Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Chapter 1
The Call of Rural India
Rural Marketing, 2e
Define rural India and rural markets
Identify common rural myths
Understand the rural marketing myths and the challenges
related to it
Understand the characteristics of the evolving rural
consumer
Describe the emerging rural India
Rural Marketing, 2e
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Learning Objectives
Organization
Definition of Rural
Limitation
Census
Several hamlets demarcated by
physical boundaries
Towns are urban areas that satisfy:
Minimum population 5,000
Population density > 400 per sq.
Km.
75% of the male population
engaged in non-agricultural
activities
The term rural
is not defined,
nor is the upper
limit of
population for
villages
IRDA
RBI
Rural Marketing, 2e
Similar to Census except that the
percentage for male population in
towns is 25% and not 75%
Rural: All locations with a population
of up to 10,000
Semi-urban: All locations with a
population between 10,000 and
100,000
Widening of
definition allows
a larger market
to be considered
as rural
Distinction
defined only by
population
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Definition of Rural
Organization
Planning
Commission
Sahara
Definition of Rural
Limitation
Towns with population up to
15,000 are considered rural
Town
characteristics
not defined
Locations with shops/commercial
establishments up to 10,000
population.
Town or village
characteristics
not defined
All population centres other than
LG Electronics the 7 metros are considered rural
or semi-urban
Rural Marketing, 2e
Population
criteria is not
considered
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Definition of Rural
Rapid urbanization
Urban increase rate only 0.75% higher than rural and
showing a slowing trend largely due to the National Rural
Employment Guarantee Scheme (NREGS)
An agrarian economy
Non-farm activity already 60%; expected to rise to 70% by
2020
This increases family income and provides a more constant
stream of income to rural households.
A higher buffer from risks involved in farming
Rural Marketing, 2e
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Rural Myths
The 4 Ps of marketing price, product, place and promotion
replaced by 4 As in rural markets
Rural Marketing, 2e
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Rural Marketing Mix
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Rural Marketing Mix
Rural Marketing, 2e
Value driven and looks for products that add to earning
capabilities or to status
Increasing literacy and exposure to mass media, increasing
aspiration levels
Better road infrastructure leading to increased mobility
Highest change amongst children and youth, increasing
their role as influencers
Rural Marketing, 2e
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
The Evolving Rural Consumer
Changing cultural and social norms
Rise in nuclear families creating new roles for women
High use of self-help groups (SHGs), especially for women
Marketers need to focus on creating
excitement amongst women and youth
Rural Marketing, 2e
awareness
and
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
The Evolving Rural Consumer
164 million households accounting for 56% of Indias total
income, 64% of expenditure and 33% of savings
67%
road
electrification
200 million mobile users
14 million DTH subscribers
87 million Kisan Credit Cards
connectivity,
30%
tele-density,
60%
Higher growth in durables as well as FMCGs as compared to
Ruralurban
Marketing, 2e
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Rural India: The Exploding
Middle Class
Rural India: The Exploding Middle
Class
Pyramid transforming into a diamond
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
2020
Rural Marketing, 2e
Rural India: The Exploding
Middle Class
cost of living leads to higher proportion of disposable
income
Government
incomes
rural thrust boosting bottom of pyramid (BoP)
Rural
infrastructure being developed in the areas of roads,
electrification, education and health
Increase
in agricultural productivity and shift to cash crops
increasing agricultural income
Rural Marketing, 2e
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Lower
Refer to video case and answer the following questions:
Despite the diverse heterogeneous nature of rural
markets, why are marketers focusing on rural
markets?
How should marketers tackle the huge diversity seen
in rural markets?
What steps should a company take to tap the huge
potential in rural markets? Discuss this with regard to
the 4 Ps of marketing.
Rural Marketing, 2e
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Rural Marketing Case
Rural Markets
Think like a businessman with the
feelings of a social worker
Rural Marketing, 2e
Copyright 2012 Dorling Kindersley (India) Pvt. Ltd.
Successful Mantra for Entering
Rural Markets
