Consumer Behavior of Rural Person

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A Study of Consumer Behavior Aspects and Brand Preferences in Rural India with Reference to FMCG Sector

Prof. (Dr.) S L Gupta & Arun Mittal Abstract The Fast Moving Consumer Goods (FMCG) sector is very important for Indian economy. This sector touches every aspect of human life. The FMCG companies are now encashing that opportunity. In rural India, this is the fact about the consumers that their income is increasing and the lifestyles are changing. There are as many middle-income households in the rural areas as there are in the urban. Thus the rural marketing has been growing steadily over the years and is now bigger than the urban market for FMCGs. Globally, the FMCG sector has been successful in selling products to the lower and middle-income groups. Many companies including MNCs and regional players started developing marketing strategies to capture the rural market in depth by using innovative and modern marketing techniques. There is no doubt that consumers in rural markets should be treated differently from urban consumers because they are different on the basis of many variables. Present study is focused on understanding the various aspects of consumer behaviour and brand preference in rural market.

Prof. (Dr.) S L Gupta Professor, Birla Institute of Technology A-7, Sector-1, NOIDA (M) 09811230453 E-Mail: slgupta_1965@yahoo.co.in Arun Mittal Faculty, Birla Institute of Technology A-7, Sector-1, NOIDA M 09818057205 E-mail: mittalarun@sify.com adbhut_arun@yahoo.co.in

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A Study of Consumer Behavior Aspects and Brand Preferences in Rural India with Reference to FMCG Sector

Prof. (Dr.) S L Gupta & Arun Mittal

1. Introduction The Fast Moving Consumer Goods (FMCG) sector is very important for Indian economy. This sector touches every aspect of human life. The FMCG companies are now encashing that opportunity. In rural India, this is the fact about the consumers that there income is increasing and the lifestyles are changing. There are as many middle-income households in the rural areas as there are in the urban. Thus the rural marketing has been growing steadily over the years and is now bigger than the urban market for FMCGs. Rural India has become a target for marketers because of the huge potential it offers for all kinds of products and services. Statistics show that there is a huge income shift-taking place in rural India, and the aspiring middle class, with increasing purchasing power, is the focus of all marketing initiatives by corporates. The rural Indian population is large and its growth rate is also high. Over 70% India’s one billion plus population lives in around 627,000 villages in rural areas. This really becomes the first motivational factor for the FMCG companies to tap in the rural markets. The census of India defines rural as any habitation where the population density is less than 400 per sq. km, and where at least 75 per cent of the male working population is engaged in agriculture, and where there is no any municipality or board. Since ancient times, Indian villages had the concept of village markets popularly known as the village "Haats". The "Haats" are basically a gathering of the local buyers and sellers. The barter system was quite prevalent, which is still continuing in a number of places even today. The village ‘mandis’ and the seasonal ‘melas’ are other important occasions for the marketers to tap. While the rural market provides tremendous opportunities to the marketers, it is not easy for any company to enter this market and walk away with a sizeable share of the market. In reality, the rural market suffers from a variety of problems including that of distribution and marketing communication. Companies have been trying to tackle these issues in a number of innovative ways. Be it the "e-choupal" initiative of ITC or "Project Shakti" launched by HLL, the aim is to come closer to the rural consumer. To capture the alluring rural market, companies need to

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