Page 41 - DMGT509_RURAL MARKETING

Rural Marketing

Notes 2.3 Features of Indian Rural Markets

1. Large and Scattered Market: The rural market of India is large and scattered in the sense
that it consists of over 63 crore consumers from 5, 70,000 villages spread throughout the
country.
2. Major Income from Agriculture: Nearly 60 % of the rural income is from agriculture.
Hence rural prosperity is tied with agricultural prosperity. Roughly speaking, a location
is defined as "rural", if 75 per cent of the population is engaged in agriculture related
activity. In India, close to 70 per cent of the population is agrarian and contributes to about
one-third of India's GNP.
3. Low Standard of Living: The consumers in the village area do have a low standard of
living because of low literacy, low per capita income, social backwardness, low savings,
etc.
4. Traditional Outlook: The rural consumer values old customs and tradition. They do not
prefer changes.

5. Diverse Socio-Economic Backwardness: Rural consumers have diverse socio-economic
backwardness. This is different in different parts of the country.
Infrastructure Facilities: The Infrastructure Facilities like roads, warehouses, communication
system, and financial facilities are inadequate in rural areas. Hence physical distribution becomes
costly due to inadequate Infrastructure Facilities.

2.4 Profile of the Rural Consumer

1. Size of rural consumer population: The size of India’s rural consumer group can be
understood from the details provided in the following table:

Table 2.9

1971 1981 1991
Population Percentage Population Percentage Population Percentage
in crores to total in crores to total in crores to total
Rural 43.90 80 50.20 76.3 64.1 76
Population
Urban 10.91 20 15.62 23.7 20.3 24
Population
Total 54.81 100 65.82 100.00 84.4 100
Population

The table shows that now 76% of India’s total population is rural. If we consider the state
level picture, in several states like Uttar Pradesh, Madhya Pradesh, Rajasthan and Kerala,
the rural population constitutes more than 80% of the total population. And there are also
states like Bihar and Orissa where as much as 90% of the total population is rural.
2. Significant Aspects of Rural Consumer Profile: Coming to consumer characteristics, it can
be seen that in general sense, low purchasing power, low standard of living, low
per capita income, low literacy level and overall low economic and social position are the
traits of the rural consumers. By and large, the rural consumers of India are a tradition

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