Concept In recent years, rural markets have acquired significance, as the overall growth of the economy has resulted

into substantial increase in the purchasing power of the rural communities.

On account of green revolution, the rural areas are consuming a large quantity of industrial and urban manufactured products. 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? Rural market has following attributes and the following facts substantiate this: 742 million people

Estimated annual size of the rural market -

FMCG Durables Agri-Inputs (including tractors) 2 / 4 Wheelers

Rs. 65,000 Crore Rs. 5,000 Crore Rs. 45,000 Crore Rs. 8,000 Crore

In 2001-02, LIC sold 55% of its policies in rural India. Of two million BSNL mobile connections, 50% are in small towns / villages.

Of the 6.0 lakh villages, 5.22 lakh have a Village Public Telephone (VPT). 41 million Kisan Credit Cards have been issued (against 22 million credit-plus-debit cards in urban), with cumulative credit of Rs. 977 billion resulting in tremendous liquidity.

Of the 20 million Rediffmail sign-ups, 60% are from small towns. 50% of transactions from these towns are on Rediff online shopping site. 42 million rural households (HHs) are availing banking services in comparison to 27 million urban HHs. Investment in formal savings instruments is 6.6 million HHs in rural and 6.7 million HHs in urban.

Opportunities 1. Infrastructure is improving rapidly In 50 years only, 40% villages have been connected by road, in next 10 years another 30% would be connected. More than 90% villages are electrified, though only 44% rural homes have electric connections. Rural telephone density has gone up by 300% in the last 10 years; every 1000+ pop is connected by STD.

Social indicators have improved a lot between 1981 and 2001 Number of "pucca" houses doubled from 22% to 41% and "kuccha" houses halved (41% to 23%). Percentage of BPL families declined from 46% to 27%. Rural literacy level improved from 36% to 59%.

Low penetration rates in rural areas, so there are many marketing opportunities -

Durables CTV Refrigerator

Urban 30.4 33.5

Rural 4.8 3.5

Total (% of Rural HH) 12.1 12.0

FMCGs Shampoo Toothpaste

Urban 66.3 82.2

Rural 35.2 44.9

Total (% of Rural HH) 44.2 55.6

Marketers can make effective use of the large available infrastructure -

Post Offices Haats (periodic markets) Melas (exhibitions) Mandis (agri markets) Public Distribution Shops Bank Branches

1,38,000 42,000 25,000 7,000 3,80,000 32,000

production of large format Rural Retail Stores, which have been successful also

DSCL Haryali Stores M & M Shubh Labh Stores TATA / Rallis Kisan Kendras

Escorts Rural Stores Warnabazaar, Maharashtra (Annual Sale Rs. 40 crore)

The ultimate objective of all production is consumption for the satisfaction of varied needs of man. A free market economy provides freedom to the consumers to buy and consume goods of their choice. Buying preferences of the consumers send signals to the producers to produce various commodities in required quantities. Producers, therefore, produces only those commodities which are desired by the consumers. Consumer behaviour is related to likes and dislikes and expectations of the consumers. Consumer behaviour has changed in recent years owing to enhanced awareness, information technology and more importantly governmental intervention through legislations. Thus, the manufacturers are more cautious in dealing with consumers of their respective products. The rural consumers in India account for about 73 percent of the total consumers. In recent years, the lifestyle of a large number of rural consumers in India has changed dramatically and the process of change is on. The buying behaviour of the rural consumers is influenced by several factors such as socio-economic conditions, cultural environment, literacy level, occupation, geographical location, efforts on the part of sellers, exposure to media etc. The consumer movement in India till now has been confined to the middle class citizens in urban areas. It has yet to spread among the masses in rural areas. This book is an effort to understand buying behaviour of rural masseswhich is influenced by a host of diverse factors. The work is useful to understand the Indian rural consumer psyche in order to formulate an appropriate marketing strategy.

The Influence of Opinion Leaders in the Rural Markets Prof. Siby Zacharias*, Prof. Jose M C**, Afsal Salam***, Binu Kruvilla****, Denny Anand***** Introduction Rural India is the buzzword and eldorado for marketers. Organizations are shifting their focus towards this huge and largely untapped market. Rural India, (Ernst and Young) reports 600,000 plus villages spread over a geographical area of over 3.2 million square kilometers, with a 60% of the countrys overall consumption amounting to Rs.9.135 lakh crore ($228 billion). Mckinsey recently surveyed rural India for Bharat Nirman project and concluded that rural India's market size in 2020 would be US $ 500 billion. Even by 2025, 63 percent of Indias population will still live in rural areas of India (Mckinsey).The problem for marketers lies in reaching out to this huge magnitude of the rural masses with varied social, cultural backgrounds speaking a few hundred language.

In rural market, the influence of opinion leaders in decision making and purchasing the product is remarkable. An Opinion leader is like a peer group leader in that, this person tends to lead the opinions of a group of people in a reference group (kotler 2002). Opinion leaders are important to marketing because they are able to influence the opinions of others (Sticky-Marketing.COM). The word of mouth is an important message carrier in marketing executed by opinion leaders and reference group (AC Nielsen survey). Promotion of brands in rural markets requires the special measures and opinion leaders

play an important role in promoting the product in rural India (ET2007). Roper ASW pollsters Ed Keller and Jon Berry (The Free Press, 2003) argue that consumers today place more weight on the word-of-mouth insights of their more influential neighbors than on what they hear on TV or read in the newspaper. The study envisages to find out, the influence of opinion leaders in the

rural market . In the study, the researchers define opinion leaders as friends and relatives. Key Words: Opinion leaders, Rural market, Word of mouth. Opinion leader Opinion leader is the agent who is an active media user and who interprets the meaning of media messages or content for lower-end media users. Typically the opinion leader is held in high esteem by those that accept their opinions. Opinion leadership tends to be subject specific, that is, a person that is an opinion leader in one field may be a follower in another field.( Wikipedia, the free encyclopedia).For dissamination of information in Market, opinion leaders are the most important source.(Channey M.Isabella;2001). In our study opinion leaders are considered as Friends (farmers, village heads, religious leaders, rural youth (who go to the nearest town to study in a college or work) and relatives (rural and urban). Rural Marketing According to National Council for Applied Economic Research (NCAER) the 70% of Indias population lives in 60,000 villages in rural areas. The 90% of the Rural India is concentrated in villages with a population of less than 3000 with Agriculture being the main business.

The number of middle income households in Rural India is expected to grow from 80 million in 2006 to 113 million in 2008. Kerala is said to be a Conglomerate of small towns. In between these are villages sandwiched between. Though there is paddy cultivation, it is dwindling fast and is taken over by cash crops like Rubber, Spices, Cashew nut, etc. Word of Mouth (WOM) The word of mouth is an important message carriage in Rural Areas. It travels fast .A bad mouth carries many a persons while a good one few (Kotler P,2002). The impact of WOM is at strongest when it originates from social contacts because of their greater perceived reliability.(Ennew,T,Christine, Banerjee,K,Anish, Li,Derek, 2000). The strength of WOM is influenced by perceived communicator characteristics and is moderated by perceived risk. (Wangenheim, V, Florian, Bayon, Thomas, 2004). In our study, we define WOM as the positive words said about the products used or heard by the customers which influence people to purchase products.

Objectives of the Study 1.

To examine the influence of opinion leaders in the purchasing decision of colour televisions (CTV). 2.

To examine the effectiveness of their word of mouth campaign. 3.

To examine the different effect of relatives and friends. Hypotheses of the study are: 1.

H0: The opinion leader has got influences in the rural market. 2.

H0: There is a favorable effect of the word of mouth campaign in the rural market. 3.

H0: There will be differential effect between relatives and friends among opinion leaders in rural marketing. Methodology The study is based on the primary data, derived through sample survey using pre-tested structured instrument (questionnaire).The questionnaires are designed in such a way that it covers all relevant factors regarding the influence of opinion leaders in the purchase of colour television (CTV).The CTV is chosen as it has the attributes of high involvement, deal prone, brand influence, technology driven and available as as a shopping good. The sample design is based on random sampling. The data is collected from 120 heads of households. The respondents include the small and medium level rubber planters, government employees, private employee and business people residing at Arakulam Grama Panchayat selected at random. The Arakulam Grama Panchayat is chosen as it is a typical agricultural region where all types of people; agriculturists, employees, business people etc. are staying together. The people are holding small(less than 1 Hector) and medium (more

than 1 Hector) land area. The respondents are not far away from urbanization but not completely under its influence. Questions were asked to elicit information about their perception on the influence of Opinion Leaders, the effect of Word of Mouth and the differential effect of friends and relatives among the influence of opinion leaders in Marketing. For testing the hypotheses, chi-square tests were to be administered at 5% level of significance with the aid of SPSS package.

CHARACTERISTICS OF RURAL CONSUMER GROUP LOCATION PATTERN:SCATTERED MARKET Rural market is a scattered market. Rural population is scattered across 5,70,000 villages. Unlike urban demand, which is highly concentrator rural demand is scattered over a larger area. SOCIO-ECONOMIC POSITION:-Rural consumers continue to be marked by low purchasing power/low per capita income. They continue to be tradition based community. 60% of rural income comes from agriculture

CULTURALLY A DIVERSE AND HETEROGENOUS MARKET

Rural markets are diverse in terms of religious, social, cultural and linguistic factors. Heterogeneity is the no.1 hallmark of the rural market5,70,000 villages, half dozen religions, 33 languages,1,650 dialects and diverse sub-cultures characterize the market. LIFESTYLE Conservative and tradition bound lifestyle. Lifestyle undergoes major change which may be contributed to several factors: 1. Growth in income and change in income distribution. 2. Growth in education3. Enhanced media reach. 4. Growing interaction with urban communities. 5. Marketers efforts to reach out the rural market.

Rural Marketing Environment 1. Large and Scattered market: The rural market of India is large and scattered in the sense that it consists of over 63 crore consumer from 5, 70,000 villages spread throughout the country. 2. Major income from agriculture: Nearly 60 % of the rural income is from agriculture. Hence rural prosperity is tied with agricultural prosperity

3. Low standard of living: The consumer in the village area do have a low standard of living because of low literacy, low per capita income, social backwardness, low savings, etc. 4. Traditional Outlook: The rural consumer values old customs and tradition. They do not prefer change. 5. Diverse socio-economic backwardness: Rural consumers have diverse socioeconomic backwardness. This is different in different parts of the country. 6. Infrastructure Facilities: The Infrastructure Facilities like roads, warehouses, communication system, financial facilities are inadequate in rural areas. Hence physical distribution becomes costly due to inadequate Infrastructure Facilities

The major problems faced are : a) Underdeveloped People and Underdeveloped Markets: -The number of people below poverty line has not decreased in any appreciable manner. Thus underdeveloped people and consequently underdeveloped market by and large characterize the rural markets. Vast majorities of the rural people are tradition bound, accepting

and believe in old customs, traditions, habits, taboos and practices. b) Lack of Proper Physical Communication Facilities: Nearly fifty percent of the villages in the country do not have all weather road. Physical communication of these villages is highly expensive. Even today most villages in the eastern parts of the country are inaccessible during the monsoon

c) Media for Rural Communication: -Among the mass media at some point of time in the late 50's and 60's radio was considered to be a potential medium for communication to the rural people. Another mass media is television and cinemas it has been observed that cinemaviewing habits in rural areas is very satisfactory were ever available d) Many Languages and Dialects: -The number of languages and dialects vary widely from state to state region to region and probably from district to district. The messages have to be delivered in the local languages and dialects