer Care Division
(CCD), Consumer Health Division (CHD) and International
Business Division (IBD)
3 Subsidiary Group companies - Dabur International, Fem Care
Pharma and newu and 8 step down subsidiaries: Dabur Nepal Pvt
Ltd (Nepal), Dabur Egypt Ltd (Egypt), Asian Consumer Care
(Bangladesh), Asian Consumer Care (Pakistan), African
Consumer Care (Nigeria), Naturelle LLC (Ras Al Khaimah-UAE),
Weikfield International (UAE) and Jaquline Inc. (USA).
17 ultra-modern manufacturing units spread around the globe
Products marketed in over 60 countries
Wide and deep market penetration with 50 C&F agents, more than
5000 distributors and over 2.8 million retail outlets all over India

29
 a. Dabur’s Business Structure
Dabur operates through three focused Strategic Business Units:

Consumer Care Division

Consumer Care Division (CCD) addresses consumer needs across the entire
FMCG spectrum through four distinct business portfolios of

Personal Care, Health Care, Home Care & Foods.

 Master brands:
Dabur - Ayurvedic healthcare products
Vatika - Premium hair care
Hajmola - Tasty digestives
Real - Fruit juices & beverages
Fem - Fairness bleaches & skin care products
 9 Billion-Rupee brands: Dabur Amla, Dabur
Chyawanprash, Vatika, Réal, Dabur Red
Toothpaste, Dabur Lal Dant Manjan, Babool,
Hajmola and Dabur Honey
 Strategic positioning of Honey as food product,
leading to market leadership (over 75%) in branded
honey market
 Dabur Chyawanprash the largest selling Ayurvedic
medicine with over 65% market share.
 Vatika Shampoo has been the fastest selling
shampoo brand in India for three years in a
row
 Hajmola tablets in command with 60% market share
of digestive tablets category.

30
Consumer Health Division
Consumer Health Division (CHD) offers a range of classical Ayurvedic
medicines and Ayurvedic OTC products that deliver the age-old benefits of
Ayurveda in modern ready-to-use formats

Has more than 300 products sold through

prescriptions as well as over the counter
Major categories in traditional formulations include:
- Asav Arishtas
- Ras Rasayanas
- Churnas
- Medicated Oils
Proprietary Ayurvedic medicines developed by Dabur
include:
- Nature Care Isabgol
- Madhuvaani
- Trifgol
Division also works for promotion of Ayurveda
through organized community of traditional
practitioners and developing fresh batches of
students

International Business Division

International Business Division (IBD) caters to the health and personal
care needs of customers across different international markets, spanning the
Middle East, North & West Africa, EU and the US with its brands Dabur &
Vatika

Growing at a CAGR of 33% in the last 6 years and

contributes to about 20% of total sales
Leveraging the 'Natural' preference among local
consumers to increase share in personal care
categories
Focus markets:
- GCC
- Egypt
- Nigeria
- Bangladesh
- Nepal
- US
High level of localization of manufacturing and sales
& marketing

31
Customer Health Division
CHD STRUCTURE-

OTC (57%)
Generics
Branded Products

ETHICAL (43%)
Tonics
Classical
Branded Ethical

CHD registered strong 19% growth during FY09

Investments in brand building and new OTC launch driving growth

Janma Ghunti, Hingoli, Sat Isabgol & Gripe

Water transferred to CHD from CCD for greater focus.

Shampoos

Market Size- 21 Billion

Dabur Brands- 1.3 Billion

32
 Shampoos continued its strong performance recording 31.5% growth

for FY09.

Vatika continues to be fastest growing shampoo brand in the country

with volume growth of 37.5% for FY09 vs. 14.4% for the category as

per AC Neilsen April-March, 09 update.

The Vatika range gained market share which went up to 6.8% vs.

5.7% in the previous year.

Digestives
Market Size-5 Billion
Dabur Brands- 1.5 Billion

The Digestives category witnessed a growth of 11.8% during

FY09 resulting from an excellent growth of 31% witnessed in
Q4FY09.
New variants and innovative consumer activations added to the
momentum.
Pudin Hara brand has been shifted to CHD for increased focus
on distribution through chemists Q4FY09 onwards.

33
FOODS
Market Size-5 Billion
Dabur Brands- 2.5 Billion

Foods category growth of 14.4% for FY09.

Brand growth in FY09
• Real Fruit Juices: 14.9%
• Homemade: 19.6%
Real franchise growing at a healthy rate with Ad campaigns
establishing its superiority over competition.
Activ Brand received a boost in Q4 with the ‘No Added Sugar’
campaign.

Consumer Care Division

Market Size-33 Billion
Dabur Brands- 5.6 Billion

Dabur Amla Hair Oil witnessed one of the strongest years reporting
20.4% growth during the year driven by on ground activations and
marketing support.
Vatika Hair Oil had a resurgent year with a growth of 12.2% during
FY09 backed by a brand re-launch, new packaging and communication
Anmol Coconut Oil recorded a growth of 42.2% for FY09 with gains in
key markets.
Dabur Mustard Amla Hair oil grew at 22.7% followed by re-staging
under the Dabur brand

34
b. Manufacturing Facilities in
India

35
 PERSONAL INSIGHT

As far as our project is concerned we are assigned to find the business

opportunity in the rural Orissa. So we’ve to study & analyse the distribution
channel through which the rural consumers & retailers can avail the huge
product line of Dabur India Ltd.

Chains of intermediaries, each passing the product down the chain to

the next organization, before it finally reaches the consumer or end-user. This
process is known as the 'distribution chain' or the 'channel.' Each of the
elements in these chains will have their own specific needs, which the
producer must take into account, along with those of the all-important end-
user.

Channels

A number of alternate 'channels' of distribution may be available:

• Distributor, who sells to retailers

• Retailer (also called dealer or reseller), who sells to end customers
• Advertisement typically used for consumption goods

Channel membership

1. Intensive distribution - Where the majority of resellers stock the

'product' (with convenience products, for example, and particularly the
brand leaders in consumer goods markets) price competition may be
evident.
2. Selective distribution - This is the normal pattern (in both consumer
and industrial markets) where 'suitable' resellers stock the product.
3. Exclusive distribution - Only specially selected resellers or authorized
dealers (typically only one per geographical area) are allowed to sell
the 'product'.

36
Channel motivation

It is difficult enough to motivate direct employees to provide the

necessary sales and service support. Motivating the owners and employees of
the independent organizations in a distribution chain requires even greater
effort. There are many devices for achieving such motivation. Perhaps the
most usual is `incentive': the supplier offers a better margin, to tempt the
owners in the channel to push the product rather than its competitors; or a
competition is offered to the distributors' sales personnel, so that they are
tempted to push the product

Monitoring and managing channels

In much the same way that the organization's own sales and
distribution activities need to be monitored and managed, so will those of the
distribution chain.

In practice, many organizations use a mix of different channels; in

particular, they may complement a direct sales force, calling on the larger
accounts, with agents, covering the smaller customers and prospects.

Bases on which the datas are analyzed

I’ve collected numerous datas regarding-

• Sales promotion
• Consumer buying behaviour
• Availability of various brands
• Accessibility of the distribution sources to the distant rural population
• Mode of transport the rural consumers opting for purchasing the
products.

37
 C. DISTRIBUTION NETWORK USED BY DABUR INDIA LTD.

Factory D.C.

Stockiest Super stockiest Modern Trade

Wholesaler Institution

Substockiest
Semi-wholesaler

Retail Trade Retail Trade

Shoppers & Consumer

Dabur is using four branches distribution network to reach its target section.

1.1 URBAN DISTRIBUTION CHANNEL [STOCKIEST]

This is divided into two parts, viz: above 5 lakhs of population and
between 1 to 5 lakhs of population. This segment is totally covered by the
direct stokist. In the segment of above 5 lakhs there are three ways of
covering the market, viz: Beat wise, Line wise & Channel wise distribution
while in the segment of 1 to 5 lakhs of population there are two ways, viz:
Channel wise & Beat wise.

38
 CHANNEL WISE DISTRIBUTION
Here the total product is divided into different channels like, Health
care product, Personal care products, Home products & etc.
 LINE WISE DISTRIBUTION
Here the total product is divided into different lines like, hair care, body
wash, coconut oil, nutrition food and etc.
 BEAT WISE DISTRIBUTION
Here total market is divided into different areas where the total
products are served to all the outlets exist in that area.

1.2 RURAL DISTRIBUTION NETWORK [SUPER STOCKIEST]

Under rural distribution network, the whole market is served by three

parties, viz: Substokist, Rural Direct Stockiest and by the Dabur network itself.
The Substokist get the required product through the super stockist which
again covers the Dabur itself segment. The Rural Direct Stock segment is
covered by the direct stockiest who serves the whole urban distribution. The
Substokist uses the Sub van mode of transportation while the Rural direct
stockiest uses the Direct Van to cover his area. (See the picture above).
Dabur is continuously monitoring its channel members to ensure the speed
and accuracy in its service to its ultimate customers. The key customers for
Dabur are Whole seller, Small Outlets and the Chemist. Dabur has
continuously focusing on these key customers and tried to satisfy them over
the years to sustain in this industry.

1.3 INSTITUTIONAL

1.4 MODERN TRADE

d. Sustainability Report
At Dabur, environment and nature is the lifeline of our business.
With a portfolio of Ayurveda and nature-based products, conservation of
nature & natural resources is deep rooted in our organizational DNA,
and in every aspect of our ever-growing business.

We, at Dabur, have not merely incorporated the concept of sustainability

into the core of our business but have, in fact, expanded it to encompass our
aspirations and responsibilities to the society and to the environment. It is
this concept that inspires us to optimize our business performance to tackle
the new and growing challenges of environment and technology.

It is a concept on which we aspire to build an organization that will

continue to increase value for all our stakeholders for generations to come,
through intensive focus on Conservation of Energy and Technology
Absorption, along with Health, Safety and Environment Protection.

39
Conservation of Energy

Dabur has been undertaking a host of energy conservation measures.

Successful implementation of various energy conservation projects have resulted
in a 13.8% reduction in the Company’s energy bill in the 2008-09 fiscal
alone. What was noteworthy was the fact that this reduction has come despite an
8-9% volume increase in manufacturing, and an average 11.7% increase in cost
of key input fuels.

The host of measures – key among them being use of bio-fuels in boilers,
generation of biogas and installation of energy efficient equipment – helped lower
the cost of production, besides reduce effluent and improve hygiene conditions &
productivity.

Health Safety & Environmental

Review

Renewing the commitment to Health Safety and Environment, Dabur has

formulated a policy focusing on People, Technology and Facilities. A dedicated
“Safety Management Team” has also been put in place to work towards the
prevention of untoward incidents at the corporate and unit level, besides educate
& motivate employees on various aspects of Health, Safety and Environment.

The Company is also continuously monitoring its waste in

adherence with the pollution control norms. In pursuance of its commitment
towards the society, efforts have also been initiated to conserve and maintain the
ground water level. The efforts include implementation of rainwater harvesting,
which has delivered encouraging results and has put the company on the path
to becoming a Water-Positive Corporation.

Dabur also initiated a Carbon Foot Print Study at the unit level with
an aim to become a carbon positive Company in years to come.

At Dabur, we are committed to sustainable development throughout our

diverse operations. And, we will strive to translate the good intentions into
concrete and lasting results, contributing to the ultimate good of the
society.

40
e. Technology Absorption

Dabur has also made continuous efforts towards technology absorption

and innovation, which have contributed towards preserving natural resources.
These efforts include:

• Minimum use of water in process by pre-concentration of herbal extract

and reduction in concentration time.
• Uniform heating in VTDs by hot water as against steam earlier, resulting in
30% reduction in bulk wastage by using non-stick coating and formulation
change.
• Improvement in water treatment plant through introduction of RO
(Reverse Osmosis) system for DM water, reutilization of waste water from
pump seal cooling and RO reject waste-water management.
• Introduction of water efficient CIP system with recycling of water in fruit
juice manufacturing
• Development of in-house technology to convert fruit waste into organic
manure by using the culture Lactobacillus burchi

The Company has achieved a host of significant benefits in terms of

product improvement, cost reduction, product development, import substitution,
cleaner environment and waste disposal, amongst others.

41
f. Strategic Intent

We intend to significantly accelerate profitable growth. To do this, we will:

• Focus on growing our core brands across categories, reaching out to new
geographies, within and outside India, and improve operational efficiencies
by leveraging technology
• Be the preferred company to meet the health and personal grooming
needs of our target consumers with safe, efficacious, natural solutions by
synthesizing our deep knowledge of ayurveda and herbs with modern
science
• Provide our consumers with innovative products within easy reach
• Build a platform to enable Dabur to become a global ayurvedic leader
• Be a professionally managed employer of choice, attracting, developing
and retaining quality personnel
• Be responsible citizens with a commitment to environmental protection
• Provide superior returns, relative to our peer group, to our shareholders

42
 V. OBJECTIVE OF THE STUDY

PRIMARY OBJECTIVE

To find out the new business opportunity in Sundergarh district of rural Orissa

SECONDARY OBJECTIVE

Availability & Visibility analysis of Dabur in rural market of Sundergarh district

of Orissa

Coverage analysis of Dabur in rural market of Sundergarh district of Orissa

To find out the feasibility of new sub stockiest in rural market of Sundergarh
district of Orissa

43
 VI. RESEARCH METHODOLOGY
TYPES OF RESEARCH

Research are categorized into four major category

First is descriptive & Analytical

Second Applied & Fundamental

Third Quantitative & Qualitative

Fourth Conceptual & Empirical

The project Presented is based on

Descriptive Research type – As it includes Survey and fact finding enquiries of different

kinds of Quantitative figures like sales are taken as the most important feature for the

analysis.

44
 VII. SAMPLING TECHNIQUE
Sampling techniques can be broadly classified into two types viz.

1) Probability Sampling (here the every item in the universe have the equal
chance of inclusion in the sample)

2) Non Probability Sampling (Here the item in the sample are deliberately
selected by the researcher)

Again both are classified as follows

Probability Sampling

Simple Random sampling

Complex random Sampling

 Cluster Sampling

 Systematic Sampling

 Stratified sampling

 Area Sampling

 Multi-stage Sampling

 Sampling with probability proportional to the size

45
Non-probability Sampling

Haphazard or convenience sampling

Purposive sampling

 Quota Sampling

 Judgment Sampling

The project done here is based on the Non-probability, purposive, Quota sampling
As in the given project the sample considered is specific to a predetermined area of Orissa

VIII. TOOLS TO ANALYSIS

The major tools used in this project for the analysis are-

1. Bar chart (Bar charts are used for comparing two or more values
that were taken over time or on different conditions, usually on
small data set )

2. Pie-chart (Circular chart divided into sectors, illustrating relative

magnitudes or frequencies)

As the datas collected are various types of datas such as comparing based on
value as well as the relative comparison, hence both the tools are to be used for the
proper analysis of the datas collected.

46
 IX. METHOD OF DATA COLLECTION
My Survey is conducted on two sources of data collection:-
a) Primary data
b) Secondary data
a) PRIMARY DATA
Looking into the objectives and information needed, I have chosen
following two methods as per the response of the subject:-
i) Schedules
ii) Personal Interview.
i) Scheduler Method
Schedules (Performa containing a set of questions) are being filled in
by the enumerators who are specially appointed for the purpose.
ii) Personal Interview
I have taken the opportunity to take personal interview wherever it
was essential. The strategy was adopted to avoid the biased
information and to spill out the required data from the respondent.
This has supplemented the Schedules in a purposive manner.
b) SECONDARY DATA
The Secondary data were mainly collected from different books,
magazines, Journals, company’s Literature, Newspapers, Internet and
from the company personnel.

47
 X. DATA ANALYSIS

ANALYSIS BASED ON AVAILABILITY

Availability No of %
Outlet
Available 85 82
Not available 19 19
Total 104 100

The above chart shows that from 104 it is observed that Dabur
products are available in 82 %( 85) shops & 18 %( 19) shops are not having
Dabur products. So this indicates that Dabur has the maximum brand
prevalence among all the other brands. In case of absence of Dabur brands in
19 shops shows that this patch of outlet is lacking distributors’ attention,
brand awareness among retailers or consumers.

48
 ANALYSIS BASED ON THE MODE OF COVERGE

Mode of No of Outlets %
Coverage
Not Covered 19 18
Stockiest 35 34
Sub-stockiest 12 11
wholesale 38 37
Total 104 100

I’ve visited around 104 retail outlets in Sundergarh District,

which are present in 16 villages. My survey tells that among them 37% (38)
outlets are covered through the Wholesaler, besides it 11% (12) shops are
covered by Sub-stockiest & 34% (35) shops are covered by stockiest.

49
 In my view the graph shows the poor coverage pattern of
Dabur India Ltd. This is because-

I. Wholesalers are playing major role in coverage as they are

doing the indirect coverage.
II. The direct coverage points like the Stockiests or the Sub
stockiests are covering the rural mass after the wholesalers.
III. Retailers don’t bring huge stock volume rather than they prefer
to keep the stocks according to the demand of the consumers &
purchase the next lot when the old one exhausted.
IV. Stockiests cover only those places which are nearer to town or
within 20 kms radius of distribution point.
V. Unavailability of profitable schemes to the retailers.
VI. Presence of local brands which are used as the alternatives of
Dabur.
VII. Local Brands give attractive schemes so the retailers do push
marketing for local brands.

ANALYSIS BASED ON MODE OF TRANSPORT

50
 Mode of transport No of Outlets %
Not Covered 19 18
Van 7 7
Order Booking 30 29
Self 48 46
Total 104 100

From the datas collected it has found that-

Transportation done by the Outlets itself- 46%,Sub-stockiest

cover by Order booking- 29%, Stockiest provide Van bit- 7% & Uncovered
market- 18%. So theses datas draw our attention to following points-

Most of the rural consumers preffer to bring the required goods from
distribution points by their own convenience.

The distributors are not providing sufficient privilege of transportation
to their distant retailers because they think that this will affect their
profit margin.

Distant consumers or retailers don’t show interest in purchasing from
one wholesaler or stockist as they also keep in mind that which
distributor will give them highest profit margin.

So the retailers don’t show loyalty to a particular distributor & hence
the distributor does not think for the transportation mode.

Distributors also seek a considerable no of outlets present in a
particular village who are interested to purchase his goods, then only
he could think about arranging the transportation for them.

Due to improper road condition & hilly areas also some distributors are
unwilling to provide transportation in remote villages.

51
 ANALYSIS BASED ON MARKET SHARE

Company Sales (in Rs) %

Dabur 273500 32
HUL 361600 42
Any other 222700 26
Total 857800 100

From the market studied for the business opportunity it was

found that HUL is the market leader of the market enjoying 42% of the
market share alone, where as Dabur is approaching near to it with 32%. From
the survey it is found that Dabur is closely competing with HUL with a market
share difference of 10%.My research work regarding market share says-

In this rural patch though HUL is the market leader but there is
presence of some other local players who have captured the market by
motivating the retailers for push sale.

The other brands have somewhere dominated the sale of HUL in
Biscuits, Chocolates, Confectionery, Personal, Health, Homecare,
Detergent and Foods as the local companies provide hefty margins &
offers.

The rural consumers consider price more than quality so their purchase
intent always bents towards the low cost products as they lack brand
awareness.

52

There is a positive sign to Dabur that it has the market share close to
HUL as its distribution network may not be effective but there are less
no of local companies who substitute its products as it has got
ayurvedic background.

ANALYSIS BASED ON AVAILABILITY OF DIFFERENT PRODUCTS

53
 Products Available (in no of outlets) %

Tooth paste 72 69.23

Lal Dant Manjan 85 81.73
Shampoo 85 81.73
Amla 55 52.88
Dabur lal tel 83 79.81
Vatika Oil 33 31.73
Hajmola 41 39.42
Honey 13 12.5
Glucose 25 24.04
Anmol 18 17.31
Chyawanprash 9 8.65
Gulabari 7 6.73
Pudin Hara 16 15.38
Home made 13 12.5
Odonil 3 2.88
Odomos 1 0.96
My analysis tells that-

Dabur Lal Dant Manjan & Shampoo leads the rural market with
85% availability.

Next to these Dabur Lal Tel & Toothpaste is available in most of the
retail outlets including Medicine store, Grocery store as well as the
betel shop.

Products like Amla, Hajmola & Vatika are available in a moderate
range in all shops

Anmol, Pudin Hara, Glucose & Honey are the products which are
present in the shops in a considerable amount because consumers
prefer Local honey as it is cost effective.

Odomos, Odonil, Chyawanprash & Gulabari are showing less
availability in rural shops as they are priced very high & sophisticated
in nature.

54
 VILLAGE STATUS
The villages so chosen for the research work can be divided into
two categories according to the sales of Dabur in the particular
villages.

1- Villages having High Sale (sale above Rs 15000)

2- Villages Having Low Sale (Sale below 15000)

According to the above mentioned need classification of

villages we can group the villages as follows-

Villages Having High sale Villages Having Low Sale

Village Sale Village Sale

Balishankara 16800 Alanda 2200
Birikera 23300 Balanda 4000
Kutra 29300 Jolongbira 6800
Tumulia 17000 Katang 1800
Karamdihi 32500 Kukuda 3400
Khatkhurbahal 88000 Lulkidihi 1400
Kinjirikela 41400 Puruna Bisra 3500
Tunmura 1600
Suruda 500

In the above cases we noted that there are some markets

having higher Sales as Balishankara, Birikera, Kutra, Tumulia,
Karamdihi, Khatkhurbahal, Kinjirikela, we can appoint sub-stockist.

Whereas in the other cases we can give spoke connection from

the nearby market that either have or we going to have a direct
covering point (Sub-stockist)

55
 VILLAGES HAVING HIGH SALE

[N.B.-The sale of HUL & other products are considered to be the benchmark
for the comparison]

By analyzing the datas available about the sales figure it can be noted-

As you can see HUL is having highest sales in these villages followed
by Dabur & other companies.

The proportionate of Dabur is not same throughout the area selected
for the study.

The village Khatkhurbahal is showing the highest sales & it is the most
appropriate proposed Sub-stockist point.

56
 PER CAPITA SALE

From the above data we can find out that:-

The per capita sale of HUL is higher in comparison to Dabur in
Khatkhurbahal, Kinjirikela, Kutra, Balishankara & Birikera.

The per capita sale of HUL is nearly same to Dabur in Karamdihi &
Tumulia.

Per capita sale is highest in Khatkhurbahal.

The markets like Khatkhurbahal, Kinjirikela, Kutra, Balishankara,
Karamdihi are having their own markets & they also distribute the
products in nearby small markets.

57
 MODE OF COVERAGE

The above figure reflects:-

Mode of direct coverage is higher in the markets as compared to that

of indirect coverage.

Markets like Khatkhurbahal, Kutra, Kinjirikela & Balishankara are mainly
covered by Stockist.

Markets like Tumulia, Karamdihi are less stockist influenced & Birikera
shows absence of stockists.

Birikera shows absence of sub-stockist & Balishankara, Kinjirikela &
Kutra show fully covered.
Hence, it will better to appoint direct coverage point at these set of villages.

58
MODE OF TRANSPORTATION

From the datas collected regarding transport it is obtained that:-

Some villages like Khatkhurbahal, Kutra, Karamdihi,

Kinjirikela & Balishankara are getting transportation facility
highly from the direct point of distribution.

In case of Birikera & Tunmura they have got high indirect
coverage.

59
VILLAGES HAVING LOW SALE

This chart shows us-

The villages having low sales show an astonishing thing that

other brands besides HUL & Dabur is sold in a higher
volume.

The sale of other brands is more in Jolongbira, Alanda,
Katang & Tunmura.

We must consider the Alanda, Katang & Tunmura because
there the sale of HUL is low as compared to Dabur & Other
brands.

60
 PER CAPITA SALE

As we discussed above the sale of the market is very low, so ultimately

it results in a very low Per Capita sale in the villages. My findings regarding
this low sales volume say that-

Half of the villages coming under this segment shows high

per capita sale of Dabur.

Requirement of consumers may be so less that they could

not go for buying the products in a large volume.

Or it may be the case that people are poorer to afford the

product.

61
 MODE OF COVERAGE

From the figure presented above we get that:-

In the low sales segment, indirect coverage is found highest in most

cases.

Most of the Outlets depending upon the Wholesalers to avail the
products which result to :-
• Higher indirect mode of coverage than that of the direct
mode of coverage.
• Market is mostly affected by the decision of the Outlet
owner.

Sub-stockists don’t contribute much to the distribution to this segment.

62
MODE OF TRANSPORTATION

Above Chart shows:-

Most of the Outlet owners have to move to the market to collect

the product.

Sales of the market are Very low.

Van & Order booking seem very poor in this segment.

Outlets preferring the Wholesaler to get the Product & they
always switch over the distribution point according to their
requirement.

These factors results in availability of the products at high
demand

63
 XI. FINDINGS
All the surveyed shops & the facts generated stress on the following findings-

Dabur is a well known & widely appreciated brand in rural Orissa

(Sundergarh Dist).Because from the 104 outlet surveyed Dabur was
found to be available at 85outlets, i.e. it has a presence of around
82%.

There is the presence of Sub Stockiest, but more people & retailers
prefer to purchase the products from other channels. Those may be
either a Stockiest who provide them the van to transport the products
or a Wholesaler who is providing them the products with good margin.

Customers & Outlets have complained about the less number of
schemes available to them & the frequent price variation from person
to person in the same distribution.

Sub-Stockiest also functions like other retail outlets & doesn’t hire
required number of staff.

Credit facility is wide spread in the rural market, so the consumers
prefer the retail outlet that gives them goods on credit.

Low product line available to the rural consumers & the rural market
does not show a clear boundary.

I’ve found another strange thing that the distributors who have been
entrusted with the task of covering a particular area are not completely
accessible by the consumers or the outlets. There are some lapses on
the part of distributors, may be due to the remoteness.

When promotion comes into picture I’ve perceived that-
• The rural people are lacking brand awareness.
• Their buying behaviour or purchasing decision is influenced by
the peer group.
• Consumers get to know about different products through the
Advertisements shown on T.V., & wall paintings, point of
purchase displays, & radio ads.

64
 XII. SUGGESTIONS
I want to suggest the following things for enhancing the market
opportunities & extract enermous profit-

I. Direct coverage points (Sub-stockiests) should be assigned to the

villages having higher Sales those are Balishankara, Birikera,
Kutra, Tumulia, Karamdihi, Khatkhurbahal, and Kinjirikela.

II. The area of operation by the Sub-stockiests/Stockiests should be

located properly.

Sub-stockiests should be directed to cover the nearby rural
market at least once in a month or a fortnight to the village
offering low sales.

They should be clear cut directed to which area they can cover
and to which they shouldn’t.

Name of the Villages Sales of Can be covered Status of the covering point
Dabur from

Jolongbira 6800 Karamdihi Sub-stockiest (proposed)

Balanda 4000 Birikera Sub-stockiest (proposed)

Puruna Bisra 3500 Rourkela Stockiest

Kukuda 3400 Khatkhurbahal Sub-stockiest (proposed)

Alanda 2200 Kutra Sub-stockiest (proposed)

Katang 1800 Kutra Sub-stockiest (proposed)

Tunmura 1600 Rajgangpur Stockiest

65
III. Company should provide financial assistance to the person involved in
the direct coverage, for example ROI (Return on Investment). An
optimized ROI can encourage the Stockiests or Sub-stockiests to go
for-

Providing credit to the Retailer/Wholesaler.

Cover some extra Outlet

May move for greater frequency of Visit to the Outlets

IV. While appointing Sub-stockiests the characteristics which should be

taken into account are:-
Personal Characteristics

• Behavior of the person

• Goodwill of the person
• Proprietor involvement

Financial Characteristics
• Capacity to invest
• Infrastructure available
•
V. If a person is having the financial aspects more than the behavioural
aspects then he will not succed in attracting customers or reinforce
sales volume.

66
Besides all these the Organization should keep its eye on:-

1. As in the rural market most of the outlets are managed by women,

they should be properly empowered & acknowledged about the
product & services.
2. Using value-based pricing strategy. Rural people always have a
tendency to buy things which give more satisfaction in comparison
to price. So we must design the product which gives the rural
customers value for money.
3. The changing perception of rural mass should be kept in track, as
gradually they want to change their change taste & preferences.
4. The distribution channels should be localized.
5. Closely monitor the Stockiest points & encourage the Sub-
stockiest to sell the products with a remarkable margin to the rural
customers & retail outlet.
6. Use backward and forward integration.
7. World-of-mouth communication strategy works better in rural
markets as these markets enjoy limited reach of media. Once
people become familiar with these products, they would perceive
them as necessities.
8. Be careful on retail margins otherwise they promote local brands.

67
 XIII. CONCLUSION

To succeed in the rural market, companies will need to adopt the 4Ps
of Marketing to the 4As in their strategy- Awareness, Acceptability,
Availability, and Affordability. Access and availability are equally important as
the mantra for success in rural is “Jo dikhta hai wohi bikta hai”.

An income dispersal project by NCAER (National Council for Applied

Economic Research) for 2006-07 shows that the no of poor household will
shrink by half to 28 million from 61 million in 1997-98, whereas the middle
income household will double & the rich household will treble over the decade
in rural india. This upward push taking rural people from poverty to prosperity
will lead to greatly increased purchasing power. Today’s non consumers
comprising the rural poor will enter the market as first time buyers in large
numbers.

To claim a larger share of growing rural pie will call for a radical shift in
management thinking- From gross margins to high profit, from high value unit
sales to a game of high volumes of capital efficiency, from the one-solution-
fits-all mandatory to market innovations. Therefore the time to prepare for
tomorrow is today.

68
 XIV. BIBLIOGRAPHY

WEB LINKS:-
www.dabur.com

www.irmaindia.org

www.wikipedia.co.in

www.deccanherald.com

www.indiantelevision.com

BOOKS REFFERED:-

Rural Marketing:-
R.V.Badi and N.V. Badi

Cases in Rural Marketing:-

C S G Krishnamacharyulu & Lalita Ramakrishnan

The Hindu: -
Business Line

69
 XIV. SCHEDULE

1) District:-…………………………………………………..
2) Village Name:-………………………………………….
3) Population:-……………………………………………..
4) Name of the outlet:-
………………………………………………………………………………………………...
5) Retailer’s Name & Address:-………………………………………………………
………………………………………………………………………………………………….
6) Availability of Dabur (Yes/No):-…………………
7) Turnover of Dabur (If Yes):-……………………….
8) Turnover of HUL (Yes/No):-……………………….
9) Turnover of HUL (If Yes):-………………………….
10) Turnover Of others:-………………………………….
11) Total Sales per Month:-……………………………..
12) Mode of coverage:-

A) Sub-Stockist
B) Stockist
C) Wholesaler

13) Covered By (Name of the Person):-…………………………………………….

14) Covered From (Name of the Place):-……………………………………………
15) Mode of Transportation:-……………………………………………………………
A) Order Booking
B) Van
C) Self
16) Brands Available:-………………………………………………………………………
………………………………………………………………………
………………………………………………………………………

70