Rural

According to IRDA and NCAER Rural villages with a population of less the 5000 with 75%of male population engaged in agriculture. The Indian Census defines: Rural as that which is not urban and which has density of population not more than 400/sqkm and at least 75% of male working population engaged in agriculture and allied activities.

 According to what mentioned above, there are 5,85,764 villages in India .Of these only 0.5% have a population above 10,000 and 2% have population between 200 and 1,000 and another 18% has a population less than 200. According to FMCG companies any area that has population between 20,000 to 99,999 is a rural market

History of Indian Rural Market

The Asian Paints were the first to enter Indian Rural Market. Hindustan Lever Ltd. Entered rural market in 1960s. Marico entered in 1980s followed by Colgate, Dabur etc.

 In 1990s companies like Samsung, LG, Rervolon and Birla Sunlife entered rural market with the products especially meant for rural market.

Features of Indian Rural Market

Population Distribution In India about 60% of its population lives in villages, in term of number of prople the Indian rural market is almost twice as large as the entire US market. Different Languages In India there are 16 languages which are given in our constitution as national languages and about 600 linguistic, regional and cultural and social disparities.

Undeveloped Market: The rural market is undeveloped because people have poor income, poor standard of living, low per capita income. Diverse Size and Nature: Today the size of rural market is approximately 2,20,000 million Rupees for non food items. Rural markets offers excellent opportunities to become local center for rural development. According to experienced industrialist and marketers, rural market are sure to outstrip the urban market very soon. Today rural market has vast potentials and challenges too.

 Literacy Level.

Meaning And Segmentation of Rural Market

Rural marketing in simple words is the planning and implementation of marketing function for the rural areas. It is a two-way marketing process, which encompasses the discharge of business activities that majorly direct the flow of goods from Urban to Rural areas.

According to National Commission on

Agriculture:
Rural Marketing is a process which starts with a decision to produce a saleable farm commodity and it involves all aspects of market structure or system, both functional and institutional, based on technical and economic considerations and includes pre and post harvest operations, transportation and distribution. According to Iyer: Rural Marketing is a process of developing , pricing, promoting, distributing rural specific goods and services leading to exchange between urban and rural markets, which satisfies consumers demand and also achieves organizational objectives.

Rural Market Segmentation

Market Segmentation is a process of dividing potential market into distinct sub-market of consumer with common needs and characteristics. Market segmentation is the process of grouping buyers in to different categories having common desires or needs. It is the process of dividing the market in order to conquer them. It is to identify the group of buyers on the basis of their desires or requirement. It is the strategy that sub divides the target market into sub groups of consumers with definable, distinct and homogeneous characteristics with a view to develop and follow a distinct and differentiated marketing programs for each sub-group in order to enhance satisfaction to consumers and profits to marketers.

So, market segmentation is very important in rural areas to know the rural consumers. It is more important because rural marketing involves pretty high cost in identifying and cultivating rural markets. It become easier to capture market when its salient features are understood by dividing the market into different identifiable divisions. These Sub-division are called market segments.

Benefits of Market Segmentation

Generation of Consumer profile Giving a differentiable basis for different customer profile. It facilitates choice of target market by evaluation of different segments Allows efficient and effective usage of limited firms resources.

Rural market segmentation is divided into 3 categories