Rural Marketing in India: An Emerging Issue
Authors: Dr Ravindra Singh Shekhawat
Rural marketing consists of marketing of inputs (products and services) to the rural market as well as marketing of outputs from rural market to other geographical area” stated by Philip Kotler. The reason why rural marketing is so important is not because majority of population in India resides in villages but these markets offers immense potential for market expansion and growth. The market for FMCGs (fast moving consumer goods) expanded about 30% between 1992-93 and 1998-99 and they accounted for about 53% product of that category of total consumption of country. There are various market indicators viz. size and growth rate for many products and product categories which entice companies to enter these rural markets. Further other factors attracting these entrants is the fact that 48% of rural population is below 20 years of age. Despite having many differences there is huge untapped potential in the rural markets for including durables in their lives. For rural markets to grow there is need to overcome some challenges residing in the areas viz. low literacy, inadequate infrastructure (roads, weak banking facilities, limited availability of credit facilities, and poor warehousing facilities), communication problem, inequitable income distribution, vertical and horizontal integration of market and seasonal demand for their produce. Further our marketing channels are found to be choked and middlemen are swallowing a major part of the farmers’ profit. The investment by Indian government to better the farm productivity and living conditions of rural people through its various programmes including MNREGA(Mahatma Gandhi national employment guarantee act), Indira Awas Yojana, APMC(agricultural produce market committee) act and others have made the rural markets more vibrant and prosperous. On one hand these schemes have enhanced demand in rural areas for production and consumption of goods such as farm equipments and machinery, improved seeds, fertilisers, chemicals and banking services. On the other hand, the increased output of rural economy such as food grains, milk, vegetables can now be marketed to processing and consumption centres, which are usually located in urban areas. Though the efforts of the government has provided a milieu for Indian farmers through price support operations and establishing mandi samitis but there is always hope for the betterment of the conditions. There are some areas which are still untouched or slightly covered and it is expected over the years that these areas will be taken care of. It is shown by a survey that ‘if rural income increases by 1% than buying power would correspondingly increase about 10,000 crores’. The rural market in India is not a separate entity in itself and it is highly influenced by sociological and behavioural factors operating in India and these rural markets covers 74%of total population of the nation. So rural marketing that consists of marketing of products to and from rural areas is a major and vital activity in India.
Kotler, Philip, Marketing Management
Acharya,S.S and Agarwal, N.L, Agricultural Marketing in India
About Author / Additional Info:
I am currently working as Scientist, Division of Forecasting and Agriculture System modeling at ICAR-IASRI, New Delhi.