11-03-2014, 01:06 PM
To analyze the marketing of consumer products (both durable and non durable products) in rural areas
To analyze the marketing of consumer .docx (Size: 788.86 KB / Downloads: 11)
EXECUTIVE SUMMARY
India’s way is not Europe’s. India is not Calcutta and Bombay. India lives
in her seven hundred thousand villages...Mahatma Gandhi, 1926
Marketing in developing countries like India have often been borrowed from the western world. Concepts like Brand identity, Customer relationship management, 4 Ps of the marketing mix, Consumer behavior process; Segmentation, targeting and positioning etc. have often been lifted straight from the marketing intelligentsia abroad and adopted in Indian conditions, often with minimal success. Reason lies not in the fault of such concepts, but their integration with the Indian ethos and culture.
The rural India offers a tremendous market potential. Nearly two-thirds of all middle-income households in the country are in rural India and represents half of India’s buying potential. Despite, the strong potential the rural markets are by and large less exploited. Consider the market, out of five lakhs villages in India only one lakh have been tapped so far. According to us if the rural market has to be adequately tapped, there has to be a change in the way marketing concepts learnt in B-schools with adequate adoption according to scenarios prevalent in rural India. The paper thereby present the modified version of Philip Kotler’s famous marketing mix consisting of 4Ps.
OBJECTIVES OF THE STUDY:
Any task without sound objectives is like Tree without roots. Similarly in case of any research study undertaken, initially the objectives of the same are determined and accordingly the further steps are taken on. A research study may have many objectives but all these objectives revolve around one major objective which is the focus of the study. In this study, the focus is on the emergence of rural markets as the most happening market on which every marketer has an eye. And so this study will be based on studying the emergence of rural market in various contexts.
The main objective of the study is to analyse and present the marketing of consumer products in rural areas. The following objectives have been set forth. They are to:
1) Present a rural marketing perspective.
2) Present a profile of Indian Rural market.
3) Study and analyse the consumer behavior in rural areas.
4) Examine the product and brand penetration in rural markets.
5) Analyze marketing of consumer product in rural markets.
6) Present marketing strategy frame for marketing consumer products in rural areas.
SCOPE OF THE STUDY:
The study is restricted to selected districts of UTTAR PRADESH. Further, product and brand penetration is examined. As regards marketing of consumer products in rural areas, the study analyzes products from non durable category (a bathing soap, detergents, tea, coffee, shampoo) and from durable category (a wrist watch, television, refrigerator, fan and bicycle).
RURAL INFRASTRUCTURE:
1) 46 percent of villages are connected by all weather roads.
2) 84 percent of villages are electrified.
3) 5700 regulated markets.
In the early 2000s, around 700 million people, i.e. 70% of the Indian population lived in 6,27,000 villages, in rural areas. Of this, 90% were concentrated in villages with population less than 2000.3 According to a study conducted in 2001 by the National Council for Applied Economic Research (NCAER), there were as many "middle income and above" households in rural areas as there were in urban areas.
There were almost twice as many "lower income households" in rural areas as in urban areas. There were 2.3 million "highest income" households in urban areas as against 1.6 million in rural areas. NCAER projections indicated that the number of "middle income and above" households was expected to grow to 111 million in rural India by 2007, compared to 59 million in urban India. Gone were the days when a rural consumer had to go to a nearby town or city to buy a branded product. The growing power of the rural consumer was forcing big companies to flock to rural markets. At the same time, they also threw up major challenges for marketers.
FMCG
There was a time when the FMCG companies ignores rural market, they took no any interest to produced or sell products in rural market in India. It was the initial stage of FMCG companies in India. As per as the time had
passed, the strategy and marketing style of FMCG companies had been changed.
The rural market is the one of the best opportunity for the FMCG sector in the India. It is wider and less competitive market for the FMCG.As the income level of the rural consumers increasing, the demand of FMCG is
increasing continuously.
Retail
The rural retail market is currently estimated at US$ 112 billion, or around 40 per cent of the US$ 280 billion retail market. Major domestic retailers like AV Birla, ITC, Godrej, Reliance and many others have already set up farm linkages. Hariyali Kisan Bazaars (DCM) and Aadhars (Pantaloon-Godrej JV), Choupal Sagars (ITC), Kisan Sansars (Tata), Reliance Fresh, Project Shakti (Hindustan Unilever) and Naya Yug Bazaar are established rural retail hubs.
Pharmaceuticals
According to a report by McKinsey, the rural and tier-II pharma market will account for almost half of the growth till 2015. The tier-II market will grow to 44 per cent by 2015, amounting to US$ 8.8 billion.
This growth will be further augmented with the government increasing the allocation under National Rural Health Mission (NRHM) by US$ 424.3 million over interim budget estimate 2009-10 of US$ 2.49 billion.
Elder Pharmaceuticals is increasing its focus on the rural market. The company that largely makes active pharmaceutical ingredients, plans to increase its sales by 8-9 per cent mainly from rural areas and has allocated US$ 8.26 million to strengthen the sales force for this segment.