New product Development in rural markets

21/10/2022 0 By indiafreenotes

One important aspect of designing products for rural markets is the product fit with the rural lifestyle and environment.

Some new products introduced in rural markets are 5-kg cooking gas cylinder by HPCL; Jolly batter-operated color TV, Philips Free Power Radio, Kisan Credit Card etc.

The Process involves

Idea Generation

The first stage of the New Product Development is the idea generation.

In rural homes, the detergent bar used for washing clothes is cut into two pieces before use to ensure that it lasts longer due to less melting. But no marketer has addressed this need so far.

Similarly areas with a problem of hard water would appreciate detergents able to cope with this factor.

Idea Screening

This second step of new product development involves finding those good and feasible ideas and discarding those which aren’t.

Concept Development and Testing

  • A concept is a detailed strategy or blueprint version of the idea.
  • Concept Testing in rural market needs to be done in different regions, as needs change from area to area depending upon the characteristics of a particular region.
  • A concept of low-cost dry toilet promoted by UNICEF (requiring less water) was appreciated in water-scarce regions of Rajasthan, but was opposed in other regions where water availability is not a problem.

Business Strategy Analysis and Development

The testing results help the business in coming up with the final concept to be developed into a product.

Estimated product profitability, marketing mix, and other product strategies are decided for the product.

Product Development

Once all the strategies are approved, the product concept is transformed into an actual tangible product.

This development stage of new product development results in building up of a prototype or a limited production model.

Test Marketing

Unlike concept testing, the prototype is introduced for research and feedback in the test marketing phase.

This process is of utmost importance as it validates the whole concept and makes the company ready for the launch.

This is the most important factor in deciding the success or failure of the product. It becomes critical in the rural context where failure rates are high.

Eicher Tractors aborted its idea of generating electricity through its tractors with the use of a generator powered by tractor engine. This was because the company found that it could not take care of the farmer’s agricultural power purposes and could only be used for domestic purposes. It found that farmers use 5-KW water pumps for irrigation which ran on 3-phase power supply. Hence the company’s single-phase, 3KW generator was not suitable. Because of limited space on tractors a bigger one could not be fit either.


The marketing mix is now put to use.

Markets are decided for the product to launch in.