Chapter-IV

OPPORTUNITIES OF
RURAL MARKETING
 127

OPPORTUNITIES OF RURAL MARKETING

The Indian rural market with its vast size and demand base offers great
opportunities to marketers. Rural India represents the heart of India.
Approximately 80% of India lives in over half a million villages, generating more
than half of the national income. The vast untapped potential of the rural market is
growing at a rapid pace. In terms of the number of people, the Indian rural market
is almost twice as large as the entire market of the USA and the USSR.
Rural India, with a significant improvement in purchasing power,
increasing brand consciousness, changing consumption pattern and rapid spread
of communication network, presents a growing prospect for the multinational
companies. The policies of the government largely favour rural development
programme. This is clearly highlighted by the fact that the outlay for rural
development has increased from Rs. 8900 crore in the seventh plan to Rs. 34400
crore, Rs. 89000 crore and Rs. 120000 crore in the Eighth, Ninth and Tenth plans
respectively. These figures also prove that the rural market is emerging stronger
with a gradual increase in disposable income of the rural folk. In addition, better
procurement prices fixed for the various crops and better yield due to many
research programmes have also contributed to the strengthening of the rural
markets.1

The rural market has been growing at 12-13% compared to 7-8% growth
of its urban counterpart, over the last decade. Corporates are now earnestly
looking towards rural markets because of the good market prospects it offers and
also because the urban consumer markets are getting a bit too cluttered. With 128
million households, the rural population is nearly 3 times that of the urban
population. According to the NCAER, average rural India household was
expected to have 5 major consumer appliances by 2006, almost double of what it
had 5 years ago.2
The potential of rural market is immense. Research studies by
organizations like NCAER and ORG-Marg have shown that rural markets are
growing at five times the rate of the urban markets. As a result of growing
affluence, fuelled by good monsoons and the increase in agricultural output to 200
million tonnes from 176 million tones in 1991, rural India has a large consuming
 128

class with 41% of India’s middle class and 58% of total disposable income. A
number of factors have been recognized as responsible for the rural market

prospectus:
1. Increase in population and hence increase in demand. The rural population
in 1981 was 2.50 crores which increased to 68.50 crores in 1991 and to 72
crores in 2001.
2. A market increase in the rural income due to agrarian prosperity. India is
now seeing a dramatic shift towards prosperity in rural households. The
lowest income class will shrink from more than 60 percent in 1994-95 to
20 percent in 2006-07 The higher income classes will be more than
double.
3. Infrastructure is improving rapidly:
i) In 50 years, only 40% Villages connected by road, in next 10 years
another 30%.
ii) More than 90% villages electrified, though only 41% rural homes have
electric connections.
iii) Social indicators have improved a lot between 1981 and 2001. Number
of‘Pucca’ houses doubled from 22% to 41% and ‘Kuccha’ houses halved
from 41% to 23%.
iv) Percentage of BPL families declined from 46% to 27%.
v) Rural literacy level improved from 36percent to 59 percent.
4. Low penetration rates in rural areas for consumer durable and non durable
products compared to urban areas.
Table 7.1
Consumer Non Durable Penetration Rate (%)
Product Category All India Urban Rural
Deodorants 2.1 5.5 0.6
Tooth paste 48.6 74.9 37.6
Skin cream 22 31.5 17.8
Shampoo 38 52.1 31.9
Utensil Cleaner 28 59.9 14.6
Instant Coffee 6.6 15.5 2.8
Washing powder 86.1 90.7 84.1
Detergent Bar 88.6 91.4 87.4
Toilet soap 91.5 97.4 88.9
Source : HLL investor meet 2006.
 129

Table 7.2
Consumer Durables : Penetration Rate (Ownership per 1000 Households)
Products Rural Urban
Wristwatch, mechanical 823 951
Bicycle 605 516
Radio 491 481
Ceiling Fan 280 933
Television (B &W) 195 490
Pressure Cooker 178 635
Television (Colour) 48 304
Mixer Grinder 44 339
Refrigerator 35 335
Motor cycle 28 77
Source : Indian Market Demographics 2002, NCAER
The average consumption by rural household is much lower than their
Urban counterparts. Existence of unsaturated markets provides an excellent
opportunity for the industry players in the form of a vastly untapped market as the
income rises.
5. Large inflow of investment for rural development programme from
Government and other sources. A large number of programmes, aimed at
improving the economic conditions of rural poor, have been operating in
the country. The Integrated Rural Development Programme (IRDP) was
evolved to increase production and productivity, and thereby marketing
among the rural masses. IRDP provides assistance to rural families below
the poverty line by providing them productive assets and thereby
increasing their level of income and purchasing power. Poverty
Alleviation programmes, integrated Rural Development Programme
Jawahar Rozgar Yojna, National Rural Employment Programme, National
Social Assistance programme and National Family benefit scheme. All
these schemes add a new thrust in rural areas by helping demand creation
and an enhanced market.3
130

6. Increasing Income and Purchasing Power: The agriculture

development programme of the government has helped to increase income
in the agriculture sector. This, in turn, has created greater purchasing
power in rural markets. Studies by NCAER provide evidence of the
increased income of rural households. Households in the lower income
groups have reduced while there is a strong growth in the number of
households in upper middle and higher income households.
Table 7.3
Average Annual Growth Rates of Rural Households in Different Income
Groups (figures are in percentages)
Income Group Annual 1985-86 to 1992 -93 to 1995-96 to
Income (Rs.) at 1998-99 1989-90 1995-96 1998-99
prices
< =35000 L -0.20 -3.03 -4.51
35001-70000 LM 4.91 10.22 7.71
70001-105000 M 17.82 3.11 7.82 #
105001 - 140000 UM 16.39 12.25 8.61
> 140000 H 13.90 15.68 14.31
Total 2.04 1.44 1.29
Source : NCAER (Income Demographics) 2002
Figure 2.1 : Growth in Income Classes

B Pre-reform period (1985-86 to 1989-90)

■ Post-reform Period-I (1992-93 to 1995-96)
□ Post-reform Period-ll (1995-98 to 1998-99)
 131

7) Competition in Urban Markets : Intensified competition in urban

markets, with a wide variety of choices of brands increases costs and
reduces market share. For examples, it is reported that there are around 86
branded cosmetic soaps in the urban market. So there is no point for a new
company to enter the urban market. The rural markets provide better
opportunities The automobile market brings this out clearly. Rajdoot
motocycle, Bajaj Scooters or Ambassador cars find ready acceptance in
rural markets as compared to urban markets where there is a proliferation
of brands.
8) Impact of the Media : The growing reach of the electronic media has
created a huge change in the lifestyle of rural consumers. It has provided
exposure to various products and services, which were hitherto considered
the domain of urban users. This has resulted in demand of various goods.
Table 7.4
Media in Indian Villages
■

Percentage of Household Exposed to

T.V. Radio Print Cinema
All India 27 37 16 29
South Zone 25 48 26 58
West Zone 33 30 17 17
North Zone 29 31 11 09
East Zone 26 39 12 29
Source : Indian Readership Survey, 1999.
9) Enhanced Mobility : With the advancement of transport and
communication system, mobility has increased. People form Rural areas
are moving to urban areas and from urban areas to rural areas. Now, there
is an enhanced interaction, interchange and intermigration between rural
and urban people and thus developing a common culture. When mobility
increases, rural people come in the close contact with the urban people.
When they come in close contact with the urban people, they feel inspired
to proceed for fashion, comfort and other desirable things to urban life.
132

The dividing line between rural and urban areas is gradually disappearing
because of enhanced mobility.4
10) Consumer Behaviour Changes : Increased literacy and greater
awareness in rural markets create new demands and discriminating buyers.
It can be analysed more in the younger generation. In villages today, this
segment of buyers consumes a large variety of products, both durables and
non durables. There is a visible increase in the consumption and use of a
variety of products which is easily observed. The younger generation
appears to seek variety and are more discriminating buyers. The young
adult in a village likes to sport a fashionable watch. The preferred brand of
toilet soap for the youth is not necessarily lifebuoy, the brand preferred by

the elders.
11) Current Consumption a Pointer to Potential: The purchase and use of
certain durables and non durables by consumers in rural areas is more than
that of consumers in urban areas. The durables for which purchase and use
by consumers in rural areas exceed those in the urban areas are as follows

(NCAER, 2002)
• Sewing Machine
• Wrist watches
• Black and white television sets
• Cassette recorders
• Bicycles
• Table fans
• Pressure Cookers
In the case of consumer non-durables, there are at least six products,
where the rural market has a larger share than the urban market.
Table 7.5
Rural Market Share of Consumption
Non - Durable Product Share of Rural Percentage
Analgesic tablets 45.7
Batteries 56.2
Coconut Oil 41.6
Blues 52.3
 Iodised salt 51.4
Safety razor Blades 54.1
Tea 60.0
Toilet Soaps 58.0
Washing cakes/' bars 67.2
Washing powder/ liquids 46.4
Source : NCAER, Indian Market Demographics, 2002.
12) Literacy level and Spread of Education : Literacy rate of rural India is
steadily increasing. In 2001, it was 65 percent compared to 36.2 percent in
1991. In absolute terms, literate rural population of 2.28 crores exceeds
literate urban population of 1.34 crores. On an average, more than one
crore literates are being added to literate rural population every year. The
adult Education and Distance Education Programmes are bound to
increase literacy rate further.
Table 7.6
Literacy Level During Various Census Period
Literacy level in percentage

1971 1981 1991 2001

Sex Rural Urban Rural Urban Rural Urban Rural Urban

Males 34 61 41 66 58 81 61 82
Females 13 42 18 48 31 64 32 67

All 24 52 30 57 45 73 50 75

Source : Census of India, 2001

This trend leads to more awareness among the rural consumers and makes
a shift in preferences regarding consumer goods.
13) Rural Marketing is iW Expensive : In rural areas, rural development
programmes enhance scope for new income by generating new
employment opportunities. This results in an increase in the purchasing
power of the rural consumer. The green revolution and expectation
revolution lead to the demand revolution in rural market. The demand
revolution and increased purchasing power of the rural people give an
 134

excellent opportunity to the modem marketers to penetrate into rural

markets. With the increase in the capacity to spend, rural marketing is
regarded as an excellent investment rather than wasteful expenditure.
Realising this fact, many big companies like Hindustan lever, Godrej,
Tomco, Colgate, Palmolive and Liptons have made their way deep into the
rural markets.5

14) Income Disparity :

Table 7.7
Rural Urban Income Comparison
Bottom (30%) Middle (40%) Top(30%) All classes
Sector Rural Urban Rural Urban Rural Urban Rural Urban
Average 3270 4580 5110 8150 9400 18720 5830 10260
Consumption
expenditure
(Rs./annum)
Population 223 86 297 114 223 86 742 285
(Million)
Source : NSS 55irrRound"( l 999-2000) Census 2001

Overall, the rural per person spending of Rs. 5830 per annum is a little
above the half of the urban households. But as the total number of the rural
population is three times larger than the urban, tha overall spending in rural is
much higher than in urban. The rural rich and middle classes present a great
opportunity for marketers to sell their products.
15) Rural Market - A Global Opportunity : Trends indicate that the rural
markets are coming up in a big way and growing twice as fast as the
urban, witnessing a rise in sales of hitherto typical urban kitchen gadgets
such as refrigerators, mixer-Grinders and pressure cookers. According to a
National Council for Applied Economic Research (NCAER) study, there
are as many ‘middle income and above’ households in the rural areas as
they are in the urban areas. There are almost twice as many ‘lower middle
income’ households in rural areas as in the urban areas. At the highest
income level, there are 2.3 million urban households as against 1.6 million
 135

households in rural areas. The absolute size of rural India is expected to be

double that of urban India.6

16) Corporate Turn to Rural India For Giowth : Coca-cola India doubled
the number of outlets in rural areas from 80000 to 160000 which increased
market penetration from 13 percent to 25 percent. It brought down the
average price of its products from Rs. 10 to Rs. 5, thereby bridging the gap
between soft drinks and other local options like tea, butter milk or lemon
water. It doubled the cost on Doordarshan, increased price compliance
from 30 percent to 50 percent in rural market and reduced overall costs by
40 percent. It also tapped local forms of entertainment like annual haats
and fairs and made huge investments in infrastructure for distribution and
marketing. The rural market accounts for 80 percent of new coke drinkers
and 30 percent of its volumes. The rural market for coca-cola grew at 37
percent over the last year, against a 24 percent growth in urban areas. Per
capita consumption in rural areas has doubled in the last two years. The
launch of the Rs. 5 pack has reaped rich dividends in terms of sales and
the bottles are expected to account for 50 percent of the company’s sales
in a year. A lot of fast moving consumer goods and consumer electronic
companies are aggressively targeting rural consumers.7

17) Accessibility of Markets : The attraction of a market depends not only

on its potential but also on its accessibility. Development of infrastructural
facilities and marketing institutions have increased the accessibility of
these markets. The road network has facilitated a systemised product
distribution system to villages. Today, an increasing number of companies
are supplying to village markets directly. Increasing direct contact to
villages helps products promotion and availability of the product in the
village shop. Marketers of durable goods use direct contacts as a means to
promote and attract rural consumers to dealer points in large feeder
villages or towns. Feeder villages or towns are locations from where a
large number of interior villages get their products. Delivery-cum-
 136

Promotion vans traversing eight to 10 villages a day and covering haats or

mandis, are the widely used method of direct contact in rural areas.
18) Socio-Cultural Changes : Many social changes can be observed in rural
areas, which have bearing on rural marketing. The changing family
structure, buying roles, increased rural - urban nexus etc. have influenced
the life style of rural middle and upper class segments. The landlords,
villages officials and rich fanners are developing a tendency to lead
comfortable life and act like ‘trend setters’ in respect of modem
consumers durables. Possession of certain products like colour T.V.,
Scooter, Refrigerator etc. adds prestige to households in some villages.
This trend leads to more demand for goods and services in rural areas and
provides an opportunity to the marketer.

OPPORTUNITIES OF RURAL MARKETING IN HARYANA

The rural population with its three-fourth share in the total population
occupies an important position in the marketing system. In Haryana, the rural
market with its vast size and demand base, offers great opportunities to marketers.
In terms of business volumes, rural market is a big market for food items,
agricultural inputs and even for non-food items. The rural market has grown
steadily through the years. Besides growth, the composition of the demand has
been changing significantly. The rural market provides vast potential as many
new products and services have already made their entry' into the rural consumers
basket. The market for clothing, cosmetics, toilet soaps, washing soaps, books,
household utensils, torches and batteries, sewing machine, electronic goods,
bicycle and other consumable and durable goods has grown spectacularly in the
rural areas. The upper segments, in particular, have started buying and using a
variety of modem consumer products which were till recently unknown in the
rural market. Thus, the rural market has been growing in magnitude for both
traditional and modem consumer goods and services.
There has been significant improvement in rural sector in respect of
agricultural production, spread of education, banking facilities, electrification,
transportation, communication etc. All these changes have led to the creation of
 137

general awareness for achieving a new and better style of living. With the
increased purchasing power, access to communication and awareness about
modem life style, rural sector offers better marketing opportunities.
The marketing boom in the rural areas is caused by such factors as
increased discretionary income, marketable surplus of product like vegetables and
eggs, rural development schemes, improved infrastructure, increased retailing and
retailers, increased awareness with information explosion, expending T.V
Network with satellite, liberalized Government polices for Rural development
emphasis on Rural Markets by companies, new cadre of entrepreneurship,
competitive, and creative sales promotion, packaging revolution and changing life
styles in the rural areas.8
In general, market potential depends on population characteristics and
economic condition. Some of the factors that determine the rural market potential
are discussed below:
1. Size of Rural Consumer
Table 7.8
Relative Growth of Rural Urban Population (Haryana)
Population % in Total Population
Year Rural Urban Rural Urban
1951 4,705,103 968,494 82.92 17.07
1961 6,282,844 1,307,680 82,77 17,23
1971 8,263,472 1,772959 82,33 17.67
1981 10,095,231 2,827,387 78.12 21.88
1991 12,408,904 4,054,744 75.37 24.63
2001 * 14.968,850 6,114,139 71.00 29.00
Source : Census of India, 2001
With a view to understand the size of rural population, the trends in urban
and rural population during 1951, 1961, 1971, 1981 and 2001 census period are
shown here. Census figures show that the rural population is more than the urban
population. This trend indicates the increasing need for goods and services in
rural areas. Hence, there is a large scope for rural marketing.
 138

2. Literacy level of Rural Consumer

Table 7.9
Rural Literacy Rate in Haryana
State 1981 1991 2001
Haryana 37.26 49.85 63.82
Source : Census of India, 2001
Literacy rate among rural population is steadily increasing. In 2001. it is
63. 82 percent compared to 49.85 percent in 1991. In absolute terms, literate rural
population of 80 lakh exceeds literate urban population of 42 lakh. The adult
Education and Distance Education Programmes are bound to increase literacy rate
further. The Eight plan objective of universalisation of elementary education and
complete eradication of illiteracy in the age group of 15-36 years provide further
impetus to literacy programmes in rural areas. This trend leads to more awareness
among the rural consumers and makes a shift in preference regarding consumer
goods.
3. Per Capita Expenditure
From per capita expenditure, the spending capacity or purchasing power
of the rural population can be assessed.
Table 7.10
Composition of Rural Per Capita
Consumption Expenditure in Haryana
Year Food Non-Food
1984 64.0 36.0
1993-94 60.1 40.0
1999-2000 55.5 44.5
.. .................... —........................................... *■" .......... —...............flf- ............... 1 1 ........ ................................ . 1

Source : National Sample Survey 55 Rounds on Households Consumer

Expenditure.
Rural spending on non-food items is increasing, out of a total per capita
spending, approximately 44 percent is spent on non-food items. This shows an
encouraging trend for consumer durables and non-durables.
 139

4. Rising Rural Prosperity

Table 7.11
Percentage of Households Income Category in Haryana
Income Groups 1989-90 1995-96 1998-99
Low Income Group 46.83 28.61 18.30
Lower Middle Income 37.85 36.00 36.30
Group
Higher Income Group 15.32 35.39 45.41
Source : Indian Market Demographic Report, 2002 (NCAER)
Haryana is now seeing a dramatic shift towards prosperity in rural
households. The lowest income class will shrink from 46.83 percent in 1989-90 to
18.30 percent in 1998-99. The higher income classes will more than double. This
trend shows the increasing capacity of consumers to spend on goods and services.
5. Life Style Changes : Life style changes are witnessed in the rural areas.
Contrary to popular perception, the potential rural market is not confined
to a few million large farmer households. The boom in the rural market is
not due to sporadic indulgence by a privileged rural minority but reflects
instead the changing priorities sweeping the entire hinterland. It is true that
the less privileged have low purchasing power, but their raising aspirations
should not be underestimated. For certain products, usage is high among
agricultural labourers, the bulk of whom falls below the poverty line. In
the rural households, there is an upgradation in terms of the form of the
product used. For example, households are upgrading from traditional
mosquito repellants such as gober to coils to mats. There is also an
upgradation from local or unbranded products to national brands and from
low price brands to premium brands. This is primarily due to the advent of
the satellite television and cable network. With increasing literacy levels
and media explosion, brand consciousness is on an upswing . This has
created an awareness of the branded products and also induced an
attraction for the premium products. Table 7.12 shows the brand with
highest penetration in rural areas of Haryana.
140

Table 7.12
Brand Penetration in Rural Areas
Category Category Brand with Higher
Penetration (%) Penetration
Tooth paste/ Tooth Powder 38 Colgate
Bathing Soap 74 Lifebuoy
Cosmetics 73 Ponds
Cold drinks 90 Pepsi
Biscuits 72 Parle-G
l ea Powder 100 fata Tea
Source : Through Questionnaire
6. Rural Development Programmes : Various schemes/ programmes arc-
worked out by the central as well as state government to improve the
status of rural population. The 20-point programme of the Government
provides ample scope for the development of rural areas. Haryana state
has developed 9636 rural industrial units for the manufacture of
agricultural implements, soap, furniture, and chemicals. Rural
electrification would speed up the process of rural industrialisation.
During the planning period, there is an increase in the allocation of
expenditure for Rural Development Programmes. These provide ample
scope for employment to the rural people, which enhances the rural
household income, thereby augmenting an improved standard of living
and Purchasing power.
Table 7.13
Rural Development Expenditure Pattern in Haryana
Year Expenditure Percentage to Total
(Rs. in Lakh) Expenditure
1991-92 1635 2.34
1992-97 12540 2.56
1997-02 29111 3.65
2002-07 60790 4.68
2006-07(Annual Plan) 17220 4.07
Source : Statistical Abstract of Haryana, 2006-07.
 141

7. Life-Cycle of Certain Consumer Items : Many products have achieved

near maturity in the urban market, while in rural areas are in the growth
phase. The reason for the variations in product life cycle stages may be
attributed to the different rates of diffusion-adoption process in urban and
rural Markets.
Table 7.14
Stages in life -Cycle
Product Urban Market Rural Market
Growth Growth Rate
Rate (%) (%)
Popular Soaps Maturity 2 Growth 40
Premium Soaps Late Growth 11 Early growth 67
Washing Powders Late Growth 6 Early Growth 60
Skin Creams Maturity 1.1 Early Growth 9.9
Talcum Powder Maturity 4 Growth 3.1
Source : ORG Surveys 2002
8. Market Growth Rates Higher than Urban : The growth rates of the
FMCG market and durable market are higher in rural areas for many
products. The rural market share will be more than 50 percent for products
like toilet soaps, body talcum powder, cooking medium (oil), tea,
cigarettes and hair oil.
Table 7.15
Boom in the Rural FMCG Market
Category Total Size*** %Growth Rural Size 2006-07*
(Urban +RuraI) 2001-02*
Toilet Soap 7500 13.4 6021 11,291
Body Talcum 940 23.65 793 2292
Powder
Tooth paste 2080 23.50 1441 4140
Cooking 17000 10.91 15377 25,806
Medium (Oil)
Tea 6500 10.97 4955 8337
Health 908 28.54 601 21,10
Beverages
 142

Electric Bulbs 750 9.40 354 555

Cigarettes 7662 13.09 6422 118.79
Packaged 2500 6.79 1323 1.837
Biscuits
Hair Oil Cream 175 30.85 179 689 !
1
Source : Business Intelligence unit and NCAER* Projections **annual growth
rates compounded for last five years *** figures in Rs. crore for 1989-99.
The durable market offers an excellent opportunity. The Table 7.15
compares the durable owned and estimates of future sales along with growth rates
in rural and urban areas. The growth rate for all the three groups of durables for
rural areas are much higher than those in urban areas.
Table 7.16
Consumer Durables : Market Growth
1992-93 to 1995-96 1995-96 to 1998-99
Rural Urban Total Rural Urban Total
Group I 5.7 4.0 5.1 11.1 5.2 9.2
Lo
O

Group II 19.6 6.4 12.7 9.9 -0.2

t

Group III 25.0 20.8 21.9 22.5 13.6 16.3

Total 8.8 7.0 8.09 11.5 2.9 8.1
Source: NCAER
Table 7.17
Stock of Consumer Durables: Rural Vs Urban (In Million Units )
2001-02' 2006-07*

Rural Urban Rural Urban

Group I 330.6 195.2 430.9 245.1
Group II 100.1 95.5 144.8 122.7
Group III 29.9 83.5 57.1 138.3
Source : NCAE Projections
NCAER estimates expect the ownership of durables to increase from 835
million in 2001-02 to 1.14 billion by 2006-07. The rural market is bigger than the
urban market for Group I and II durables. But it will continue to be smaller for
Group III even in 2006-07.
 143

9. Preferences for Purchasing Durables

Table 7.18
Frequency Distribution of Responsdents (Consumer) Regarding Preferences
_______________ _______for Purchasing Durables _________ __________
Factor Ranks Weighted Rank
1st Ilnd Illrd Scores

Brand Image 48(8) 66(11) 78(13) 354 7

Durability 114(19) 96(16) 66(11) 600 2

Price 192(32) 126 (21) 108(18) 936 1

Guarantee/ 72(12) 54 (9) 42(7) 366 6

Warranty
Credit Availability 60(10) 102(17) 96(16) 480 3

Latest Technology 54(9) 84(14) 108(18) 438 5

After Sale Service 66(11) 72(12) 102(17) 444 4

Note : Figures in Parenthesis indicate percentage

Source: Through Questionnaire
In Order to assess the buyer behaviour towards certain critical aspects of
marketing, we have made an attempt to find out the preferences of consumers
towards Price, Durability, Credit facility, Guarantee and After Sale Service. In
this regard the respondents were asked to rank any three factor of (as 1,2,3)
preferences according to their perception about purchases. To calculate the
weighted scores, weights 3,2, and 1 were assigned to 1st rank, Ilnd rank and Illrd
rank respectively as given by the respondents to different factors of purchases.
Table 7.18 shows the responses of consumers and also shows weighted scores and
ranks.
Table 7.18 clearly reveals that majority of respondents (32 percent) State
that Price is the major factor considered by respondents, ranking in 1st while (21
percent) respondents assigned rank two to this factor of preferences. 17 percent
respondents gave 2nd rank to credit availability and 16 percent assigned 2nd rank to

durability factor. Very few respondents (8 percent) state that the Brand Image is
also an important factor of purchases. The overall weighted scores indicate that
price has got first rank followed by durability 2nd rank and credit availability to
the 3rd rank, with regard to preferences about purchases. After sale service were

also considered important by respondents belonging to rural areas.

 144

10. Importance of Different Factors of Facilitators in Rural Marketing

To measure, the degree of importance attached to different factors of
facilitators in rural marketing, a query’ was asked from respondents
(Intermediaries and Company executives) and responses were obtained at five
point rating scale. An analysis was made on the percentage basis and then an
attempt was made on to calculate average weighted scores for respondents by
assigning weights as 5,4,3,2,1 to the 'Greatly Facilitator'. 'Significantly
Facilitators’, 'Moderately Facilitators’, 'Facilitators below Moderate’ and Rarely
Facilitator’ respectively. After this ranks were also given according to the average
weighted scores. Table 7.19 summarizes the information in this regard.
Table 7.19
Frequency Wise Distribution of Respondents (Company Executive and
Intermediaries) Regarding Importance Attached to Different
Factors of Facilitators
Factors Greatly Significantly Moderately Facilitates Rarely Average [ Ranks
Facilitates Facilitates Facilitates Below Facilitate Weighted
Moderate Score
Increased 70 28 17 21 4 3.99 2
Income & (50) (20) (12) (15) (3)
Agricultural
Prosperity
Increasing 66 25 28 14 7 3.92 3
Trend of (47) (18) (20) GO) (5)
Expenditure
Enhanced 77 35 13 10 5 4.21 1
Mobility (55) (25) (9) (7) (4)
Spread of 63 21 31 14 11 3.79 5
Education (45) 05) (22) GO) (8)
Improving 49 41 21 17 13 3.70 7
Infrastructure (35) (29) (15) (12) (9)
Increased 45 24 21 28 22 3.30 8
Penetration (32) (17) (15) (20) (16)
of Sattellite
& Television
Changing 64 25 21 18 13 3.80 4
Life Style (46) (18) (15) (13) (9)
Low 59 29 20 18 14 3.72 6
Penetration (42) (21) (14) (13) (10)
of Consumer
durable &
Non durable
goods
Source : Through Questionnaire
Note : Figures in Parenthesis indicate percentage
 145

It is evident from Table 7,19 that an overwhelming majority of

respondents (80 percent) considered enhanced mobility as very important
facilitator followed by 70 percent of respondents considering increased income
and agriculture prosperity as very important facilitators. Increasing trend of
expenditure and changing life style were also considered as very important
facilitator by 65 percent and 64 percent of the respondents respectively. 60
percent respondents considered spread of education as very important facilitator.
But as far as increasing trend of expenditure is concerned 5 percent respondents
considered it rarely facilitator. It has been noted that 'Improving infrastructure
and 'Enhanced Mobility’ were considered moderately facilitator by 15 percent
respondents respectively. Only 63 percent of respondents took low penetration of
consumer durable and non-durable goods as very important facilitators.
Analysis of the table 7.19 reveals that average respondents has considered
enhanced mobility and increased income and agricultural prosperity as
'Significantly facilitator’ to 'Greatly facilitators’ factors (score being above 4).
While 'spread of Education is considered’ moderately facilitator factor but
penetration of satellite and television has been rated between 'facilitator below
moderate’ to 'moderately facilitator’ factors in rural markets. To know the relative
importance of factors, enhanced mobility had been given 1st rank as average
weighted scores are maximum in this case. Increased Income and Agricultural
Prosperity, Increasing Trend of expenditure and changing life style have got 2nd,
3rd and 4th rank respectively. Spread of Education, low penetration of consumer
durable and non-durables and improving infrastructure have got 5lh, 6th and 7th

rank respectively. Increased penetration of satellite and television has been given
rank 8th from the importance point of view in rural marketing.

Conclusion :
The Indian rural market is a huge one, offering a lot of potential. The rural
market is growing at a much faster rate than the urban market. Once the rural
market potential is assessed and known, the next imperative step is to make the
products available in the rural area.
 146

References

1. Kashyap, Pradeep And Raut, Siddhartha, The Rural Marketing Book, New
Delhi, Biztantra, 2006, p. 80
2. Balaji B. and Narayanan Sathya, “Rural Marketing the Road for
Sustainable Growth”, Marketing Mastermind, Vol. 7, Issue 5, 2007 (May),
p. 23
3. Velayudhan Kumar, Sanal, “Rural Marketing - Targeting the Non-Urban
Consumer”, New Delhi, Sage Publications, 2002, p. 22
4. Dey, N.B. and Adhikari, Kingshuk, “Rural Marketing Challenges and
Opportunties”, Yojana, Volume 42, Issue 5, 1998, p. 22.
5. Sathyavathi M., “Rural Marketing : iijst and Challenges”, Khadi
Gramodyog, Vol. 42, Issue 10, 1996, p. 462.
6. Selvaraj A., “Issues and Challenges in the Rural Marketing”, The
Economic Challenger Volume 10, Issue 37, 2007, p. 53.
7. Ibid, p. 54
8. Raman Rao, V.P., “Rural Market - Problems and Perspectives”, Indian
Journal of Marketing, Vol. 27, Issue (9-32), 1997, p. 18.