MS 611 IGNOU MBA Solved Assignment - Explain the role of Melas and Haats in rural distribution.

Explain the role of Melas and Haats in rural distribution. 

Ans

    Table of ContentsIntroductionRural India’s Traditional HaatsThe Big PictureAdvantagesFew Companies InitiativesConclusionReferences

Introduction The Indian rural haats were from ancient times. From barter system to modern transaction methods, every change were adopted by these haats. Though traditional, these Indian avatars of hypermarkets promise to drive marketing plans of companies as they eye the emerging rural market, accounting for over two-thirds of India's population, 56% of income, 64% of expenditure and 33% of savings

. Though the Rs 50,000-crore sales that these weekly rural bazaars collectively generate every year may just be a fraction (under 3%) of all rural private consumption expenditure (Rs 20 lakhcrore), their importance in rural life goes beyond salesAlmost every villager is a regular haat visitor, with over three-fourths visiting one every week. And two in every five visitors here are women. With the average distance between a haat and the nearest big town at 24 km (16 km in case of the most urbanised state in Tamil Nadu), these haats double up a shopping-cum-outing opportunity for millions of entertainment-starved rural Indians

 RURAL INDIA'S TRADITIONAL HAATS Rs 50,000 crore annual sales n Out of total footfalls around two-fifth are women Large haat, in a 10,000+ village, caters to 57 villages attracts 12,000 visitors daily Small haat, in a 5,000+ village, caters to 21 villages, average footfall of 5,600 a day 545 stalls appear in a large haat while around 327 stalls are set up in a small haat

6. 98% rural people are regular visitors to haats75% visit any particular haat almost every week Three-fifth come to buy specific products from haats despite the fact that similar products are available in their villages A buyer spends Rs 40 on purchase of FMCG products in a single haat day. It nears Rs 60 in UP and Maharashtra while is comparatively lower at Rs 22 in Orissa and AP

 The Big PictureLocation Of Haats5% 52%Temple Market Place35% 8%Bus Stop OthersSource:RMAI

8 States with max HaatsUttar Pradesh 10,380Bihar 4,993West Bengal 4,078Jharkhand 3,996Maharashtra 3,758Stalls in Haats(in percent)Source:RMAI

 Brand awareness for specific FMCG products sold at haats (%)Source:RMAI

FMCG products preferred at haats (%)Source:RMAI

. Sale of FMCG products per outlet on a haat day (Rs)

 Average number of visitors in a haat

. Source of purchase of branded FMCG for haat sellers

15. AdvantagesBrands rarely vie for attention because a shop in a rural area usually wouldn't have place for too many SKUs (stock-keeping units) They can build a strong rural base without much advertising support (like Chik and Ghadi, the shampoo and detergent brands). This could be due to product design and benefits as well as due to self-sustaining distribution/marketing modelsExpensive brands too can do well - contrary to popular belief, rural consumers believe in value for money and do not buy cheap products (Close up toothpaste, Marie and Tiger biscuits and Clinic shampoo are doing well due to deep distribution)

 Disposable surplus is not low in rural markets because the people there don't usually pay rent or spend much on food as grain and vegetables are from their own fields/homes. The number of middle-class households (those having annual income of Rs 45,000-2.15 lakh) are almost equal at 15.6 million in rural areas and 16.4 million in urban areas.Another opportunity lies in making effective use of the infrastructure: 3.8 lakh public distribution shops, 1.38 lakh post offices, 42,000 haats, 32,000 bank branches, 25,000 melas (exhibitions) and 7,000 mandis (agricultural markets)Large-format rural retail stores such as DSCL Hariyali, as well as IT initiatives like ITC"s e-choupal will help make inroads into rural markets

Few Companies Taking IntiativesMedimixFocused brand-building initiatives—like participation at community events such as “melas” (village fairs),“haats” (markets), street theater, van campaigns, and puppet shows—generate positive word-of-mouth and influence buying decisions. Medimix,” campaigned in mobile vans to promote its brand and give out product samples

 Colgate Distributed free sample and toothbrushes at these haats for awareness of oral healthTaken initiatives to circumvent the limitation in communication channels by innovatively leveraging non conventional media. Wall paintings cinema vans weekly markets haat fairs and festivalsPromote the product as a substitute for neem twigs, salt , charcoal etc in rural belt

DaburIn villages promote its hair oil as a substitute for mustard oil which village folks generally used.In rural UP & Bihar With SwasthyaChetnaAbhiyan project for DaburChyawanprashHealth camps set up for these haats so that health benefits are told to the customers coming there

.SonataSonata launched project Swades, aimed at changing people's mindsets and making them aware of the value of time in rural IndiaSonata watches were also displayed at local melas (fairs) and haats(markets)Gaily decorated mobile vans travelled around villages to generate interestTo customers, in the 20-to-35 year age groupSonata is talking to banks for micro financing, so that more people can afford to buy watch

ConclusionThe haat system demonstrates the Indian ingenuity of keeping product prices low. No high shop rentals, salesmen salaries or investment in display shelves and shop interiors. The fee for putting up a stall is a ridiculous Rs 5, whether you are a poor woman selling vegetables or a multinational selling consumer goods.More focus should be on better infrastructure on these haats like electricity, sheds etc.Companies will directly communicate to the huge rural masses with very less advertisement cost and their products are directly sold without much intermediaries .As income of rural people increase demand for branded goods will also increase rapidly 

The countries oldest tradition holds the key to rural penetration. The average daily sale at a Haat is about Rs.2.25 Lacs while the annual sales at melas amount to Rs.3, 500 crore.

In rural India, annual melas organised with a religious or festive significance are quite popular and provide a very good platform for distribution. Rural markets come alive at these melas and people visit them to make several purchases. According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year.Rural markets have the practice of fixing specific days in a week as Market Days when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Haats serve a good opportunity for promotion after brand building has been done at Mela.Also, one satellite town where people prefer to go to buy their durable commodities generally serves every region consisting of several villages. If marketing managers use these feeder towns they will easily be able to cover a large section of the rural population. Melas are organized after harvest season, so the villager has enough money, which he will be ready to spend. Demonstration at Haat is essential to convert customers at haats since their attitude is far more utilitarian than that of visitors to a fair.

MS 611 IGNOU MBA Solved Assignment - What are the major objectives of sales promotion?

What are the major objectives of sales promotion?
Ans

The main objective of sales promotion is to bring about a change in the demand pattern of products and services. Basically, sales promotion has three specific objectives. First, it is meant to provide important marketing information to the potential buyers.

The second objective is to convince and influence the potential buyers through persuasive measures. Thirdly, sales promotion is meant to act as a powerful tool of competition. The specific objectives of sales promotion are as follows:

a. To introduce new products or services:

Sales promotion is often used to motivate prospective consumers to try new products and services. Dealers are also induced to introduce new products and services in the market. Usually, free samples are provided through dealers during such introduction. Similarly, discounts in cash or goods may also be offered to dealers to stock new products or deal with new services. Free samples, trade discounts, cash discounts are basically sales promotion measures.

b. To attract new customers:

Sales promotion measures also play an important role in attracting new customers for an organisation. Usually, new customers are those persons that are won away from other firms. Samples, gifts, prizes, etc. are used to encourage consumers to try a new brand or shift their patronage to new dealers.

c. To induce existing customers to buy more:

Sales promotion devices are most often used to induce the existing customers of a firm to buy more. Product development, offering three products at the cost of two, discount coupons, are some of the sales promotion devices used by firms to motivate the existing buyers to buy more of a specific product.

d. Helps the firm to remain competitive:

Most of the companies undertake sales promotion activities in order to remain in the competitive market. Therefore, in the modern competitive world no firm can escape the responsibility of undertaking sales promotion activities.

e. To increase sales in off-seasons:

Many products like air-coolers, fans, refrigerators, air-conditioners, cold drinks, room heaters, etc. have seasonal demand. Manufacturers and dealers dealing with such type of goods make every effort to maintain a stable demand throughout the year.

In other words, firms try to encourage the purchase of such goods in off-seasons also. That is the main reason behind discounts and off-season price reductions of such items in the market during slack seasons.

f. To add to the stock of the dealers:

Dealers like wholesalers and retailers usually deal with a variety of goods. Their selling activity becomes easier when the manufacturer supplements their efforts by sales promotion measures. When a product or service is well supported by sales promotion, dealers are automatically induced to have more of such items.

MS 611 IGNOU MBA Solved Assignment - Discuss the various product strategies marketers’ use for rural markets, giving suitable examples.

Discuss the various product strategies marketers’ use for rural markets, giving suitable examples.

More than 750 million people * Estimated annual size of the rural market

FMCG	Rs. 70,000 Crore
Durables	Rs. 5,500 Crore
Agricultural-Inputs (including tractors)	Rs. 48,000 Crore
2 / 4 Wheelers	Rs. 8,400 Crore

* In financial year 2001-02, LIC sold more than 50% of its policies in rural market. 
* 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.
* In last 50 years, 45% villages have been connected by road. 
* More than 90% villages are electrified, though only 44% rural homes have electric connections. 
* Government is providing subsidiaries to the villagers to use other source of energy like Solar System and is now being used in large amount.
* Number of "pucca" houses increasing day by day. 
* Rural literacy level improved from 36% to 59%. 
* Percentage of BPL families declined from 46% to 25%. 
* Out of two million BSNL mobile connections, 50% are in small towns / villages.
* 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.
Strategies to be Followed in Indian Rural Market-
a) Marketing Strategy

Marketers need to understand the psychology of the rural consumers and then act consequently. Rural marketing involves more exhaustive personal selling efforts compared to urban marketing. Firms should abstain from designing goods for the urban markets and subsequently pushing them in the rural areas. To effectively tap the rural market, a brand must associate it with the same things the rural folks do. This can be done by utilizing the various rural folk media to reach them in their own language and in large numbers so that the brand can be associated with the myriad rituals, celebrations, festivals, "melas", and other activities where they assemble.

b) Distribution Strategy

One of the ways could be using company delivery van which can serve two purposes - it can take the products to the customers in every nook and corner of the market, and it also enables the firm to establish direct contact with them, and thereby facilitate sales promotion.

However, only the companies having excellent Infrastructure can adopt this channel. The companies with relatively fewer resources can go in for syndicated distribution where a tie-up between non-competitive marketers can be established to facilitate distribution. Annual "melas" organized are quite popular and provide a very good platform for distribution because people visit them to make several purchases.

According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year. Rural markets have the practice of fixing specific days in a week as Market Days called "Haats' when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town termed as "Mandis" where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns, they will easily be able to cover a large section of the rural population.

c) Promotional Strategy

Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers
a) Marketing Strategy
Marketers need to understand the psychology of the rural consumers and then act consequently. Rural marketing involves more exhaustive personal selling efforts compared to urban marketing. Firms should abstain from designing goods for the urban markets and subsequently pushing them in the rural areas. To effectively tap the rural market, a brand must associate it with the same things the rural folks do. This can be done by utilizing the various rural folk media to reach them in their own language and in large numbers so that the brand can be associated with the myriad rituals, celebrations, festivals, "melas", and other activities where they assemble.

b) Distribution Strategy

One of the ways could be using company delivery van which can serve two purposes - it can take the products to the customers in every nook and corner of the market, and it also enables the firm to establish direct contact with them, and thereby facilitate sales promotion.

However, only the companies having excellent Infrastructure can adopt this channel. The companies with relatively fewer resources can go in for syndicated distribution where a tie-up between non-competitive marketers can be established to facilitate distribution. Annual "melas" organized are quite popular and provide a very good platform for distribution because people visit them to make several purchases.

According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year. Rural markets have the practice of fixing specific days in a week as Market Days called "Haats' when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town termed as "Mandis" where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns, they will easily be able to cover a large section of the rural population.

c) Promotional Strategy

Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers
Marketers need to understand the psychology of the rural consumers and then act consequently. Rural marketing involves more exhaustive personal selling efforts compared to urban marketing. Firms should abstain from designing goods for the urban markets and subsequently pushing them in the rural areas. To effectively tap the rural market, a brand must associate it with the same things the rural folks do. This can be done by utilizing the various rural folk media to reach them in their own language and in large numbers so that the brand can be associated with the myriad rituals, celebrations, festivals, "melas", and other activities where they assemble. 
b) Distribution Strategy

One of the ways could be using company delivery van which can serve two purposes - it can take the products to the customers in every nook and corner of the market, and it also enables the firm to establish direct contact with them, and thereby facilitate sales promotion.

However, only the companies having excellent Infrastructure can adopt this channel. The companies with relatively fewer resources can go in for syndicated distribution where a tie-up between non-competitive marketers can be established to facilitate distribution. Annual "melas" organized are quite popular and provide a very good platform for distribution because people visit them to make several purchases.

According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year. Rural markets have the practice of fixing specific days in a week as Market Days called "Haats' when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town termed as "Mandis" where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns, they will easily be able to cover a large section of the rural population.

c) Promotional Strategy

Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers
b) Distribution Strategy
One of the ways could be using company delivery van which can serve two purposes - it can take the products to the customers in every nook and corner of the market, and it also enables the firm to establish direct contact with them, and thereby facilitate sales promotion.

However, only the companies having excellent Infrastructure can adopt this channel. The companies with relatively fewer resources can go in for syndicated distribution where a tie-up between non-competitive marketers can be established to facilitate distribution. Annual "melas" organized are quite popular and provide a very good platform for distribution because people visit them to make several purchases.

According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year. Rural markets have the practice of fixing specific days in a week as Market Days called "Haats' when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town termed as "Mandis" where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns, they will easily be able to cover a large section of the rural population.

c) Promotional Strategy

Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers
One of the ways could be using company delivery van which can serve two purposes - it can take the products to the customers in every nook and corner of the market, and it also enables the firm to establish direct contact with them, and thereby facilitate sales promotion. 
However, only the companies having excellent Infrastructure can adopt this channel. The companies with relatively fewer resources can go in for syndicated distribution where a tie-up between non-competitive marketers can be established to facilitate distribution. Annual "melas" organized are quite popular and provide a very good platform for distribution because people visit them to make several purchases.

According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year. Rural markets have the practice of fixing specific days in a week as Market Days called "Haats' when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town termed as "Mandis" where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns, they will easily be able to cover a large section of the rural population.

c) Promotional Strategy

Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers
However, only the companies having excellent Infrastructure can adopt this channel. The companies with relatively fewer resources can go in for syndicated distribution where a tie-up between non-competitive marketers can be established to facilitate distribution. Annual "melas" organized are quite popular and provide a very good platform for distribution because people visit them to make several purchases. 
According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year. Rural markets have the practice of fixing specific days in a week as Market Days called "Haats' when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town termed as "Mandis" where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns, they will easily be able to cover a large section of the rural population.

c) Promotional Strategy

Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers
According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year. Rural markets have the practice of fixing specific days in a week as Market Days called "Haats' when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town termed as "Mandis" where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns, they will easily be able to cover a large section of the rural population.
c) Promotional Strategy

Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers
c) Promotional Strategy
Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers
Marketers must be very careful while choosing the mediums to be used for communication. Only 16% of the rural population has access to a vernacular newspaper. So, the audio visuals must be planned to convey a right message to the rural folk. The rich, traditional media forms like folk dances, puppet shows, etc., with which the rural consumers are familiar and comfortable, can be used for high impact product campaigns. Radio is also very popular source of information and Entertainment, Adds on radio can also be a helpful tool for marketers

Dynamics of rural markets differ from other market types, and similarly, rural marketing strategies are also significantly different from the marketing strategies aimed at an urban or industrial consumer. 

MS 611 IGNOU MBA Solved Assignment - Explain the factors that influence buyer behaviour in the rural context, specially highlighting the impact of social class and reference groups. Use appropriate examples to illustrate your answer.

Explain the factors that influence buyer behaviour  in the rural context, specially highlighting the impact of social class and reference groups. Use appropriate examples to illustrate your answer. 

Ans :

Types of consumer buying behavior are determined by:

y

Level of Involvement in purchase decision

. Importance and intensity of interest in aproduct in a particular situation.

y

Buyer¶s level of involvement

determines why he/she is motivated to seek informationabout a certain products and brands but virtually ignores others.High involvement purchases--Honda Motorbike, high priced goods, products visible toothers, and the higher the risk the higher the involvement.Types of risk:

y

Personal risk 

y

Social risk 

y

Economic risk The four type of consumer buying behavior are:

y

Routine Response/Programmed Behavior

--buying low involvement frequentlypurchased low cost items; need very little search and decision effort; purchased almostautomatically. Examples include soft drinks, snack foods, milk etc.

y

Limited Decision Making

--buying product occasionally. When you need to obtaininformation about unfamiliar brand in a familiar product category, perhaps. It requires a

moderate amount of time for information gathering. Examples include Clothes--knowproduct class but not the brand.

y

Extensive Decision Making/Complex high involvement

- unfamiliar, expensive and/or infrequently bought products. High degree of economic/performance/psychological risk.Examples include cars, homes, computers, education. Spend a lot of time seekinginformation and deciding.Information from the companies MM; friends and relatives, store personnel etc. Gothrough all six stages of the buying process.

y

Impulse buying, no conscious planning.

The purchase of the same product does not always elicit the same buying behavior. Product canshift from one category to the next.For exampleGoing out for dinner for one person may be extensive decision making (for someone that doesnot go out often at all), but limited decision making for someone else. The reason for the dinner,whether it is an anniversary celebration, or a meal with a couple of friends will also determinethe extent of the decision making.

Role of people in buying decisionInitiator

± The person who first suggests the idea of buying the product or service. For example,a in a family the youngest child who goes to school suggests the buying of a cell phone.

Influencer ± 

The people whose views or advise influence the decision. For instance the father of the child talks to his relative who lives in a nearby city. This relative suggests the farmer that aNokia or Dolphin cell phone would be good since he is well versed with the various models.Thus he has influenced his father.

a

Decider ± 

The person who decides on any component of the buying decision, whether to buy,what to buy, how to buy or where to buy. The elder son of the farmer when asked, tells him thatNokia cell phone suggest that buying it would be a better option as it is more trusted. He hasdecided what cell phone to buy for the father.

Buyer ± 

He is the person who makes the actual purchase. Here the father has made a decisionand buys a Nokia cell phone from a dealer known to him. The father has paid the money and heis the buyer.

User

± The person who consumes or uses the product or service. For example this new Nokiacell phone is actually used buy their sister who teaches in the school.

The Indian consumer spending has increased from US$ 133.60 in 1992-93 to US$ 350.74 in2002-03, a compound annual growth of 10.13 per cent at current prices. The way Indianconsumers are spending their money on various items has changed in recent years. The sharebeing spent on the basis (food and beverages) has fallen from 54.07 per cent in 1992-93 to 44.8per cent in 2002-03. Other items have increased in importance, for example, medical andhealthcare spending has increased from 3.5 per cent to 8.5 per cent of total expenditure over thesame period, a compound growth rate of 19.71 per cent. Similarly spending on transport andcommunication has grown at 13.2 per cent.While the Compound Annual Growth Rate (CAGR) in total consumer spending has been around12 per cent a year over the past decade, there have been sharp ups and downs. Consumer expenditure has been in tandem with the annual GDP growth.For rural India, per capita 30 days' consumer expenditure of US$ 12.34 was split up into US$6.78, on an average, for food, and US$ 5.56 for non-food. Food expenditure included US$ 2.25for cereals and cereal substitutes, and US$ 2.37 for milk, milk products, vegetables, edible oiland US$ 2.16 on others. Non-food expenditure included US$ 1.11 for fuel and light, and another US$1.00 for clothing, footwear and US$3.45 on other non-food expenditure.For the urban sector, average Monthly Per Capita Consumer Expenditure (MPCE) of US$ 23.53was split up into US$ 10.00 for food and US$ 13.53 for non-food. Of food expenditure, US$2.37 went towards cereals and cereal substitutes while US$ 3.67 was spent on milk, milk products, vegetables and edible oil and US$3.96 on other food items. US$ 2.11 was spent per person per month on fuel and light, and US$ 1.65 on clothing and footwear and US$9.77 onother non-food items.Urban expenditure levels per capita exceeded rural levels for all the product groups, except oncereals and cereal substitutes. The average monthly per capita expenditures on cereals and cerealsubstitutes for rural and urban areas are very close to each other.

The gap between rural and urban averages of MPCE was of the order of US$ 11.16. The item-groups viz. milk and milk products, beverages etc, fuel and light, education, miscellaneousconsumer goods & services, conveyance and rent contributed to the gap significantly.Non-food expenditure per person in the urban sector was more than double of that for the ruralsector, where it was about US$ 5.55.In India, the higher income group (>US$2,465) spends more amount of their income on luxurygoods and trendy products than fact moving consumer products.The middle income group (US$1,162 ± US$1,190) spends more on consumer expendables thanthe rich.Combined the middle and the lower income group provide 60 per cent of the value of the Indianmarket.

MS 611 IGNOU MBA Solved Assignment - What are the specific marketing challenges presented by rural markets? Explain with the help of examples.

What are the specific marketing challenges presented by rural markets? Explain with the help of examples.

Ans

been substantial increase in the purchasing power of the rural habitants. Since Green revolution in India, the rural areas are started to use a large quantity of consumable and non-consumable products. In this way, rural marketing has been used as a strategy to combat against the competition by the marketers. The rural marketing and agricultural marketing prior to globalisation of Indian economy convey the same meaning, but after wards both understand by the markets in different context– the later denotes agricultural and rural production of the for the urban consumers or industrial consumers, whereas rural marketing involves marketing of manufactured or processed inputs to rural consumers. These have changed the entire spectrum of marketing for the Indian rural market and force the marketers to move towards rural areas. Rural marketing in India is still at infancy stages, and faces the various types of problems in respect of marketing, product designing and positioning, pricing, distribution and promotion. Today’s corporation must understand the rural market on different context to widentheir business horizon, to expand their market and to exploiting the opportunities available in the rural areas. The Indian rural market is bigger and vast in size with its lager consumer base, its offers the great opportunities for the marketer and stay tune with the rural marketing offerings. Rural marketing consists of around 833 million potential consumers, and majority of the Indian middle-class, and about half the country's disposable income. The marketer must understand the growing complexities of the rural market and making strategy for the proper mixing of marketing mix. It involves high risk and attractive for those who are searching challenge and having a courage to face those challenges. The key to face the challenges is to understand the market, the consumer need and behaviour. Hence, it is proposed to undertake in this study to assess the various dimension of Indian rural markets. The main aim of this study is to observe the potentiality of Indian Rural Markets and finding out various problems are being faced by rural markets. This paper attempts to look into the challenges and opportunities of Indian rural marketing by adopting SWOT analysis matrix on rural markets.

Recently, the growth of the Indian economy after starting of liberalization and globalisation policy in 1991 has