Segmenting Indian Rural Market

Segmentation is the subdivision of a market into homogeneous subsets of customers where any subset may be selected as a target market to be reached with a distinct marketing mix.

50% of rural people are engaged in agriculture and they can not be clubbed under one category of farmers.
There is a need to classify farmers under different customer segments. Further the remaining 50 % of rural people are engaged in non farm activities. Rural customers could be segmented on the basis of self employed farmers, daily wage labour, salaried employees, traders etc. There are factors which indicate heterogeneity of rural markets: socio-cultural differences across regions, variation in population size, difference in the levels of infrastructural development. Variation in literacy levels.

Prerequisites for effective Segmentation

Measurable Accessible

Differentiable
Substantial

Degrees of Segmentation Mass MarketingColgate-Palmolive successfully marketed the same Colgate toothpaste to all consumers in urban and rural markets.

Segment Marketing-

Hindustan Lever uses this approach for introducing four variants of brand- Lifebuoy Active Red, Active Orange, Plus and Gold to reach four different segments of the Indian Market.

Niche Marketing- Caters to very small group in a segment with some

specific and distinct need which the marketer satisfies through specific skills. The GoldPlus Brand of jewellery from the TATA GROUP. Ghari detergent has used a unique parameter to segment the Indian market.

Micro Marketing-

Micro Marketing refers to the tailoring of products to satisfy a particular taste or need. E.g Daburs Anmol hair oil, a mustard amla based oil launched for northern Indian markets at INR 10 for a 50 ml pack targeted at rural consumers using loose mustard oil.

Bases for Segmenting Rural Consumer Markets

Geographic Segmentation- Rural customers can be segmented according to geographic factors like region, state, villages and climate. Demographic Segmentation- Rural customers can be segmented on the basis of demographic factors like age and lifecycle, family structure, socio economic class, religion and caste. Psychographic Segmentation- Psychographic include factors such as personality traits, lifestyle and value systems. Behavioral Segmentation- Involves many parameters such as purchasing occasions, benefits, user status, loyalty status and place of purchase.

Multi-attribute Segmentation- Uses various variables together to effectively segment the consumer markets.

MART team has focused their efforts to develop their own solution to this problem based on their extensive knowledge of and insight into rural markets. MART MAS comprises four factors- means, consumption awareness and infrastructure and has been adjusted to the population size. Provides a single index to aid marketers in selecting the best fit locations across the range of Indias population centers from urban India to rural India. Each factor reflects the components of interest to marketers and therefore each has a particular merit for being considered in its own right.

Targeting Rural Market

Targeting involves evaluating various segments and selecting how many and which ones to target. The three aspects in targeting are evaluating, selection and coverage.

Evaluation of SegmentsFactors considered while evaluating segments1. Overall Attractiveness- The criteria for measuring the attractiveness of a segment
are size, growth rate, accessibility, profitability, low risk.

2.

Company Objectives and Resource Competencies- HUL and ITC have initiated
Project Shakti and e-choupal pilots which have been transformed into mega rural marketing models.

Selection of SegmentsAfter evaluating segments, the same can be selected by rating them on pre-determined scale(low, medium, high) with respect to evaluation factors.

Coverage of Segments- Organizations have three coverage strategies to suit their

segmentation approaches.

Segmentation Coverage strategy Type of Marketing

Zero

Substantial

Selective Concentrated

Undifferentiated Differentiated

Mass Marketing Segmented Marketing Niche Marketing Nirma Lifebuoy Multiple brands of soaps of HUL

Example

Ghadi Detergent is using undifferentiated Marketing.

Coverage StrategyThe marketers approach towards strategy selection changes with reference to the state of four variables- company resources, product variability, product life cycle stage and market variability.

Mahindra and Mahindra have developed differentiated strategy as these companies have large resources and more product variability.
FMCG Major players are HUL, Dabur, Marico, Colgate Palmolive, Nirma, CavinKare and Godrej Consumer Durables Usha, Bajaj, Philips, Titan, Godrej, Videocon, Onida, Salora, Hero Cycles, Hero Honda, Mahindra & Mahindra and Tata. New entrants LG, Samsung and Maruti. Agricultural Products Agricultural inputs such as seeds, fertilizers, pesticides, insecticides and implements (tractors, tillers and threshers) Livestock, poultry and fishery. Major players are Rallis India, Monsanto, DCM Shriram, Chambal Fertilisers, IFFCO, Mahindra & Mahindra, Eicher and Escorts. Services Telecommunications (BSNL), transport, health care, banking (SBI), insurance (LIC) and education

Positioning The act of designing the companys offering and image to occupy a distinctive place in the mind of the target segment.

It is defined by consumers on the basis of important attributes. Companies have to plan positions that give their products the advantage in the target market. Positioning involves identifying the unique feature of the product, selecting the differences between this offer and communicating such advantages to the target audience. Positioning begins with the construction of a visual map of the customers mind. TATA Motors launched its mini truck ACE and positioned it as Chota Hathi. Tata Ace is in the minds of consumers.

Identifying the positioning concept

Product differentiation
Service differentiation

People differentiation
Image differentiation

Factors while Selecting the brand positioning

Attractive

Distinctive
Preemptive

Affordable
Communicable

Positioning involve following steps

1. Identification of unique feature of the product (USP) as well as difference between the offer and competitor 2. Selecting the differences that have greater competitive advantage

3. Communicating such advantage to the target audience

Product Strategy
Marketers can penetrate the rural market by designing innovative products done successfully by companies such as LG, Phillips, HUL. In 1998 LG electronics developed a customized television for rural market called SAMPOORNA. 1lac sets were sold in the first year. Phillips launched its Free power radio especially for rural India. Cadbury launched chocoBix a chocolate flavoured biscuit based on consumer insight that rural mothers opt for the more affordable biscuits rather than expensive chocolates. Tata Ace was launched in 2005 for satisfying the rural customers.

Eveready introduced plastic torches in urban market but no takers in rural market as farmers prefer heavy brass torches.
Micromax Mobile launched in 2008 targeted rural Indian consumer with its feature packed economically priced handsets.

Essentials of a Product to be in rural market

Appropriate for the rural environment Simple to operate Visually identifiable Affordable

Rural Product Classification

Rural products can be classified into four broad categories- fast moving consumer goods , consumer durables, services, agricultural goods.
Rural markets currently account for more than 50% of the total FMCG consumption in the country. Rural penetration for products like edible oil, washing powders, tea and biscuits is more than 75%. Consumer durables include products like home appliances, automobiles and furniture. The major durables player in rural markets are Usha, Bajaj, Phillips, Titan, Godrej, Videocon, LG, Hero Honda, Mahindra and Mahindra

Major services in rural India include healthcare, telecommunication, information communication technology, banking, insurance and education. This category is led by players like LIC, SBI, BSNL and new entrants. Agricultural goods include agricultural inputs such as seeds, fertilizers, pesticides, and implements. The major players in this segment are DCM, IFFCO, Mahindra & Mahindra.

Marketers have to make product decisions at three levels: individual product decisions , product line decisions, and product mix decisions. Individual product decisions are governed by product attributes like quality, features, design and style.

MAX Gas introduced leakage protective gas cylinder for rural consumers.
Godrej Chotu Kool is an example of product design for rural market. After developing products a company needs to create an appropriate product line and product mix for rural markets. Product lifecycle in rural market is often longer than it is urban market. Each stage lasts longer in rural markets due to the multiple challenges involved in the distribution, communication and adoption of the product.

Many products launched in rural markets without serious planning die out. Examples include AIM toothpaste from HUL and Ruf-n-Tuf ready to stitch denims.

Brand association is mainly with colours, numbers and visuals For example ColoursLal Dant Manjan, Lal Sabun (lifebuoy), Red battery(eveready)
Numbers- Godrej no. 1, 555 detergent bar, 502 pataka chai

Visuals- Ghadi, Rath vanaspati, Wagh Bakri tea, cycle agarbatti

Building brands in rural market comprises of three important decisions1. Developing a brand name 2. Creating a brand identity 3. Building a brand image Horlicks Asha is another low cost variant for rural market. Godrej introduced small pack sizes of its three brands- Cinthol, Fair Glow, Godrej No 1.

Pricing Strategy
With about 75% of the Indian population living in rural areas and representing half of the countrys buying potential even today, the Indian economy can be developed by improving the living conditions in rural areas.

A rural consumer is always a budget seeking consumer.

It is essential to first match a products expectations and its pricing structures. It is to be noted that most of the rural population comprises of daily wage workers who tend to have minimal stock of money The products in the rural market should be able to meet the basic needs of the consumer, as a rural consumer shall not be willing to pay additionally for extra benefits. This makes pack sizes and price points all the more important. For instance, a rural consumer would prefer buying a shampoo sachet to a large bottle which could be used for over a month.

A clear understanding of the Value for Money concept in the rural areas shall be the major differentiating factor between a successful brand and its competitors. HUL discovered that Indians in the rural areas used soaps for multiple purposes. This resulted in the design of all-in-one soaps which was a huge success. First established in 2002, Hariyali Kisaan Bazaar represents a retail revolution in rural India. By understanding and supplying farming families with all their agricultural and household needs, the Hariyali centres aim to engender trust and provide their customers with quality products and long-term advice. Godrej Aadhaar(started in 2003) is a program of Godrej agrovate for rural India. Lower prices/smaller packaging has been the most common strategies adopted by FMCG companies to penetrate rural markets. HLL initiated Operation Bharat to tap rural market by rolling out low priced sample packets of its toothpaste, fairness cream, shampoo, cream and other products. Similarly LPG companies have introduced small sized cylinders ensuring that price remains in the affordable range for its rural consumers. The rural audience better receives tailor-made products as the consumers feel empowered and tend to identify with the offering. For instance, shampoos or soaps with distinctive, strong rose or jasmine perfumes are very with the rural women in South India. The urban women do not identify as strongly with these perfumes.

Setting the price for rural products and services

Internal Factors1. Cost- promotional cost and distribution cost

2. Pricing objectives of the company- profit maximization in the long run, minimum returns on sales turnover, deeper penetration of the market, keeping up with competition, increasing sales volume and market share.

External Factors1. Price sensitivity of customers 2. Channel costs 3. Competition 4. Environment

Videocon introduced a washing machine without a drier.

Phillips launched a low cost smokeless chulha (stove), DCM Shriram developed a low cost water purifier especially for rural areas.

Price setting strategies include Market entry strategies, product mix pricing strategies and Price Adjustment Strategies and Rural specific pricing strategies.
Market entry strategies include skimming pricing , penetration pricing P& G introduced Ariel and Tide at high prices then later reduced them. Anchor white and Ajanta Toothpaste uses penetration pricing to enter the crowded dental cream market. Product mix pricing strategies include optional product pricing, captive product pricing, product bundle pricing.

Optional product pricing is pricing of optional products along with the main product A company selling tractors for a lower sticker price, but charging high prices for servicing and spare parts.

LG, Samsung, Onida are using this pricing strategy to penetrate into villages.
Captive product pricing is setting price for products that must be used along with the main product such as film for camera. Product bundle pricing involves combining several products and offering the bundle at a reduced price. It is extensively used during festival. HUL launched a combo pack comprising a Clinic shampoo bottle, tube each of pepsodent, Fair & Lovely and a Ponds Dream flower talc for rural areas. Price Adjustment Strategies include discounts and allowance pricing, special event pricing, economy pricing, value pricing, psychological pricing, discriminatory pricing.

 Discount and allowance pricing has the effect of reducing prices to reward

customer responses.
Rural people are price sensitive and hence discounts play an effective role in giving rural customers a rationale to purchase goods. Good Night Mosquito coil offer 1+1 scheme. Special event pricing Companies offer products at reduced prices in rural markets at certain times of the year such as the wedding season etc. Hero Honda ran a van campaign before the harvest season in rural areas took bookings against a token deposit of INR 500 and gave watch free in return. Economy pricing Maharaja Appliances Limited has launched a range of no frills home appliances, bonus for the rural and semi urban markets. Earlier LG had television sets priced at Rs 20000 but now they cost Rs 8000. Value Pricing is used in cases where external factors such as economic recession or increased competition forces a company to provide value product and services to retain sales. Godrej No 1 place their offerings containing rose, neem ingredients at economical price.

Psychological Pricing- The price-quality relationship refers to the idea that consumers tend to equate product quality with the price charged. Discriminatory pricing is selling the same product or service at different prices. A hospital targeting the rural masses could charge lower fees for women and senior citizens. Rural specific strategies include low price points, low cost packaging, reusable packs, coinage pricing, product-sharing services. Some of the brands that HUL sells for INR 5 are pepsodent, ponds dreamflower, Rin, Taaza, Fair & Lovely. Product sharing services example is HPCL Rasoi Ghar Model. A community kitchen is set up in smaller villages where women come and cook. Once they are satisfied they buy individual connections. Reusable packs means where empties can b e used for some purpose. Low cost packaging- Britannias Tiger business is doing good business in rural markets because of its small affordable packaging.

Packaging should also be done accordingly in smaller units and lesser priced packs, thereby making them affordable. Physical distribution becomes arduous due to high costs involved and the non availability of retail outlets. Melas & Haats, and Rural Marketing Vehicles (RMVs) could prove to be better means of distribution as the rural consumers prefer touch and feel experience. The concept of e-choupals introduced by ITC is noteworthy in the context of Indian Rural Marketing. The presence of these e-choupals is increasing at a rapid rate. It helps in raising the income levels of farmers by providing better prices for their produce in comparison with auctions. These also provide high quality seeds and online advice on various agricultural practices. These practices enable the farmers to increase the consumption levels of the products and services offered by ITC.

MARKETING OF CONSUMER DURABLES

The products in the rural market should be able to meet the basic needs of the consumer, as a rural consumer shall not be willing to pay additionally for extra benefits. This makes pack sizes and price points all the more important. For instance, a rural consumer would prefer buying a shampoo sachet to a large bottle which could be used for over a month. Packaging should also be done accordingly in smaller units and lesser priced packs, thereby making them affordable. Physical distribution becomes arduous due to high costs involved and the non availability of retail outlets. Melas & Haats, and Rural Marketing Vehicles (RMVs) could prove to be better means of distribution as the rural consumers prefer touch and feel experience. In rural markets, a consumers buying behavior is widely influenced by social customs and traditions. Higher levels of illiteracy and lack of exposure to traditional media practices further add to the problems. Hence, the advertising mix should be customized and contain other alternative forms like street plays, wall painting, posters etc.

Distribution Strategy
Distribution is the important variable in the marketing plans of most consumer goods. Reaching rural consumers across 600000 villages is the biggest challenge in rural marketing. There are five layers of distribution channels used by all major companies for the movement of product from the company depot to interior village markets. Channel Partners Marketplace Level 1 company depots/CFAs National/State Level 2 CFAs/redistribution stockists Cluster of districts Level 3 Redistribution stockists/semi-wholesalers Sub-district Level 4 Semi wholesalers/retailers Feeder town Level 5 Retailers/Vans/Barefoot agents Large and small villages Only few players like HUL, ITC have been able to reach the level directly using out of box and innovative distribution channels. Channels of distribution have the maximum channel partners in FMCG distribution.

Rural Distribution System

Wholesalers

Retailers Mobile traders Vans Weekly haats

DISTRIBUTION STRATEGIES IN RURAL MARKETS

Distribution strategy A one of the ways could be using company delivery vans which can serve two purposes it can take the products to the customers in every corner of the market and it also enables the firm to establish direct contact with them and thereby facilitates sales promotion. The mediocre companies with sizable resources may chip in for syndicated distribution. Haats and Melas could also be a great platform to display merchandise. Also, every region consisting of several villages is generally served by one satellite town termed as Mandi where people prefer to go to buy their durable commodities. If marketing companies use these feeder towns they can have a vast coverage of rural arena.

Delivery Vans Companies can use their own delivery vans to reach the rural consumers. There are certain advantages of using delivery vans. They take the products to customers and retail outlets in every corner of selected rural markets and enable the company to establish direct contact with the consumers which helps in sales promotion. We can take the example of HLLs distribution strategy in rural market. In 1998, HLL landed "Operation Harvest" with an objective to increase penetration, increase brand awareness, encouraging trials and identification of key distribution points and retail points. Around 30,000 villages having high growth potential, having a population of at least2000, and well connected by roads, were selected. The vans were retrofitted with a public address system and their audiovisual equipment. These vans covered six villages a day for six days in a week. The cycle was repeated couple of times in the same villages. On reaching the villages, they would play audio-cassette and video-films. These cassettes and films had songs and sequences from popular films with advertisement of HLL coming at some intervals. Company representatives distributed free samples. Small shops of villages were provided with HLL products like Lifebuoy and Wheel. This helped company to understand the potential of the market.

Joint Distribution by Non-Competing Companies

Companies having lesser distribution reach in rural areas can collaborate with companies already having wide network in rural market. This type of tie-up can prove to be beneficial as one can reach to large number of retail outlets by utilizing the network and the other one can earn better revenue. Also, this type of joint collaboration can help both companies to reduce distribution costs and can convert operation which seems to be unviable into financially viable operation. Some examples of effective distribution tie-ups in rural market: Samsung has tied-up with the Indian Farmers Fertilizer Cooperative (IFFCO). Thus, Samsung will use IFFCO's cooperative network for marketing the hand-sets to rural consumers over a wide area. Nokia has entered into a partnership with HCL for distribution of its hand-sets. Motorola and Nokia have partnered with ITC e-Choupal which gave them wider reach inrural market. Procter & Gamble had tie-up with Godrej and Marico Industries, and now it is planning one with Nirma as well for distribution of Camay Soaps. Godrej has tie-up with Jyothi Labs to use its extensive distribution network for marketing Godrej Tea across the country. Godrej Aaadhar tied up with HDFC, Eicher Motors and is in talk with Apollo Hospitals to set up pharmacy at stores.

Distribution up to Feeder Towns / Mandis Companies can cater to the needs of rural consumers by making their products available Upto feeder towns or mandis. Feeder markets or mandis provide excellent scope for distribution of products like consumer durables, clothes, kitchen equipment, agri-inputs and tools. The ruralconsumers visit these towns at regular intervals not only for selling their agricultural producebut also to purchase clothes, jewelry, hardware, radio, and other consumer durable products. Haats

Along with permanent retail outlets, haats can also be utilised to make the products availableto rural consumers. Haats are held on a particular day of every week. Typically, an average Haat has 300 stalls. A haat usually serves around 5000 visitors. So if we consider average population of an Indian village to be 1000, then one haat caters to the needs of 5 villages. There are almost 47,000 haats in India. The sale per haat per day is Rs. 2.25 Lakh (approximately) and average sale per outlet is Rs. 900 (approximately).large number of retailers also buy products from haats for their village stores. About 90% of sales on Haats are on cash basis. The participation fees at haats are a flat Re. 1 to Rs. 5 per stall which is very low. These figures show that targetingHaats for distribution purpose can prove to be beneficial for companies.

Companies can tap the rural consumers for clothes, Cosmetics, FMCGs, kitchen equipments and agricultural tools at these haats . Leading manufacturers are introducing sachets of tea, blues and washing powders in these haats to create a demand and then meet the demand in affordable packages. Melas Over 25,000 melas are held every year all over the country. Out of these, 5000 are commercial melas , 2,000 are cultural melas and 18,000 religious melas The following facts regarding melas will help us to understand their importance to marketers: Number of visitors per mela is approximately 7.5 lakh. On an average, 850 outlets are set-up in every mela Average sale per day in a mela is Rs. 25 Lakh. Visitor turn-out in a mela is very high. A large part of the visitors in these melas are women and children, which is significantbecause rural women are restricted to leave village often. Melas are generally used to sell durables, high-priced items and new products launched. Examples of effective use of melas by marketers are: -

Active participation of Maruti in rural melas like the kisan mela (Ludhiana), Sonepur mela (Bihar), Kila Raipur sports mela (Punjab) and Pushkar mela (Rajasthan). The melas provide both a platform for demonstration and improving product awareness, and also booking newsales. In 2001, HLL ran a campaign at the Allahabad Kumbh Mela to demonstrate to the visitors the importance of usage of soap for better health and hygiene. Rural people in general believe that washing hands with water alone is enough, so there is no need to use soaps. HLL representatives educated them about use of soap for better health and hygiene. This awareness campaign has helped HLL to increase the sales of Lifebuoy in rural market. Hub & Spoke Method of Distribution The urban model of distribution in which the products are transported directly from the bottling plant to retailers is not very effective in rural markets as taking stock directly to retail point would be costly due to the long distance to be covered. So Coca Cola has opted for a hub and spoke method of distribution system. It worked this way: -Coke bottles were transported from the bottling plants to the hubs (large distributors) and from hubs to spokes (smaller distributors) situated in small towns. These spokes then distribute the stocks to village retailers who cater to the demand in rural market.

The conventional distribution channel members servicing rural markets include four participants : carrying and forwarding agents(CFAs), redistribution stockists, wholesalers and retailers. 1. CFAs- are the first link with the company depot for supplying products to channel members engaged by FMCG companies to supplement their own depot. 2. Redistribution stockists- Critical link between a company and its rural channels as they are supplying stocks to both rural and urban retail networks. 3. Wholesalers- meant to distribute goods to retailers.
4. Retailers- last link in the distribution chain.

Distribution Adoption
Hub and Spoke Model, Example: Coca Cola

Use of Affinity groups, Example: Project Shakti

Haat Activation, Example: Colgate

Syndicated distribution, Example: Cavin Care & Amrutanjan

Use of marketing co-operatives, Example: Warna Bazaar in Rural Areas Mobile traders, Example: FMCG companies

Modern Retail in Rural areas ITC CHOUPAL SAGAR

DSCL HARIYALI KISAN BAZAAR

TATA KISAN SANSAR

GODREJ AADHAR
3A BAZAAR

Challenges in Rural Communication Heterogeneity and spread Low Literacy and Varying Comprehension Abilities Different Media Reach and Habits

Dimensions of Channel Behaviour in Rural Areas Sourcing of stocks and purchase cycle Stocking behaviour and seasonality Credit Pattern Transfer of Capital Pricing by the channel Channel promotion Retailer-channel dynamics

Distribution Models in Rural Markets

Distribution models 1- The distributers of rural and urban are separate to create focus.
E.g- HUL, Britannia In consumer durable e.g include Philips and LG Distribution models 2- Rural markets are serviced thru same channel servicing urban market. E.g- Ghari, Nirma, Priyagold In consumer durables e.g include Usha International, Bajaj Electricals Rural Centric Distribution Models-

Haats

Modern Distribution Models SHG(Self Help Group) Youth Entrepreneurship Model Vans Public Distribution System- Thru network of Fair Price Shops Cooperative Societies- India has cooperatives spread across country. more than 500000

Petrol Pumps and Extension counters- IOC Kisan Seva Kendra

NGO- Tata Tea project with 12 NGOs GAON CHALO.

Rural Mobile Traders

Communication Strategy Developing Effective Rural Communication 1. Identifying and profiling the target audience

2. Determining communication objectives

3. Designing the message

4. Selecting the communication channels

5. Budgeting for rural communication

6. Designing the communication mix strategy

7. Measuring the impact of communication LGs Batteria campaign

RURAL MARKETING STRATEGIES PRODUCT STRATEGIES1. Small size packings- low per capita , non availability of regular pay forces the rural consumer to buy small packets of various products. 2. Low priced product 3. Rough, tough and loud 4. Usable products 5. Brand image

1. 2. 3.
1. 2. 3.

PRICING STRAGIESLow pricing Cost saving in packing ordinary packing etc. Conversions
DISTRIBUTION STRATEGIESSmall villages Agro input dealers Activising Cooperative societies

4. Utilizing

PDS stores and petrol pumps 5. Town as feeder centres PROMOTION STRATEGIES 1. Cinema 2. Television 3. Radio 4. Print Media 5. Hoardings 6. Various congregations like Mela/Jathra/Hats

COMPARISON OF PROMOTIONAL TOOLS USED BETWEEN URBAN AND RURAL POPULATION

Direct Selling of Consumer goods-

URBAN MARKET
Catalogues Mailing

RURAL MARKET
Direct talk with traders, cooperative societies

Telemarketing
E-shopping TV Shopping Fax mail E-mail Voice mail

Contacting friends and relatives

Public Relations of General Consumer Goods URBAN MARKET Speeches, seminars Press conferences Annual reports Charitable donations Sponsorships Publications Community Relations RURAL MARKET Agricultural magazines Cooperative meetings Hoardings in towns and highways

Sales Promotion of General Consumer Goods

URBAN MARKET RURAL MARKET

Trade exhibitions
Premiums and gifts

Display in fairs
Wall writings

Sample distribution
coupons

Radio advertising
Fruits, vegetables, flower exhibitions

Demonstrations
Tie-ins

Exhibits
Contests, games, lotteries

Advertising for General Consumer goods URBAN MARKET Newspapers. magazines Packaging, outer, inner Movie interval ads Directories entry RURAL MARKET Advertisement in tent cinemas Handbills Audiovisual display Hoardings at prominent locations

Bill boards
Display signs Stores displays Audiovisual advt.

Use of folklore and local language

Publicity during fairs

PROBLEMS IN RURAL MARKETING

Low Literacy
There are not enough opportunities for education in rural areas. The literacy level is as low (36%) when compared to all- India average of 52%.

Seasonal Demand
Demand for goods in rural markets depends upon agricultural situation, as agriculture is the main source of income. Agriculture to a large extent depends upon monsoon and, therefore, the demand or buying capacity is not stable or regular.

Transportation
Many rural areas are not connected by rail transport. Kacha roads become unserviceable during the monsoon and interior villages get isolated.

Communication Problems Facilities such as telephone, fax and telegram are rather poor in rural areas.
Traditional Life Life in rural areas is still governed by customs and traditions and people do not easily adapt new practices. For example, even rich and educated class of farmers does not wear jeans or branded shoes. Buying Decisions Rural consumers are cautious in buying and decisions are slow and delayed. They like to give a trial and only after being personally satisfied, do they buy the product. Media for Promotions Distribution An effective distribution system requires village-level shopkeeper, Mandal/ Taluka- level wholesaler or preferred dealer, distributor or stockiest at district level and company-owned depot or consignment distribution at state level.