UMANG 2010 : NGOs and Rural Marketing

UMANG 2010 focuses on the role of NGOs in Rural Marketing and hence the theme for this year is "NGOs and Rural Marketing". In this post, we would like to elucidate on the theme of Rural Marketing.

RURAL MARKETING

In recent years, rural markets have acquired significance, as the overall growth of the economy and green revolution has resulted into substantial increase in the purchasing power of the rural communities. Because of these developments the rural areas are consuming a large quantity of industrial and urban manufactured products. Also urban market has reached saturation as most of the capacity of the purchasers has been already targeted by the marketers. In this context, a special marketing strategy, namely, rural marketing has emerged. But often, rural marketing is confused with agricultural marketing - the latter denotes marketing of produce of the rural areas to the urban consumers or industrial consumers, whereas rural marketing involves delivering manufactured or processed inputs or services to rural producers or consumers.

 

What Makes Rural Markets Attractive?

The Indian rural market has a huge demand base and offers great opportunities to marketers. There are a variety of reasons for corporates to target the rural market. Firstly, two-thirds of Indian consumers live in rural areas and almost half of the national income is generated here. Secondly, increase in income of people in rural areas has led to a rapid growth in rural demand. The urban consumer durable market for products like color TVs, washing machines, refrigerators and air conditioners is growing annually at between 7 per cent and 10 per cent. On the other hand, the rural market is zooming ahead at around 25 per cent annually. Thirdly, the urban market has reached saturation level whereas rural market has huge potential for growth. Finally, even corporates are now realizing that not competing in the fast growing rural areas will keep them out of about half of country’s market which is largely untapped.

Special Features of Rural market

Difficulty in prediction and possession of special characteristics make rural market different from the urban market. Since the rural population is predominantly agrarian, it is characterized by low and irregular income which keeps on fluctuating with the monsoon winds.

Before venturing into rural markets, corporates have to address some critical issues like distribution, understanding the rural consumer, communication and poor infrastructure. The marketer has to strengthen the distribution and pricing strategies. The rural consumer expects value for money and owing to unsteady and meager status of weekly income; increasing the household income and improving distribution are the viable strategies that have to be adapted to tap the immense potential of the market.

Opinion leaders play a key role in popularizing products and influencing consumers in rural market. Nowadays educated youth of rural areas also influences the rural consumers. Rural consumers are influenced by the life style they watch on television sets. Their less exposure to outside world makes them innocent and fascinated to novelties. The reach of mass television media, especially television has influenced the buying behavior greatly.

Role of NGOs in Rural Market

NGOs can play a significant role in helping corporates by making the rural populace understand the benefits of their products and services. NGOs use interpersonal methods of communication, and study the right entry points whereby they gain the trust of the community they seek to benefit. They would also have a good idea of the feasibility of the projects they take up. The significance of this role to the corporate is that NGOs can communicate information about the lives, capabilities, attitudes and cultural characteristics of people at the local level.

NGOs can facilitate communication upward from people to the corporate and downward from the corporate to the people. Communication upward involves informing corporate about what local people are thinking, doing and feeling while communication downward involves informing local people about what the corporate is planning and doing. NGOs are also in a unique position to share information horizontally, networking between other organizations doing similar work.

The synergy between NGOs and corporates could pave the way for better standards of living of the rural population.