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Understanding Rural Consumer Behaviour Tapping the Future Market

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Understanding Rural Consumer Behaviour Tapping the Future Market
UNDERSTANDING RURAL CONSUMER BEHAVIOUR : TAPPING THE FUTURE MARKET

SHWETA Email – shweta.esha@gmail.com

1. INTRODUCTION
It is widely acclaimed that India is one of the largest consumer market in the world. Estimation signs that the Indian consumer market is likely to grow four times by 2025. (McKinsey Report - 'The Rise of Indian Consumer Market '). India 's overall retail sector is expected to rise to US$ 833 billion by 2013 and to US$ 1.3 trillion by 2018, at a Compound Annual Growth Rate (CAGR) of 10 percent.

2. INDIA’S RURAL SCENARIO Real India lives in villages. About 75 percent of Indian population lives in rural area. In the country we have 6.45 lacs villages out of which only 13 percent villages have population above 2000. More than 50 percent of the sales of FMCG and Durable companies come from the rural areas. The McKinsey Report on “the Rise on Consumer Market in India” predicts that in twenty years the rural Indian market will be larger than the total consumer markets in countries such as South Korea or Canada today, and almost four times the size of today’s urban Indian market and estimated the size of the rural market at $577 Billion.
The urban areas constitute the fastest-growing part of the Indian market. Presently, the rural market accounts for a hefty share in most market segments– 55 percent of LIC policies, 70 percent of toilet soaps, 50 percent of TV, fans, bicycles, tea and wrist watches. With urban markets getting saturated, most companies are looking at huge potential in rural markets. Major corporations have seen great success with innovative strategies such as smaller packaging. Fast Moving Consumer Goods (FMCG) companies have creams and soaps priced at 5, hair oil and shampoo sachets at 2 and small Coke at 8. Companies have developed special products for the rural market, like Chic Shampoo sachets priced at 1, Parle G Tikki Packs at 2, customised televisions by LG, Shanti Amla oil by Marico. Even with increasing



References: Journals: Aggarwal R and Parhar B B S (2007) , “ A Survey of Consumer Awareness about Consumer Legislations in India,” The IUP Journal of Consumer Behaviour , Vol Bishnoi , V.K. (2001) . Marketing of Consumer goods in Rural India, Doctoral Thesis. Bansal , R & Easwaran , S. (2004) . Creative Marketing for Rural India, A Research paper for Menifestations, Vista2004 – IIM Banglore. Dodds W B , Monroe K B and Grewal D (1991) , “ Effect of price, Brand and Store information on Buyers’ Product Evaluation,” Journal of Marketing Research, Vol. 28, No. 3, pp. 307-319. Howard J and Sheth J (1969), The Theory of Buying Behaviour, pp. 16-20, John Willey & Sons. Krishan,Mahalaxmi. (2011), “Emerging Trends in Marketing: Non- Farms Goods In Rural India” , Journal of Banking , Information and Management, Vol. 8 N0-1, Jan-Jun, pp 67-76 Lokhande, M.A(2004) Madhavi,C., &Arul,Kumar.S. (2006), “Rural Marketing for FMCG”, Indian Journal of Marketing, Vol. 36, No. 4, Apr, pp. 19-23. Nagaraja,B. (2004), “Consumer Behaviour in rural areas: A microlevel study on buying behaviour of rural consumers in Kaval Mandal”, Indian Journal of Marketing, Vol. 34, No 11, Nov , pp. 30-35. Jiyoung Kim, Leslie Stoel, (2010) "Factors contributing to rural consumers ' in shopping behavior: Effects of institutional environment and social capital", Marketing Intelligence & Planning, Vol Rao, K.L K and Tagat R.G (1985). “Rural Marketing : A Developmental Approach”, Vikalpa, 10(3), 1985, pp.315-326 Sarkar A Sehrawet, M and Kundu, S.Subhash. “Buying Behaviour of Rural and Urban Consumers in India: the Impact of Packaging”, International Journal of Consumer Studies 31(2007), ISSN 1470-6423, pp. 630-638 Sinha, M

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