Rural Marketing is gaining importance nowadays especially in India as India has around

6, 38,365 villages. About 285 million live in urban India whereas 742 million reside in
rural areas, constituting 72% of India's population. Companies have realized that there is
a lot of potential in these rural markets where they can get good business and gain market
leadership. However rural marketing has a lot of challenges particularly in India. These
are the challenges companies face:-
1. Creating brand loyalty About 285 million live in urban India whereas 742 million
reside in rural areas, constituting 72% of India's population
This is one of the greatest challenges of rural marketing. As there is a lot of
competition in the market by companies to cut down on cost and maintain the
same brand loyalty as the people in rural India would always prefer low price
product. Life in rural areas is still governed by customs and traditions where in the
rural people do not adapt to the new practices easily. The main hurdle in selling
products in rural markets is that it’s sometimes very difficult to convince them to
buy the product as they are loyal to brand of products which they already use.
2. Illiteracy
There is not enough opportunities for education in rural areas. The literacy level is
as low as 36% whereas the all- India average is 52%. The medium through which
companies have to advertise their products to rural consumers is uncertain because
of the high illiteracy level of the consumers.
3. Transportation and Distribution
Transportation is one more challenge that the companies face. The rural areas in
India are not easily accessible due to lack of improper roads and transportation
means. Therefore this hampers marketing and distribution systems.
4. Seasonal Demand
Agriculture is the main occupation practiced in the rural areas. As it is a seasonal
occupation, the demand for goods in rural areas tends to be seasonal in nature.
5. Communication
Communication facilities like telephones, fax, telegraph and internet are not very
well developed in some villages and hardly exists in some villages. These pose a
real challenge to rural marketing.
6. High costs
Initial setting up costs are very high. Also distribution costs are very high in rural
areas and this proves to be a deterrent to rural marketing.
7. Inadequate Infrastructure
Vital infrastructure like roads, electricity, godown or storage facilities are very
underdeveloped or hardly present in rural areas and pose a major problem to rural
marketing.