understanding rural consumer

7/31/2019 Understanding Rural Consumer

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Presenter:

Ganesh Swamy


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Background-Rural Consumers Size of Rural Consumer

Rural Population about 73% of total population

According to 2001 census population is about 74 corer12 crore of the households

Location Pattern: A scattered market

Urban Population in 3,200 cities

Rural Population in 5,70,000 villages


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Contd.. Socio-economic Position

Low purchasing power/ per capita income

Bounded by tradition, culture, religion andcommunity

60% rural income from agriculture

Less 50 % have income less than Rs. 25,000

In recent year, 70% rural households have startedsaving their income ( service class, non farmers likeshop keeper)


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Contd.. Literacy level

Rural India has literacy rate of 28% compared to the

whole countryEvery year numbers of people getting added to the

rural Indias population is increasing

Adult literacy programmes have been launched

-TCS ALP - software to promote literacy among theadults


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Contd.. Lifestyle

Conservative and tradition bound

But it has changed to a good extend due to:- Increase in income

- Growth in education

-Enlarged media reach

-Growing interaction with urban area

- Marketers effort to reach rural area


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Rural Demand Pressure cooker

Medicines

Cell Phone

TV

Cycles, Bikes, Scooters

Bathing soaps, washing powder, washing cakes

Tea


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What is Consumer

behavior?

Those activities directly involved in obtaining ,

consuming and disposing of products and services,including the decision processes that precede anddecision actions follow these actions


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Factors Impacting Consumer

Behavior Environment of the consumer

The environment or the surroundings, within which the

consumer lives, has a very strong inf luence on the buyerbehavior Example: Electrification, water supply affects demandfor durables

Geographic Influences

Rural consumer behavior is also influenced by the geographic

location of the consumers. For Example, nearness to feedertowns and industrial projects influence the buying behavior ofconsumers in the respective cluster of villages.


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Contd.. Family

Family size & the roles played by family members exerciseconsiderable influence on the purchase decisions. Example

Industry observers are increasingly realizing that at times,purchase of durable has less to do with income, but has more todo with the size of the family & thats where rural India with

joint family structures, becomes an attractive proposition

Economic factor

The quantum of income & the earning stream are one of themajor deciding factors, which determine to a great extent, whatthe customer will be able to buy. Example Many people in therural market are below poverty line & for large number of people,

agriculture is the primary occupation


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Contd.. Place of purchase

Buying behavior of rural consumer also varies depending on theplace of purchase. Different segments of rural buyers buy their

requirements from different places/outlets. Example Some buyfrom the village shopkeepers; some from villagemarkets/hats/melas; others buys from town that serves as thefeeder to the rural area

Creative use of productThe study of product end provides indicators to thecompany on the need for education. Example Godrej hair dyebeing used as a paint to colour horns of oxen, Washing machinebeing used for churning lassi


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Contd.. The way the consumer uses the product

The situation in which the consumer utilize the product alsoinfluences their buying behavior. Example Since rural consumers

cannot use washing powders/ detergent powders that much, asthey wash their clothes in streams or ponds, they go in more for

washing bars and detergent cakes

Involvement of others in the purchase

Example Head of family make purchase decision all by himself


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Cultural factors impacting

consumer behavior Product (colour, size, design, and shape): There are many

examples that support this point.

a. For Example, the Tata Sumo, which was launched in rural India

in a white colour, was not well accepted. But however, when thesame Sumo was re launched as Spacio (a different name) and ina bright yellow colour, with a larger seating capacity and ability totransport good, the acceptance was higher.

b. Another good Example would be Philips audio systems. UrbanIndia looks at technology with the viewpoint of the smaller thebetter. However, in rural India, the viewpoint is totally opposite.That is the main reason for the large acceptance of big audiosystems. Thus Philips makes audio systems, which are big in size

and get accepted in rural India by their sheer size.


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Social PracticesThere are so many different cultures, and each culture exhibitsdifferent social practices. For Example, in a few villages they have

common bath areas. Villagers used to buy one Lifebuoy cake andcut it into smaller bars. This helped lifebuoy to introduce smaller75gram soap bars, which could be used individually

Changes in saving and investment pattern

From gold, land, to tractors, LCVs


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Thank you

understanding rural consumer

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