Ishtylish Rural Janta
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Are you looking forward for a market having Rs. 3,787,910,000,000 (approx three lakhs eighty thousand crores) as the spending power? If, YES, then dont look anywhere, rural India is the answer! A lot has been said and discussed about the spending power rural India has and why it is still considered a virgin territory as far as company incursions are concerned. Globalisation is the key to success for any large organisation. However, with the promise of larger markets, it comes along with a problem, that of understanding these markets. While some products do extremely good, others fail miserably. So why does this happen? “A strategy that has worked in one place will not work equally well in another region,” explains Mr. A. R. Thakur, ad-consultant.
This study paper seeks to analyse the reasons as to what can make a product sell in the rural market like hot-cakes and how it can be tapped into after the urban-phenomenon stops showing in the bottom-line. Let us take a sneak-peek at the strategies and advertising campaigns which made them stand out. Though, there is no standard solution to all the different regions in our country, some strategies are discussed herein. HLL and ITC have been seen drive into the hearts of the rural customers, closely followed by Amul, Coca-Cola, Colgate, LG, LIC, BSNL and hero Honda. One thing is common between them all, their full understanding of the rural janta. They provided the quality products with the right mix of price, packaging and distribution channel, a sustainable business model, advertised in a way that would be easily absorbed by the rural audience, because you cant miss a market which contributes more than 75% of the sales for bicycles, radios, and mechanical wristwatches too.
So what makes Rural India special? Well it is the spending power that I have already mentioned above, and apart from thatnearly half of our countrys GDP comes from the rural sector, per capita income is Rs. 5780 on average, with the expenditure increasing by more than four times from 1983 to 2000. The expenditure on non-food items has also increased five folds. So let us have a look at what makes Corporate India sell in the Rural India.
The HLL ki Shakti:
A few weeks back, I was travelling in Rajasthan by road. Suddenly I came across a camel drawn cart (call it a camel-cart). This camel-cart was loaded with a few dozen sachets each of shampoos, detergents and tea, along with products like soaps and other essentials of lifestyle in rural India. I came to know, it is a strategy of HLL to market its products and sell them moving around in that camel-cart across a group of 4-5 villages. Other than that also, visit any kirana shop in any remote village and youll find HLL present in all ways. The advertisements by HLL showing shampoos vs. soaps on hair, paved the way for rural women deciding to buy shampoos. Add to it, the affordable value for money sachets and you have a strategy that took its sales across all skies. HLL advertised heavily, with a bulk of unconventional ways, such as marketing in the village fairs, festivals, shops, as well as the now popular medium of painting walls and wells, all added up to the massive rural campaign for its brand awareness. Project Shakti helped HLL not only increase the CSR-value of the organisation but also targeting small villages with population of less than 2000 people. It seeks to empower underprivileged rural women by providing income-generating opportunities, health and hygiene education through the Shakti Vani programme, and creating access to relevant information through the iShakti community portal, creating self-help groups and also increasing distribution of its products through the network of sub-stockists in the remotest of villages. It made them sell HLL products, while providing them earning opportunity. It already has about 25,000 women entrepreneurs in its fold. A typical Shakti entrepreneur earns a sustainable income of about Rs.700 – Rs.1000 per month, which is sometimes, double their average household income. This helped them reach customers who were not accessible otherwise and word-of-mouth helped them reach the mass. This shows that a value-chain is very important in building a model which is based in rural India.
Sampoorna LG
LG Electronics India Pvt. Ltd., after establishing itself as a niche brand in the urban sector, it set its eyes at the rural sector & successfully tapped into it. A story goes thus-
Rajiv Karwal is an iconoclast. At a senior management meeting in March 1998, LG Electronics Indias vice president (sales & marketing) suggested the South Korean electronics major call its new, customised TV being developed for the rural market, Sampoorna. The word, he explained, was a part of the Bengali, Hindi, Marathi and Tamil tongue. And when Karwals colleagues, including India head K.R. Kim, felt a western name would work better, he walked out in a huff.
But they cant say this anymore…by 1999, 12% of LGs sale was coming from this TV, sold only in towns with population of less than 10,000. And, moreover, Mr. Ganesh Mahalingam, Head of Sales, LG Electronics says, the contribution from the semi-rural and rural sector has been close to 48 per cent in the overall turnover of the company. LG follows the concept of area specific advertising. Marketing activities like mobile vans and road shows are used to create brand awareness which also give a first hand feel of the products,” says Girish Bapat, Vice President, Marketing Division, LG. They have tried to tap into this market with their 72 Remote Area Offices, 86 Central Area Offices and 47 Branch Offices, following their DMDC model (Different Markets Different Channel). So what did LG do? Well, they only made the things available to the customers, following the seeing is believing and thus going in for one-to-one marketing & communication.
Hamara Bajaj
Ever thought how the catch-line Hamara Bajaj- Bulund Bharat ki Bulund Tasveer, could affect a nation…it makes it proud and helps a company reach global heights! Just in case you are still wondering at, what I am saying, look at the phenomenal growth figures. 65% of the sales of Bajaj Auto motorcycles is derived from the rural areas. Bajajs Chetak model still rules in the scooter segment, especially especially with the rural janta. The pricing of Chetak is also a big determining factor in its sales. Data suggests it is, at least 20% cheaper than its competitors in all segments, it caters to. So, we now know, rural janta wants value-for-money. Bajaj is one company which has stood the test of time, specially the tough times of late 80s and 90s, when many existing companies went