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various tiers present depending on the
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90%,Bihar 44%
44%) & population
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( The increased efforts of central & state
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rural markets for house hold consumables
& durables.
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( Durables-Watches, Bicycles, television

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the rural market there is a need to understand
the market not just in terms of households &
population ,but in terms of their occupation
pattern, income generation, marketing
arrangements for agricultural produce, the
process of rural & cottage industrialization,
communication facilities, infrastructure
development, rural buyer behaviour, attitude &
belief of rural people & their changing values &
aspirations..
aspirations
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( Population, Occupation pattern, income
generation.
( Location of rural population, expenditure pattern.
( Literacy level, land distribution, land use pattern.
( Irrigation, development programs, infrastructure
facilities.
( Vural credit institutions, rural retail outlets, print
media in rural areas, rural area requirement.
( Problems in rural marketing, rural demand, rural
market index.
( */*j "$/1 - mbout 70 percent of Indians
reside in rural areas.
areas. ms per the 2001 census
data, India has a total population of 1027 million
of which rural population is large & is 742 million.
million.
It should be noted that a large population will
require a wide variety of consumable & durable
goods & services but at the same time these
needs of the rural areas do not automatically
guarantee a market, unless backed by rising
disposable income & the resultant purchasing
power..
power
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rural population is agriculture & allied activities
activities..
mbout half of the rural population own or lease
land & cultivate it for their livelihood.
livelihood.
( mnother 27 percent are dependent on these
cultivators for jobs as agriculture laborers.
laborers.
( Others include petty shop owners, Merchants,
teachers, health workers & village- village-level
officials.. So disposable income in the hands of
officials
rural people is very much dependent on the
status of agriculture & other allied activities
activities..
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generation. Major
occupation being agriculture a large
portion of income generated in rural areas
is from agriculture & agriculture related
activities..
activities
( The prosperity of rural areas &
development of rural market to a large
extent depends upon the progress of
agriculture & related activities.
activities.
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( ëearly 70%
70% of the area under cultivation
is occupied by food crops only 30%
30% under
non food crops.
crops.
( The preference for food crops is due to the
fact that farmers prefer to have their food
secured & so retain sufficient quantities of
the production for their own consumption
& only the balance will be sold in the
market.. This has an implication in
market
generation of disposable income
income..
 ( 
( Irrigation plays a major role in increasing
the potential of rural market. ms of 1999-
1999-
2000 the country¶s created irrigation
potential is estimated to have gone up to
94.7 million hectares which is about 50%
of area under cultivation.
( Wherever irrigation facilities are available
the rate of technology adoption is also
higher resulting in increased productivity
& thereby increased incomes to the rural
people.
  1 ( 
( 

( The five year plans have witnessed

massive investments by the central &
state governments in rural areas in a
number of development programmes.
programmes.
( Intensive mgricultural district programme
(ImDP
(ImDP--popularly known as package
programme)
( Intensive mgricultural area programme
(ImmP)
( High
High--yielding varieties programme (HYVP-
(HYVP-
green revolution)
  1 ( 
( 
( Drought Prone areas programme (DPmP)
( Small farmers development agency
(SFDm)
( Marginal farmers & agricultural Laborers
development programme (MFmL)
( Integrated tribal development programme
(ITDP)
( Hill area development programme

( Operation flood (White Vevolution)

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( The term "Green Vevolution" is a general
one that is applied to successful
agricultural experiments in many
developing countries.
countries. It is ëOT specific to
India.. But it was most successful in India.
India India.
mimed at improving food grain production
in the country & hence achieving food self
sufficiency..
sufficiency
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( There were three basic elements in the

method of the Green Vevolution:

(1) Continued expansion of farming areas.

(2) Double-
Double-cropping existing farmland.

(3) Using seeds with improved genetics.

 
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( ms mentioned above, the area of land
under cultivation was being increased
right from 1947.
1947. But this was not enough
in meeting with rising demand
demand..
( Other methods were required.
required. Yet, the
expansion of cultivable land also had to
continue.. So, the Green Vevolution
continue
continued with this quantitative expansion
of farmlands.
farmlands. However, this is ëOT the
most striking feature of the Vevolution
Vevolution..
 


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( This was the scientific aspect of the Green

Vevolution.. The Indian Council for mgricultural
Vevolution
Vesearch developed new quality of high yield
value (HYV) seeds
seeds..

( The most noteworthy HYV seed was the K68

variety for wheat.
wheat. The credit for developing this
high yield value seed goes to Dr. Dr. M.P. Singh
who is also regarded as the hero of India's
Green revolution.
revolution.
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( 4.Postal System
System--

The department of post comes under the

ministry of communications & information
technology.. India has 1,55,
technology 55,279 post office &
which serves on an average of 6,614 persons.
persons.

( 5.Telecom & Mobile services

services--

8   
 

-_  
  DmmKIYm mmYm
MOBILE LmmYm (MOBILE POSTMmë SCHEME)
24..12.
24 12.2002
( The scheme is designed to provide
availability of a phone at the
doorstep of every rural household.
Under the scheme, mobile phone will
be provided to a Postman(Gramin
Postman(Gramin
Sanchar Sevak).
Sevak). When the postman
goes to a house to deliver a letter,
he will carry the phone with him.
Since a postman reaches practically
every house, the scheme will enable
the phone service to be made
available practically to all citizens in
his area.
 

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( Credit providers in Vural India can be

classified into two groups.

( 1.organised.

( 2.Un organized.
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( Vural finance in the organized sector has
been spearheaded by cooperatives,
commercial banks & VVBs
( under government programmes these
organizations provide timely, cheap &
adequate credit to benefit small &
marginal farmers & the weaker sections
of society.
society.
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( mlthough the rural market does offer a
vast untapped potential, it should also be
recognized that it is not that easy to
operate in rural market because of
several problems.
problems. Vural marketing is thus
a time consuming affair and requires
considerable investments in terms of
evolving appropriate strategies with a
view to tackle the problems.
problems.

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 The number of people below poverty line
has not decreased in any appreciable
manner.. Thus underdeveloped people
manner
and consequently underdeveloped market
by and large characterize the rural
markets..
markets

 Vast majorities of the rural people are

tradition bound, fatalistic and believe in
old customs, traditions, habits, taboos
and practices.
practices.
 $ï "1 1 
 
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 ëearly fifty percent of the villages
in the country do not have all
weather roads.
roads. Physical
communication of these villages is
highly expensive
expensive.. Even today most
villages in the eastern parts of the
country are inaccessible during the
monsoon..
monsoon
 %$#" 

 
 
 mmong the mass media at some point of
time in the late 50's
50's and 60's
60's radio was
considered to be a potential medium for
communication to the rural people. people.
mnother mass media is television and
cinemas.. Statistics indicate that the rural
cinemas
areas account for hardly 2000 to 3500
mobile theatres, which is far less when
compared to the number of villages.
villages.
/$ï(
( #
 The number of languages and
dialects vary widely from state to
state, region to region and probably
from district to district.
district. The
messages have to be delivered in the
local languages and dialects.
dialects. Even
though the number of recognized
languages are only 16,
16, the dialects
are estimated to be around 850.
850.
 ð   #
  #
 Vural areas are scattered and it is
next to impossible to ensure the
availability of a brand all over the
country.. Seven Indian states account
country
for 76%
76% of the country's rural retail
outlets, the total number of which is
placed at around 3.7 million. million.
mdvertising in such a highly
heterogeneous market, which is
widely spread, is very expensive.
expensive.
 K ï
ï 1 
 Even though about 33- 33-35%
35% of gross
domestic product is generated in the
rural areas it is shared by 74%
74% of the
population.. Hence the per capita
population
incomes are low compared to the
urban areas.
areas.
  ï
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( The literacy rate is low in rural areas
as compared to urban areas. areas. This
again leads to problem of
communication for promotion
purposes.. Print medium becomes
purposes
ineffective and to an extent
irrelevant in rural areas since its
reach is poor and so is the level of
literacy
 ,R 3 /
/ 
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 For any branded product there are a
multitude of 'local variants', which
are cheaper, and, therefore, more
desirable to villagers.
villagers. (For ex-
ex-Edible
oil)
 $"" "(
 There is a vast difference in the lifestyles
of the people.
people. The kind of choices of
brands that an urban customer enjoys is
different from the choices available to the
rural customer.
customer. The rural customer usually
has 2 or 3 brands to choose from whereas
the urban one has multiple choices
choices.. The
difference is also in the way of thinking.
thinking.
The rural customer has a fairly simple
thinking as compared to the urban
counterpart..
counterpart
 
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Haats plays an important role in the rural
economy as well as in the social life of
villagers.
( m first point contact for villages with the
Market.
( m means of distributing local product
( mn opportunity for buying daily necessities
as well as farm supplies & equipments.
( m place for political, social & cultural
contact
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( ms per the 2001 census out of the
1.33 crore shops in India,
India,55
55 lakhs
are in rural areas.
areas. The type of outlets
found in villages are kirana store,
paan shops, Flour mills, tailor,
barber, Medical shops etc.
etc.
 è 
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* 
system is the distribution of essential
commodities to a large number of people
through network of fair price shops. shops.
Commodities distributed are wheat, rice,
sugar, edible oil & kerosene.
kerosene.

( Ofthe total number of FPS 80%

80% are in
rural areas.
areas.
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( The "Hariyali Kisaan Bazaar" chain, seeks to
empower the farmer by setting up centres,
which provide all encompassing solutions to the
farmers under one roof.
roof.
( Each "Hariyali Kisaan Bazaar" centre operates
in a catchment of about 20 kms. kms. m typical
centre caters to agricultural land of about
50000--70000 acres and impacts the life of
50000
approx.. 15000 farmers.
approx farmers.
( Each centre is engaged in:in:
( Bridging the last mile
mile:: Provides handholding to
improve the quality of agriculture in the area.
area.
Provides 24X
24X7 support through a team of
qualified agronomists based at the centre.
centre.
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( GODVEJ madhaar, the rural retail
initiative of Godrej mgrovet Ltd, has chain
of 18 stores providing a host of services
to farmers and their families.
families.

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CMIE which was the overall indicator
of rural market potential.
potential. m statistical
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with 10 selected variables related to
agriculture with the value of
agricultural production.
production.
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inputs
( Product characteristics

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characteristics.
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( Consumable inputs or capital input.
( High value or low value.

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farms.
farms.
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farms.
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farmers..
farmers
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( Fertilizer consumption depends upon
several factors like:
( Profitability of farming

( mvailability of irrigation facilities

( Introduction of new technology

( Introduction of genetically modified seeds.

( mvailability of fertilizers &

( Prices of fertilizers.
( Under the essential commodities act
(ECm)& the fertilizer control order (FCO)
the government is empowered to allocate
the quantities & territories to the
manufacture..
manufacture

( The FCO empowers the concerned state

governments agricultural departments to
test the quality of fertilizers.
fertilizers. For example
ammonium sulphate should contain 26. 26.6%
of nitrogen & urea 46%
46% of nitrogen.
nitrogen. This
has to be clearly specified on the fertilizer
bag itself.
itself.
 (6 "0 
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( Fertilizers are classified into three
different groups depending upon the
nutrients they supply to the crop.
( ëitrogenous),

( Phosphatic (P)

( Potassic (K).
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( Subsidy on fertilizer is common in most of
the developing countries, though the rate
of subsidy varies across countries & types
of fertilizer.
fertilizer.
( Since july 1991 there have been
considerable changes in the fertilizer
pricing policy
policy.. ëPK fertilizers were
decontrolled.. owing to the decontrol of
decontrolled
phosphatic & pottasic fertilizers their
prices shot up & the government had to
announce ad hoc subsidy to reduce the
burden on farmers.
farmers.
  
 
( The most common distribution channel for
fertilizer is from the supplier to the whole
saler & on to the retailer.
retailer. How ever a
manufacture can also supply to a retailer
directly & can also do retail business
directly..
directly
( some companies sell directly to farmers
through their company sales depots or
service centers.
centers.
( Generally co-co-operative network operates
through a 3-tier system.
system.
  
 
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are free to use their own promotional
measures & create a brand image.
image.
( since fertilizer are critical input for better
yields, thus promoting fertilizers must aim
first to highlight the usage conditions for
better yield & then create brand
awareness in the minds of farmers
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( In order to remain in business viably
the fertilizer companies need to
restructure their business in terms of
spreading the risk.
( The companies in fertilizer marketing
can think of cutting transportation
cost
 c( " "9
(
( The problem of storage & distribution
can also be tackled by undertaking
bulk vending of the product wherein
farmers can get the bags filled &
take home with the product,from
neighbourhood vending stations.This
will give the buyer a confidence
about the quality & weight of the
materials since filling will be done in
his presence.
 c( " "9
(
(m mobile unit mounted on a truck
can be operated by the dealers to
reach the product to far off rural
markets.o hooking of bags can be
prevented
( The losses due to hooking of bags
can be reduced by providing a loop
on both sides of the bag.
 8c1
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( In quality SHVIVmM UVEm is beyond
comparision
( * C

( m tradition of quality & service.

( 7$(+./
7$(+./7 
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( Set up to modernize agriculture &
strengthen co-
co-operatives worlds
largest plant.
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( m multi dimension approach towards
rural development
( 19 1
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( Progress through innovation

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( Suphala & ujjwala for you to double
your yield
yield
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( The happy smile-
smile-Farmer
 èá*' ïc
( The chemicals used for control of pests,
plant diseases, rodents, viruses etc are
broadly termed as agricultural chemicals.
chemicals.
( The agro chemical market can be
classified as follows.
follows.
( Insecticides

( Pesticide
Pesticide-- manocrotophous used for
killing mites in coconut trees.
trees.
( Fungicides

( Vodenticides

( Herbicides & Fumigants

 èá*' ïc

( The manufactures of agrochemicals

can be classified as

( Manufactures of technical grade

material

( Formulators
 èá*' ïc

( mll manufactures & formulators have

to register themselves with the
central insecticides board under
insecticides act 1968.
1968.
( ëo banned agro chemicals can be
manufactured or sold.
sold. mpart from
such restrictions formulators are free
to adopt any trade or brand name for
the products they manufacture.
manufacture.
 èá*' ïc

( The market for agro chemicals

depends heavily on the region & the
crops grown therein.
therein.
( since there are no significant
government controls the elements of
marketing mix are very much under
the control of the manufactures of
agro chemicals.
chemicals.
 1 #


( The formulators are free to

manufacture & market any
combination or concentration of
insecticide or pesticide from the
basic chemicals
chemicals..
( They are also free to give any trade
or brand name to their products.
products.
 1 #


( These products need an applicator

the insecticides or pesticides in
powder form require dusters for
application, while those in liquid form
require sprayers.
sprayers.
( Most co-
co-operative society at village
level & the departments of
agriculture of various state
government keep this applicators for
custom hiring to farmers
 1 #


( The big co
co--operative sector fertilizer
manufacture IIFCO stocks these
applicators in its agro kendras for
free use as a measure of service.
service.
 1
( The government does not control the
prices of agro Chemicals.
Chemicals. manufactures
are free to fix their own prices
prices..

( There are national players like Vallis,

Ciba, Bayer etc . mt times of serious pest
or disease attack the government
purchases agro chemicals & distributes
them at subsidized prices to farmers.
farmers.
  
 
( Distribution of agro chemicals is
similar to that of fertilizers.
fertilizers.
( Distribution is the most important
activity in the marketing of mgro
chemicals..
chemicals
( mppropriate chemicals have to be
made available quickly at the time of
disease.. Most of the chemical have a
disease
definite shelf life.
life.
  
 
( The manufactures should be able to
forecast the disease & move the
required chemicals rapidly to places
where the pest attack is noticed.
noticed.
( It is easy for local formulators to
supply the products in time as the
time available is very short & the
shelf life is also less.
less.
  
 
( since most of the chemicals are
poisonous in nature packaging
requirements along with instructions
how to use the products in the field
are of utmost importance.
importance.
 1   
( The promotion measures used to
promote agrochemical products are
usually same as used by fertilizer
manufactures/marketers..
manufactures/marketers
( The media generally used are
television, news papers, radio, wall
paintings, Hoardings & cinema slides.
slides.
 1   
( The major objective in promoting agro
chemical products is to educate the
farmers in using the product effectively &
efficiently..
efficiently
( mpart from advertisements in mass media
some of the effective promotional
strategies are below
( Field demonstrations.

( Conducting farmers meetings

( Gifting applicators & dusters

( Kisan melas & Credit facilities

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( frequently using the same formulation

results in developing a resistance
tendency by the organism.
organism.
( More dosage should be used in order to
control the pest & new formulations have
to be developed
( Irrigation, new varieties of seeds &
growth in population are all factors
favoring the growth of agro chemicals
 c(

( Irrigation,new varieties of seeds &

growth in population are all factors
favoring the growth of agro
chemicals..
chemicals
 M
( when applied in more quantity it is
injurious to human health.
health.
( DDT was banned in the country as it
was taking a call on the human
health..
health
 á 

( Focus on V & D will pay dividend in
the form of patents
 2
( ms agro chemicals will effect more on
human health when used more in
quantity an alternative chemical of
biological origin(Bio Pesticide) is in
demand..
demand
( so manufactures have to make new
inventions in their formulations
which will not effect human life.
life.
 . 1 #
( are the chemicals of biological origin
which is environment friendly.
friendly. ëeem
is the base for manufacturing bio
pesticide as it has properties of
killing pest & insecticide & which is
not harmful to human life.
life.
( Ex for ëeem based bio pesticide is
5

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 c''c

( Seed is the most important input

component for productive
agriculture.. The Indian seed industry
agriculture
is currently valued at Vs 2500 crores.
crores.
( The VOI depends significantly on the
quality of seed that is used in the
production of crops.
crops.
( Indian seed programme largely
adheres to the limited generation
system for seed multiplication.
multiplication.
 c''c

( The system recognizes three

generations namely breeder,
foundation & certified seeds.
seeds.

( Breeder seed is the primary stage of

the seed production cycle.
cycle. The
production of breeder seed is
organized by the Indian council of
mgricultural research
research..
 c''c
( Foundation seed is the one born out
of breeder seed & its is the
secondary stage of seed production
cycle..
cycle

( Certified
seed is the one born out of
foundation seed & distributed to
farmers in all the regions.
regions.
 c

 "c##

( The Indian seed industry used to be
dominated by public sector seed
companies.. how ever following the
companies
easing of government regulations the
private sector seed companies have
started playing a major role in seed
development & marketing.
marketing.
 c

 "c##

( The government decision to embrace
biotechnology as a means of
achieving food security has attracted
several leading bio technology
focused multinational seed
companies to India.
India.
 .   (
( Uses the methods and techniques
that involve the use of living
organisms Cells, bacteria, yeast, and
others..
others
( They are used in a number of fields
like food processing, agriculture,
pharmaceutics, and medicine, among
others..
others
( In mgriculture Biotechnology is used
to develop insect resistant products.
products.
 1
c c#  
 
( ëational seed corporation was
established in the year 1963 in order
to promote seed industry right from
production, processing,
storage,Marketing,&
storage,Marketing ,& establishing a
system of quality control
control..
( The state seed corporations were
established with the support from
the world bank, it covers 13 states
for production & handling of seed in
their respective states.
states.
7 2á7 ïc''cá1á 2á7<+
7c-<
( The ëational Seeds Corporation
(ëSC
(ëSC00 was initiated in 1961 under
the Indian Council of mgricultural
Vesearch..
Vesearch

( Later, on 7th March,

March,1963
1963,, it was
registered as a limited company in
the public sector
sector..
7 2á7 ïc''cá1á 2á7<+
7c-<

( The ëSC was established to serve

two main objectives:
objectives:
( first, to promote the development of
a seed industry in India and
( second to produce and supply the
foundation seeds of various crops
( Production and supply of foundation
seed..
seed
m
!"  
( To maintain improved seed stocks of
improved varieties
( Interstate marketing of all classes of
seed.
( Export and import of seed.

( Production of certified seed where

required.
m
!"  
( Providing technical assistance to
seeds corporations and private
agencies..
agencies
( Co
Co--ordinating certified seed
production of several State Seeds
Corporations..
Corporations
( Conducting surveys of seed demand.
demand.
( Planning the production of breeder
seed in consultation with ICmV
ICmV..
m
!"  

( Coordinating market research and

sales promotion efforts.
efforts.
( Providing training facilities for the
staff participating in seed industry
development..
development
( Providing certification services to
states lacking established and
independent seed certification
agencies..
agencies
 1 # 
( Easing of government regulations in
the late 1980 opened enormous
development within the seed
industry by attracting several forgien
seed companies to india.
india.
( Most of the large multinational seed
companies now have their presence
in india either as a joint venture or
with 100
100%% equity
equity..
( Monsanto, bayer & others.
others.
 ( "c##

( Marketing of seeds is more complicated &
specialized process as compared to
marketing of other agricultural inputs.
( ms seed quality deteriorates faster
production of good quality of seed is of
no value if it does not reach the farmer in
time.
( the non availability of improved seeds of
high quality deprives the farmers of the
advantages of modern technology.
 ( "*#
( Seed or plants produced as the result
of controlled pollination as opposed
to seed produced as the result of
natural pollination
 1 #


( Seeds are perishable product by nature.

nature.
Its demand is seasonal & derived.
derived. The
demand for seeds depends on the
following various factors.
factors.
( .climate

( 2.Prices of the crop under consideration.

( 3.prices of other crops.

( 4.Information about the market

 1 #

( Because of the this nature of the
product a proper care & co- co-
ordination is required at various
stages of marketing process like
production of seeds, Pricing,
distribution & promotion of the
product..
product
 1(
( The prices of ordinary quality of seeds
transacted between farmers usually from
large farmers to small farmers or from
traders to the farmers are derived from
the prevailing grain prices.
( Prices of such seeds therefore tend to be
only marginally higher than the grain
prices. however the prices of improved
varieties of seeds & seeds of high yielding
varieties tend to rule much higher than
the grain prices.
 1(
( In the public sector the ëational Seed
corporation usually is the retail price setter.
setter.
( There is government intervention in pricing of
seeds produced by public sector corporations
with the degree of intervention varying from
state to state.
state.
( The government on a cost plus basis
determines the prices of seeds marketed by
national seed corporation.
corporation.
( Even dealers commission is considered in
arriving at the prices of seeds.
seeds.

# 
( The public sector companies as well
as private sector firms, distribute
seeds through a network of
distributors & dealers
 Co.Op mgro Vesearch
Distributors Mktg.Fed Ind.Corpn Institutes

mffiliate
Block Level mgri
Dealer primary
Offices Universities
society

Member
Vetailer Farmer Farmer
Farmer

Farmer

# 
( The above mentioned distribution
channels are used for selling all kinds
of seeds including food grains, oil
seeds, spices & vegetables.
vegetables. The
companies appoint distributor for a
region that may consist of one or
more states
( These distributors appoint dealers at
district level. They are appointed on
non exclusive basis.

# 
( The ëational seed corporation & the
state seeds corporations have their
own sale points for seed marketing.
marketing.
In some states department of
agriculture also sell seeds through
their field staff
staff..
( The agro industries corporations of
the states encourage private
entrepreneurs to establish agro
service centers in rural areas.
areas.
 1   
( Building trust with the farmers by means
of advertisement/promotion is not
enough.. It is more about involving the
enough
farmers, providing quality seeds in
sample & encouraging them by showing
the results of the product that leads to
build loyalty for the product.
product.
( Wall paintings, hoardings, krishi melas
melas,,
exhibition ,radio, Television & video
shows are the most commonly used
promotional tools.
tools. The effective way can
be supplying free samples to the farmers.
farmers.
c   
 

 

( Due to high competition most of the

private companies & MëC are using
creative promotional tools to reach
the cultivators or farmers.
( ITC Zeneca chooses a few farmers
before the growing season & gives
the company seeds to plant along
side local varieties.
c   
 

 

( mt the time of harvest hundreds of

farmers from the nearby areas are
invited to a field day where the
grower narrates his experience of
growing the particular seed & the
results of it to other farmers.
farmers.
 ,
 );
"# $

( This is another area where a number

of multinationals & Indian companies
are very active like HUL & godrej
agrovet..
agrovet
( The milk production in the country
got a big boost with the
implementation of operation flood
programmes..
programmes
,
);
"# $

( Some big names in the Indian

poultry business are venkateshwara
hatcheries,Deejay hatcheries &
others.It is better for the farmers
who have taken up poultry business
to buy the feed from organized
manufactures since it takes care of
balanced nutrition.
 ,
);
"# $

( Shrimp farming is on the fast track

due to the export opportunities.
Many coastal areas of mP, Të,
Pondicherry,orissa are into shrimp
farming.