Rural Marketing M1M3
Rural Marketing M1M3
Rural Marketing M1M3
MODULE – I
➢ Describe the scope of rural marketing.
➢ Explain the Evolution of Rural Marketing.
➢ Discuss the 4P’s of Rural Marketing Strategies.
➢ Explain the Rural Infrastructural Facilities.
➢ Discuss the Logistic steps in new product development.
➢ Differentiate between Rural and Urban market.
➢ Discuss the importance of Branding.
➢ Describe the Scope and Importance of Transportation Networking in Rural Markets.
MODULE – III
➢ Describe the importance of Agricultural marketing.
➢ Describe the issues of agricultural marketing.
➢ Explain the features of Cooperative and Self Help Groups (SHG) in rural marketing.
➢ Explain the role of Commodity Boards.
➢ Explain the role of APEDA.
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MODULE – I
Question: Describe the scope of rural marketing.
Answer: Introduction:
Definition:-
• ‘Rural marketing’ is similar to simply ‘marketing.’ Rural marketing differs only in
terms of buyers. Here, the target market consists of customers living in rural areas.
Thus, rural marketing is an application of marketing fundamentals to rural markets.
1. Population:
• According to 2011 Census, rural population is 72% of total population and it is
scattered over a wide range of geographic area.
3. Growth in Consumption:
• There is a growth in purchasing power of rural consumers. But, the average
per capita house hold expenditure is still lower as compared to urban
spending.
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7. Decision-making Units:
• Women in rural areas are beginning to make fast decisions for purchases.
• Studies reveal that 72.3% decisions are taken jointly in a family.
• With education and mass media, role of children in decision making is also
changing.
A.Product Mix:
• Product is a powerful tool of an organization’s success.
• The product must be acceptable to rural consumers in all significant aspects.
• The firm must produce products according to the needs and future demands of rural
buyers.
• The products features like size, shape, colour, weight, qualities, brand name,
packaging, labelling, services, and other relevant aspects must be fit with the needs,
demands and capacity of rural buyers.
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B. Price Mix
• Price is the central element of marketing mix, particularly for rural markets.
• A rural customer is price sensitive and shops for value mainly because of his lower
income levels than his urban counterparts.
• Rural consumers are most price sensitive and price plays more decisive role in
buying decisions.
• Pricing policies and its strategies must be formulated with care and caution.
• Hence the marketer has to find ways of making the product affordable to the rural
consumer.
• Normally, the low-priced products always attract the rural buyers, but rarely some
rural customers are equality and status conscious.
C. Promotion Mix
• Most of the companies advertise their products and services on television and they
are sure it reaches the target audience.
• This is because a large section of the rural India is now glued to TV sets.
• Marketers have to decide on promotional tools such as advertisement, sales
promotion, personal selling and publicity and public relations.
• The method of promotion needs to meet the expectations of the market. Vehicle
campaigns, entertainment films, generating word of mouth publicity, colorful wall
posters, etc. – all these techniques have proved effective in reaching out to the rural
masses.
• Village fairs and festivals are ideal venues for projecting these programs.
• In certain cases, public meetings with Sarpanch and Mukhiya too are used for rural
promotion.
D. Place Mix
• Rural market faces critical issues of distribution. A marketer has to strengthen the
distribution strategies.
• Distributing small and medium sized packets through poor roads, over long
distances, into the remote areas of rural market and getting the stockiest to do it
accordingly.
• Both physical distribution and distribution channel should be decided carefully to
ensure easy accessibility of products for rural consumers.
• Choosing the right mode of transportation, locating warehouses at strategic points,
maintaining adequate inventory, sufficient number of retail outlets at different
regions, and deploying specially trained sales force are some of the critical decisions
in rural distribution.
• Nowadays, online marketing is also making its place gradually in rural areas.
Marketers must design and modify their distribution strategies time to time taking
into consideration the nature and characteristics prevailing in rural areas.
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1. Warehousing:
• Warehousing is the process of storing physical inventory for sale or distribution.
• Warehouses are used by all different types of businesses that need to temporarily
store products in bulk, before either shipping them to other locations or individually
to end consumers.
• For instance, many ecommerce businesses will purchase products in bulk from their
suppliers, who ship them to their warehouse for storage. When an end customer then
places an order from the ecommerce site, the business — or its third-party
fulfilment provider — picks and packs the product from the warehouse and ships it
directly to the customer.
• Warehousing is an essential part of the supply chain for most types of businesses that
deal in physical goods.
• This could be consumer businesses holding a product that eventually makes its way
to an end retail customer, or it could be business to business (B2B) companies
storing products that eventually make it to business customers.
7. It will prevent distress sale of agricultural produce immediately after harvest when
the prevailing prices are at their lowest.
8. The goods are handled properly and stored scientifically to prevent damage,
deterioration and loss during handling and storage.
9. This will also make available agricultural inputs required for growing crops and
increasing production. The loss, if any, in quality or quantity is minimum.
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2. Cold Storage:
• This is essential for safety and protection.
• For certain perishable goods like fruits, vegetables, meat products, eggs, etc. cold
storage is preferred.
• At present, cold storage facility is inadequate and need to be increased, with
growth in agro-products the need for more and more storage facility would
increase.
Classification of Cold Storage in India:
As per the present day practice, cold stores can be classified mainly as follows:
7. Ripening Chambers:
These are mainly setup for bananas and mangoes.
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1. Idea Generation:
• The process of developing a new product begins with the generation of ideas. And to
generate the ideas, companies can focus on customer demands and needs.
• The company generates new ideas internally. It includes both R&D and staff
contributions. Employees are frequently the biggest source of fresh ideas.
• Organizations like Toyota have created incentive programs to encourage their
employees to come up with viable ideas in this regard.
• The company also seeks out new ideas from outside sources. It includes external
sources such as distributors and suppliers, as well as competitors.
• Customers are the most significant external source, since the new product
development process stages must be centered on delivering value to customers.
2. Idea Screening:
• Not every idea is suitable to become a product.
• For that reason, companies have to screen the ideas. Companies can label an idea as
promising and act on it, marginal and try to improve it, or simply poor and reject it.
• It is also very important for companies to avoid any bias related to the source of the
idea.
• So even if someone like Steve Jobs pitches an idea, the company should still be very
careful with it.
• However, there are more things to consider while screening a product idea than
whether it is “strong” or “weak.”
• Ideas must also be compatible with a company’s broader business plan and direction.
4. Marketing Strategy:
• Once a company decides on the product, they will have to spend time developing a
marketing strategy for it.
• Experts will evaluate the size of the market, demand for the product, and revenue
estimates.
• The marketing team will get a budget for their efforts and they can select distribution
channels.
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5. Business Model:
• The development of a business model works very similarly to the development of a
marketing strategy.
• The experts in the company will estimate the costs and profits and manage the
potential of the product.
• Also, they will estimate the economic feasibility of the new product.
6. Manufacture:
• At this stage, the production finally begins.
• The company will make multiple prototypes (an early version of a product from
which future versions are developed) and choose on which designs get to go to the
next stage.
• Also, the company will, once again, perform a cost analysis to see if it matches the
estimates.
• And if the costs go above the higher-end estimates, the company might abandon the
project.
7. Branding:
• Once the company finally has a physical product in their hands, the marketing team
can get to work. For starters, they can develop the brand name, packaging, and the
marketing message behind the product.
• They will also determine the price of the product.
8. Product Launch:
• The final phase of the product development process is the commercialisation phase.
• The product is launched, and it is followed by a developed marketing strategy in
order to maximise its earning potential.
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Importance of Branding:
1. Creates Consumer Preference for the Product or Service Behind the Brand
2. Generates Increased Revenues and Market Share.
3. Helps the Company Survive Temporary Crisis.
4. Expands the Organization’s Estimated Worth
5. Keeps New Competition Away
6. Increases Employee Productivity
7. Increases Profitability by Commanding a Higher Price
8. Helps the Company Attract New Distribution for its Products
9. Makes a Remarkable and Unique Brand Image
10. Generates New Customers
11. Increases Business Value
12. Keeps Reputation and Trust
4. Personal vehicles like automobiles, including vans and cars for hire like taxis
or ride-sharing services, and golf carts or all-terrain vehicles (ATVs)
5. Pedestrian transportation, which includes walking and bicycling
6. Boats, which may be personally owned or operated as a ferry service
• Transportation refers to any vehicle that moves people and goods from one place to
another.
• In the United States, key modes of transportation for people and goods include buses,
trains, trucks, cars, airplanes, and other forms of motorized vehicles. However,
transportation can also refer to bicycles, boats, and even pedestrian traffic. Both
public and private authorities can manage transportation systems, which can involve
maintaining and updating infrastructure to ensure the system runs smoothly.
Transportation infrastructure may include roads, bridges, bus stations, train tracks,
airports, sidewalks, or ferry terminals.
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IMPORTANCE:
About seventy percent of the population of India are living in the rural areas. Therefore
developments in urban centres alone do not indicate the overall development of the
country.
Only with the improvement in transportation facilities in rural areas, there could be faster
developments of these areas, resulting in overall development of the country.
For the growth of rural areas, transport is very important. Better transportation enables
farmers to quickly get their farm produce to the market.
1. Improved transportation services leads to improve access to market centres for the
rural producers, better availability of farm inputs at reduced price.
2. Better connectivity enhances employment opportunities in the non-agricultural
sectors.
3. Improved services with improved road connectivity, enhances access to education,
health and financial services.
4. It improves the connectivity of village people from major city roads, by that all public
services are improved.
5. Transport allows individuals to travel from one place to another. It can be used to
transfer items or raw materials from one location to another location.
6. It can also be used as a source of income. Rickshaw Walas, tonga walas, jeep drivers,
for example, get money for their transport service.
7. This helps to increase attendance levels in schools by providing both students and
teachers with access to schools.
8. Improved access to markets and cities adds to business growth as well.
Better transportation enables farmers to quickly get their farm produce to the
market.
9. It allows rural citizens from remote clinics or medical centres to use medical services.
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MODULE – II
Question: Describe the importance of agricultural marketing.
Answer:
Agriculture and marketing are the two words that make up the term agricultural marketing.
Agriculture, in its broadest meaning, refers to activities aimed at maximizing the use of
natural resources for human benefit. However, it is most commonly used to refer to the
process of cultivating and/or rearing crops and livestock.
The term “marketing” refers to a set of activities involved in getting products from point of
production to point of consumption.
Creation of Employment:
The agricultural marketing system provides employment to millions of people engaged in
various activities, such as packaging, storage and processing, transportation.
Persons like commission agents, brokers, traders, retailers, weigh men, Hamals etc. are
directly employed in the marketing system.
Better Living:
The agricultural marketing system is essential for the success of the development
programmes which are designed to uplift the population as a whole.
Creating of Utility:
Agricultural Marketing is as necessary as farm production.
In fact, it is, a part of production itself.
An efficient agricultural marketing system creates four types of utilities.
1. Farm utility – Processing function
2. Place utility – Storage
3. Time utility – Transportation
4. Possession utility – Buying and Selling
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Question: Explain the features of Cooperative and Self Help Groups (SHG) in rural
marketing.
Answer:
It follows the principle of mutual help and self-help to facilitate rural development.
Every member joins co-operative society in order to provide support rather than earning
profits.
Voluntary Association:
The formation of such society is possible only when all members voluntarily take the
responsibility to make one.
Anyone with a common interest may join or create co-operative society.
Further, members can leave the association at any time after giving a notice in this regards.
No Personal Motive:
Co-operative societies works to achieve a common motive, members can’t have any
personal motive involved.
The main aim of co-operative societies is to provide services to members instead of earning
profits.
State Authority:
The government laws regulate all co-operative societies.
In India, a co-operative society is required to register itself under the State Co-operative
Societies Act.
Democratic Administration:
Co-operative societies conduct AGM (Annual General Meeting) every year where the
committee is elected and manages the affairs of the co-operative society.
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4. To provide trade information, guidance and various other services to their members
and help them in their export business.
5. To participate in trade fairs and exhibitions abroad.
6. To sponsor trade delegations and conduct market surveys.
The Act came into effect from 13th February 1986 by the notification issued in the Gazette of
India: Extraordinary Part – II.
The authority replaced the Processed Food Export Promotion Council (PFEPC).
Following are the functions of APEDA:
➢ Fixing of standards and specifications for the scheduled products for the purpose of
exports.
➢ Carrying out inspection of meat and meat products in slaughter houses, processing
plants, storage premises, or other places where such products are kept for the
purpose of ensuring the quality of such products.
➢ Training in various aspects of the industries connected with the scheduled products;
such other matters as may be prescribed.
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APEDA is mandatory with the responsibility of export promotion and development of the
following scheduled products:
➢ Fruits Vegetables and their Products
➢ Meat and Meat Products
➢ Poultry and Poultry Products
➢ Dairy Products
➢ Confectionary, Biscuits and Bakery Products
➢ Honey, Jaggery and Sugar Products
In addition to this, APEDA has been entrusted with the responsibility of monitoring the
import of sugar as well.
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