INDIAN RURAL MARKET

INTRODUCTION TO RURAL MARKET

Rural India occupies 68.84% of Indian population. For every consumer in urban area, there are three of them in rural area. India/State/UTTotal Population Rural Population Urban Population Rural Pop Percentage Urban Pop Percantage INDIA 1,21,01,93,422 83,30,87,662 37,71,05,760 68.8431.16

Rural marketing
It is often said that markets are made, not found. This is especially true for the rural market of India

Nature and characteristics of the rural market

1) Large and scattered market: 75 crore rural consumers who live in rural area, approximately 6,38,365 villages. So widely scattered- it will raise transportation costs, affects the viability of the distribution system.

2) Heterogeneous market Not a homogeneous.

24 languages and 1642 dialects- varies every 100 km. Difficult to develop uniform message caste, community, tradition values (from state to state, region to region differ)

 Variations in economic development and socio-cultural background influence. Literacy rate in rural south India is higher than rural north. Rural consumers in the south are more brand conscious. So, variations in behavior due to the consumer environment geographical, occupational.

3)Income from agriculture 55% of rural income comes from the agriculture sector. Hence rural prosperity is tied with agricultural prosperity. Recently- gradual reduction in the sole dependence on agriculture( other sectors plays significant role in the rural economy)

4) Standard of living Lower standard of living.

70% rural population is employed in small scale agricultural and related occupation. Seasonality As it is unreliability in income- rural consumers are extremely conscious in their purchase behaviour. Low literacy, social backwardness, low savings.

5) Infrastructural facilities Road, warehouse, communication system and financial facilities are inadequate in rural area.
Roads do not connect nearly 50% villages in the country.

Inadequate infrastructure is single most important factor distinguishes urban and rural. Promotion and physical distribution thus becomes very difficult.

IMPORTANCE OF THE RURAL MARKET

Size of the rural market Rural market in value terms Rural target population The market for agriculture inputs Sources of rural purchasing capacity

Basis of Segmentation and Approaches to Rural Segmentation:

Geographic Segmentation
Regions Village population and density Culture

 Demographic Segmentation
Age & Life Cycle Family Structure Income Landownership Occupation Education and House Type Religion & Caste

 Psychographic Segmentation
Social Class Lifestyle

 Behavioural Segmentation
Occasions Benefits Sought User Status Usage Rate Loyalty Place of Purchase

4 As of rural marketing mix

1. Affordability Not cheaper product, designing products which match the needs of rural consumers, at a price that they feel 2. Availability: Lesser number of brands available at rural retail outlet Ensuring the reach of the products at the retailers shelf is one of the most critical function

3.Awareness They use unconventional media along with commercial media like TV , Radio Elements like colour, logo, slogan designed according to the rural consumer 4. Acceptability They must feel that the product serves its purpose, then they are ready to even spend extra for the product