Presentation ON Rural Marketing Mix

Presented by: Aradhana Bhopte Ravneet Kaur

Rural Marketing Mix

Marketing Mix refers to the set of actions, tactics, tools or variables that a company uses to promote and sells its brand or product in a markets

4 Ps of Rural Marketing

Every Product and promotion, which is a hit in cities , might not work in rural areas

Product

Price

Place

Promotion

 Product :Product refers to anything that is capable of

or can be offered to satisfy need or want?

Price :Price refers to the amount the customers has to

pay in order to acquire a product or services 3Cs of Pricing Customer Value Competitors Prices Cost of Company

 Place : refers to point of sale. Promotion: This refers to all the activities undertaken to make the product or service known to and preferred amongst the user and trade.

Product
Product for rural market must be built or modified to suit the lifestyle and needs of the rural consumers . Product Strategies 1. New/Modified Product. 2. Utility Oriented Product 3. Avoiding Sophisticated Packaging 4. Application of value Engineering. 5. Small unit packaging

 New/Modified Product Designs The research,

Manufacturing and marketing departments need to think in terms of new product design specially meant for rural areas, keeping in view their styles. The rural product usage environmental factors must be considered while developing the products meant for the rural audience. Nokia 11oo Model is a very good example of a customized model for rural markets. Utility Oriented Products The rural consumer are more concerned with the functional utility of the product than its appearance and sophistication. Therefore, unnecessary frills can be taken off the product for rural market as the rural consumer is not likely to use them and this will make the product more affordable too. This will also reduce

 Avoiding Sophisticated Packaging Rural consumer

are more interested in the sturdiness and utility of the product; it is possible to avoid sophisticated packaging, which adds to the cost considerable Application of value Engineering To evolve cheaper but quality products, companies need to go for value engineering and substituting the costly raw material with the cheaper one.
Small Units Packaging Given the low per capital

rural income and purchasing habits of the rural consumer, small unit packages stand a good chance of acceptance in the rural market.There is a generally held belief that small packs are good for rural markets while large ones are good for the urban markets .

Price
The villagers due to their limited resources are

very price sensitive by nature. Pricing Strategies Large Volume low margin Overall Efficiency And passing on benefits to consumers. low cost/ value for money product Low volume-low price.

 Large Volume Low Margin : Rapid or slow Penetration

strategy Marketers have to focus on generating large volumes and not big profit margins on Individual products. If they price their product at a level which can lead to good volume, then they can still generate good returns on the capital employed. Low cost/ value for money products- This follows from the product strategy. The price can be kept low by smaller unit packaging or re-engineering. No frill functional products at a low cost are perceived to have better value in the rural market than higher priced, value added products, with features that a rural consumer is not going to use.

 Overall Efficiency & Passing on Benefits to consumer For

rural products , the strategy should be to cut down the production, distribution and advertising costs and passing on these benefits to the consumer to further increase the turnover. Most often , it has been observed that advertising has less to do with product sales in the rural areas. If an organization right, then it can work in the rural market. Low volume low price strategy- This strategy of reducing prices by reducing the package size in order to make it appear more affordable, is delivering very good results for a large number of FMCG product categories, in the rural markets of India. In categories where maintaining the price point is extremely critical, this strategy is delivering very good results

Examples
Godrej recently introduced three brands of Cinthol, Fair Glow

and Godrej in 50-gm packs, priced at Rs 4-5 meant specifically for Madhya Pradesh, Bihar and Uttar Pradesh.
Hindustan Lever, among the first MNCs to realise the potential

of India's rural market, has launched a variant of its largest selling soap brand, Lifebuoy at Rs 2 for 50 gm

Place A village as a place for promotion, distribution, and consumption is very different from town or city)

Place Strategy
Segmentation

Coverage of villages with 2,000 and above

population Distribution up to feeder markets/ Mandi towns. Direct Contact with rural Retail

 Segmentation- The number of village in India is

huge and it is not viable to contact and serve all the village directly therefore, companies or distributors can carefully examine the market potential of different village and target the village that can be served in a financially viable manner through an organized distribution effort. Coverage of village with 2000 and above population- By organizing distribution up to this level, the percentage of villages covered, comes to only 10 % of all the village, but the rural population covered will be substantial, to the extent of about 40 % to 45 %. With a distribution network in about 55000 villages, which have a population of 2000 person and above each, one can cover about 25 crore rural consumer. This strategy is good to begin

 Distribution up to Feeder Market/ Mandi Towns-

The feeder market and mandi towns offer excellent scope for distribution, especially for consumer durables. The rural consumer visit these towns at regular intervals, not only for selling their agricultural produce but also for purchase of cloth, jewellery, hardware, radios, torch cells and other durables and consumer products. But consumer goods companies have to now think beyond these towns and block headquarter. Direct contact with Rural Retail- Along with the efforts of wholesalers and dealers, companies need to have direct points of contact with retailers and sub-retailers in the rural areas . If they want to have a strong network. There is no substitute for stretching direct communication to the village level.

Promotion
Promotion aspect always creates a challenge in rural

markets because of the fact that village have thin population density and are widely spread over large remote areas. NCAER conducted survey to study the socio economic effects of advertising ; the India Society of Advertisers sponsored this survey. It covered 3,836 household in 50 towns and 50 rural district in 10 states. It showed a clean rural urban divide, 16% of rural and 25% of urban customers felt that advertising influenced them to frequently or always buy products they do not really need.

Media Vehicles
The marketers has to develop an appropriate combination of traditional mass media and unconventional media for different regions to take the message effectively to the rural audience.

 Mass Media: When it comes to rural market, two

out of five Indians are not reached by any media: TV , Press, Radio and Cinema put together.
Television

Radio
Print media Cinema

Hoarding/Wall Painting
Unconventional Media- Media, as perceived in the

urban market, does not cover as much as 43% of rural India. This means that organizations must think of innovative ways of reaching the rural consumer. Haats,

mandis and meals are opportunities in the form of unconventional ways to really reach the rural consumer.

Additional Ps of Rural Marketing

Passion
Passion to earn Goodwill for the company. Passion to serve and educate the consumer Passion to give 100% to the rural marketing effort

Pace
Product intended to be sold in the rural market need to be launched into the heart of the customers, at the pace required in the rural market and not at the pace at which the company wants it to be.

Examples of rural marketing mix

Noika develop affordable Mobile phones for

rural markets with unique features such as local language capabilities, present time/ call limits etc. Philip develop a TV Vardaan for rural markets. This TV work on the voltage 90-270 volts. Philips developed Free Power radio this radio do not require power and battery also. it run on simple winding of level provided in the set. The price of this attractive set is Rs. 995.

 LG developed CTV called CinePlus was

launched in rural markets price Rs.5000 Hyundai increases focus on Rural India
New promotional scheme titled - Ghar Ghar Ki Pehchaan'. In this first of its kind initiative, Hyundai Motor would extend special schemes for government employees in rural areas and members of Gram Panchayats on the purchase of the Hyundai Santro Launched on May 1, the Ghar Ghar Ki Pehchaan' scheme will continue till July 31, 2008. Through this special rural scheme Hyundai Motor India plans to touch base with at least 58 per cent of Indian villages with a population of 500 or more.

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