RURAL MARKETING OPPORTUNITIES

The opportunities and challenges23 that are needed to face by marketer in rural
areas are:
1. Untapped Potential: It offers a great chance for different branded goods as well
as services for the larger number of customers and the untapped potential.
2. Market size: The size of the India's rural market, stated as the percentage of
world population is 12.2 per cent. This means 12.2 per cent of the world's
consumers live in rural India. In India, rural household’s from about 72 per cent of
the total households and this constitutes a huge market by any standard.
3. Current - Growth in Consumption: The purchase and consumption of certain
durables and non-durables by consumes in rural areas is more than that in urban
areas. Some of the products for which the demand is more in rural areas are
wristwatches, bicycles, radios. Etc. It is estimated that for durables the annual
growth has been at a rate of 25 per cent, which is outstanding by any standards.
> According to the National Sample Survey 2000, India22 has witnessed
growth in purchasing power as a consequence of rising rural prosperity. It
is reflected in terms of rising consumption levels of rural masses. The All-
India average per capita household expenditure is Rs.382.
4. Increasing Income: Different programmes undertaken by the government has
helped to improve the economic situation of the rural areas. The increase in
income is seen in both absolute values as well as on the increase in average
number of days of occupation in a year.
5. Accessibility of Markets: Though the road network has not developed to the best
possible extent, a fair amount of development has been made in many regions,
making these regions accessible from the urban region and making it easier for
supplying products to these regions.
6. Competition in Urban Areas: The urban market is getting saturated and thus, is
unable to provide the much needed market to many companies and in search of
greener pastures, many of these companies are now targeting the rural market.

7. Changing Consumer Behaviour: The literacy rate in the villages has increased
considerably, bringing about a shift in the preferences of the people. This change
in preference and buying behaviour of the people has led many companies to tap
this new breed of customers.
8. Rising Rural Prosperity: The production index of consumer durables continued
to display impressive year on year growth in April 2004. During the month, index
was up by 17.7 per cent as compared with a negligible 0.4 per cent growth in
April 2003. This impressive production growth of consumer durables in recent
times, has been due to increased demand from rural sector on account of higher
growth in income
From the table India is now seeing a dramatic shift towards prosperity in rural
households. The lowest income class (Rs.25, 000 and below) will shrink from
more
than 60 per cent in 1994-95 to 20 per cent in 2006-07. The higher income class will
be
more than double. The developmental activities were undertaken during 5 year
plans
and other special programs such as land reforms, rural electrification, rural
communication network, and rural credit facilities etc.

9. Life Cycle Changes:

Many products have achieved near maturity in the urban market, while in rural
markets, they are still the growth phase. The reason for the variations in product
lifecycle stages may be attributed to the different rates of adoption - diffusion
process
in urban and rural markets. Popular consumer durable brands in urban areas have
reached maturity stage while in rural markets yet to gro

P R O D U C T C O N C E P T
I N R U R A L A R E A S

The product is the most vital element in the market offering.

The acceptance of the product in rural markets is determined not only by, consumer, needs and
wants, but also by the physical and social environment.(ex. Mercedez car)

KOTLER FIVE LEVEL OF PRODUCT :-0

1. Core Product

This is the basic product and the focus is on the purpose for which the product is
intended. For example, a warm coat will protect you from the cold and the rain.

2. Generic Product

This represents all the qualities of the product.

For a warm coat this is about fit, material, rain repellent ability, high-quality
fasteners, etc.

3. Expected Product

This is about all aspects the consumer expects to get when they purchase a product.

That coat should be really warm and protect from the weather and the wind and be
comfortable when riding a bicycle.

4. Augmented Product
This refers to all additional factors which sets the product apart from that of the
competition.

And this particularly involves brand identity and image.

Is that warm coat in style, its colour trendy and made by a well-known fashion
brand?

But also factors like service, warranty and good value for money play a major role
in this.

5. Potential Product

This is about augmentations and transformations that the product may undergo in
the future.

For example, a warm coat that is made of a fabric that is as thin as paper and
therefore light as a feather that allows rain to automatically slide down.