© 2020 JETIR February 2020 , Volume 7, Issue 2 www.jetir.

org (ISSN-2349-5162)

RECENT TRENDS AND INNOVATION IN

RURAL MAREKTING
Ms Lovely, Research Scholar, Jagannath University, NCR, Haryana.

ABSTRACT

Nation’s essential part is constituted through villages. A majority proportion of global population resides in
rural pockets of the world. Innovation in marketing is about introducing notable changes in designing of
product or packaging, placement of product, pricing or promotion of product. Planning and implementation of
marketing functions in rural areas is known as rural marketing. Success of marketers in rural areas depends on
how well they understand the needs and mindset of rural consumers. Since this segment constitutes significant
proportion of global population, it offers abundance of opportunities in comparison to urban sector. The paper
will focus on the rural market scenario in India, trends, potentiality and early innovations made in rural
market. In Indian context, innovations in rural markets should be based on 4 As namely: Awareness,
Acceptability, Affordability and most importantly Availability. Exploiting new ideas should always lead to
creation of new product or service which lowers the cost and at the same time has the potential to meet the
demand.

KEYWORDS
Indian Rural Market, Innovation, Rural Marketing, Rural Consumers & Challenges.

INTRODUCTION

Innovation in marketing is an activity that involves new ideas that have a positive impact to a new product and
service. Marketing is a process through which product and services information is communicated t the
consumers. Innovative marketing concept is all about conducting market research into customer needs,
behaviors and trends, develop changes within product designing, launching a new product in a unique place,
pricing the product in a unique way, promoting products in an unconventional way, etc. For example, Grand
Shoes is a Sweden based shoes store that deals in Size 12 to Size 17 branded footwear. Here Grand Shoes not
targeted mass buyers but innovatively targeted the market with unique plus Size that customer don’t get
everywhere.

Rural Marketing can be defined as “the process of developing, pricing, promoting and distributing rural
specific products and services leading to consumer satisfaction and achievement of organizational objectives”.
It involves the process of delivering better standard of living and quality of life to rural environment. It
encompasses social interactions between the rural and urban as well as within the rural areas, which may be
spontaneous or planned.

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Characteristics of Indian rural market:

1.Vast and scattered: It offers numerous opportunities to marketers and producersin comparison to urban
sector. It constitutes the maximum number of consumers since it covers greater part of global population.
2.Customary/traditional prospective: People are traditional in their thinking level and also are superstitious
in their beliefs. Due to increasing literacy level in rural belt, this trend is changing amongst rural youth.
3.Major source of income: AGRICULTURE is the major source of income for people living in rural areas.
Their income is affected and purchasing power gets reduced due to crop failure.
4.Rigidity: Illiteracy, backward and orthodox are most persistent features amongst rural people. Due to
which, it gets difficult to convince them to buy the products.

Need of marketing in rural India:

1. Large population of India

India 2019 population is estimated at 136.64 crores people at mid year according to UN data. India
population is equivalent to 17.71% of the total world population. 68.86% Indian lives in rural areas and
31.14% lives in urban areas. This statistics clearly indicates the need for rural marketing.
2. Employment generation
Rural marketing can generate more attractive employment opportunities to rural and urban people. Growth of
rural marketing leads to increased business operations, professional activities, and services that can generate a
lot of employment opportunities
3. Improved Rural Infrastructures
Rural marketing and basic infrastructures go hand to hand. Growth of rural marketing leads to improved
transportation, insurance, banking, communication, entertainment, and other facilities. Due to availability of
basic infrastructural facilities, business units can easily reach the target rural buyers
4. Improved Living Standard
Due to rural marketing system, rural buyers can easily access needed standard goods and services at fair
prices. In the same way, rural marketing improves rural infrastructure. Additionally, rural marketing can also
improve their income. These all aspects can directly improve living standard.
5. Development of Agro-based Industries
Rural marketing leads to set up agro-based processing industries. Fruits, vegetables, cereals, pulses, etc., are
used as raw-materials. Such industries can improve farmers’ profit margin and employment opportunities.

Trends in Rural Marketing

The companies must maintain their focus on the conecet of quality with proper communication in order to
bring a change in the outlook of Indian customer. Some of the recent trends in rural marketing are explained
as:

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1. Mass population: The Indian rural market with its vast size and demand offers great opportunity to
marketers. Our national is classified in around 450 districts & approx. 6, 30,000 villages. Indian rural market
is huge in size because rural population accounts for almost 70% of Indian population as the recent Census
2011, 833 million live in rural India, 33% of rural population includes youth, number of households increased
from 25 to 33 crore. The rural market is currently worth approximately USD$ 10 billion in consumer spending
in the FMCG market annually. Food categories are currently driving the bulk of the additional USD$ 90
billion into the marketplace by 2025.
2. Green revolution: The vision of Dr. Swami Nathan, the father of the green revolution to achieve self-
sufficiency in food grain production in 1995, gave a major breakthrough in food grain production by the use
of scientific methods in agriculture. At present, Rural India generates 299 million tons annually. The
substantial attention accorded to agriculture during the successive five-year plans has helped in improving
agricultural productivity. Adoption of new agronomic practices, selected mechanisation, multiple cropping,
inclusion of cash crops and development of allied activities like dairy, fisheries and other commercial
activities have helped in increasing disposable income of rural consumers. By observing this scenario, India‟s
one of the biggest giant Hindustan Lever Ltd. has entered into rural market for more penetration through the
operation „Bharat‟.
3. Smart phones are making their way into rural India: 320 million are rural mobile phone users i.e. roughly
38 per cent of the rural population, which includes children and senior citizens. The actual benefit of
technology positively impacting rural economy will be seen when data communication is used effectively.
4. Increased education level and employability of rural youth: Villagers realized their children education is the
first priority. Most of the rural youth especially teenagers are [email protected],
www.anveshanaindia.com 105 well aware of products due to their school education and media exposure.
Significant progress on literacy levels – 90% of the villages have a primary school within a 1 km walk. Private
school enrolment in rural India has enhanced by 5.5% points over past six years. The literacy rate has also
gone up by 68.91% in rural India. This enhanced the employability of rural youth they are not sitting idle in
villages they are motivated to go to nearby towns to find the jobs.
5. Increased purchasing power: Rural purchasing power has grown faster than urban in the recent years. Rural
Indian economy is highly supported by increasing disposable income, Government initiatives and schemes
and favourable demographics. As a result, the rural segment of the Indian economy is growing at a pace of 8-
10% per annum. Government spending in rural India has tripled over the last four years and is now translating
into higher consumer spending. Therefore, rural consumers are consuming more premium and convenience
oriented categories that are typical of their urban counterparts. “Policy measures like the waiver of agricultural
loans around US$ 13.9 billion and the National Rural Employment Guarantee Scheme, which guarantees 100
days of employment to one member of every rural household (NREGS), the Bharat Nirman program with an
outlay of US$ 34.84 billion for improving rural infrastructure etc helped the rural economy.
6. Government Incentives and polices: The government’s stress on self-sufficiency resulted in various
schemes like Operation Flood (White Revolution), Blue Revolution, Yellow Revolution, etc. resulted in the

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production of 15 million tons of milk per annum. The Indian Government launched a number of schemes like
IRDP (Integrated Rural Development Programme) and REP (Rural Electrification Programme) in the 1970‟s,
which gave a boost to the agrarian economy. This resulted in changes in people’s habits and social life. REP
gave impetus to the development of consumer durable industry.
7. Media: Mass Media has created increased demand for goods and services in rural areas. Smart marketers
are employing the right mix of conventional and non-conventional
Recent Trendsin Rural Marketing 477 media to create increased demand for products. The role cable
television has been noteworthy in bringing about the change in rural people’s mind set and influencing their
lifestyles.
8. IT penetration in rural India: Today's rural children and youth will grow up in an environment where they
have 'information access' to education opportunities, exam results, career counseling, job opportunities,
government schemes and services, health and legal advice and services, worldwide news and information,
land records, mandi prices, weather forecasts, bank loans, livelihood options. If television could change the
language of brand communication in rural India, affordable Web connectivity through various types of
communication hubs will surely impact the currency of information exchange .As the electronic ethos and IT
culture moves into rural India, the possibilities [email protected], www.anveshanaindia.com 106 of
change are becoming visible. Products developed for rural marketing are Philips develop a tv “vardaan” and
free power radio for rural markets, ICICI rural ATMS, Bhumiheen credit cards by bank of India, E-choupal by
ITC.
9. Better credit facilities through banks: With co-operative banks taking the lead in the rural areas, every
village has access to short, medium, long-term loans from these banks. The credit facilities extended by public
sector banks through Kisan Credit Cards help the farmers to buy seeds, fertilizers and every consumer goods
on instalments.
10. Brand conscious: The rural market in India is not separate entity in itself and it is highly influenced by the
sociological and behavioural factors operating in the country. Spending on FMCG products especially in the
rural areas is showing an increasing tendency.

CHALLENGES AND STRATEGIES IN INDIAN RURAL MARKETING

CHALLENGES:

Today almost all of corporate India is falling head over heels to reach out to rural India, as it can help in
adding substantially to their bottom lines. However the overall successful rate in rural markets is not so
appealing. The problem in reaching out to the rural masses equals the prospects in the rural land. Very few
corporate like Hindustan Unilever is on top list triumphant through their rural marketing projects like ‘Shakti’
‘Operation Bharat’, Amul with their aggressive marketing strategy and ITC with their e-choupal. Many others
like Coca-Cola,Colgate, Britannia, BSNL .LIC, Hero Honda, LG Electronics e.t.c are striving successfully
toclimb the rural ladder. The major challenges they face includes
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 Deprived people and deprived markets

 Lack of communication facilities
 Transport
 Many languages and dialects
 Dispersed markets
 Low per capita Income
 Low levels of literacy
 Prevalence of spurious brands and seasonal demand
All of the above factors have been categorized into 4 A’s of rural marketing which is also known as rural
marketing mix which are as follows:
Awareness: Mass media is able to reach only to 57% of the rural population. Creating awareness then, means
utilizing targeted, unconventional media including ambient media. For generating awareness, events like fairs
and festivals, Haats, etc., are used as occasions for brand communication. Cinema vans, shop-fronts, walls and
wells are other media vehicles that have been utilized to increase brand and pack visibility. Innovative media
used by personal wash like Lux and Lifebuoy and fabric wash items like Rin and Wheel. Idea was to advertise
not only at the point of purchase but also at the time of consumption.
Hindustan Lever relies heavily on its own company organized media. These are promotional events organized
by stockiest. Godrej Consumer Products, which is trying to push its soap brands into the interior areas, uses
radio to reach the local people in their language. Creating brand awareness through appropriate media is very
important for the companies to gain acceptability among rural folks.
Affordability: Since rural consumers have low disposable incomes, products must be such that can be
afforded by rural consumers. The problem of affordability has been addressed by few companies though
introduction of small unit packs. Godrej recently introduced three sizes of Cinthol, Fair Glow and Godrej in
50-gm packs, Hindustan Lever, among the first MNCs to realize the potential of India's rural market, has
launched a variant of its largest selling soap brand, Lifebuoy at Rs 2 for 50 gm. The move is mainly targeted
at the rural market. Coca Cola has addressed the affordability issue by introducing the returnable 200-ml glass
bottle priced at Rs 5.
HUL’s initiated ‘operation Bharat’ to tap rural markets by bringing out low priced sample packets of its
toothpaste, Fairness cream, shampoo, other products.
Availability: For making the products available to consumers, companies adopt a variety of means such as
direct selling, using company delivery vans, syndicated distribution between non-competitive marketers,
setting up of temporary stalls in rural melas or haths etc. In the rural areas with places far flung and well
connected with proper roads, delivering the product to the rural consumers can be a challenge. Companies
have realized this and are trying to be creative in this situation.
The company, BPCL initiated specially designed ‘Rural Marketing Vehicle’ which moved from villages to
villages for filling cylinders on spot.

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HUL started Project “SHAKTI” in partnership with Self Help groups of rural women. The project ‘Shakti’
with a social aim of upliftment of rural women by providing income-generating opportunities was intended to
amplify the company’s rural distribution network. HUL’s Shakti project connects Self Help Groups (SHGs)
with business opportunities. The company promotes and uses the SHGs network present in the villages for
increasing its sales in the rural areas. The SHGs are presented chance to become company’s local small-scale
distributor in the rural areas. These groups typically comprise of 15 to 20 people. They buy a small stock of
items like soap, detergents or shampoos and sell directly to consumers in their homes. This innovative
distribution model is a win-win for the company and the village SHGs.
Acceptability: Another challenge is to gain acceptability for the product or service. Therefore, there is a need
to offer products that suit the rural market. One company, which has reaped rich dividends by doing so, is LG
Electronics. In 1998, it developed a customized TV for the rural market and christened it Sampoorna. Because
of the lack of electricity and refrigerators in the rural areas, Coca-Cola provides low-cost ice-boxes - a tin box
for new outlets and thermocol box for seasonal outlets.
The insurance companies that have tailor-made products for the rural market have performed well. HDFC
Standard LIFE topped private insurers by selling policies worth Rs 3.5 crore in total premia. The company
tied up with nongovernmental organisations and offered reasonably priced policies in the nature of group
insurance covers.
Mobile device companies are also tailoring their products to the rural marketers. For instance, Nokia had
earlier launched s basic handset with a torch and an alarm clock. In December2008, the company launched
Nokia Life Tools, which is a range of agriculture, education and entertainment services designed especially
for consumers in small towns and rural areas of emerging markets. The product is meant to provide timely and
relevant information customized to the user’s location and personal preference directly on their mobile
services.
.
STRATEGIES:
The past practices of treating rural markets as appendages of the urban market is not correct, since rural
markets have their own independent existence, and if cultivated well could turn into a generator of profit for
the marketers. But the rural markets can be exploited by realizing them, rather than treating them as
convenient extensions of the urban market.

a) Marketing Strategy: Marketers need to understand the psychology of the rural consumers and then act
consequently. Rural marketing involves more exhaustive personal selling efforts compared to urban
marketing. Firms should abstain from designing goods for the urban markets and subsequently pushing them
in the rural areas. To effectively tap the rural market, a brand must associate it with the same things the rural
folks do. This can be done by utilizing the various rural folk media to reach them in their own language and in
large numbers so that the brand can be associated with the myriad rituals, celebrations, festivals, "melas", and
other activities where they assemble.

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b) Distribution Strategy: One of the ways could be using company delivery van which can serve two
purposes - it can take the products to the customers in every nook and corner of the market, and it also enables
the firm to establish direct contact with them, and thereby facilitate sales promotion. Annual "melas"
organized are quite popular and provide a very good platform for distribution because people visit them to
make several purchases. According to the Indian Market Research Bureau, around 8000 such melas are held
in rural India every year.This is another potential low cost distribution channel available to the marketers.
Also, every region consisting of several villages is generally served by one satellite town termed as "Mandis"
where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns,
they will easily be able to cover a large section of the rural population.

c) Promotional Strategy: Marketers must be very careful while choosing the mediums to be used for
communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals
must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances,
puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact
product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can
also be a helpful tool for marketers.

Major brands that rule rural India includes:

 Amul
 Britannia
 Lifebuoy
 Colgate
 Eveready
 BSNL

CONCLUSIONS
India’s rural market could have been stronger than the present position, if Indian policymakers have made
adequate infrastructure for rural India. Rural markets, as part of any economy, have untapped potential. Thus
looking at the challenges and the strategies which rural markets offer to the marketers it can be said that the
future is very promising for those who can understand the dynamics of rural markets and exploit them to their
best advantage.

REFERENCES

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