01-01-2013, 04:50 PM
Strategies For Rural Marketing By An Organization
1Strategies For Rural.pdf (Size: 120.77 KB / Downloads: 474)
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. Adi Godrej, chairman of
the Godrej group that is in a range of businesses from real estate and personal
care to agri-foods, has no hesitation proclaiming, It is a myth that rural
consumers are not brand and quality conscious. A survey by the National
Council for Applied Economic Research(NCAER), India's premier economic
research entity, recently conrmed that rise in rural incomes is keeping pace
with urban incomes. From 55 to 58 per cent of the average urban income
in 1994-95, the average rural income has gone up to 63 to 64 per cent by
2001-02 and touched almost 66 per cent in 2004-05. The rural middle class is
growing at 12 per cent against the 13 per cent growth of its urban counterpart.
Even better, the upper income class those with household incomes of
over Rs one million [$22,700] per annum is projected to go up to 21 million
by 2009-10 from four million in 2001-02. It will have a 22 to 23 per cent
rural component. Higher rural incomes have meant larger markets. Already,
the rural tilt is beginning to show. A study by the Chennai-based Francis
Kanoi Marketing Planning Services says that the rural market for FMCG
is worth $14.4 billion, far ahead of the market for tractors and agri-inputs
which is estimated at $10 billion. Rural India also accounts for sales of $1.7
billion for cars, scooters and bikes and over one billion dollars of durables.
In total, that represents a market worth a whopping $27 billion. It is no
wonder that even MNCs have cottoned on to the idea of a resurgent rural
India waiting to happen. Four years ago, Coke ventured into the hinterland.
Now Coke's rural growth of 37 per cent far outstrips its urban growth of 24
per cent.
BY COMMUNICATING AND CHANGING QUAL-
ITY PERCEPTION
Companies are coming up with new technology and they are properly communicating
it to the customer. There is a trade-o between Quality a customer
perceives and a company wants to communicate. Thus, this positioning of
technology is very crucial. The perception of the Indian about the desired
product is changing. Now they know the dierence between the products
and the utilities derived out of it. As a rural Indian customer always wanted
value for money with the changed perception, one can notice dierence in
current market scenario.
BY PROPER COMMUNICATION IN INDIAN
LANGUAGE
The companies have realized the importance of proper communication in
local language for promoting their products. They have started selling the
concept of quality with proper communication. Their main focus is to change
the Indian customer outlook about quality. With their promotion, rural
customer started asking for value for money.
BY TARGET CHANGING PERCEPTION
If one go to villages they will see that villagers using Toothpaste, even when
they can use Neem or Babool sticks or Gudakhu, villagers are using soaps
like Nima rose, Breeze, Cinthol etc. even when they can use locally manufactured
very low priced soaps. Villagers are constantly looking forward
for new branded products. What can one infer from these incidents, is the
paradigm changing and customer no longer price sensitive? Indian customer
was never price sensitive, but they want value for money. They are ready to
pay premium for the product if the product is oering some extra utility for
the premium.
BY UNDERSTANDING CULTURAL AND SO-
CIAL VALUES
Companies have recognized that social and cultural values have a very strong
hold on the people. Cultural values play major role in deciding what to buy.
Moreover, rural people are emotional and sensitive. Thus, to promote their
brands, they are exploiting social and cultural values.
BY PROVIDING WHAT CUSTOMER WANT
The customers want value for money. They do not see any value in frills
associated with the products. They aim for the basic functionality. However,
if the seller provide frills free of cost they are happy with that. They are
happy with such a high technology that can fulll their need. As "Motorola"
has launched, seven models of Cellular Phones of high technology but none
took o. On the other hand, "Nokia" has launched a simple product, which
has captured the market.
BY PROMOTING INDIAN SPORTS TEAM
Companies are promoting Indian sports teams so that they can associate
themselves with India. With this, they in
uence Indian mindset. LG has
launched a campaign "LG ki Dua, all the best". ITC is promoting Indian
cricket team for years, during world cup they have launched a campaign
"Jeeta hai jitega apna HindustanIndia India India". Similarly, Whirlpool
has also launched a campaign during world cup.
BY TALKING ABOUT A NORMAL INDIAN
Companies are now talking about normal India. It is a normal tendency of
an Indian to try to associate himself/herself with the product. If he/she can
visualize himself/herself with the product, he /she becomes loyal to it. That
is why companies like Daewoo based their advertisements on a normal Indian
family.
BY ACQUIRING INDIAN BRANDS
As Indian brands are operating in India for a long time and they enjoy a
good reputation in India. MNCs have found that it is much easier for them
to operate in India if they acquire an Established Indian Brand. Electrolux
has acquired two Indian brands Kelvinator and Allwyn this has gave them
the well-established distribution channel. As well as trust of people, as people
believe these brands. Similarly Coke has acquired Thumps up, Gold Spot,
Citra and Limca so that they can kill these brands, but later on they realized
that to survive in the market and to compete with their competitor they have
to rejuvenate these brands.
BY ADOPTING LOCALISED WAY OF DIS-
TRIBUTING
Proper distribution channels are recognized by companies. The distribution
channel could be a Big scale Super markets, they thought that a similar
system can be grown in India. However, they were wrong, soon they realized
that to succeed in India they have to reach the nook and the corner of
the country. They have to reach the "local Paan wala, Local Baniya" only
they can succeed. MNC shoe giants, Adidas, Reebok, Nike started with
exclusive stores but soon they realized that they do not enjoy much Brand
Equity in India, and to capture the market share in India they have to go the
local market shoe sellers. They have to reach to local cities with low priced
products.