Page 101 - DMGT509_RURAL MARKETING

Rural Marketing

Notes falling sharply in rural areas. Farmers preferred Usha’s premier ‘Century’ brand, though it was
priced 20 per cent higher (Das Gupta and Menon, 1990).

The Buying Process

The rural consumer has a very high involvement in any product purchased, especially when he
decides to buy high-end products which cost a few hundreds or thousands of rupees. He has his
daily routine, and there is no sense of urgency in his lifestyle. He understands symbols and
colours better, and looks for endorsement by local leaders or icons (Rajan, 2005).

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Caution Companies should draw up pricing formula based on their revenue objectives,
price and volume relationships and marketing expenses. Companies have to understand
competitive pricing formula, costs, product specifications and market segment.

Self Assessment

State whether the following statements are true or false:

7. Big volume buyers usually call the three to four short-listed vendors for final negotiations
on price and terms of business.
8. Industrial sales or B-to-B sales can be long drawn out processes as the money value of
orders is large, and the buyers want the best deal.
9. Industrial buying is mostly directly from the manufacturers but in case of raw materials
and components, the sellers use the services of distribution channels.
10. In India, there are two types of tenders, running contracts and rate contracts.
11. Home buyers prefer to buy a large range of products from one source and hence number
of sellers tie up for providing turn key solutions.

5.8 Brand Preference and Loyalty

A marketer does not perceive an opportunity in rural market when he or she thinks that the
rural consumer buys only unbranded items. It is useful to have a good understanding of the
purchase behaviour of the consumer in order to guide decisions in the rural markets. In as many
as 10 product categories, national brands account for more than 90 per cent of the sales The
attitude of the rural consumers favours quality products and brands, but brand pricing has to
take into account both the income level and income flow of the consumers. Rural consumers, as
seen earlier, are not homogenous. There are consumers who can afford high priced brands. A
group of rural consumers can not only afford but are also willing to buy high priced brands.

Brand Loyalty

Multi-brand strategies and entry for new brands in rural markets are possible, even though it is
perceived to be a highly brand loyal market. The rural consumer is willing to consider alternatives
The loyalty of rural consumers to a brand varies according to product categories. It has been
seen that loyalty is low in toilet soaps, toothpaste, batteries and washing cakes but high in home
insecticides, chyavanprash, shaving preparations and skin cream. Brand loyalty is possibly lower
in product categories where there is choice and not much brand building.

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