About 75 percent of Indian population lives in rural area. In the country we have 6. 45 lass villages out of which only 13 percent villages have population above 2000. More than 50 percent of the sales of FMC and Durable companies come from the rural areas. The McKinney Report on “the Rise on Consumer Market in India” predicts that in twenty years the rural Indian market will be larger than the total consumer markets in countries such as South Korea or Canada today, and almost four times the size of today’s urban Indian market and estimated the size of the rural market at $577 Billion.
The urban areas constitute the fastest-growing part of the Indian market. Presently, the rural market accounts for a hefty share in most market segments- 55 percent of LICE policies, 70 percent of toilet soaps, 50 percent of TV, fans, bicycles, tea and wrist watches. With urban markets getting saturated, most companies are looking at huge potential in rural markets. Major corporations have seen great success with innovative strategies such as smaller packaging. Fast Moving Consumer Goods (FMC) companies have creams and soaps priced at 5, hair oil and shampoo sachets at 2 and small Coke at 8.
Companies have developed special products for the rural market, like Chic Shampoo sachets ricer at 1, Pearl G Tike Packs at 2, customized televisions by LAG, Shanty Mammal oil by Marino. Even with increasing arbitration and migration, 63 percent of Indian’s population will still live in rural areas in 2025. Thus, the rural market has been, and will remain, vitally important to the Indian economy. Rural consumption will be nearly tripled by 2025, creating a large potential market worth over 26 trillion Indian rupees ($577 billion). In the next 20 years the rural Indian market will be almost four times the size of today’s urban Indian market. McKinney Report). 2. 1 Myth about the rural sector The belief that rural people do not buy brands. Understanding Rural Consumer Behavior Tapping the Future Market By straitjacketing ; The belief that rural customer buy cheap products . In real TTY they seek value tort money. ; The belief that the rural market is homogeneous mass. In fact it is fascinatingly heterogeneous. 2. 2 Increase in purchasing power of rural consumer . Purchasing power of rural consumer increased in the last few decades with increase in farm and non-farm income.
Initially the impact of green revolution could be seen only in the prosperous agricultural states of the country but now slowly its influence has spread across the country with the increase in irrigation (Ball and Sings 2001). Facts reveal that rural consumers have low disposable income but as the time goes there are changes in the rising of their income and standard of living which happens because of different types of government schemes such as MANNER(Mahatma Gandhi National Rural Employment Guarantee Act) , Rural Credit, Micromanage ,Encouragement to Cottage and Micro industry 3.
Review OF LITERATURE “Rural Market: Currently, it’s a black hole, there’s not enough data; we will try to create a knowledge base,” – Mr. Paraded Shape (CEO of Mart). Dill Boob (2010) says better prices, enhanced connectivity, proper rural schemes, new crops and technology are among a host of factors which have changed the face of rural India and brought urban life styles and aspirations.
Dashes Kumar Sings ; Astrakhan’s Pander (2005) feel Indian rural market can be called a sleeping giant “since it holds vast untapped potential and rural market environment has changed along with the rural consumer who has become conscious regarding quality and price. 4. OBJECTIVE OF THE STUDY 1 . To study the changing profile of the rural consumer. . To offer suggestions to marketers’ to overcome the problems (faced by) and tapping the potentiality of the rural markets at optimum level. 5. RESEARCH METHODOLOGY The present study will be descriptive and exploratory in nature.
The data will be collected through secondary sources. The data comprises of information on consumer buying behavior and problems faced by marketers’ in tapping potential rural market through available online and published surveys on the related topics. 6. SUGGESTIONS After going through few literatures and published surveys on the related topics, this duty here offers some suggestions to the marketers’ for FMC and Durable Products. Marketers have to develop new strategies to dig deeper in rural markets. Marketers have to think deeply for targeting the rural market.
For that, they need to understand the need and behavior of the consumer. Companies’ may choose some innovative strategies that can penetrate the rural markets. Some of them are: * Producing new categories. * Customizing products. * Generating Awareness and Promoting Products through the Right Media. * Direct Consumer-Manufacturer-producer Relations. * Mobile Retailing. * Distribution strategy according to rural people. Communicate in their mother tongue. * The Government has to develop infrastructure facilities like roadways, railways etc. , in rural areas so as to reach large Indian rural market. 6.