Aspsm Project[1]

8/8/2019 Aspsm Project[1]

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Introduction



Rural Marketing

Assessing, stimulating andconverting the purchasingpower of rural consumer into

an effective demand forspecific products and services.



Gaps

Bridge by Govt. & Development. Agencies

1) Low priority to Agriculture.

2) Failure of LandReforms.

3) Inadequate Food Supplies.

4) Slow growt of Infrastructure.

5) Inadequate Inputs

6) Slowdown of rural Industrialization.



Phases of Rural Marketing

PHASE I (before mid 1960's)

Considered as a synonymous with"Agricultural Marketing".

Referred to marketing of 118 ruralproducts in Rural and Urban areas andagricultural inputs in rural markets.



Better irrigation facilities, soil testing, use of high yield

variety seeds, fertilizers, pesticides and employment ofmachinery like power tillers, harvesters' crushers.

Two separate areas of activity had emerged- the new"marketing of agricultural inputs " and the conventional

"agricultural marketing".

Formation of agencies like Khadi and Village IndustriesCommission, Girijan CooperatIve Societies and ApcoFabrics

PHASE II (mid 1960's-mid 1990's)



India's Industrial Sector had gained

strength and maturity.

The market has grown for householdconsumables and durables.

Development programs run by Central andState Governments.

PHASE III (After mid 1990's)



CONSUMER MARKET

Individuals

Households.Constituents:

Consumables,

Food- Products,

Toiletries,

Cosmetics, etc

Products :

Watches,

Bicycles,

Radio,

T.V,

Kitchen Appliances Furniture,

Durables :



INDUSTRIAL MARKET

Constituents :

y Agricultural and allied activities,y Poultry farming,y Fishing,y Animal husbandry,y Cottage Industries,y Panchayat office etc.

Products :

y Consumables,y seeds,y Fertilizers,y Pesticides,y P

etroll diesel etc.

Durables :

y Tillers,y Tractors,y Pump sets,y Generators,

y Boat etc.



SERVIC

ES MARKET

Individuals,

Households,

Offices Production firms.

Constituents:

Repairs,

Transport,

Banking credit,

Insurance,

Education,

Communications etc

Services :



Environment Differences

Small settlement units of villages widely dispersed.

Low Infrastructure level (such as road, electricityetc.)

Low Density of population per square kilometer ofspace

Poor physical connectivity with other villages andtowns, Low mobility.



Social Relations-Peculiar Aspects

Less number of impersonal interactions, more frequentinteractions between the same people.

Individual better known and with a strong identity of his/herown

Status is ascribed: determined by births in a family, lineage.Strong class structure.

Social norms influencing individuals are more visible.



DEPENDENCE ON NATURE

Abundance of Natural Resources and high dependenceon them for a large number of households needs.

High dependence for livelihoods, employment andIncome on Natural factors.

Differential access to resources based on Caste,Political and Money Power etc.



STRATEGIESPR ODUCT STRATEGIES

Includes product mix changes

Modernization and product design considerations.

Competitive product strategies

Identity strategies

Customer value strategies

Packaging strategies

Branding strategies



Q uality conscious : Discriminatory, perceivedvalue and psychological pricing.

Value conscious : Psychological, value,penetration and skimming.

Price conscious : Low prices, Premium pricing(small units) and barter pricing.

PRIC

IN

G STRATEGIES



PR OMOTION STRATEGIES

Mass media (Radio, Cinema, Press and TV)

Local media (Haats and Melas, Wall painting,Leaflets,Video vans, Folk media, Animal parade)

Personalised media includes direct communication,

dealers, sales persons and researches

BY PROMOTING PRODUCTS WITH INDIAN MODELS ANDACTORS



a) company depot

b) Redistribution stockiest, clearing agents

c) Semi wholesalers and retailers

d) Itinerant traders, Vans, Sales people, NGOs and garment agencies

DISTRIBUTION STRATEGIES

Distribution Channel Includes:



BY COMMUNICATING AND CHANGING Q UAL- ITY

PERCEPTION

BY PROPER COMMUNICATION IN INDIANLANGUAGE

BY TARGET CHANGING PERCEPTION

Communication Strategies



BY DEVELOPING RURAL-SPECIFIC PRODUCTS

BY ACQ UIRING INDIAN BRANDS

BY GIVING INDIAN WORDS FOR BRANDS

BY ASSOCIATING THEMSELVES WITH INDIANCELEBRITIES

Other Strategies



What kinds of themes are attractive

to rural consumers?Need category : Q uality of life messages -nutritious,healthy.

ro lem category : onvenien e, e onomy I hassle free,easy to maintain, lifetime om anion, a frien in nee anthe ay to ros erity.

Desire category : In e en en e, status, luxury et .

Ideal category : ommunal harmony, so ial ohesiveness,religious onformity, national integration an ea e.



CASE STUDIES



NIRMA

This washing powder adopted a market penetration strategybased on price which was 0%.

lower than the highest priced product in the market.

Its distribution efforts were highly concentrated in Westernand Northern zones.

It made the industry leader lose its market sharesubstantially in those zones.

Nirma is possibly the largest detergent brand in the worldwith sales of 700,000 tonnes a year.



PR OMISE TOOTHPASTE

The Company, Balsara, decided to "againstposition" the new product and aimed at No.2

position.

The advertisements were framed so as to offer allthe benefits being claimed by No.1 in a positivesense.

The product became a success with growth rate of30% in a market expanding at the rate of 7%.



LIFEBUOY SOAP

Success of this soap can be attributed to the right

market focus.

The market segment is clearly identified as the lowerincome segment and price sensitive.

Recently HUL introduced a new segment "Fightingsweat", for relatively higher incomes.

This culminated in "Lifebuoy Plus" a pink coloureddeodorant soap at a price higher than Lifebuoy.



ASIAN

PAIN

TS

They entered the exterior decorative segment with "ace", focusing onnon-metro markets. "Utsav´ and "Opal PuB followed.

Advertisements in TV and cinema are resorted to before festivals likePongal in Tamilnadu and other festivals elsewhere when demand foroutdoor decorative paints.

It is recognized that turnover and volume growth will come from rural

markets.

Mobile vans and demonstration cum sales techniques are used to flog"Utsav" brand.



RUF AND TUF JEANS

A ready to stitch jeans for the first time users priced at Rs.195/- as against theunorganized sector's range of Rs.150-3501-

Arvind mills, India's leading denim manufacturer created this new product specifically

for the rural market.

The kit included a denim trouser length with specific tailoring instruction and thebranded zipper, rivets and buttons that distinguish jeans in the consumer's mind.

The product was made available in villages with a population as small as fivethousand.

Local cloth shops were used as retail outlets.

Seminars were organized to train tailors in denim fits and inform them about thechanges required in sewing machines for stitching jeans.

The additional machine accessories were initially provided free of cost and later at asubsidized rate.



OUTCOME

The strategy worked. In the first two months, demand crossed a millionpieces as against a production capacity of 2,50,000 kits. So, the company hadto stop advertising.

Consumer feed back showed that nearly 75% were first time jean wearers.

R& T shorts and ready-made jeans were' launched for the slightly moreevolved customer who demanded jean specifics like the right wash.

This is a perfect example of brilliant product promotion.



PSYCHOGRAPHIC SEGMENTATION

In some parts of Gujarat, it isreported that farmers are going in for

big 50 HP tractors when their needwas for smaller 25 to 30 HP ones. Thereason was compulsion to "Keep upwith the neighbours". Now M&M hascome out with 35 HP and 5 HP

tractors name "Sarpanch" to flatterthe ego of such buyers and retainthem.



PR ODUCT LINE PRUNING

HUL is pruning its eighty strongbrand portfolio to the 30 powerbrands, which account for 75% of itsFMCG turnover. This is an example ofoptimization of resources to achievemore with the same ad-spend andmarketing effort.



LINE MODER NISATION

HUL relaunched VIM dish washbar with a superior formulation.Vim bar, the first such productfuelled the growth of dish washbar segment by over 200% in five

years. It converted customersfrom unbranded proxy productslike ash and mud.



BRAND AWARENESS BUILDING

In 1990, TVS launched TVS 50 XL as a"value for money" vehicle. This was

supported by massive advertisingcampaigns on TV to increase awareness ofthe brand. TVS spent around Rs.1.5 croreon the "Namma ooru Vandi" (Our own

vehicle) which showed people fromvarious walks of life swearing by TVS 50XL.



USE OF INTER NET FOR RURAL MARKETING

ITC has launched three web-based initiatives (E-Choupals in company speak) as part ofits strategies to vertically integrate its sourcing operations. Aqua Choupal.com in

AndhraPradesh, Soyachoupal.com in M.

Pand

Planters net.com in Karnataka.

ITC - .has setup 235 Internet kiosks, which cater to 10,000 farmers and cover2,50,000 hectares of land.

ITC Info Tech structured the entire virtual interaction model and Meta markets for

inputs like fertilizers, pesticides etc. that the farmers in different states can use.

Its plan was to set up 3000 kiosks to cover 100000 farmers. The idea is to use thisnetwork as a distribution channel for other products



AMUL

It recognized the fragmented and rural nature of milk production in

India.

It organized a very efficient milk collection network and supportedsmall dairy farmers with a variety of extension services.

It installed very modem processing and packaging facilities.

Used mass advertising very effectively to build high levels of brandawareness and preference for its products.



THE OUTLOOK

This new century brings a host of challenges andopportunities in the rural market as the youngergeneration frees itself from the bonds that tied down theprevious one.

India's democracy allows the people to change thegovernment if the majority of the voters feel stronglyabout the lack of basic amenities

Though marketers are alive to the importance of ruralmarkets it would be very difficult to wean the ruralcustomer away from regional or local brands unless thereis perceived benefit in price or value.



Contd«

In FMCG Sector, the next battle for a market share in rural areaswould be between local or regional brands on one side and nationalbrands on the other. The former would fight like hell using all meansfair and foul to retain their share of market and survive.

In the white goods sector the battle would be between new roducerswith latest technolog and the older ones. The success of G andS MS G in enetrating both urban and rural sectors in a short time isa lesson in market a roach.

ocal brands have so far used gut feeling and lain common sense intheir marketing o erations, as well as direct contact with theretailers. When the scale u to regional level, the use low costmedia as Cable TV, Radio and Regional rint media. This enables themto reach more customers while retaining existing ones.



Contd«««

Agricultural inputs such as fertilizers and pesticides may see aprice increase and volumes may fall as more and more farmersturn to "Precision farmingµ.

Increased incomes in the rural sector should result in investment

in goods and services enabling a better quality of life, like betterhousing schooling and more white goods. But a portion may bewasted in conspicuous consumption and even wastefulexpenditure as on liquor. Campaigns should be launched in suchareas to avoid such evils.

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