Page 11 - DMGT509_RURAL MARKETING

Rural Marketing

Notes 3. Pricing: While Sachet pricing may have worked very well for Chik shampoo, the overheads
involved in payment collection do not always allow easy execution of sachet pricing. It is
easier to collect in larger amounts as every instance of collection and carrying of cash has
associated costs. Disposable income, though, isn’t always high since the bulk of rural India
is agricultural and income cycles in agricultural are very erratic and not as predictable as
in the case of us salaried individuals.
4. Scaling across geographies: If India is a land of many cultures, the contrast becomes that
much starker in the case of rural India. Setting up operations on a pan-India level presents
different types of hurdles in different states ranging from political juggling to downright
local factors. Any model where scalability involves scaling on-ground operations (and
not merely an increase in downloads) is bound to run into myriad issues as we move from
one state to the next. Add to that the greater differences in consumer tastes and behavior
across geographies than in the relatively more cosmopolitan urban population.

5. Developing inorganic scale: Developing synthetic scale through partnerships typically
results in larger overheads in the rural context. Finding the right partner with reach and
presence in villages is difficult to start with. More importantly, there are very few players
who are strong on these counts across multiple geographies. Hence, a pan-India rollout
typically requires multiple partnerships resulting in higher partner management
overheads.
6. Social and cultural challenges: The cyber café (or kiosk) model has not worked in many
parts of rural India due to socio-cultural issues. One of the reasons for the failure of the
kiosk model in Kuppam (HP’s i-community) was the lack of usage by women which was
largely due to their discomfort in going to kiosks run by men.

Self Assessment

Fill in the blanks:
1. Developing synthetic scale through partnerships typically results in larger overheads in
the ............................ context.
2. The majority of the rural population is still ............................ .
3. The time-tested manufacturer-distributor-retailer network has been the only real success
so far but setting up such a structure is rarely ............................ .
4. The dependence of villagers on farm income that varies with the fluctuations in rainfalls
so vitally required for ............................ .

5. The government has enacted laws against child marriages and ............................ .
6. ............................ and roads have been given priority in the government’s planning process.

1.4 Rural Products

Most products required in cities are also needed in the rural markets (with few exceptions), as
given below:
1. FMCG products like cosmetics, food items, cooking oil, kerosene, and medicines
2. Consumer durables like refrigerators, stoves, motor cycles

3. Farm products like tractors, harvesters, seeders, seeds, fertilizers, and diesel, water supply
for household use including drinking purposes and for watering farms

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