Professional Documents
Culture Documents
DEFINATION
Let us take at some of the points with respect to Rural India as per Census
Population density of less than 400 per sq.km.
At least 75% of the male working population is engaged in agriculture.
No municipality or board.
If we go by statistics, roughly around 70% of the Indian population lives in the rural areas. That is almost 12 % of the
world population. To expand the market by tapping the countryside, more and more MNCs are foraying into Indias
rural market.
Below are the few points why organizations are looking at rural marketing with a positive attitude
1. Population : According to 2011 Census rural population is 72% of total population and it is scattered over a wide
range of geographic area. That is 12% of the world population which is not yet fully utilized.
2. Rising Rural Prosperity : Average income level has unproved due to modern farming practices, contract farming
industrialization, migration to urban areas etc. There has been an overall increase in economic activities because
during the planned rural development heavy outlay of resources on irrigation, fertilizers, agricultural equipments
and agro processing industry has been made. Saving habits in rural people also has increased. This too contributes
in higher purchasing power
3. Growth in consumption : There is a growth in purchasing power of rural consumers. But, the average per capita
house hold expenditure is still low compared to urban spending
4. Change in life style and Demands : Life style of rural consumer changed considerably. There has been increase
in demand for durables and non-durables like table fans, radios, mopeds, soaps, etc. by rural consumers. This
provides a ready market for the producers. Rural market is expanding day after day.
5. Market growth rate higher than urban: The growth rate of fast moving consumer goods [FMCG] market and
durable market is high in rural areas. The rural market share is more than 50% for products like cooking oil, hair oil
etc.
6. Life cycle advantage : The products which have attained the maturity stage in urban market is still in growth
stage in rural market.
7. Decision-making Units : Women in rural areas are beginning to make fast decisions for purchases. Studies
reveal that 72.3% decisions are taken jointly in a family. With education and mass media, role of children in decision
making is also changing
CONCEPTS
COMPONENETS OF RURAL MARKETS
CLASSIFICATION OF RURAL MARKETS
RURAL vs URBAN MARKETS
CHARACTERISTICS & DIAMENSIONS OF RURAL MARKET
Mostly, major part of rural market holds a very divergent pattern of reacting to marketing. So, marketer
needs to design a specific marketing mix for the rural segments. For rural market, a marketing manager
has three options one is, to design marketing programme common for all types of customers; the
second is, to design marketing programme purely for rural customers; and the third is, to design
marketing programme for customers residing in rural but reacting as if they were global.
Excepts some villagers of some progressive states like Maharashtra, Gujarat, Haryana, etc., most rural
customers are poor, backward, illiterate, and orthodox. They vary significantly in terms of preference
and habits. They are to be treated in different patterns.
1. More Prospective:
With the initiation of various rural development programmes, there has been an upsurge of employment
opportunities for the rural poor. One of the biggest cause behind the steady growth of rural market is
that it is not exploited and also yet to be explored.
2. Size:
The rural market in India is vast and scattered, and offers a plethora of opportunities in comparison to
the urban sector. It covers the maximum population and regions, and thereby, the maximum number of
consumers. Rural market is account for about 74% of total Indian population.
3. Nature:
The social status of the rural regions is precarious (uncertain) as the income level and literacy is
extremely low along with the range of traditional values and superstitious beliefs that have always been
a major impediment (obstacle) in the progression of this sector.
Rural Population Statistics
Population Number of Villages Percentage of total villages
7. Response to Distribution:
Distribution-related features of rural segment include:
i. Normally, they buy from familiar retailers and salesmen. They are hesitant
to buy from big shopping malls or departmental stores. However, situation is
changing gradually.
ii. Rural customers strongly favour relations. They continue buying from
known and established retailers who maintain close family relations with
them.
v. They are not interested in home-delivery. They want immediate possession.
They lack patience. They are found eager to possess and use the products
immediately.
vi. Caste, religion, political party, relations, etc., play important role in
selecting the retailers.
vii. Online and direct marketing are not much popular in rural areas.
Sometimes, a few of them are interested in network marketing.
8. Predictability:
Unlike urban markets, the rural markets are difficult to predict, and possess
special characteristics. The featured population is predominantly illiterate,
have low and irregular income, lack of monthly income, and flow of income
fluctuating with the monsoon winds. They dont have a stable pattern of
reacting due to income factors.
9. Role of Government:
Demand of products depends on availability of basic facilities like electricity,
transportation, schools, hospitals, etc. The steps taken by the Government of
India to initiate proper irrigation, infrastructural developments, prevention of
flood, grants for fertilizers, and various schemes to cut down the poverty line
have improved the condition of the rural masses. Rural market depends on
governments contribution to the rural sector.
10. Rigidity:
Most rural customers are illiterate, backward, and orthodox. It is very difficult
11. High Level of Heterogeneity:
We find different types of buyers in rural areas. Some are simple, while some
are sophisticated; some are extreme rich, while some are extreme poor;
some are highly educated, while some are complete illiterate; some are
dynamic and modern, while some are very rigid and orthodox; some believe
in quality and status, while some believe in availability and price.
Rural customers are gradually transforming into urban, metropolitan, and
even cosmopolitan customers. Improved education, rapid means of
transportation, access to advance communication, raised living standards,
craze to follow modern (even ultramodern) life pattern, and many similar
factors have drastically changed rural consumer behaviour. The gap between
urban and rural segments tends to be notably narrow. Sometimes, rural and
urban customers exhibit no difference at all.
RURAL MARKET IN INDIA
SIZE & SCOPE
ENVIRONMENT & EMERGING PROFILE OF RURAL MARKET IN INDIA
CONSTRAINTS IN RURAL MARKETING
Important Constraints in Rural Marketing
2. Transport Problem
4. Warehousing Problems
5. Many Languages and Dialects
Apart from agriculture, the villagers are also involved in other occupations like
fishing, farming, cottage industry, pottery, business, various small, medium or large
scale industries, carpentry, etc. .
The rich cultural diversity in the villages attracts many tourists from all over
the world every year. This has encouraged many villagers to get involved in
various tourism related occupations. The villagers work as tourist guides or
run different kinds of business in the famous tourist spots or even provide
accommodation facilities to the tourists to earn their livelihoods.
Other than the occupations mentioned above, there are several other means
of livelihood in rural India such as community, social and personal services;
mining and quarrying; real estate; post and telecommunication; health and
social work; educational services; public administration and national defence;
wholesale and retail trade; utilities supply and other activities.
The occupation scenario in Indian villages has changed mainly due to the
changing economical scenario of the villages of India. The invention of new
INCOME GENERATION
Location of Rural population
Expenditure Pattern
Literacy Level
Land Distribution
Land Use Pattern
Irrigation
Development Programs
Infrastructure Facilities
Rural Credit Institutions
Rural Retail Outlet
Media in Rural Market
Rural Area Requirement
Problems In Rural Marketing
Rural Marketing: 12 Problems Faced in Rural Marketing
Twelve problems faced in rural marketing are as follows: 1.Deprived people and deprived markets 2. Lack of
communication facilities 3. Transport 4. Many languages and dialects 5. Dispersed markets 6. Low per capita Income 7.
Low levels of literacy 8. Prevalence of spurious brands and seasonal demand 9. Different way of thinking 10.
Warehousing problem 11. Problems in sales force management 12. Distribution problem.
3. Transport:
Many rural areas are not connected by rail transport. Many roads have been poorly surfaced and got severely
damaged during monsoons. The use of bullock carts is inevitable even today. Camel carts are used in
Rajasthan and Gujarat in both rural and urban sectors.
5. Dispersed markets:
Rural population is scattered over a large land area. And it is almost impossible to ensure the availability of a
brand all over the country. District fairs are periodic and occasional in nature. Manufacturers and retailers
prefer such occasions, as they allow greater visibility and capture the attention of the target audience for
larger spans of time. Advertising in such a highly heterogeneous market is also very expensive.
6. Low per capita Income:
The per capita income of rural people is low as compared to the urban people. Moreover, demand in rural markets
depends on the agricultural situation, which in turn depends on the monsoons. Therefore, the demand is not stable
or regular. Hence, the per-capita income is low in villages compared with urban areas.