Rural Market Segmentation

Rural marketing is now a two-way marketing process. There is inflow of products into rural markets for production or consumption and there is also outflow of products to urban areas. The urban to rural flow consists of agricultural inputs, fast-moving consumer goods (FMCG) such as soaps, detergents, cosmetics, textiles, and so on. The rural to urban flow consists of agricultural produce such as rice, wheat, sugar, and cotton. There is also a movement of rural products within rural areas for consumption.

Rural marketing can be described as any marketing activity in which a dominant participant will be from a rural area which implies that it consists of two things that is marketing of inputs to the rural in addition to that marketing of outputs from the rural markets to other geographical area. Rural areas are those areas which are not urbanized and low population density and much of the land is devoted to agriculture. Rural Marketing is growing at a much faster rate than its urban counterpart. Indian Rural Market is becoming the powerhouse of the country. 12 % of the world population is residing in rural areas witnessing enormous growth in their incomes and crucial shift in consumer behaviour.

Facts that strengthen the rural India is given below:

• Rural India accounts for a total of 55% of the manufacturing GDP. They were host to nearly 75% of new factories built in the last decade.
• Rural consumption per person has increased by 38% yearly between 2019 and 2020.

Degrees of Segmentation:

1. Mass Marketing

In this all consumers are being treated the same. It allows the company to target the maximum number of consumers. For example HUL has offered only one detergent that is “Surf” to all consumers but Nirma entered the market and grabbed a sizeable market share because of which HUL woke up and introduced wheel.

2. Segment Marketing

Marketers determines the potential of consumers segments which are substanial enough to target and respond by offering low-priced sachets and products that are designed appropriatley.

Segmenting the rural market

There are various dimensions on basis of which the rural market can be segmented these dimensions include geographic, demographic, psychographic and behavioural. The rural areas can be also classified on the basis of socioeconomic classes bases on the occupation and the type of house in which they live. The consumers are classified into four classes which are as follows:-

1. SEC R1

This section consists of the landlord farmers, people who are exposed to urban areas like if their children studying in the nearby towns, who lifestyle as of the urban people, those who own consumer durable goods like refrigerator, two wheeler etc.

2. SEC R2

They include the rich farmers, who themselves are not educated but want their children to be educated, own some of the consumer durable products like television, tractor etc.

3. SEC R3

They include those who have their children studying in the villages, those who are conservative in adopting technology and have some consumer durable products.

4. SEC R4

These include low income labours, agricultural farmers and uneducated people of labour class.

Characteristics of the Rural Market

Few characteristics which are unique to the rural market these are:-

• Level of literacy
• Family structure
• Pattern of occupation
• Household settlements distribution

There are few features that have importance in the rural market, these are:-

• Demographic features of the rural India
• Unique characteristics of the rural economy
• Cultural and social behavior
• Consumer response in the rural market
• Marketing in rural areas

The market structure in the rural areas is different from that of the urban areas. There are different means to reach the rural consumers unlike the urban consumers who have retail stores, supermarkets etc. The rural consumers can be reached through periodic markets in the village known as haats, agricultural markets known as mandis and fairs in the rural areas known as melas.

Rural market is said to be heterogeneous market where there are many variations in income, population, density, socio- cultural aspects, literacy level, consuming habits, tastes, preferences which influence the response of the consumers to a greater extent.