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JAIPURIA INSTITUTE OF MANAGEMENT, INDORE PGDM (2011-13), TRIMESTER VI

Course Title: Rural Marketing (GM615)


Course Instructor: Prof. Dinesh Wadhwa Number of Sessions: 24 Course Credit: 3

Course Overview: In India the rural economy contributes nearly half of the countrys GDP and the size of the rural market in durables and FMCG is bigger than its urban counterpart. Even with increasing urbanization and migration 63% of Indias population would still live in rural areas by 2025 and rural consumption will nearly triple creating a market worth 26 trillion Indian rupees. Indeed, rural growth has been exceeding urban growth. Thus, Rural Marketing has emerged as an important area within the marketing discipline particularly in the context of a large rural economy like India. Rural Marketing is an evolving area with tremendous untapped potential and of late marketers have begun exploiting this opportunity in an organized manner. Traditionally, rural markets have been ignored by big multinational firms as well as local large-scale manufacturers of packaged good for a number of reasons. These include the fact that rural markets were less attractive due to the fragmented nature of competition and low density of population. In fact, rural markets are mostly served by unbranded local competition. Secondly, most consumers still self-produce products and services at home rather than buy them commercially. Further, lack of modern infrastructure, including roads, electricity, banks and media make accessibility to rural markets very difficult and expensive. However, all this is now changing rapidly due to several reasons. Rural markets are growing faster than urban markets and with better profitability. Several reasons including internet connectivity and the spread of television and mobile phones have led to higher awareness levels among rural consumers. Therefore, rural markets represent an attractive proposition for companies. Companies have responded by customizing products for rural consumers. Some companies have innovated new communication and distribution channels. In the last decade or so, India has witnessed various initiatives taken by the corporate to penetrate into rural market like ITC Echoupal, Tata Kisan Sansar, Hariyali Kisan Bazaar to name a few. While banks have been trying to promote micro-lending to penetrate rural areas, many organizations are leveraging the power of Information Technology to provide services at the doorstep. The rural environment is vastly different from urban settings. Rural markets have inherent challenges of accessibility, awareness and affordability. Professionals will have to acquire diverse skills and get equipped with practical knowledge if they wish to succeed in the rural market. This course would familiarize you with the opportunities and challenges of marketing in rural areas. Besides being introduced to the emerging rural India, you would also gain familiarity with the rural marketing environment, the changing rural economic structure, and income spending pattern.

The course would help you to appreciate the nuances of rural consumer behavior and understand how companies identify attractive market segments and choose their target marketing strategy. You would also develop an understanding of the new product development strategies for rural consumers, appreciate how companies position their products for maximum competitive advantage in the rural marketplace, and develop effective communication strategies to influence decisions and behavior. The broad objectives of the course are to explore the potential of rural markets, critically analyze the rural market opportunities so as to formulate better marketing strategies. Learning Outcomes: After undergoing this course, the participants will be able to: 1. 2. 3. 4. Analyze the rural marketing environment Assess the factors affecting buying behavior of rural consumers Examine the various factors influencing the design of the rural marketing mix Appraise best practices and examine how rural markets can be developed further

Pedagogy The pedagogical tools used for this course would be - classroom discussion, exercises, video-clips, case studies, relevant readings (recent news clips, research articles), activities on the Learning Management Software MOODLE, field visits, presentations and group activities. The instructor will periodically distribute handouts, articles from textbooks/journals for improved understanding of concepts. The emphasis will be on learning through individual and group participation. Text Kashyap, Pradeep (2012). Rural Marketing, 2nd Edition; New Delhi: Pearson Education (referred hereafter as PK). References 1. Krishnamacharyulu, C.S.G. and Lalitha, R. (2009). Rural Marketing - Text and Cases; New Delhi: Pearson Education 2. Gopalaswamy, T.P. (2011). Rural Marketing Environment, Problems and Strategies; New Delhi: Vikas Publishing House Pvt. Ltd. 3. Dogra, B. & Ghuman, K. (2010). Rural Marketing Concepts and Practices; New Delhi: Tata McGraw Hill Education Pvt. Ltd., Inernet Resources: 1. www.rmai.in (This is the official website of the Rural Marketing Association of India, which is a premier industry body devoted to furthering the cause of rural marketing) 2. http://www.martrural.com/mart-knowledge-center.html (This is the website of MARTs Knowledge Centre. It works primarily towards capturing the knowledge and disseminating it through various platforms like publications, reports and events) 3. www.drishtee.com (This is the website of Drishtee, which is a social enterprise focused exclusively on rural India) Assessment:

S.No. 01 02 03 04 05

Criteria Quizzes (best two out of three) Cases (Discussion 10% + Write-up 10%) Project (Presentation 10% + Report 10%) Mid-term Examination End term Examination

Weightage % 10 20 20 20 30

Quizzes: There will be three quizzes of MCQ(s) type which will be conducted unannounced. The quizzes would be based on concepts, cases and readings. Cases: For case discussions students will first build the background of the case and point out relevant issues. Thereafter the class will be involved in the discussions and analysis of the issues. Evaluation will be done on the basis of ability to highlight the decision problem(s) and the corresponding issues and on the quality of participation. Each member will individually provide a write up on the case (not exceeding 3 (three) A4 sheets) before the case discussion session. Project: This would be conducted group-wise. Each group would select one company that has successfully made inroads into the rural market. Please note that the company selected has to be shared in the class on the third session so as to ensure that there is no duplication. Thereafter, each group would develop and write a report on that companys marketing efforts in Rural India. The data for the same may be collected from both primary and secondary sources. The report would include details about the companys current marketing strategies as well as the groups recommendations for the company. The report may cover the following aspects an overview of the industry, company background, its entry into rural markets, products offered for rural consumers, information regarding companys research on rural consumers, its segmentation and positioning strategy, rural marketing mix, innovations (if any) for rural markets, information about competitors, an analysis of the reasons behind its success in rural markets, future plans as well as your recommendations for improving the companys offering. There would be detailed discussions in the class regarding every aspect of the project. At the end of the course each group needs to present their project work. Sl. No. 1. 2. 3. 4. 5. Description of activity Important dates

Submit the name of the company 3rd session selected by you 1st Progress Report 10th session nd 2 Progress Report 15th session Report 19th session Presentation 20th and 21st sessions

Presentation: In the presentation, each group would present the project work done by them. Presentations would be evaluated on the basis of content, structure, verbal communication and creativity in presenting the subject matter.

Report: The report would contain the work done by them based on the primary and secondary data collected by the group. The report shall be of maximum ten pages, neatly typed. Relevant appendices may be attached. Mid-term examination: This will be a blend of conceptual questions as well as application based questions. End-term examination: This will be a combination of cases; application based situational questions and conceptual questions.

Session Plan
Session Topic Methods/Case Text Chapter No.

Module 1: Introduction

1.

2. 3

Introduction - Course outline discussion - Group activity discussion - Overview of rural marketing The Changing face of development The Rural Environment Economic, Social, Cultural

Discussion + Videos

PK/ Ch. 1, Pp. 29/ Reading:

Tapping Indias Rural Market.


rural Guest Lecture Discussion + Videos PK/ Ch. 2, Pp. 15-23 PK/ Ch. 2, Pp. 15-23/Reading:

Marketing to Rural India: Making the Ends Meet Discussion


PK/ Ch. 2, Pp. 15-23/ Reading:

4.

The Rural Environment Demographic factors

Why Companies See Bright Prospects in Rural India?


Case Discussion Case: Sarvodaya Samiti Handouts

Farm sector Non-farm sector NGOs & Rural Marketing Module 2: Rural Consumer Behaviour

5.

6. 7. 8.

Characteristics of rural consumer Influences on rural consumer behavior Rural consumer decision making Rural traffic builders and Loyalty builders Rural Marketing Research

Discussion Discussion Discussion

PK/ Ch. 4, Pp. 68-75 PK/ Ch. 3, Pp. 5455 PK/ Ch. 4, Pp. 6675

Module 3: Marketing Strategies

Session 9. 10.

Topic Segmenting and Targeting Rural Markets Product Strategies New Product Launch in rural markets - unique aspects Distribution in rural markets

Methods/Case

Text Chapter No. PK/ Ch. 5, Pp. 86-105 PK/ Ch. 6, Pp. 108-128 PK/ Ch. Pp.154-193 8,

Discussion + Video Discussion + Case:


LG Rural Marketing in India Discussion + Case: Hindustan Lever Rural Marketing Initiatives

11.

12. 13. 14.

Role of Co-operatives in distribution Guest Lecture of Agri-inputs and other essential commodities Pricing strategies Discussion Developing effective communication strategies rural

Discussion + Videos +
Case: Coca-Cola Indias Thirst for the Rural Market

PK/ Ch. 7, Pp. 134-149 PK/ Ch. 9, Pp. 198-228

15. 16.

Designing the marketing mix for rural markets special considerations

Discussion Discussion

PK/Ch. 5, 6, 7, 8 & 9

New models of customer servicing (especially by consumer durable, farm machinery & implements and automobile companies)

Module 4: Marketing of Services 17. Current Status of penetration of Financial Services in rural India Challenges faced by marketers in providing Financial Services 18. Telecommunication Services

Discussion

PK/ Pp.247

Ch.

10,

Discussion

19. 20-21.

Rural Healthcare Services - Discussion of Yashavini scheme of Narayan Hrudayalaya Student Presentations

Discussion

PK/ Ch. 10, pp 236-242/ Reading: Rural Telecom in India PK/ Ch. 10, Pp. 255-259

Module 5: Issues and Opportunities in Rural Marketing 22. Agri-input Marketing in India Guest Lecture 23. ICT in rural areas Discussion + Case: ITC Reshaping Lives of Indian Farmers 24. Measuring and improving rural

PK/ Ch. 10, Pp. 243 -246

Discussion

PK/ Ch. 12, Pp. 287-288

Session

Topic marketing productivity Future of Rural Markets

Methods/Case

Text Chapter No.

Questions for Discussion


Sarvodaya Samiti

1. Should Sarvodaya be a part of the proposed consortium? 2. Discuss the role of non-profit organizations in the development of tribal and underprivileged communities of the society.
LG Rural Marketing in India 1. To what extent, do you think, LGs rural marketing initiatives reflect its understanding of the rural consumers 2. Discuss LGs product strategy for the rural market. 3. Attempt a critical analysis of LGs strategy of Different Model. Different Channels. Hindustan Lever Rural Marketing Initiatives

1. Discuss the importance of building a strong distribution system to effectively make an FMCG product, especially in rural areas. 2. What were the reasons behind HLL deciding to focus its efforts and resources in building up the rural consumer base? 3. Comment on the marketing structure adopted by HLL to ensure the availability of its products in rural areas? How far has the distribution strategy contributed to HLLs growth in rural India?
Coca-Cola Indias Thirst for the Rural Market

1. In the late 1990s, CCI increased its focus on the rural market in India. Explain the reasons for CCI's move in detail. 2. According to analysts, CCI's Thanda Matlab Coca-Cola advertisement was a major hit and made rural consumers connect with the product. Discuss the importance of advertising in rural marketing. What are the issues in advertising that a company should focus on while targeting rural consumers? Do you think there should be differences in advertising (appeals, illustration, layout, media, repeat frequency) for rural consumers and urban consumers? Justify your stand. 3. Some analysts feel that with the urban market reaching saturation, the Cola war will now be fought in the rural market. What are the issues that CCI and Pepsi Co have to focus on to capture the rural market? Who do you think is more comfortably placed in the rural market? Why? ITC Reshaping Lives of Indian Farmers 1. Point out the differences between the traditional Mandi system and ITCs E-Choupal model. 2. What is your opinion about the comments from journalists, food security and agricultural experts regarding the ITC initiative? 3. Critically analyze the growth strategies adopted by ITC.

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