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Marketing process of rural marketing.
Rural marketing is a two way marketing process that can be in
the form of:
URBAN RURAL
RURAL
1.Urban to Rural: A major part of rural marketing falls into this
category. It involves the selling of products and services by
urban marketers in rural areas. These include: Pesticides, FMCG
Products, Consumer durables, etc.
2. Rural to Urban: Transactions in this category basically fall
under agricultural marketing where a rural producer seeks to sell
his produce in an urban market. An agent or a middleman plays
a crucial role in the marketing process. The following are some
of the important items sold from the rural to urban areas: seeds,
fruits and vegetables, milk and related products, forest produce,
spices, etc.
3. Rural to Rural: This includes the activities that take place
between two villages in close proximity to each other. The
transactions relate to the areas of expertise the particular village
has. These include selling of agricultural tools, cattle, carts and
others to another village in its proximity.
Indian agricultural industry has been growing at a tremendous
pace in the last few decades. The rural areas are consuming a
large number of industrial and urban manufactured products.
The rural agricultural production and consumption process plays
a predominant role in developing the Indian economy. This has
designed a new way for understanding a new process called
Rural Marketing.
The concept of rural marketing has to be distinguished from
Agricultural marketing. Marketing is the process of identifying
and satisfying customers needs and providing them with
adequate after sales service. Rural marketing is different from
agricultural marketing, which signifies marketing of rural
products to the urban consumer or institutional markets. Rural
marketing
basically deals with delivering manufactured or processed inputs
or services to rural producers, the demand for which is basically
a derived outcome.
Rural marketing differs from
agricultural or consumer products marketing in terms of the
nature of transactions, which includes participants, products,
modalities, norms and outcomes. The participants in case of
Rural Marketing would also be different they include input
manufacturers, dealers, farmers, opinion makers, government
agencies and traders.
Rural marketing needs to combine concerns for profit with a
concern for the society, besides being titled towards profit. Most
of the jobs of marketing and selling are left to the local dealers
and retailers. The market for input gets interlocked with other
markets like output, consumer goods, money
and labour. Rural marketing in India is not much developed
there are many hindrances in the area of market, product design
and positioning, pricing, distribution and promotion .
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Nature of Rural Market
Large, Diverse and Scattered Market:
Rural market in India is large, and scattered into a number of
regions. There may be less number of shops available to market
products.
Major Income of Rural consumers is from Agriculture:
Rural Prosperity is tied with agriculture prosperity. In the event
of a crop failure, the income of the rural masses is directly
affected.
Standard of Living and rising disposable income of the
rural customers:
It is known that majority of the rural population lives below
poverty line and has low literacy rate, low per capital income,
societal backwardness, low savings, etc. But the new tax
structure, good monsoon, government regulation on pricing has
created disposable incomes. Today the rural customer spends
money to get value and is aware of the happening around him.
Traditional Outlook:
Villages develop slowly and have a traditional outlook. Change
is a continuous process but most rural people accept change
gradually. This is gradually changing due to literacy especially
the youth who have begun to change the outlook in the villages.
Rising literacy levels:
It is documented that approximately 45% of rural Indians are
literate. Hence awareness has increases and the farmers are well-
informed about the world around them. They are also educating
themselves on the new technology around them and aspiring for
a better lifestyle.
Diverse socioeconomic background:
Due to dispersion of geographical areas and uneven land
fertility, rural people have disparate socioeconomic background,
which ultimately affects the rural market.
Infrastructure Facilities:
The infrastructure facilities like cemented roads, warehouses
communication system, and financial facilities are inadequate in
rural areas. Hence physical distribution is a challenge to
marketers who have found innovative ways to market their
products.
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Characteristics of rural market
1) Large and Scattered Market
a) It consists of approximately 75 crore rural consumer who
live, 38,365 villages and the rural market is geographically
scattered.
b) About 1,45,098 v 23 percent of the total number of village in
India have population less than 200 and another 21 percent have
population between 200 and 500 and on the other hand 13
percent villages have 50 percent rural population and they
posses 60 percent of the rural wealth.
2) Heterogeneous Market:
a) It shows linguistic, religious and cultural diversities and
economic disparities. As many as 20,000 ethnic groups are
present in rural India and this poses a formidable challenge to
the marketer.
b) There are 24 languages which varies every 100 km.
3) Income from Agriculture
Agriculture is the main source of income. Nearly 55 percent of
rural income comes from the agriculture and the income being
seasonal in nature is fluctuating. The type of crop production
method of agriculture and the amount of land directly influence
this income.
4) Standard of living
a) Over 70 percent of the rural population is employed in small
scale agriculture and its related occupations
b) The rural market is undeveloped, as the people who constitute
it still lack adequate
purchasing power. It is largely agricultural oriented, with poor
standard of living, low-per capita income.
5) Infrastructure facilities
a) The infrastructural facilities like Roads, Warehouses,
Communication system and financial facilities are inadequate in
rural areas. Nearly 50 percent of the rural villages in the country
are not properly connected by roads.
b) Over 50 percent rural household has access to electricity as
main source of lighting but 46 percent use kerosene or other
means for lighting.
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Impact of globalization on farmers
In India, roughly 90 percent of the rural population is engaged in
agriculture. In absolute terms they are nearly 600 million or 60
crore. Since 1990, when Globalization was implemented in
India then many important changes were made in cultivation
like-Multi cropping.The shift from rain fed to irrigation
dependent farming in many areas.
And a certain degree of development of productive forces like-
in inputs like HYV seeds Machinery, Techniques, Skills.
Due to the opening of agriculture sector for the multinational
companies and big corporations. Consequently, the cost of
agricultural production has increased because cost of chemical
fertilizers, pesticides, irrigation etc. has increased in manifolds.
The capital intensive and import based agricultural activity have
naturally started displacing mostly poor, small and marginal
peasants from land. Multinational agri-business companies like
Cargill, Pepsico, Monsanto, ITC etc. Are already in the field to
monopolize this lucrative market. A new class has emerged in
rural India during the period of globalization which has been
benefited by this globalization. These are mainly the rich and
high middle class farmers.
Basically, these classes have more purchasing power and are the
main customers for durable and other luxurious goods in rural
India. The remaining poor and marginal peasants ironically who
constitute the major portion in rural areas have been subjected to
deep trouble in the era of globalization and their purchasing
power are too low and has been decreasing over the years. Small
farmers in particular are least benefited by this globalization
whereas big farmers with their economic and political influence,
are able to reap the benefits of globalization as they can get best
technologies, grow cash crops, negotiate agreements, and move
their products.
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