Basic intro of rural marketing, work done by various fmcg companies in rural india

1. FMCG SECTOR IN
RURAL INDIA

2. INTRODUCTION TO RURAL
MARKETING
• The term “Rural Marketing” used to be an umbrella term for
the people who dealt with rural people in one way or another.
It got a separate meaning and importance after the economic
revolution in India after 1990.
• Process of developing, pricing, promoting and distributing
rural specific goods and services leading to satisfaction of rural
customers’ needs and wants.

3. WHAT ARE RURAL AREAS?
• In general, a rural area is a geographic area that is located outside towns
and cities.
• As per census, any habitation with a population density of less than 400
sq. km. is known as rural.
• The definition of ‘rural’ differ from country to country based on
experience.
• It is difficult to identify rural places is expected to be, it is hard to agree
on a common definition of a rural area for statistical purposes.
• Therefore, there is no standard international definition of rural.

4. IMPORTANCE OF RURAL MARKETING
LARGE MARKET
LESS EXPENSIVE
BRINGS SOCIO-
ECONOMIC
CHANGES
INCREASING
COMPETITION
IN URBAN INDIA

5. MARKETING PROCESS IN RURAL AREAS
URBAN TO RURAL RURAL TO URBAN RURAL TO RURAL
• Major part of rural marketing
• Includes transactions of urban
marketers who sell their goods
and services in rural areas
• Pesticides, fertilizers, FMCG
products, tractors, bicycles,
consumer durables, etc.
• Basically, falls under agricultural
marketing
• A rural producer seeks to sell his
produce in urban market
• Seeds, fruits and vegetables, forest
produce, spices, milk and dairy
products, etc.
• Includes the activities that
take place between two
villages in close proximity to
each other
• Agricultural tools, handicrafts,
dress materials, bullock carts,
etc.

6. BENEFITS OF RURAL MARKETING
• Increased size of rural market.
• Increased employment.
• Better living conditions for rural people.
• Contribution to national income.
• Increase in farm income.

7. PROBLEMS FACED IN RURAL MARKETING
Deprived people and
deprived market.
Lack of communication
facilities.
Lack of transport facilities.
Low per capita income. Low levels of literacy. Warehousing problems.

8. INDIAN FMCG COMPANIES WORKING
TOWARDS RURAL DEVELOPMENT

9. PIDILITE’S STEPS TOWARDS RURAL
DEVELOPMENT
• The company has made arrangements/
signed MOUs with various institutes
and expert organizations for providing
technical inputs to the farmers.
• For the important crops of the region
such as cotton, onion, groundnut,
coconut, etc., these tie-ups have helped
the farmers to adopt the modern
package of practices for working
towards reducing input costs and
increasing yield of these crops.
• They have also supported activities for
conservation of water and efficient
usage of water-soluble fertilizers.

10. ITC’S E-CHOUPAL
• Choupal is a Hindi word which means “village meeting
place”.
• Launched in 2000.
• It is a unique web-based initiative taken by ITC Ltd.
offering farmers required information, products and
services they need.
• Farmers can directly negotiate the sale of their products
with the company.
• ITC has provided computers and internet access in several
rural regions of the country.
• Since the introduction of this, farmers have seen a rise in
their income levels because of increase in yields.

11. AMUL’S RURAL SANITATION CAMPAIGN
• Amul dairy has launched a novel scheme
for total rural sanitization and set a target
for itself whereby not a single milk
producer will attend to defecate in the
open.
• The dairy with the support of District Rural
Development Agency (DRDA) will provide
interest-free loans to its milk producers in
Anand and Kheda districts to set up pakka
toilet blocks, which will not only help
women milk producers avoid
embarrassment but also ensure hygiene.
• The mission is not just about brining a
cultural change by imbibing good among
milk producers but also targeted towards
encouraging hygienic practices in the milk
supply chain.

12. DABUR’S
SWALAMBHAN
• In 2015 India’s leading consumer products
maker Dabur India Ltd. announced the
launch of a mega initiative aimed at
improving the employability of local youth
from villages by providing free technical
training and skill development.
• It is being run in association with the Rural
Development and Self-Employment Training
Institute (RUDSETI).
• It will provide training to rural youth on
three key areas of sales, merchandising, and
promotion.
• It will also seek to provide guaranteed
employment to these youth post-
completion of their training.

13. HUL’S KHUSHIYON KI TOLI
• Launched in three Indian states –
Uttar Pradesh, Andhra Pradesh and
Maharashtra.
• Main objective is to reach out to
media dark villages.
• Aims at changing attitudes of rural
mass to inculcate good personal
hygiene.
• Helps to create a cost-efficient rural
activation module.
• Other unique characteristic of this
initiative is the effective use of
popular traditional symbols with
technology to create more
acceptance.

14. 5 P’s OF MARKETING MIX

15. 1.) Product
• Developing relevant products to meet the specific needs and wants of rural consumers will
exercise the minds of marketers.
• Products must be modified or built to suit the lifestyle and requirements of the people.
2.) Price
• Price refers to the pricing strategy for products and services and how it will affect customers.
Pricing decisions do not include just the selling price, but also discounts, payment arrangements,
credit terms, and any price-matching services offered.
• The villagers/ people belonging to rural places are very price sensitive by nature due to the
limited resources available and low income.

16. 3.) Promotion
• Promotion refers to the activities that make the business more known to consumers. It includes
items such as sponsorships, advertising, and public relations activities.
• Since promotion costs can be substantial, it is essential to conduct a break-even analysis when
making promotion decisions. It is important to understand the value of a customer and whether it
is worth conducting promotions to acquire them.
4.) Place
• Place refers to where the product/service of the business is seen, made, sold, or distributed. In
essence, place decisions are associated with distribution channels and ways of getting the
product to targeted key customers.
• It is important to consider how accessible the product or service is and ensure that customers can
easily find you. The product or service must be available to customers at the right time, at the
right place, and in the right quantity.
• For example, a business may want to provide their products over an e-commerce site, at a retail
store, or through a third-party distributor.

17. 5.) People
• People refer to the staff, salespeople, and those who work for the business. People decisions are
usually centered around customer service – how do you want your employees to be perceived by
customers?

18. FUTURE OF FMCG’S IN RURAL INDIA
• Leading FMCG players such as ITC, Godrej, Dabur, Emami and Marico are witnessing robust sales in
rural and semi-urban markets, bolstering hopes of a speedy recovery from the impact of the COVID-
19 crisis.
• The companies are also reporting a spike in sales of health and wellness, hygiene and immunity-
boosting products in these markets, apart from the food products category.
• ITC has launched its hand sanitizer pack priced at just 50 paise to target these markets.
• Marico aims to drive direct distribution and value to consumers, as they will be the key growth drivers
in rural markets, while continuing to focus on increasing market share and maintaining volume
growth which is independent of category growth.
• Nielsen expects India’s rural FMCG market to reach a size of US$ 100 billion by 2025. Another report
by McKinsey Global Institute forecasts the annual real income per household in rural India to rise to
3.6 per cent 2025, from 2.8 per cent in the last 20 years.

19. • The rural FMCG market in India is expected to grow to US$ 220 billion by 2025 from US$ 23.6 billion
in FY18.
• the organised sector growth is expected to rise with increased level of brand consciousness,
augmented by the growth in modern retail.
• Internet has contributed in a big way, facilitating a cheaper and more convenient mode to increase a
company’s reach. It is estimated that 40% of all FMCG consumption in India will be made online by
2020.
• The online FMCG market is forecast to reach US$ 45 billion in 2020 from US$ 20 billion in 2017.