Consumption Pattern in Rural Maharashtra

Babli Sara Babu, Vidya Dabholkar, Subhash Davda, Karen A. Dias, Aditya Dixit, Fenil Gutka, Khushboo Jain, Sohail Sayani, Nilisha Shah, Shashank Subramanian Post Graduate Diploma in Management- Business Design,Welingkar Institute of Management Development & Research, Mumbai- 400 019.

Abstract
Rural India, with its own set of needs, aspirations and expectations varies greatly from urban settlements. The aims of the journal are to highlight and encourage socially relevant and useful research in various fields of rural studies. Through on field interviews and observational research, insights were obtained into the rural mindset. Accordingly, suggestions were made to address existing loop holes. The objective of this communication was to assess the consumption pattern of among the rural population in India, utilizing a sample population from the state of Maharashtra. It was concluded that rural life demands effective communication of economical and practical products and SKUs. Keywords- rural, lifestyle, consumption pattern, agriculture, sustainable, innovation

1. Introduction
70% of India's population lives in 627000 villages in rural areas. 90% of the rural population us concentrated in villages with a population of less than 2000, with agriculture being the main business. This simply shows the great potentiality rural India has to bring the much - needed volume- driven growth. As per the National Council for Applied Economic Research (NCAER) study, there are as many 'middle income and above' households in the rural areas as there are in the urban areas. There are almost twice as many' lower middle income' households in rural areas as in the urban areas. At the highest income level there are 2.3 million urban households as against 1.6 million households in rural areas. The urban and rural consumers differ in their consumption pattern; this can be attributed to following factors: Age and life cycle stage Occupation Economic condition Life style Self-concept and personality Psychological factors (like perception, motivation, cognition etc.)

Rural population is strongly bounded by tradition, custom and values (both cultural and moral) which bring about enormous difference in their life style and personality when compared to urban counterpart. Page 1 of 7

These were studied over the course of 4 days of on field study. In addition sources of income and technological advances too were dealt with, shedding light on local innovation and unconventional practices. This paper deals with these varied aspects of rural lifestyle and attempts to decode the consumption pattern in rural Maharashtra.

2. Research Questions
What are the various expense heads and according what do villagers typically invest in and save for? What are the aspirations that would define the current & future drivers for consumption in rural markets? How can these be exploited to obtain novel sustainable, economical, solutions & employment generation? 2.1 Research objectives & Motives To study the consumption pattern in rural areas and gain insight into their lifestyle, identify need gaps & opportunities; and thus propose sustainable solutions for bothcommercialization and employment generation. 2.2 Learning objectives Implementing academic knowledge and existing models so as to find congruence between theoretical and practical frameworks. 2.3 Limitations Sample size includes 6 villages in from the Satara District of Maharashtra, India. Generalization, with regards to the entire country may not be possible, the geographic expanse will provide for diverse needs, wants and hence, consumption pattern. .

3. Literature Survey
3.1 Definitions 3.1.1 Urban Unit (or Town): All places with a municipality, corporation, cantonment board or notified town area committee, etc. (known as Statutory Town) All other places which satisfied the following criteria (known as Census Town): A minimum population of 5,000; At least 75 per cent of the male main workers engaged in non-agricultural pursuits; and A density of population of at least 400 per sq. km.

3.1.2

3.2 Theory Rural consumers have low per capita income which is reflected in their consumption pattern. Further rural market is still under developed and is characterised by low level of consumer awareness. The communication vehicle in the rural area comprises of radio, print, puppetry, melas, folk theatres and pre dominantly word of mouth. Page 2 of 7

The strength of rural marketing lies in four As i.e. Affordability, Availability, Awareness and Acceptability while the weakness includes low per capita income and illiteracy. Rural market has been growing at 3-4% per annum, adding more than 1 million new consumers every year and now accounts for close to 50% of the volume consumption of FMCG products. The market of FMCG sector is projected to be more than double of US$ 23.25 billion by 2010 from present US$ 11.16 billion.

Fig: Basic model of rural consumer behaviour

Factors influencing buying behaviour: The various factors that affect buying behaviour of in rural India are: 1. Environmental factor: The environment or the surroundings, within which the consumer lives, has a very strong influence on the buying behaviour. For instance electrification, water supply affects demand for various durables. 2. Geographic influences: The geographic location in which the rural consumer is located also speaks about the thought process of the consumer. For instance, villages in South India accept technology quicker than in other parts of India. Thus, various watch companies sell more winding watches in the north while they sell more quartz watches down south. 3. Influence of occupation: The land owners and service clan buy more of Category II and Category III durables than agricultural labourers/farmers. Also the amount of disposable income available at a given instance differs based on occupation, which ultimately affects buying behaviour. 4. Place of purchase: Almost 60% of the rural consumers prefer haats due to better quality, variety & price. Companies need to assess the influence of retailers on both consumers at village shops and at haats. 5. Creative use of product: A classic example of this is hair dye being used as a paint to colour horns of oxen, Washing machine being used for churning lassi and so on. The study of product end provides indicators to the company on the need for education and also for new product ideas. Page 3 of 7

Cultural factors influencing consumer behaviour Cultural factors exert the broadest and deepest influence on consumer behaviour. Culture is the most basic element that shapes a persons wants and behaviour. In India, there is huge diversity of cultures, which only goes on to make the marketer's job tougher. Some of the few cultural factors that influence buyer behaviour are: 1. Product (colour, size, design, shape): There are many examples that illustrate this point. For example, the Tata Sumo, which was launched in rural India in a white colour, was not well accepted. However, when the same Sumo was relaunched as Spacio and in bright yellow colour, with larger seating capacity and enhanced ability to transport good, the acceptance was way higher. Another good example would be Philips audio systems. Urban India looks at technology with the viewpoint of the smaller the better. However, in rural India, this viewpoint is in stark contrast; this is the main reason for the large acceptance of big audio systems. Thus Philips makes audio systems, which are big in size and get accepted in rural India by their sheer size. 2. Social practices: Huge diversity of cultures results in each culture exhibiting different social practices. For example, in few villages there are common bathing areas. So villagers buy one Lifebuoy cake and cut it into smaller bars. This influenced Unilever to introduce smaller 75-gram Lifebuoy bars, which could be used individually. 3. Decision-making: Indian culture is largely male dominated and hence males are given the designation of key decision maker. For example, the Mukhiyas opinion (Head of the village), in most cases, is shared with the rest of the village. Even in a house male head is the final decision maker. In rural areas, this trend is very prominent.

Page 4 of 7

These factors along with marketing offer and mix generate stimuli in minds of rural customer and create an urge to purchase product. The actual buying process takes place as per stimuli and buying behaviour of the consumers.

Fig: Rural buying decision process

4. Methods
The Consumption Pattern that comes under Agriculture, Education, Kirana stores and Hospitals were studied in detail. Individuals from different families of various income groups, ages and different hierarchies in the village were questioned. Various methods were used for the research. The main ones being questions, both open ended and closed ended, observations and visual mapping. In the Visual Mapping method, lot of pictures belonging to the four categories viz. Basic, Fashion, Technology and Traditional were collected and put together to show the villagers. They were asked to pick out any one picture of their choice. Different individuals differing on the basis of their sex, age, income level, occupation and their position in the village chose showed similar interests and wants. Observation was one of the main areas of research. They way they behave and their attitude towards generic questions and statements helped in the gathering of most of the findings and conclusions of their consumption pattern style. Observations and findings through interviews and visual mapping were both quantitative and qualitative. A very clear idea about their lifestyle could be drawn out with the help of statistics, in terms of the population of the village and other statistics regarding their consumption pattern lifestyles.

5. Empirical Study:
1. Inclination towards cosmetics: Women used fair and lovely and ponds powder. Also during festivals and birthdays nail paints and lipsticks were used. Hair dyes were used on a small scale too. 2. Proactive in clothes buying for almost every occasion: During diwali, ganpati, melas and birthdays parents buy new clothes for their kids. Also clothes for every member are bought for festivals. 3. Detergents and soaps and tooth pastes: Most of the households used wheel for washing clothes and vim for utensils, while body soap was lifeboy. There were a few BLP families which used rakh for cleaning the utensils. The most prefered toothpaste was colgate which majority of households used.

Page 5 of 7

4. Digital connection and TVs: Dish tvs, prominently airtel connection was used. Colour TV penetration being 100%. 5. Vehicles: Most of the households were having four wheelers and almost all were having bikes.

6. Discussion
Our study in this rural region gave us an insight into the lives of 70% of the nation. Following are a few of them: Buying power was in the hands of men. Thus, lack of readiness to try new products. Marketing strategies should be such that they convince the man of the family. Shopping is extremely need based. Festivals are the only time they really splurge. Thus, new product launches should be planned according to the festivals celebrated the most (eg. Diwali) especially for clothes These people are very brand conscious. They all use the same brands too (Colgate Toothpaste, Wheel Detergent, Lifebuoy Soap). If one want to change their brand of choice, efforts should be such that the entire village switches. This is because the villagers have a need to blend in. Movie theatres are dying out since the advent of DTH in these regions

7. Ideas and Innovations

9.1 Cooler bags The primary reason why a lot of rural folk are unable to enjoy the benefits of products that need cooling is because of the erratic electricity and load shedding. However each house is fairly cooler than the temperature outside. Our first idea to help them is to create bags with cooling gels so as to be able to store cooled products and the fully sealed bag will remain underground where the temperature is even cooler. The nitrous oxide filled gel will accelerate the process of the cooling and will require zero variable cost or electricity. It can also be given like fridges are in urban areas by soft beverage giants so as to increase their sales, and reaching out to far more rural customers. 9.2 Oyster Mushroom farming In rural Maharashtra especially near the Baramati belt, the sugarcane production is highly proliferating and consists of the massive cultivable land. The biggest by-product to come out is that of bagasse and molasses. The bagasse is an extremely versatile substrate for the farming of oyster mushrooms which can grow within plastic bags filled with bagasse and having perforations. Once the oyster mushrooms have grown, they are extremely nutritious and can sell at a sizeable premium in urban market or be utilized for cooking for a healthy meal within the family. The versatile substrate of bagasse then converts itself into highly effective compost which can be utilized for their agriculture. 9.3 Mini Tutors The primary aspiration that all parents were found to have is for quality English education for their children. The pain point lies in the fact that English schools are often far away and the transport charges supersede that of the education itself. Page 6 of 7

The innovation lies in utilizing existing aanganwadis (crches for children and pregnant mothers) and train existing educated women of the village to be able to impart a good form of pedagogy in the houses that are larger in the village. Hence each village will be able to maintain smaller, mobile schools and everyone will be able to avail of extremely cheap or free education for their children. 9.4 Aaanganwadi Contraception Pregnant women are taken care of by the crches in all villages in terms of education and nutrition during their pre-natal period. This proves to be an excellent opportunity to educate women about the benefits of contraception and create small centres for sampling first, and adoption through purchases as a secondary phase.

Conclusion
It can be concluded from the research that the rural population demands a marketing mix different from that required by an urban society. Thus, in order to cater to this diversity, the stated suggestions would prove effective; and it is recommended that these be implemented through a trial based module before scale up to State Level is carried out. In addition, we can conclude that the print and television media, along with local radio are most effective in these areas and therefore should be exploited optimally to create demand and improve sales. However, media planning (if existent) is minimal, and leads to wastage or unemployment of disposable resources in a rural setting. Finally, WOM i.e. Word of Mouth continues to be the most effective tools for promotion and therefore, the marketing mix should include elements of a well defined positioning (identified through STDP analysis), which will assist in building brand equity and aid success in rural markets.

References:
Dhumal M., Tayade A., Khandkar A.- Rural marketing- Understanding the consumer behaviour and decision process. Kothari, C.R., 2004, Research Methodology,New Age International Publishers Pvt. Ltd. Kotler P., Keller K., Koshy A., Jha M., 2007, Marketing Management. 13th edition, Prentice Hall. Rural marketing in India: Strategies and challenges; Ruchika Ramakrishnan. Hitendra Bargal -Promotion of Brand in Rural Market of India Govt. Of India, Ministry of Home Afairs, Census 2011 Provisional Population Totals - Maharashtra

Page 7 of 7