Updated April 25, 2023
Introduction to Rural Market Products
Rural market products are growing at a quick pace in developing countries. With the increase in wages and income, there is an increase in the middle class. As a result, the consumption rate in rural areas is increasing daily. Around 12% of the global population lives in rural areas of India, according to estimates. Therefore the rural market has become a powerful economic booster. Seeing this change, many corporations are trying to utilize this opportunity to gain a strong footing in India’s rural market. But entering into a rural market and making a mark is not easy to process; one has to face a lot of challenging situations, like:
- Undeveloped transport systems
- Inadequate electricity services
- Unreliable telecommunication services
- Unavailability of appropriate rural market infrastructure
- Low level of literacy
A large area is covered by the dispersed consumers.
- Unavailability of partners to support the identification of the needs and marketing in the rural areas
- Unavailability of properly channelized distributors.
Reasons for the Increase in Business Opportunities in Rural India
Economists estimate that the rural market has great profit and growth prospects for various industries. The reasons for the increase in business opportunities in rural India are:
- Good quality crops, as a result of modern technology, and suitable weather facilitate a good harvest; it also enables an increase in rural employment in the agriculture sector and its allied industries. Industrialization in rural areas has brought income stability and has increased household purchasing capacity. The government is paying higher prices to farmers for their produce in rural markets, resulting in an increase in procurement prices.
- Government policies such as NREGS have helped to do away with poverty and unemployment problems in rural areas. These schemes have facilitated employment for at least one family member, thereby increasing the family’s income.
- The changing lifestyle of the rural population over the period. There has been a change in the necessities, now a day’s every household owns a two-wheeler, mobile, and television. Entry-level versions of the commodity are giving way to branded items.
Steps in Rural Market Products
Rural market products in India have great potential. The following steps can facilitate the unlocking of the rural market potential:
Step #1. Developing an appropriate distribution channel
One must identify efficient ways to take their goods and services to the rural population. Companies should focus on building distribution channels so that every individual in the rural setting can access their rustic market products and services. It can be done by developing a multilayer distribution system. Various methods can reach diverse rural dwellers. It can be conventional distribution, and small sub-distributors can distribute the goods and services, or the goods can be distributed through van or vehicular delivery; this distribution channel is very effective in inaccessible reach areas. Retailers order through mobiles or other telecommunication technologies to order, and these can deliver the rural market products to these destinations. Still, unavailable and smaller rural micro-markets, with low populations and no proper road connectivity, can be reached by two or three-wheelers.
These vehicles can make two or three visits to these retail kiosks to distribute the goods; One needs to build and develop an effective distribution strategy with diverse action plans to cater to the diverse needs and populations in the rural areas, regardless of the way the goods are distributed.
Step #2. Identify Prospective Clients
Identifying prospective customers or clients is an important aspect of the success of any business. It includes the identification of customers who possess the highest rural market potential. A great deal of research needs to do in this process. One needs to identify the target group for each product; one needs to analyze the purchasing power of the family as a whole; the income level and the average finance or percentage of savings utilized for the purchase of goods and services; the employment, under-employed and unemployment scenario of that area; identify the particular age group, class and their choices of the types of goods and rural products and so on.
Step #3. Gain Trust
One should focus on building trust among the masses rather than only focusing on profit-making. Once winning trust, customers become patrons for that particular good and service. They prefer to purchase goods under the same brand name. One should focus on developing a long-term relationship with their customers; this is achievable by providing them with efficient, reliable, and consistent services; The goods should have the best quality compared to other such goods in the market and should be cost-effective. One should develop action plans to attract prospective customers and retain existing ones. One can do this in several ways, such as giving discounts, offering special privileges to existing customers, and providing them with cashback schemes. One can use the mobile van strategy to reach people in far-flung areas who need access to shops or outlets.
Your rural marketing strategies should be such that people get satisfied with your services, identify themselves with your company, and refer your goods and services to others. Focus on building durable ties with your customers.
Step #4. Developing Rural Marketing Strategies
One should focus on the rural market development of organizational and management strategies to make one’s business in rural areas. It may include building a special division to look after the matters of rural area marketing; developing regional units in the rural areas; identifying rural talent and training and developing them into potential marketing executives, as they are from the rural background and understand the mindset of the rural population better than anyone else. They are locals who know the area well, therefore, can move around with much comfort and ease. Dedicate and define the job of every person, who does what, and how to maintain coordination between the different employees and departments of the company.
An efficient tracking system should be developed to track the performance of every co-worker. And there should be regular updates on the progress made, new technological advancements, and new marketing strategies. We can discuss the various problems encountered and their resolutions. Developing rural marketing strategies to predict future sales and profit should be a priority.
Step #5. Approach the locals
Another effective way to tap potential customers is with the help of local people in rural areas. These people can be insurance agents, bank Mitras, local teachers, social workers, krishak Mitras, or anyone who already covers the rural population for their own business. One can train them in their business and marketing strategies and provide them with employment at the same time. You can develop a team of rural youth or Grameen Mitras, who can go to the remote areas with your rural market and services and identify and add potential customers. Some companies have adopted the village entrepreneur model, empowering the local small-scale business people and providing them with mini-stores or minimum rural market infrastructure to function.
Similarly, various financial institutions like banks have employed the unemployed youth in the form of bank Mitras; these bank Mitras identify potential clients for loans, the opening of bank accounts, and the sale of insurance policies. The companies provide the bank Mitras with the appropriate technology and information, which they use to tap new customers.
Step #6. Connect with Channel Partners
Another important factor to consider is developing a bond with channel partners. It is achievable by understanding the diverse needs and requirements of the distributors and retailers in rural areas. They should be then trained in the fields of shop management; efficient distribution strategies; efficient sales strategies; management of stock; how to tap potential customers and how to retain the existing ones; how to identify new requirements and customer trends and work accordingly; and; customer satisfaction and how to carry the brand name forward.
Step #7. Identify Key Areas
Companies planning to enter the rural market products should identify the key areas where they can provide the best services to satisfy their rural customers. What are the requirements of the rural dwellers, for example, education, a high standard of living at a low cost, health, sanitation, nutrition, and so on? For example, in rural areas, the electricity services are inappropriate, therefore the rural market development of appliances that can work on solar or any other alternative energy source, nutritional supplements at low cost to take care of malnutrition problems in women and children, production of easy and low-cost sanitary products like sanitary napkins and so on. One can also develop teams of youth from rural areas to educate the rural masses regarding these issues and how they can be tackled using rustic market products manufactured by the company.
Step #8. Develop Service Infrastructures
Rural areas are inaccessible and remote, so a company trying to tap the rustic market products should develop adequate and efficient service infrastructures. Hiring locals for no-frills support in the villages can be done. Efforts should also be made to deliver the services at a low cost. Training the locals in repair and maintenance services can accomplish this. Spares parts should be easily available at affordable prices. Or the mobile van strategy can also cater to the servicing problems of rural dwellers.
Step #9. Develop Community rural market Infrastructures
A company can also develop a long-lasting relationship with its customers by developing community infrastructures and facilities to build the community, such as constructing dispensaries and health care programs and providing scholarships or financial aid to bright deserving students. Employing the unemployed rural youth, organizing workshops for better harvests, modern technologies, utilizing the available resources, conserving them, or various issues specific to the rural population.
Step #10. Inventory Management
Inventory management is an important aspect of the success of any rural business. One needs to have regular updates on the rustic market products which need ordering; updates on which rural market products are most in-demand and popular; information about which product is popular in which age group; Information about which rustic market products work efficiently without any problems, and which rural market products require regular servicing and replacement of spare parts, which rural market products are more cost-effective and fulfill the satisfaction level of the customers. All these aspects provide a transparent view of the company’s products; how they can be improved to cater to the customers’ needs; what modifications are required in the production, sales, and marketing strategies to attract potential customers and retain the existing ones.
With the growth in the global market, the rural market has also grown drastically. There is a vast difference in the rural market vs. urban market pattern. Rural dwellers are estimated to have a higher consumption rate than their urban counterparts. Establishing oneself in the rural market is challenging due to various problems such as inadequate infrastructure, lack of electricity, inappropriate distribution channels, mass illiteracy, and so on. One needs to develop numerous creative rural marketing strategies to attract rural customers; proper distribution channels need to be identified; rural market research needs to do to identify potential customers, and techniques need to develop to retain the existing customers; Local resource persons or talents need to be determined who can carry your message and image of the product among the rural population so that they can identify with your product or services.
You will also need to develop other rural marketing strategies, like providing employment to the unemployed, providing income sources to the underemployed, developing community infrastructures, and rural marketing strategies to improve the standard of living of the people of the community and which increase the overall income of the family. You need to develop a bond with the rural population that identifies with and trusts your products and services. One needs to put in a lot of effort to tap the potential of the rural market. Like the rural market, rustic products should be easy to use, cost-effective, reliable, and durable. But once you can develop a bond with the rural dwellers, the relationship becomes a long-lasting one.
This has been a guide to Rural market products. Here we have discussed a brief overview, steps, and reasons for an increase in business opportunities that are growing at a quick pace in developing countries. You may also look at the following articles to learn more –