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8/9/2019 Chapter 2 rural management
1/39
Copyr i
gh
t
2012
Dor l
ingK
inder
sley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Chapter 2
The Rural Marketing Environment
8/9/2019 Chapter 2 rural management
2/39
Copyr i
gh
t
2012
Dor l
ingK
inder
sley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Learning Objectives
# Des$ri%e the evolution o& rural 'ar!eting
# ra$! the rural 'ar!eting environ'ent in ter's o&de'ographi$" physi$al" so$ial" $ultural" politi$al andte$hnologi$al aspe$ts
# nderstand the rural e$ono'i$ environ'ent" the $hangingrural e$ono'i$ stru$ture" and in$o'e spending pattern
# nderstand rural in&rastru$ture" govern'ent support" andits relevan$e &or 'ar!eting
# Des$ri%e the initiatives in the rural e'ploy'ent generationprogra''e
2
8/9/2019 Chapter 2 rural management
3/39
Copyr i
gh
t
2012
Dor l
ingK
inder
sley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Evolution of RuralMarketing
8/9/2019 Chapter 2 rural management
4/39
Copyr i
gh
t
2012
Dor l
ingK
inder
sley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural Environment
4
8/9/2019 Chapter 2 rural management
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8/9/2019 Chapter 2 rural management
6/39
Copyr i
gh
t
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural DemographicEnvironment
6
" #reak$up of the T%pe of &ousehol!s in n!iaOthers inclu!es siblings living together' etc(
Source: n!ian Rea!ership )urve%
# oint &a'ily stru$ture giving ,ay to individualied 3oint&a'ilies staying in the sa'e house %ut ,ith separate !it$hens
8/9/2019 Chapter 2 rural management
7/39
Copyr i
gh
t
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
# 4+ o& the population is in the $onsu'ing age group o& 1 to4- years
The Rural Population in n!ia
Rural DemographicEnvironment
8/9/2019 Chapter 2 rural management
8/39
Copyr i
gh
t
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural DemographicEnvironment
# Litera$y rate up &ro' 4+ in 2000 to /4+ in 2010
Literac% "mong n!ivi!uals of "ge *2 %ears an! "bove
8/9/2019 Chapter 2 rural management
9/39
Copyr i
gh
t
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
# Land &rag'entation" rising edu$ation and in$reased s!ill setshave en$ouraged shi&t &ro' agri$ultural to non5agri$ulturalo$$upation
Rural DemographicEnvironment
Occupation #reak$up in Rural "reas
8/9/2019 Chapter 2 rural management
10/39
Copyr i
gh
t
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural DemographicEnvironment
# otal land under &ar'ing al'ost $onstant %ut gro,th in
s'all and 'arginal &ar'ers
# Per $apita in$o'e up &ro' I6R 11"22* in 200-50 to I6R
1"1*4 in 2010
The Lan!hol!ing Pattern in Rural n!ia
8/9/2019 Chapter 2 rural management
11/39
Copyr i
gh
t
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural Ph%sical Environment
)ettlement )i+e# otal o& /.4 la$ villages o&
,hi$h .4 la$ inha%ited
&ousing )tructure# ype o& houses indi$ators
o& e$ono'i$ gro,th# 7hare o& pu$$a houses up
&ro' 41+ in 10 to /+in 2010
)prea! of ,illages in Rural n!ia
The &ousing Pattern in Rural "reasSource:Census of n!ia an! n!ian
Rea!ership )urve%(
8/9/2019 Chapter 2 rural management
12/39
Copyr i
gh
t
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural Ph%sical Environment
)ettlement )i+e
# 4/.-+ o& villages have
population o& 00 or less
,ith no shops
# 8illages ,ith population o&
2"0009 (1.*+) 'ost
prosperous ,ith 0+ o& the
rural population and /0+ o&
the rural ,ealth
&ousing )tructure
# ype o& house ,as part o&
7:C $lassi&i$ation in rural
8/9/2019 Chapter 2 rural management
13/39
Copyr i
gh
t
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural )ocial an! CulturalEnvironment
# India has / so$io5$ultural regions ,hi$h ,ere later split into 0to %e used &or 'ar!et seg'entation and targeting
# 8illages have lo$al ;ra' Pan$hayats ,ith reservations on $asteand gender lines
# he role o& elders as in&luen$ers no, giving ,ay to youth and!no,ledgea%le
#
8/9/2019 Chapter 2 rural management
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8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural TechnologicalEnvironment
# Rapid 'e$haniation otal $ropped area $onstant at around 10 'illionhe$tares
ra$tors nearly dou%led %et,een 1- and 200/
15
Rapi! -ro.th of /arm Mechani+ation
8/9/2019 Chapter 2 rural management
16/39
Copyr ig
ht
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
# 7hare o& ani'al po,er do,n &ro' 1/+ to *+
ncreasing Mechani+ation0 )ource of Po.erSource:n!ia #ran! E1uit% /oun!ation' ...(ibef(org
Rural TechnologicalEnvironment
8/9/2019 Chapter 2 rural management
17/39
Copyr ig
ht
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural TechnologicalEnvironment
# In&or'ation and $o''uni$ation revolution enhan$ing
e?posure to ,eather &ore$asts" 'andi rates" health and legal
advi$e" 3o% opportunities
# :&&e$tiveness o& e5Choupal introdu$ed %y IC
17
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Rural EconomicEnvironment
Rising rural in$o'es is&uelling $onsu'ption gro,thin$reasing the share o& total
Parameter Contribution of Rural n!ia 34
Total Population 56
Total ncome 78
Total E9pen!iture 8:
Total )avings ;;
# Rural gro,th ,as the
highest in 200
# =ll hu'an develop'entindi$ators on the rise
# Persons %elo, the povertyline do,n &ro' 2*+ to22+
18
Table 2.9
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Changing /ace of Rural Development
# ;ro,th in no'inal rural ;DP has in$reased to over 12+ perannu' over the last &e, years.
# Politi$al environ'ent 'ore &riendly.
19
-ro.th in Rural ConsumptionSource:Cre!it$)uisse
8/9/2019 Chapter 2 rural management
20/39
Copyr ig
ht
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Changing /ace of Rural Development
# 7i? &old in$rease in %udget allo$ations &or agri$ulture andrural develop'ent %et,een the @th and the 11th Aive BearPlan
# Aar' to non5&ar' in$o'e at -0/0 in 2010
#20
)ectoral "llocations During /ive
8/9/2019 Chapter 2 rural management
21/39
Copyr ig
ht
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Transition of the RuralEconom%
ransition has o$$urred at threelevels# Aood grain $rops# n5land a$tivities# Aar' a$tivities
ransition lin!ed to highopportunity &or value additionresulting in high rural in$o'es.Aar' se$tor no, $ontri%utesonly -0+ o& the rural in$o'e,ith non5&ar' a$tivity$ontri%uting to /0+.
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
indersley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Rural Economic)tructure
Aro' &ood grain5s$ar$ee$ono'y to a &ood grain5surplus e$ono'yIndia largest produ$er o&$o$onut" 'angoes"
%ananas" 'il! and dairyprodu$ts" $ashe, nuts"pulses" ginger" tur'eri$ and%la$! pepper.7e$ond largest produ$er o&ri$e" ,heat" sugar" $otton"&ruits and vegeta%les.
8/9/2019 Chapter 2 rural management
23/39
Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The /arm )ector
# 7hi&t &ro' staples to 'ore lu$rative $ash $rops
# =rea under &ood grains and $oarse grains de$lined %y 2 and1@+ ,hile sugar$ane and $otton up %y 2 and 10+
respe$tively
# ini'u' 7upport Pri$es no, %eing in$reased at a &asterpa$e
# Produ$tion o& &oodgrains in 200E10 is esti'ated at 21/.@'illion tonnes.
# =llied a$tivities li!e dairy" poultry and &ishing also gro,ing23
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The =on$farm )ector
)econ!ar% sector# Cotton te?tiles" ,ood" pottery" &ood" 'etal produ$ts"
handi$ra&ts
# :le$tri$al e>uip'ent" paper" $he'i$als and po,er loo's
Tertiar% sectors# rade" transport" &ood %usiness" edu$ation" personal
servi$es
6on5&ar' se$tor a$$ounts &or /0+ o& rural ;DP e'ployingonly 2*+ o& the rural ,or!&or$e
# :sti'ated to $ontri%ute *0+ %y 2020 24
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural Enterprises
# otal rural enterprises 2.- 'illion (/1+ o& total)
# 6on5agri$ultural enterprises 1.@4 'illion (@+ o& total)
# Retail trade (4+) do'inant a$tivity &ollo,ed %y'anu&a$turing (2/+)
# 6u'%er o& ,or!ers e'ployed up %y 20 'illion %et,een
10 and 200
25
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural Enterprises
26
The )tatus of Rural Enterprises in n!ia
=on$agricultural Establishments in Rural n!iaSource:
Economic Census' 2667(
8/9/2019 Chapter 2 rural management
27/39
Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Changing Migration Tren!s
# igration &ro' rural areashas a positive i'pa$t onrural in$o'es sin$e 'oney isre'itted ho'e
# igration &ro' rural to ruralhighest indi$ating higheropportunities in rural.
# 2-+ o& 'ale 'igrantsreturned to their ho'elandsin 200*E0@
27
Migration Pattern
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
ncome an! E9pen!itures
#
8/9/2019 Chapter 2 rural management
29/39
Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
ncome an! E9pen!itures
# 6on5&ar' households reported higher in$o'es led %ysalaried and sel&5e'ployed
Changes in Rural ncome b% Occupation -roups
8/9/2019 Chapter 2 rural management
30/39
Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
# ore %uying po,er a'ong non5&ar' households
The Rural ncome>E9pen!iture Profile in =R4)ource0 Ma9>=C"ER an! E!el.eiss>M"RT )urve%(
ncome an! E9pen!itures
8/9/2019 Chapter 2 rural management
31/39
Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
ncome an! E9pen!itures
ncome Disparit%# op >uintile earns seven ti'es that o& %otto' >uintile
# op t,o >uintiles $ontri%ute to /0+ o& total rural in$o'es
Distribution of Rural Population an! ncome b% ncome ?uintiles
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
ncome an! E9pen!itures
Rural )pen!ing
# Rural $onsu'ption 'ar!et 7D 10 %illion
# 7hare o& &ood dropped &ro' @+ to -2+ in the last de$ade
# 7e$tors gaining ,ere transport" edu$ation and re$reation
# 7hi&t &ro' un%randed to %randed goods
# Dura%les have not gro,n in ,allet share largely due to
drop in pri$es
# Rural $onsu'ption 'ar!et ,ill triple %y 2020 as per
:del,eiss esti'ates
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Changing @allet )hare in Rural n!ia)ource0 =))O an! E!el.eiss>M"RT )urve%
ncome an! E9pen!itures
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Rural nfrastructure
34
# #harat =irman" $overing all5round in&rastru$turaldevelop'ent laun$hed in 200
#
"reas of Development An!er #harat =irman
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Rural nfrastructure
35
# Rural eletri&i$ation is + although proportion o& ele$tri&ied
households is only /0+
# Rural housing (n!ira ".as
8/9/2019 Chapter 2 rural management
36/39
Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Rural nfrastructure
Telecommunications
# otal rural users 21 'illion
# 2/ &old gro,th in teledensity in the last eight years
# Get,een 200/ and 2010 'o%ile penetration gre, seventi'es in rural India against three&old gro,th in ur%an
Rural Tele!ensit% -ro.th
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
The Rural Emplo%ment -enerationProgrammes
37
The Mahatma -an!hi =ational Rural Emplo%ment-uarantee "ct M=RE-"4# Laun$hed in Ae%ruary 200/ $overing /1 distri$ts and
pro'ising 100 days o& guaranteed ,age e'ploy'ent in a&inan$ial year
The ).arnj%anti -ram ).aro+gar
8/9/2019 Chapter 2 rural management
38/39
Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural ar!eting" 2e
Rural Marketing Case=RE-"
Re&er to video $ase and ans,er the &ollo,ing >uestions
#
8/9/2019 Chapter 2 rural management
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Copyr ig
ht
2012
Dor l
ingK
inde
rsley(I
ndia)Pvt.L
td.
Rural marketing is marketing to arural mindset, not a rural market.
It is all about understanding themind rather than manipulating itor adapting marketing theory to a
rural environment.
)uccessful Mantra in )tu!%ingRural Marketing Environment