Rural Market Environment

Forms basis for consumer decisions ,also for

marketing actions.
Use S-T-E-P model:
S- Population, households, education, literacy,
reference groups, folk arts/ entertainment, hatts,
melas.
T- ICT, electrification. Pucca houses ,Digitalisation
E- Occupation, land-use/ holdings / distribution,
irrigation levels, Incomes, savings, disposable
incomes, rural credit suports, retail outlets, micro
finance activity etc.
P- Panchayat raj, development initiatives

Or- analyze as Demographics, Physical, socio

cultural, political, technological, economical,

Marketing decisions and environment

1- demand
estimation
2-S.T.P.
3-Product
decisions

Demographics etc

Psychographics, usage levels etc

Income, quality consciousness, brand

awareness, consumer preferences,
competition, technology developments etc
Disposable incomes, demand, per capita
consumption ,competition, input cost levels

4-Price decisions

5-place decisions

Channel availability, distribution facilities, ICT

developments, location etc

6-Promotion
decisions

Media availability, costs, habits, target

customers, competition etc

 Demographic environment
Rural population growth

Additional 200 millions in last two decades- 629 in 1991

and 826 in 2010

Households

112 millions in 1991 to 165 millions in 2010

Joint families to nuclear

1/3 rural population in consuming class of 15 34 years

Education

20% population SSC/HSC pass

Rural Literacy from 53% to 63% in last 10 years

Occupation

Farm to non-farm shift

Reduction in agricultural labor
Supplementary occupations
Land ownerships
Land fragmentation

Population Distribution
RURAL POUPLATION IN
STATES

 Income Rural constitutes 56% share in total income

Per capita rural income increased from Rs-11,227 in 2005 to
15,173 in 2010
Income growth faster in rural and future projections shows
higher incomes with large population

Physical environment
Scattered

Villages with less than 500 population- 37%

Next level between 500 to 2000 population 46 %
2000 to 5000- 13%
5000 + 4%

Prosperity more in 2000+ , more shops etc ,also

account for 50 +rural population
% of Kuccha houses coming down fro 23 % in 2001 to
14% in 2010

 The socio cultural environment

Socio cultural regions and sub regions

Caste, linguistic groups differ Lifestyles and consumption

patterns 90 distinct SCR in our country being used for media
surveys etc- provides homogeneity reference for STP

Village community-village administrations, caste

system
The political environment
Panchayat raj institutions
Gram sabha - roles, group gram panchayats
The technological environment
Rapid mechanization

Use of animal power to tractor

Use of tractors increases from 30 % to 46 % in last 10 years

ICT revolution

Information access and network

 The Economic environment

Subsistence to commercial farming opened up
consumption of many goods and services
Cash crops
Better MSP
Non-farm support
Developmental activities
Contract farming
Rural enterprises
Increased from 17.19 millions to 25.54 million in last
10 years in farm and non-farm sector
Changing Migrations

Rural employment opportunities increasing provides stable

pattern
Income expenditure patterns- NCAER surveys ,+shifts
Income disparity- reduction in bottom profiles
Rural spending- + shifts for travel, personal care, recreation,
education, healthcare, - shifts for food

Landscape & Income distribution

Consumption

Rural India

RURAL ECONOMY sources

FARM SECTOR
(AGRI & ALLIED)

NON-FARM SECTOR
(FORMAL & INFORMAL)

AGRICILTURE

RURAL INDUSTRIES

RURAL
SERVICE

ANIMAL HUSBANDRY

AGRI PROCESSING

RETAILING AND
TRADING

HORTICULTURE

MANUFACTURING HANDLOOMS

COMMUNITY
& SOCIAL

FORESTRY

MINING AND QUARRYING

TRANSPORTATION

FISHING

CONSTRUCTION

COMMUNICATION

 Rural Infrastructure
MGNREGA, Bharat Nirman
Increased budgets

Road connectivity - PMGSY

All weather connectivity to all habitations

Electrification

Increased from 48 % households to 60 percent - 2001 to

2008
Rajiv Gandhi Grameen Vidyutikaran Yojana

Rural housing

Indira Awas Yojana

Telecommunications

Tele density increased in rural fro 1.2 to 26.4 -2002 to 2010

Subscriber base in progressively increasing in rural

Drinking water
Postal services

total-1,55,618,rural-p.o. 1,39,081
rural bank network of 30977 branches

 Media habits Radio a cost effective media in rural, FM channels

penetration
Interests in news papers increasing
Internet- 5.5 mn. rural users and penetrating fast
State wise reach of medias-83% TV in goa and 62%
print in Kerala
Gender based media penetration- TV 39% men 35%
women,radio-22:13, print-20:7,cinema-4:1
Non-conventional forms of media
Advertisers choice of media?