CHAPTER-II
PRESENT STUDY
Selection of the problem and study area
The rural India offers a tremendous market potential. A mere one
percent increase in India’s rural income translates to a mind-boggling Rs.
10,000 crore of buying power. Nearly two-thirds of all middle-income
households in the country are in Rural India and close to half of India’s
buying potential lies in its villages. Therefore, rural markets are the new
markets, which are opening up for both durable and non-durable
products. Companies that have expanded in these areas found that, they
are able toward off competition, generate a new demand and in turn,
increase their sales or profits. Long-term perspective of marketing
planning with modern approach is essential for their future growth.
Considering the broad classification of researches, this study put
into social research category. It aims at obtaining the information on
market and removing the confusion about the behaviour of rural
consumers. Marketing itself a social process, since it is having a human
aspect and is resulted by the complex social behaviour. The management
of marketing is also social oriented and leads to the improvement of
52
quality of life and supplies better amenities to man in keeping with the
growing and varied requirements of the societies.
The approach of the present study is exploratory in the sense that it
is mostly directed towards identifying the various characteristic of the
consumer and creates observations conductive to further study. The
exploratory nature has necessitated keeping the coverage of the study
wide enough to cover all marketing aspects. A research in marketing is
required to have a bias for application. Therefore, in spite of keeping the
study wide enough and exploratory in nature an attempt has been made to
relate each aspect of the study with a managerial decision based on it.
Each of the hypothesis is related with a management action.
Relying on experience and observations is always preferable over
relying solely on theory and especially when the available information is
insufficient, the empirical study is the only way to get it. In this particular
case also, the lack of the information in rural markets of the study area
has been the main reason for preferring an empirical study. An extensive
survey of the rural areas of Dehradun district has been conducted and it is
expected that its results may necessitate the changes in the presently held
opinions and help in new theory altogether.
53
Product Selection
Regarding the product selection most commonly used products
have been chosen as it was not possible to include the whole range of
both durable and non-durable products in the study. Only eight products
of each category have been selected:
Durable
Non-Durable
Television
Salt
Tape Recorder
Tea
Cycle
Toothpowder/paste
Scooter
Hair Oil
Bike
Shampoo
Sewing Machine
Soap
Fan
Detergent Cake
Wrist watch
Detergent powder
Scope of Determination
Covering the whole population of rural Uttarakhand was beyond
the time and cost resources, therefore, the scope of the study was kept
limited. It was decided to cover some rural areas of Dehradun district
only.
54
REVIEW OF LITERATURE
To have proper insight for conducting the proposed study some
empirical studies carried out in India and abroad have been analysed.
Although the focus of the study is on consumption pattern of the rural
consumers with respect to durable and nondurable goods along with their
buying behaviour however, some emphasis and elucidation has also been
made to review the research work related to other aspects of rural
marketing.
While reviewing the literature, it was observed that only a few
comprehensive studies have been carried out covering different aspects of
rural marketing in India. Furthermore, of all the studies reviewed, there
was hardly any systematic and comprehensive study available on the rural
buyer behavior for consumer goods in India.
To understand the total scenario of the rural marketing, various
studies reviewed here have been divided into different aspects of rural
marketing such as the scope of rural markets, its potential, profile and
behavior of the rural consumers, rural distribution network, rural
communication, and some other aspects of rural marketing. Within each
category, the studies have been reviewed to know how the research scope
and methods have changed over the time.
Gaikwad (1973) observed that the term ‘rural consumer’ was
vague as every individual living in a rural area was a potential consumer
55
of some products. He stated that we had a large mass of individuals in
rural India and not a large mass of consumers. The study segmented the
rural consumers into six categories i.e. comprising proprietors or
landlords; comprising a small group of rich farmers; class of small
peasants; a class of tenant farmers; and a class of ruined artisans and
others. He considered the size of the land holding as an indicator of
economic status and purchasing capacity of the individual in defining the
potential rural consumer. According to this classification, only 30% of the
rural population, falling in the categories 1 and 2, could be termed as
potential consumers, because the rest of the population (categories 3
through 6) lived in extreme poverty and had an extremely low per capita
expenditure. Between the first two categories, the first category was a
class of people whom themselves did not live in a rural area. Therefore,
their tastes, preferences, value system and way of life were closer to the
urban-upper and upper-middle classes than the rural population. The
second category had strong roots in the village and belonged to a village
community. According to the author, this category had adopted major
agricultural innovations and modern technologies.
Balakrishan (1978) stated that rural India was thought of as one
huge mass of potential consumers of branded products. The author
contends that out of half a million villages, only 42,000 villages having a
population of more than 2,000 people should be the target for the
56
marketers. Among these villages, the marketers should concentrate on
feeder-market villages with a population of more than 2,000. The study
claimed the branded products used in urban areas had filtered out and
spilled over to the villages, which were peripheral to larger towns. Vast
proportions of rural population spend less than Rs. 43 per month.
Cultivators are by far the predominant occupational group and 20% of
these cultivators control about 66% of rural India’s assets.
Dholakia and Dholakia (1978) measured the extent of inter-state
variations in the urban-rural per-capita income differentials and analyzed
the contribution of structural factors to the urban-rural differentials. The
results indicated the existence of considerable inter-state variations in the
rural-urban per-capita income differential. The ration ranged from 1.33 in
Punjab to 3.97 in Bihar. Rural per-capita income showed a greater
regional variation than urban per-capita income. The structural factors
marginally contributed to the urban-rural income differentials as
compared to the sectoral productivity differentials. On the other hand, the
productivity differentials in a tertiary sector contributed more to the
urban-rural income differentials as compared to those in the secondary
sector.
A study undertaken by NCAER (1980) found some significant
differences in the rural and urban areas in terms of the household source
of income, wealth, investment, and savings. 83% of all earners in India
57
lived in a rural area. The rural household had more earners per family as
compared to urban households.
Mishra (2006) on his study pointed out that the Indian rural market
has grown in size, range and in sophistication in the recent years. Under
changing socio-economic scenario, the rural market has enough
potentialities in India and offers big opportunities and attractions to the
Indian marketers. However, widely scattered and heterogeneous rural
markets, inadequate and insufficient rural transportation, communication
and warehousing facilities, overall backwardness, preference for
conventional way of life of the rural people etc. are some such factors
which must be tackled as these have been hindering the growth of rural
markets. Thus, there is a need to formulate appropriate marketing strategy
more specifically advertising, personal selling and distribution to be an
integral part of that strategy to explore opportunities in order to tap the
untapped potentialities in rural markets.
Lesser and Huges (1986), tested whether the psychographic
profile of shoppers across geographic markets could be generalized.
Respondents were asked to indicate their level of agreement with each of
the 34 psychographic statements on a 0 to 10 scales. Seven types of
shoppers consistently appeared across the market which established
psychographic segments were generalisable across geographic markets.
58
The study suggested that firms may target their marketing strategies that
appeal to the basic consumer segments existing in every market.
A comprehensive attempt to review and evaluated the work done
on rural marketing was undertaken by Mukundas (1986) in order to
conceptualize ‘rural consumers’ and develop a ‘general framework’ and
approach from the marketing perspective. The study suggested
delineating villages into three stages from a marketing perspective such
as, villages that have primitive developmental characteristics, villages,
which are developing, and villages that are analogous to urban areas but
with certain differences. The delineation of villages was based on
indicators such as the economic based of the village, the village’s cultural
and social variables. Consumers in the three types of villages tend to
show three broad patterns of behaviour, which influence the marketing
mix strategies. The study suggested that the villages in India needed to be
looked at as if they were slowly moving from a primitive stage of
development to an urban analogous stage of development.
Meshram (2006) suggested two major emphases for enhancing
rural development opportunities. First, today youth regardless of they
ultimately live and work, will need an unprecedented level of education
and technical skills to compete in the increasingly high skill “new
economy”. Only 17 percent of rural adults age 25 and older had
completed college in 2000, half the percentage of urban adults. Moreover,
59
the rural-urban gap in college completion has widened since 1990. Rural
areas with poorly funded Public Schools, few good universities and
community colleges, very low educational attainment, and high levels of
economic distress may find it hard to compete in this new economy. All
of these are major obstacles to the educational progress of local youth and
to local development efforts. Second, rural economic health and vitality
depend on innovative ways to generate income. Jobs are declining and
incomes are eroding in rural areas that depend on natural resource based
industries, such as farming and mining. Those areas that can adopt
innovative income generating strategies to build on their assets diversify
their economies attract new businesses, and sustain their successive will
likely thrive in the global economy. Many rural areas have successfully
built on their assets and taken on new roles-providing labour for a
diversity of industry, land for urban and suburban expansion sites for
prisons and natural settings for recreation, retirement and enjoyment,
enhancing rural communities as places to live, retire and vacation may
improve not only the quality of life for existing residents, but also the
possibility of attracting new businesses and residents. These rapidly
growing areas can help sustain their successes by ensuring that the
changing demand for essential services and infrastructure is adequately
met.
60
A study undertaken by Mander and Grewal (1990) attempted to
evaluate the pattern of investment in Punjab farms from the perspective
of economic development. The study showed that the investment in
agriculture had stabilized, although it had declined marginally from the
year 1980-81 onward. The importance of consumer durable goods and
non-farm investments had increased whereas that of machinery declined.
Regarding the rural potential Information Service Department’s
(1986) Thompson Rural Market Index is the most comprehensive
publication in India to provide an assessment of the rural market potential
in all the districts of the country. The index was constructed based on 23
rural indicators. These twenty-three indicators were classified into six
categories viz.; area, demographics, occupation, agriculture, agricultural
inputs, rural electrification and commercial banks. Demographics include
rural population (both male and female), density per square kilometer,
percentage distribution population-by-population strata, number of
villages, percentage distribution of villages by population strata, and the
percentage of rural literates (both male and female). The occupation
indicators are cultivators, agricultural laborers and non-agricultural
workers. Agriculture factors are gross cropped area, gross irrigated area,
area under non-food crops and the average size of operational holdings.
Agricultural inputs include fertilizers (metric tones), tractors, pumpsets,
and tubewells. Rural electrification indicators include percentages of
61
electrified villages; Commercial bank indicators include the number of
rural branches, deposits and advances in lakhs of rupees. A total of 383
districts were considered for analysis of data and thus classified into five
classes A, B, C, D and E. The Class A market was considered to have the
highest potential and Class E market the lowest. The study is useful for
making investments in distribution, advertising and market research in
rural India.
The study by Namians (1960) was undertaken to determine which
of the consumer characteristics predict whether consumers will carryout
their intention to buy household durable goods. It was found that peoples’
expectations of higher prices hastened their buying and expectations of
lower prices slowed their buying. When an urgent need of the product
was felt, price expectation made little difference in consumer’s decisions
to buy. The highest proportion of consumers who carried out their
intention to buy a household product appeared to be influenced by their
geographical/regional location. Households in the occupation category of
‘unskilled and protective service and farm operators’ reported that their
intention to buy television sets, refrigerators or washing machines was
due to the availability of credit facilities. Consumer income rather their
education was another factor that influenced purchase of household
durables.
62
A study on “Priority Pattern and Consumer Behavior” by McFall
(1969) found a similarity between the priorities of urban and rural
consumers. Differences in the possession of some products were also
observed. For example, refrigerators were higher on the priority pattern of
rural consumers versus that of urban consumers. The reason may be that
the rural consumers make larger meat purchases on fewer shopping trips
than urban consumers do. For lower-income consumers, vacuum cleaners
were higher in priority, while electric irons were higher in priority for
upper-income consumers. Cross-sectional samples did not clarify the
current priority patterns. A simple ‘longitudinal’ experiment was
conducted in San Diego involving two interviews. They were conducted
at a 5-month interval using the same samples related to 23 household
durables. The results showed that products with high diffusion potential
such as color television ranked lower on consumers’ priority patterns as
compared to the consumers intention to buy. The downward gradient was
observed in the case of two relatively new products, electric toothbrushes
and electric carving knives. The study helped marketers allocated their
promotional activities and could be used as a basis for market
segmentation.
Moore and Mason (1969) hypothesized that patronage of three
major retail centers was strongly influenced by the perception of social
class. The study was based on survey data obtained from 500 households
63
located in an area north of Birmingham. It was noticed that all of the
consumers, trips from the study area to the three major retail centers
required significant expenditure of time and effort. The residents of the
incorporated communities depleted significantly even though the areas
were markedly similar in social-economic characteristics, which showed
different patronage decisions from the rural residents. Consumer’s
perceptions of a given retail center lead to irregularities in the trading
areas even in the absence of social class differences and spatial, temporal
or physical barriers. Rural shoppers were willing to travel farther even
though other centers were nearer. The study suggested that urban and
rural differences in shopping behavior have not completely disappeared
because of improved communication and increased mobility.
In an empirical study, Mehta (1973) studied the penetration level
of consumer durables in the rural area, consumer intention and
acquisition priorities for durables, sources of product information, reasons
for brand preference, and consumer perceptions of repair services. It was
observed that penetration of bicycles and radio/transistors were found to
be very high, followed by alarm and wall clocks, fans, and stoves.
Penetration of white goods was extremely poor. Consumers in the upperincome group were innovators because they owned more consumer
durable goods than in lower-income households. The top ten commonly
owned goods were bicycles, radios and transistors, alarm clocks, scooters
64
and motorcycles, cameras, wall clocks, fans (table and ceiling), stoves,
steel cabinets and sofa-cum-beds (in that order). Friends and relatives
followed by dealers and advertisements were the main sources
contributing to brand awareness. The dealer’s recommendation played a
vital role for the rural consumers when purchasing non-technical products
such
as
cabinets,
sofa-cum-beds,
etc.
Product
features
and
recommendations of friends were the most important reasons for
preferring a certain brand. Price, discounts and installment plans scarcely
influenced one’s choice of brand. Regarding repair services, the rural
consumer did not experience any problem with availability, quality, and
cost of repairs.
Kapoor (1976) attempted to define the emerging life style of rural
consumers. It was found that rural consumers were well aware of the
different brands of daily consumption items. Radios and transistors,
cycles, sewing machines, fans and wristwatches were the most common
consumer durables owned by rural consumers. The price of consumer
durables was found to influence the consumers’ purchases. Friends and
relatives of the consumers were the main source of product information.
Daily consumption items were generally purchased from villages on
credit basis. Purchases of durable products were generally made in cities
and towns with cash. The study revealed that rural consumers were not
satisfied with the services rendered by village retailers. This includes
65
product availability, price charged, after sale service and credit
availability.
Chikhalkar (2000) suggested that rural consumer in India has
deep religious and cultural roots. Additionally, their inherited life style
and social behaviour makes them different from urban consumers.
Understanding rural consumer through such complete parameter will lead
to knowing its pulse for market expansions.
A study by Goldman (1978) was conducted in a city where the
retailing system of the products under study was relatively concentrated.
Two of the four possible factors affecting purchase behavior, i.e., the
retailing system and accessibility were controlled; while factors constraint
and preference remained as explanatory for a confined buying pattern.
The result showed that the group of respondents from the lower class area
did not confine their purchases to small subsets of the retailing system
(either in comparison with other income groups or in an absolute sense),
nor did they restrict their purchases to smaller and lower quality stores.
Westbrook and Newman (1978) study indicated that the personal
competence of the shopper influenced consumer satisfaction. A
consumer’s experience of previous household appliances influenced the
consumers’ satisfaction with new appliances. No relationship was found
between information search and shopping dissatisfaction among persons
who had completed their purchased decision.
66
Foxall (1979) identified the degree interpersonal relationship
influenced a farmer’s decision to purchase a tractor. The respondents
were ignorant of the influence interpersonal communication had on their
purchased decision. The majority of the farmers interviewed did not talk
to their neighboring farmers about their tractor buying, thus reducing the
role of opinion leaders. A very limited search of brands demonstrated
brand loyalty among farmers.
Michael (1979) analyzed the consumer behavior in the retail
footwear market of Kolhapur. The study revealed that in spite of the
favorable attitude and the buying environment, consumers postponed
their buying decisions until the harvest season approached. Similarly,
festival seasons and marriage seasons stimulated consumers to buy. The
study concluded that the consumer behavior was a function of
determinant variables (like consumer attitudes and buying environment)
and consistent variables. The researchers finally stated that the product
marketing strategy, quantity, quality and life cycle of the product,
promotional strategy, the marketing mix elements, etc. should be closely
linked with the above mentioned consumer behavior factors.
According to Satyajeet Kumar Bhagat (2006) pointed out that the
external
factors
like
economic,
social,
political,
demographic,
geographical, cultural, technological and educational factors are at macro
level and some internal factors like nature, belief, taboos, intelligence
67
quotient, language, attitude and behaviour of a person which influences
the behaviour of an individual. The poor warehousing system,
unorganised market, poor access to educational system, lack of
professional training are some other points that are detrimental in forming
specific countryside consumer behaviour. A through examination and
understanding of these factors will enable understanding the rural
consumer.
A study by Sitamber and Manohar (1980) explored the behavior
of the consumer in a semi-urban city (Warangal) and analyzed the factors
affecting the purchase choices. The study found that consumers had a
limited choice of shops from which to purchase. In most of the families,
the male head made the purchases, restricting the choice of other
members of the family. The head generally selected a shop within a
radius of one kilometer from his residence and preferred to buy from a
shop where credit facilities were available. The average consumer was
prelaxed with non-availability of goods, high prices and bad performance
of the goods.
Giri, Sarin and Arshad (2006) have discussed the behaviour of
rural consumers is radically different from that of urban consumers. They
are diverse in terms of religious, social, cultural, and linguistic factors.
Their life style, largely, is traditionally bound and is also marked by
conservatism. However, what is striking today is not the basic
68
conservative characteristic, but the fact that the life style is undergoing a
significant change. And as such the earlier practice of bracketing all
consumers as people with a tradition bound life style does not hold good
in the era of E-Marketing (Electronic Marketing) which boasts to provide
all information about any product or service anywhere in the universe at
any time to any person anywhere in the would.
Roy, Singh and Singh (1984) compared the adoption behavior of
leaders and their followers with respect to recommended improved farm
practices. Three villages of Nawadah district were selected for field
investigation. There was no significant relationship between the
innovativeness score of leaders and that of their followers. The extent of
adoption of high-yielding varieties of wheat and hybrid maize among the
leaders was very low. Five leaders were non-adopters. The leaders were
themselves not very good adopters, so they could not motivate their
followers to adopt innovation. The study suggested that the pre-requisite
for future planning should be firstly to identify the local leaders and
secondly to impart them necessary training.
Ahmad and Singh (1985) revealed that 54 out of the 90 farmers
preferred Shri Ram Fertilizers followed by IFFCO fertilizers. The farmers
were not as influenced by price considerations as by easy availability,
good quality, good packaging and the fertilizer’s effect on soil structure.
Sixty percent preferred Shri Ram Fertilizers, as it was easily available at
69
all the villages’ co-operative societies. Any marketing organization can
take heed of these factors in order to plan its marketing strategy.
Ghosh (1985) conducted a comparative study on the usage pattern
of footwear in rural and urban areas of Gujrat. Durability and price of the
footwear were prime factors influencing both the rural and urban
consumers. Brand names and suitability scored low on the list of
consumers’ priorities. In urban areas, the highly educated people bought
quality footwear, while rural consumers were more fashion conscious.
Layton
(1986)
explored
some
personal
and
household
characteristics, which effect buying behaviour of housewives in a
developing country and the role of housewives in modernizing household
consumption. In both the rural and urban groups, wives were more likely
to make the decisions to buy foodstuffs, household needs and children’s
clothes than the husband was. In urban households, greater joint decisionmaking was observed for purchasing of household and expensive goods.
Rural households showed a more traditional pattern where husband had
greater authority in purchase decision. Apart from purchases of expensive
goods, the wife had greater influence in both rural and urban households.
The majority of urban and rural housewives (rural housewives in more
proportion) preferred to purchases from traditional retail outlets. Layton
suggested that future research should include more focused studies of a
particular market place behavior and its relationship to attitudes and value
70
in developing countries as well as the relative impact on market behavior
of cultural values and external factors over which the individual has no
control.
Saini (1986) concluded that the textile consumers of the rural and
urban areas of the Jaipur district did not give equal preference to the four
behavioral factors. Decision to buy clothes was male dominated in rural
areas as compared to urban areas. Family members’ views were more
often sought in urban areas than rural areas. Price was a very important
factor for both rural and urban consumers. Rural consumers were found
to be loyal to Khadi Bhandar while urban consumers were loyal to Khadi
Bhandar and the factory retail store. In general, rural consumers were
loyal towards a specific store, while urban consumer will “shop-around”.
Urban consumers pre-planned their purchases more often than rural
consumers did. Urban consumer went shopping with companions more
often than rural consumers. Rural consumers sought for sales assistance
more often than that of urban consumers. Advertising was an important
communication devise in urban areas, but its influence was almost
insignificant in rural areas, therefore, sales promotion schemes were more
popular in the rural areas.
Ahmad (1991) undertook an exploratory study in respect to
cosmetic and toiletry items in the rural areas of Uttar Pradesh and Bihar.
The study explored a very high market potential for cosmetic products in
71
rural areas. Only a small proportion of rural consumers did not use
perfume, face powder and face cream. Brand quality influenced the brand
choice of the rural consumer. Rural areas were found favorable for both
the existing and new brands of products studied. Reference groups were a
dominant source of knowledge for the rural consumers, followed by mass
media for literate, and stickers and posters for illiterate rural people.
Radio and magazines were the most important advertising forms of media
supplying product information. The rural consumer attitude towards
promotional tools; such as, price discounts and free-gifts, was found to be
positive. This attitude was found among all income, education and age
groups of rural consumers. Most of the consumers bought the
understudied products from the city. This was mainly due to nonavailability of products and the shop’s irregularity in supply.
Charan (1994) revealed that today, the rural market of the country
accounts for a large share of the expenditure manufactured and branded
consumer goods. It is estimated according to various surveys that the
rural market offers a vast market for consumer goods i.e. approximately,
three times larger than urban markets. The rising income levels, literary
levels, improved communication, infrastructural systems, ever increasing
electrification, various development programmes and the priority given to
the rural development in the national planning process, have helped in the
significant growth of rural market potential .
72
The A & M Mode Survey (1993) was undertaken to determine
whether newer brands were likely to affect its popularity, whether the
consumer was willing to pay a higher price, and whether emotional
parameters such as love and trust effected consumers. The respondents
were asked to rate India’s 62 brands against several attitudinal statements.
Colgate was found to be India’s top brand both in urban and rural areas,
followed by Bata and Dettol. Consumers exhibited maximum brand
loyalty towards personal care and hygiene brands. The older brands
showed higher chances of being positioned high on the consumer’s
perceptual ladder. The main earner of the household thought of Lifebuoy
as better product, while housewives preferred Vicks, and young adults,
Dettol. Colgate remained the favorite with all three. In the income class
earning upto Rs. 2,000 per month, Bata remained the favorite, while
Colgate did not even figure in the top ten. The over Rs. 4,000 class
exhibited strong loyalty towards Dettol, followed by Colgate.
Madhya Pradesh based Jai Prakash Rewa, a cement manufacturer,
asked their consultants Gaur and Nagi (1994) to assess customer
satisfaction, find the attractiveness of rural markets, and the dealer’s
motivational level in east Uttar Pradesh and north Bihar. The study
indicated that it was the local mason and not the village head who acted
as the strongest influencer regarding rural consumers cement buying
decisions. The consumers did not prefer specific brand of cement.
73
However, their cement brand was influenced by the local mason’s
recommendation. The majority of the rural consumers felt that the darker
the color of cement, the more durable it was. Since the villagers tend to
build their homes in phases, the cement purchase decision was repeated.
Based on this study, the consultant suggested an index to find out the
attractiveness of rural markets for the company. The seven parameters
used to find out the attractiveness of the markets were: market potential,
the rate at which cement could be sold, credit terms, market share, dealer
index, inventory index, and premium obtained. Secondly, the consultant
suggested launching a Mason Contact Program (MCP) showing
audiovisual recordings of the cement manufacturer along with framed
colored photographs of their products. The relationship with masons had
led to greater brand awareness and the photographs served as a constant
reminder of the company’s product. To build the brand, the consultants
further suggested the company should target the second most important
buying decision influencer, i.e., the dealer, through the Primary Media
Plan (PMP). In order to coincide with MCP, wall painting, shop painting
and signage at dealer shops were utilized. A religious fair plan was
undertaken to target consumers by offering them free tea. The plan helped
in creating tremendous goodwill and increased brand loyalty. These
programs helped the company become a market leader in rural markets.
74
Wanmali and Ghosh (1975) observed that as the population
increased the types of shops also increased. Ready made garment shops
and cycle stores were available at a population size of 4000, chemist and
druggist shops at a population size of 5500, electrical goods shops at
6800 and paints and hardware shops at a population of about 18,000. The
market centers had a greater number of shops, but included fewer types of
shops. Unless a particular level of turnover for a market center was
achieved, it was unlikely that a new shop with different products would
be available. With increased turnover, there was an increase in the
number of brands, shops, and shop types in that market center. The
number of brands tends to increased in relation to the number of
consumers served by the market center and not by the area’s population.
Further the study conducted by Singh and Khatri (2006) give the
emphases on the future of marketing lies in rural India, tremendous
growth, unimaginable potential, is waiting to be harnessed in an
organised and professional manner. The FMCG companies will have
really gain inroads in the rural markets in order to achieve double-digit
growth targets in future. One who will overcome the distribution
bottleneck, understand the behaviour and the perception of the rural
consumer first will not only be the trendsetter but also the owner of the
GOLDMINE, which are nothing else, but the villages of India.
75
Mali (1978) made an analytical study of the weekly market of the
town Sanganer. This market served both urban and rural populations. The
goods sold there were mostly for the rural population, such as country
shoes, inexpensive ready-made clothes, fancy articles, agricultural
implements, etc. The frequent bus service from Jaipur to Sanganer was a
great infrastructure for the marketers. The study’s conclusions suggested
that the weekly market was an integral part of the country’s economy,
specifically for rural masses and for the lowest and middle class urban
populations. As these markets were easily approachable to the consumers
living in the nearby rural areas and were more profitable to sellers, they
could coexist along with the permanent markets. He was of the opinion
that the state government should provide necessary facilities and
encouraged holding of such markets at the weekends and that the rural
economy could be restructured by developing rural industries.
Tripathi and Tripathi (2006) highlighted that the rural India
having more than 70% (72.10 crore) population living in 6.27 lakh
villages, is a huge market. Obviously, a number of FMCG companies are
trying their best to harness the business opportunities in rural India.
Electronic media, efficient transportation system, increasing income
levels and strategic marketing policies are the major contributing factors
76
to enhance the scope of rural marketing. Rural consumer is changing his
consumption habits to suit himself to changing environment.
Sudhir Wanamali (1981) gives slight picture of periodic markets
(Haat Baazar) in rural areas. Similarly, Pradeep Kashyap (2000)
indicated that, despite the same product being available in the village’s
shop, rural consumers visiting the haats to buy these products.
The study conducted by the Natarajan (1998), in which, he only
define the distribution of households by region, ownership of durables
and penetration of non-electrical consumer durables.
The ICICI (1981) made a comprehensive attempt to understand
the rural retail system through a survey of Khair tehsil, Aligarh district in
Uttar Pradesh state. The study found that most of the retail outlets were of
general variety and most of the shops were having annual turnover of less
than Rs. 10,000. 80% of the outlets had an average monthly turnover of
approximately Rs. 80 per product category. Over two-fifths of the retail
outlets stocked 8 to 9 standard items. Toiletries followed by cosmetics
and footwear were the most common stocked product categories.
Uniquely enough, this study found that 60% of the outlets stocked both
the branded and unbranded packaged products, while the rest stocked
only branded products. Stock-turnover ratios were uniformly high for
product categories like footwear and accessories, ready-made garments,
77
and household wares. This ratio was found close to unity for toiletries.
Almost a third to a half of the total turnover of packaged foodstuffs,
toiletries and tobacco was accounted for by sales made on credit basis.
The household survey revealed the main occupation of the head of
the household was cultivation. A small proportion of the households were
having more than 8 members and half of the households had monthly
expenditure between Rs. 300 and Rs. 500. A majority of the households
used toiletries, cosmetics, footwear, ready-made garments, household
linens and fabric, and beverages. Toilet and washing soap were the most
common items of consumption. 80% of the consumers purchased these
items from near by towns. The bulk purchases were generally, made from
near by towns or cities and half of the respondents were making special
trips for these purchases. The major reasons for making purchases from a
town or city were non-availability of items, higher prices, and lack of
choice in village shops. Half of the households surveyed reported change
in their pattern of purchase and consumption for the last 3 to 5 years.
Consumer durables were purchased only by 15% of the households from
1977-1981. However, the items of occasional purchased, for example,
parts of water pumps and tubewells, umbrellas, bicycle parts, and
wristwatches straps were purchased from nearby towns. The product
categories most preferred by the households, who indicated their
78
inclination to make 10% additional purchases, were consumer durables
like radios, sewing machines and vehicles. Over half of the respondents
favored spending all or at least half of their additional income.
An attempt was made by Ozmet and Martin (1990) to determine
how Discount Retail Chains (DRC) influenced the competitive
environments of small-rural-trade areas. The study concluded that the
presence of a DRC may create alternative opportunities for businesses
that were unable to compete with large discount retail chains. Moreover,
positive benefits accrued to persons who wished to open businesses that
may complement the large chain stores.
A study by Anuradha (1993) explored the scope for generating ad
revenues for publications specifically designed for neo-literates and semiliterates along with brand consciousness among rural consumers and tried
to measure the correlation between the stocking pattern of brands in rural
retail outlets and brand preferences of rural consumers. Data on 25
common branded consumer goods, purchased by over 80% of neo-literate
rural consumers, were collected. Only two of the items, washing powder
and tea, were purchased by less than 50% of the rural consumers. Brand
awareness among rural consumers was found to be quite high as they
chose between three and eight brands for each product category. Brands
stocked by shops in rural areas indicated brand consciousness. A
79
correlation of 79.33 indicated a high degree of correlation between neoliterate brand preferences with brands stocked by the rural retailers.
Brannon and Anderson (1996) conducted a study to find whether
the ease, acceptability and frequency of shopping away from hometown
stores had increased concern for the survival of small, independent,
locally owned businesses in rural towns. The study indicated that the
consumers most frequently shopped at mass merchandisers, such as
Walmart and K-Mart. Hometown merchants was the next choice. Mass
Merchandisers ranked best in terms of convenience and value of price,
but they ranked worst in the area of assortment and selection. Hometown
merchants, on the other hand, received the highest rating for service. The
study suggested that despite the increasing competition from other
shopping alternatives, opportunities existed for these independent
retailers to enhance profitability if they understood the “trade off”
consumers used in choosing a shopping destination.
Mukerjee (1993) pointed out that in rural markets positioning is
achieved through methods and media that compel the attentions of the
audience. Games and demonstrations are common.
A study was carried out by Siddaramaiah and Rajanna (1984) to
investigate the relative effectiveness of various combinations of radio,
slide shows and film on the overall knowledge, recall and comprehension
80
of farmers. The influence of these different combinations on the
knowledge of farmers who have varying personal and socio-economic
characteristics was also studied. The study was conducted in 5 randomly
selected villages of Devanahally taluk of Bangalore district of Karnatka.
The sample consisted of 150 respondents. Five experimental treatments
(methods) were designed. Each treatment was randomly allotted to a
village. The analysis of variance tests revealed significant differences in
recall, comprehension, and the overall knowledge of farmers, depending
upon the nature of treatment. Slide show and film shows, singly, or in
combination with radio were found to be more effective as a two-media
combination. This increased the respondents’ knowledge, indicating the
potentiality of slide shows in agricultural communication. Under all the
treatments it was found that the farmers, although varying in personal
characteristics, gained knowledge about the presented subject.
Agrawal and Pandey (1985) explored the type and role of opinion
leaders and how they made the process of communication more effective
in rural areas. The study revealed that opinion leaders were the primeagents of interpersonal communication in rural areas particularly because
of the insufficient use of mass media and the scarcity of agents. The
process of interpersonal communication in India was characterized by
horizontal, vertical and downward type. Persons of high caste were found
81
to be hesitant in seeking opinion from a low caste leader, but training in
agricultural innovations gradually reduced such barriers. The mass media
was not as effective as interpersonal communication. Because of
unproportionate numbers, lack of efficiency, and low level of
commitment, the change agents could hardly direct rural masses towards
the innovation necessary for rural development. The study showed
emphasis on healthy opinion leadership may have proved an effective
remedy for the gap that was widely experienced in the field of
communication. This could have been achieved through an extensive
training program.
Bhagat and Mathur (1989) attempted to study the extent of mass
media, i.e., radio, television and print media on the life style of
farmwomen. A random sample of 336 farmwomen, between the ages of
15 and 60 years, was taken from three villages near Delhi. The
farmwomen with modern life styles were having high exposure to mass
media. Similar trends were also visible as far as the innovativeness of the
respondents. All the farmwomen with modern life styles had a radio,
which was used for entertainment and news. Only one third of the rural
households owned televisions. Entertainment is the main reason for this.
The families not having televisions either felt it was very expensive or
they did not have time to watch it. The study indicated that farmwomen
82
were increasingly able to read printed media. A large number of
farmwomen were found to view films in theaters and on the television.
Traditional women felt strongly about the impact of film on the people’s
lives.
Dr. Prachi Tripathi (2006) pointed out that different matter like
branded items, advertisement effect, packaging style, their size due to
their cost, and factors effecting rural consumer behavior. Majority of
people like to buy branded items they give importance to different
companies at different level and also like to use only those items, which
has been used by some rich person of their village. They also like to use
only that item, which has been used by some rich person of their village.
They also want to purchase their necessary item at low level but should
be of high quality. They are affected by advertisements but not more than
other sources like friends and neighbor.
Further, she mentions that
the psychology of rural consumer is much different from urban consumer
psychology. In rural consumer is much different from urban consumer
psychology. In rural are the system of measuring the importance and
quality of any thing depends upon the mood of whole society and the
lifestyle. Therefore, the medium of advertisement should be very
attractive and more in connected to village. Using these techniques, it is
possible to change the rural psychology as a consumer.
83
A study conducted by Mukundas and Sen (1991) described the
audience’s response to television commercials in rural areas of West
Bengal and Tamil Naidu. It was found that mainly the males below 35
years of age and males related with agriculture viewed the TV more
often. The majority of the viewers understood the main theme of the
commercials when they were in Hindi. 70% of the viewers liked ad slots
coming in between programs as they thought the ads were charming and
entertaining. A large proportion of rural viewers mentioned that the visual
showed a “different world”. The rural viewers felt that the style of dresses
used on the television were attractive. Television alone was not
influencing the purchase intention or increasing trial of product being
advertised. The study concluded that television commercials increased
brand retention but the rural audience was at a loss insofar as the meaning
and message of the commercials. Further, the study also revealed that
even a good proportion of the male viewers do not comprehend,
appreciate or regard the commercials as realistic or close to a desirable
worldview.
Bhagyalakshmi (2001) emphases on the communication needs of
rural India are vastly different from urban India. Urban areas have high
awareness level and a smooth flow of information. Intelligent use of
various communication media can facilitate dialogue, debate and
84
exchange of ideas and information, which can significantly benefit the
masses.
Some Other Aspects of Rural Marketing
The studies reviewed in this section are not directly related with
rural markets. The studies are either related to the objectives or the
products considered in this survey.
Studies conducted on rural marketing in the country by Baig
(1974), Balakrishna (1978), Ganguly (1981), and Ganguly (1983) have
discussed only the scope and difficulties in rural marketing, also
highlighting buying capacity of the rural consumers, whereas,
Ramaswamy and Nam Kumari (1995) merely presented the overall
profile of the rural marketing. Jha (1999) only define the rural marketing
and classify the exchange flow between rural and urban locations.
Gopalaswamy (2000) pointed out that the things are changing due to
development programmes in the field of agriculture and allied activities,
health, education, communication, rural electrification, etc. have
improved the life styles of the rural populace. In fact, some market
research agencies forecast that the rural demand will suppress the urban
demand in the near future. McClure and Ryans (1968) found some
differences between consumer and retailer’s views. They researched the
importance of product attributes to consumers. For example, they wanted
85
to determine how the price influenced the consumers purchase decision of
refrigerators, ranges and automatic clothes washers. They also researched
the retailer’s opinion regarding competitor’s brands and the consumer’s
image of various appliances.
The study conducted by Dular (2006) is just a preliminary survey
of rural markets but attempts to provide an insight into rural development
programmes. A State level agency must be established for conducting
surveys preliminary to developing a rational system of marketing centers,
and to provide finances and other infrastructural facilities, etc for the
same. The establishment of rural market system tends to make
agricultural sector increasingly market sensitive and also provide an
incentive for village producers to increase production. This works as a
catalyst to the rural development process.
Smith (1970) examined various hypothesis on brand choice
determinants for durable goods like refrigerators and televisions. Visits to
stores were considered more important than advertising in order to gain
product related information. He observed that shopping for durables was
not a deliberate activity. Customers did not have any specific brands in
mind before shopping. Store loyalty was found to be stronger than brand
loyalty, resulting in frequent brand switching.
86
Gabor and Granger (1972) explored the impulses behind
anticipated purchases and the reasons which impelled consumers to
postpone or abandon anticipated acquisition. Two surveys were
conducted at an interval of fourteen months, where same households were
visited twice. The respondents in both interviews were asked to estimate
the probability of their acquiring any of the selected items in the next
twelve months, reasons for timing of purchase made within preceding
twenty four months, and reasons for abandoning or postponing any
previous intention in the last twelve months. 548 households were
interviewed in both the surveys. The study showed that as measured by
the ownership of consumer durables, the differences between the various
socio-economic groups had been eliminated, specifically for cookers and
televisions. 40% of the respondents reported that they did not have the
money to purchase the durable and therefore abandoned their plan to do
so. Marketing institutions were not able to motivate consumers living in
the inner city and consumers with low income.
A study by Hills, Granbois and Petterson (1973) explored the
effects of residence, age and education of black shopper’s of residence,
age and education of black shopper’s perceptions regarding food store
characteristics. Two medium sized, independent food stores were selected
for this study in two different areas. The respondents were black females
87
who were asked to shop in each of the two stores over a two week period
of time. A sample of 62 housewives, 31 from each area, was selected.
Few perceptual differences were found between the two groups. The
differences that did exist were based on store atmosphere rather than
quality or price variables. The younger females were less favorable of
price and quality variables than older females. Education was generally
not an important variable in explaining differences in perceptions.
Some writers claimed that social class was a better variable than
consumer’s income to explain purchases of consumer goods and services.
Myers and Mount (1973) collected data by interviewing 6000
households. The households were selected by a multi-stage area
probability sample. The correlation between income and social class, and
income as correlated to buying behavior, were determined. The null
hypothesis, which was tested, was that no difference existed between
product ownership among the five groups of social class and their income
level. The analysis of the data showed that income was superior to social
class in segmenting the market for nearly all the items understudied. The
only exception was the slight superiority for social class in the case of
black and white televisions, commercial air travel, and possession of
passports.
88
Newman and Staelin (1973) conducted a study to determine the
sources of information consumer’s consulted before buying a product and
whether these sources differ in number and kind. Data was obtained from
personal interviews of 653 households which had purchased automobiles
and one or more of the six major appliances; be it, colored televisions,
black and white televisions, refrigerators or freezers, washing machines,
kitchen stoves, and air conditioners. The sample consisted of 217 buyers
of new cars and 436 buyers of one or more of the six appliances. A
majority of the buyers reported using upto three sources of information
for both purchasing a car and appliance. The number of sources tended to
be lower when the sources used included friends and neighbour, retail
outlets or booklets, pamphlets and articles. In most of the cases when the
buyer consulted only one source, it was the retailer. The result of the
study further suggested that advertising might go beyond creating
awareness among many buyers of common durables.
Adler and Hlavacek (1976) investigated the extent to which repair
service persisted as a problem to consumers and examined the
relationship between product price and acceptable repair charges over a
range of low and high priced consumer durables. The majority of the
consumers had little or no trouble repairing the seven products studied.
The majority of the consumers did not perceive repair costs to be too
89
high. The consumers were willing to pay disproportionately higher
amounts to have the lower-cost product repaired. To determine the degree
of correlation between the variables of original product price and an
acceptable repair price, a regression analysis was performed. It was found
that as the average purchase cost increased, the correlation between the
cost and what consumers were willing to pay to have the product repaired
also increased.
The purpose of the study undertaken by Adler and Hlavacek
(1978) was to identify the factor used by consumers in assessing repair
service for commonly purchased durable goods and to explore the
relationship between the purchase price of durable goods and the
importance of the identified repair service characteristics. An in-depth
interview, with twenty-nine repair service personnel, identified cost,
speed, reputation, quality and location as the main repair service
characteristics. The respondents were also asked to rank these five
characteristics with respect to ten durable goods, which represented a
wide range of high, medium and low priced items. Quality of repair
service was rated as the most important and speed of repair and location
were rated the least important. The quality of repair services was found to
be more important to the consumers in cases of high-priced goods, while
the cost of repair was more important in cases of low-priced items.
90
Factors such as reputation, speed of service and physical location were
found to be less important.
The consumer acquisition pattern for durable goods was explained
by Soutar, Bell and Wallis (1990) using a latent structure model as
suggested by Rasch. The results suggested a set of durables for which a
common acquisition order existed; only some durables did not confine to
this pattern. The study suggested that it would be of little use to search
subgroups of consumers with different acquisition patterns in different
age groups, occupation groups, and family life cycle stages.
Kala and Rath (2000) pointed out that the larger companies face
competition from smaller players on price and margins; therefore, the
companies like HLL and Marico are developing products with low prices
and in sachets and pouches to meet competition from local players. David
(2000) emphasis that leading brands very often finds themselves
confronted with duplicates and imitations, especially in the case of beauty
products. Vilanilam (1996) pointed out that TV suppresses Indian reality
and presents a world of fantasy, which does not deal with the pressing
problems of the poor and rural India. Sinha (1996) said that the social use
of development communication between rural and urban India is
lopsided. Yadava (1998) pointed out that given the high rate of illiteracy
and poor means of transportation the print and electronic media would
91
cater to not so poor among the rural people. The media themes and ethos
will have a similar effect on rural audiences. Rao (2000), pointed out that
penetration of T.V. satellite and radio has increased in rural as well as
urban areas. Consequent to this it is observed that brand awareness and
association with established brands is as high in rural areas as in urban.
Kilaru (1994), pointed that the rural retailers stock a particular item
usually because consumers request it and to a lesser extent because of the
wholesalers push or because a competitor stocks the item. A study
conducted by Ghosh and Krishnaswamy (1997) suggests the use of
longer channel with the retailer at the tail end servicing the customer.
This is the strategy followed by Nirma to compete with H.L.L. Further
studies conducted on the rural marketing Goyal (1986), Velayudhan and
Suri (1996) and Velayudhan (1998) have discussed that the influence of
the retailer is perceived to be high in rural markets; however, it is the
knowledge of the brand that influences choice. Purohit (2006) suggested
regarding product development, modification of product, packaging,
branding for rural consumers. Further, he also clear that there are
limitations of the reach of the media like newspapers and televisions
among the masses. Therefore, there needs felt to supplement advertising.
A study was conducted by Bayus (1991) to develop a better
understanding of the timing of the replacement purchases of durable
goods. The characteristics of consumers who replaced a product during
92
the early part of their lifetime were compared with those consumers who
made replacement purchases much later in their lifetime. A crosssectional design was involved to collect data from 3,100 respondents. The
degree to which consumer demographic characteristics, attitude,
perceptions, and search behavior, were associated with the timing of
replacement of new automobiles, was tested. Results based on univariate
and multivariate analyses showed that replacement buyers were more
concerned with styling and image and less concerned with costs than
‘late’ replacement buyers. Further, consumer’s replacing their products
earlier had higher income but lower levels of education and occupation
status, than consumers replacing their purchase later. Consumers
replacing their purchase later researched their replacement product.
Upadhya (2006), mentioned out the numerable challenges but
innumerable responses if we unleash the creative power and stretch our
imagination. One could afford to overlook the fortune at the bottom of the
pyramid only at the perils of stagnant or negative growth of an
organisation in long run. The challenge is to come out with a creative
response to the problems as several corporations have shown. The
challenges have to be translated into opportunities. The overall approach
needs to be re-crafted. Rather than treating rural consumes as prays, in
order to be on sustainable developmental path, one has to become partner
93
in their success. The approach should not be myopic, that is, only limited
to sale of products or services. The sustainable growth could only be
achieved only we collaborate in improvement of quality of life of rural
populace. The rest will automatically follow.
Anandan, Raj and Madhu (2007) studied the brand preference of
washing soap in the rural areas of Pudukottai district and found that the
quality is the major driver to prefer a particular brand in washing soaps in
the rural market. Power soaps are ruling the rural market. If the preferred
brands are not available, customers buy the available brands. It was found
that there is a significant relationship between the age of the respondents
and the factors influencing their brand preferences. Study also noted that
there is no significant relationship between the income of the respondents
and the factors influencing their brand preferences. Higher prices and
non-availability are the key reasons for dissatisfaction of the rural
consumers. Marketers should target the customers with high qualitative
soaps at affordable prices. They should concentrate on distribution
strategies, as non-availability had been an important factor for
dissatisfaction.
Losarwar (2002) studied the consumer behaviour towards selected
durables in the Marathwada region of Maharashtra state. An attempt is
made to analyse decision-making procedure of consumers with reference
94
to durables (Television, Washing machine, Refrigerator, Mixer and Fan).
It was observed that in case of fan the awareness of different other brands
was maximum (56%) whereas regarding television, washing machine,
refrigerator, mixer the awareness was quite average (35%). In short, the
study reveals that, there is no significant difference in brand awareness
among urban and rural respondents. ONIDA is a popular brand followed
by LG in television, Whirlpool followed by Godrej, Videocon and
Kelvinator brands in washing machines, Godrej followed by Whirlpool
and Kelvinator in refrigerator. There is considerable positive correlation
between urban and rural population with reference to selection of brands
of television, washing machines, refrigerator and mixer. However, there
is negligible positive correlation between urban and rural population with
reference to selection of brands of fans. Majority of the consumer
respondents
have
purchased
television,
washing
machines
and
refrigerator from authorized dealers.
Majority of the consumer respondents have purchased mixers and
fans from retailers. In case of television, washing machines and
refrigerator the habit of choice of place of purchase of urban and rural
respondents is not uniform whereas, in case of mixer and fan it was
uniform. Company’s advertisement, reputations, price and quality of the
products are some of the factors influencing the choice of consumer
95
durables. Friends and relatives advice, retailers’ advice, joint decision of
the family and credit facility is responsible for purchase of consumer
durables. Price and reputations of manufacturers of consumer durables
are the major factors influencing purchase decisions of consumer in lower
income group. Most of the consumer respondents irrespective of their
educational level were conscious about price and they have given
importance to the manufacturing company. Consumer respondents have
purchased the preferred brand.
Behavioural patterns of consumers have a deep relevance with their
life styles. The life style of a person depicts his thought, pattern and
attitude towards change. It was observed that, respondents belonging to
traditional life style strata in both the urban and rural area are very less
(about 10%). A trend of modern life style acceptance has been observed
in the urban area, whereas, a modernization trend in rural population is
very meager. However, it is observed that, 35 percent of the overall
respondents have accepted modern life style. Therefore, it is concluded
that there is no significant difference between urban and rural respondents
on the basis of life style. The study reveals that the majority of consumers
are concerned with the quality of the product. Companies can attract
consumers only by offering quality products at reasonable prices.
96
Jain and Rathod (2005) studied the acceptability of the
unconventional distribution channels and new retailing formats amongst
rural consumers. The secondary objective was to study deeply intricacies
involved in designing distribution channels for rural market in terms of
product availability, cost effectiveness and product variety and quality. In
addition, the study aims to get better understanding of rural consumer’s
psyche and problems faced with the existing system. The survey revealed
that most of the purchases by rural consumers are either from nearest
baniya shop (tradition name for a grocery shop) 52% or from
markets/wholesalers of nearest towns and cities for bulk purchases (38%).
The awareness regarding new modes of credit availability was found to
be low. The survey also revealed that a high percentage of products sold
in rural markets are cheap imitation of branded products.
Further, the study suggested that Government’s efforts to ensure
easy availability of loan at affordable rates to villagers through Kissan
credit cards and initiatives by companies like Mahindra Finance to offer
credit in rural areas makes it easy for these companies to experiment with
unconventional channels of distribution and new retailing formats. As per
NCAER survey growth in financed purchase of white goods has been
more in rural market (39.6%) as compared to urban market (17.4%)
during period 1998-1999 to 1999-2000. As per the positive response
97
shown by the consumers and the inherent problems of distribution and
retailing through conventional modes for companies, it is advisable for
these companies to try such innovative methods. However, companies
need to increase awareness about these options amongst rural consumers.
Companies need to design proper communication and marketing
strategies to prevent imitation and counterfeiting of their products. In
order to promote new channels as used by “Project Shakti”, products need
to be customized to fit target consumer’s aspirations and needs. Thus, it
can be summarized that rural market offers great opportunity to the
marketers. The need of the hour is correct profiling of rural consumer and
detailed study of rural buying behavior and purchasing patterns in rural
markets.
Lokhande (2004) studied the consumption pattern, behavior,
preferences, their attachment to a particular brand, information seeking
and to understand the preferences of rural consumers. The Study revealed
that rural markets are developing fastly and the marketers (i.e. Local,
National and International) are concentrating on this huge market by way
of effective advertising, pouring a variety of branded and attractive
packaged goods. As a result, the consumption pattern of rural people has
changed drastically. They are preferring Pepsi and Coca Cola to tea as
these soft drinks are easily available in rural small shops, tea stalls and
98
pan stalls at affordable prices. Rural Market is a huge market and to tap it
fully it is needed to improve the efficiency of distribution channel so that
rural consumers receive required commodities at right time, at right place
and affordable prices.
One of the observations of the study is that illiteracy is a major
hindrance in the way of rural marketing. Therefore, audio-visual ads are
most effective in rural areas to inform the consumers regarding the
commodities. While asked about how they differentiate the commodities
of the same use, a sizeable number of respondents stated that it is difficult
task to make difference between two branded goods e.g. Bytco and Bytco
tooth powder, Nirma and Neerma. There are a number of cases of
cheating and exploitation of rural consumers. In this regard, it may be
suggested that consumer protection movement should be activated in
rural areas. Consumer awareness must be created by way of imparting
consumer education. It was observed that a few respondents have brand
loyalty. Majority of the respondents (Male and Female) stated that brand
does not matter to them. What they want is to fulfill their needs.
However, some respondents had been using only specific branded goods
and did not shift to other brands. In this regard, it was suggest that the
manufacturers, the marketers should concentrate on brand value i.e. the
quality, utility and reliability of their products.
99
It can be inferred from the study that majority of rural women use
cheaper, low quality goods while men use comparatively high quality
goods. One of the observations of the study is that rural consumers
purchased required goods from retail shops in the villages. Whenever
required purchasing in done from weekly bazaars and Taluka places.
Sometimes rural consumers purchase goods from district places. It was
observed that barter system still has notable existence in rural areas.
Purchasing is done in exchange of grains, cotton, oilseeds etc., however,
daily wage earners purchase commodities on net payment basis. Rural
consumers gradually are being habitual of eating at dhabas, small hotels
and imitating their urban counterparts. They prefer to purchase small
packs and low priced commodities eg. small packs of Parle and Tiger
biscuits, small bottles of Coca Cola and Pepsi etc. Consumption pattern
of rural consumers is dependent on their income levels, occupations,
education and social status. The study revealed that TV, Movies have
deep impact on the minds of rural consumers particularly children and
young consumers.
Sarwade (2002) studied the marketing and consumer behaviour
aspects such as place of buying, frequency of purchase, brand deciding in
the family, buying motives, shopping behaviour of consumers and
durability of goods, selection of brand, quality and purchasing influences
100
the buyers in selected products in rural area. It is observed from the study
that, the role of husband in family purchasing decisions in various items
was comparatively less than of housewife. The study reveals that, the
family purchases for convenience goods in rural market was mostly did
once a week and it is daily for daily consumption goods such as edible
oil, sugar, tea etc. with the increase in real income of rural peoples, a shift
was found to have taken place in the items consumed by the rural
consumers. It is found in the study that, most of the consumers from rural
area developed brand familiarity with brand names such as lipton,
international lux, keo karpin, brahmi amla, panteen, which are heavily
known in urban areas.
It has been noted that, “income” is the variable, which determine
the purchasing pattern. As most of the consumers from higher income
group generally purchase the products that are highly popular in urban
area. It is very interesting finding from the survey of that, most of the
rural consumers are not aware of the producer of the product. Hence, the
“incorporate” image is playing very significant role in popularizing the
product in rural markets. Another finding of the study is that, marketing
and trading of luxurious durable products such as washing machines,
water heater, bathroom fitting and fixtures, air conditioning, sofa set,
chairs, camera and other products have not yet strategically established in
101
the rural markets. The buying behaviour in general and buying decision in
particular in rural area is influenced by the factors like price, availability
of products. An interesting finding of the study is that, overall
consumption pattern of the rural consumers has changed, consumption
expenditure for non-durable items has increased considerably during the
study period.
Prasad and Reddy (2003) studied the effect of celebrities on
consumers in their purchase decisions and to look into the
appropriateness of such celebrities to various products they endorse.
Identifying the right celebrities for different products and the degree of
influence these celebrities have in the different stages of new product
adoption and decision-making process are the other objectives of this
study. The study reveals that among the respondents, more than 50
percent watch ads regularly and 15.6 percent watch them very regularly.
When asked about the advertisements as an informatives source, 57.7
percent respondents consider ads as important source whereas 20 percent
feel it as very much important. All the respondents are aware of celebrity
ads. Regarding the influence of celebrity on consumers, 57.8 percent
respondents feel that there will be likely influence of celebrity on
consumers. While 17.8 percent, feel the influence as very much likely.
More than sixty-percent respondents feel the necessity of celebrity in ads
102
with respect to certain product categories only. They feel that celebrities
endorsement is required for such products like premium range goods,
luxurious items, soft drinks, suiting, cars etc. Celebrity presence in ads is
highly required according to 40 percent of respondents where as 11.1
percent feel their presence is very much highly required.
Among various kinds of celebrities, movies stars, sports
personalities have much influence on consumers. Sachin Tendulkar,
Sharkukh Khan, Aishwarya Rai, Amitab Bachchan, Aamir Khan, Salman
Khan, Kareina Kapoor are the celebrities who have high recall among
respondents. When asked to recall the celebrity ads most of the
respondents recalled ads of softdrinks immediately. Moreover, with much
difficulty they were able to recall ads of other products using celebrities.
Another observation made from the respondents is that many were
confused as to which celebrity is endorsing which product. This happened
because one celebrity is endorsing various categories of products as in the
case of Sachin Tendulkar and Amitabh Bachchan. Most of the
respondents ranked Sachin Tendulkar at first place followed by Amitabh
Bachchan when questioned about the preference of celebrities with
ranking.
Further, it was observed that a celebrity is essential for softdrinks,
cars followed by suiting. Among the three celebrities chosen for the
103
study, Sharukh Khan is more apt in endorsing a car like Hyundai-Santro,
than Pierce Brosnan (Reid & Taylor) who comes next to Sharukh Khan.
Moreover, Sachin Tendulkar endorsing for pepsi Softdrink is considered
apt after Pierce Brosnan. The presence of Sharukh Khan in the ad of
Hyundai-Santro car has enhanced the ad, which is closely followed by the
advertisement of Pepsi featuring Sachin Tendulkar. The presence of
Pierce Brosnan in Reid & Taylor ad has not enhanced the image of the ad
when compared with the Pepsi and Hyundai Santro car ads. Pepsi ad
featuring Sachin Tendulkar and Reid &Taylor featuring Pierce Brosnan
are successful ads closely followed by Sharukh Khan ad of HyundaiSantro car.
Nandogopal and Chinnaiyan (2005) studied the awareness and
willingness to avail consumer finance on purchasing the durable in rural
households of Tamil Nadu. The study reveals that about 19 per cent of the
respondents own durables. 54 per cent of the respondents were aware
about the consumer finance whereas only 7 per cent of the respondents
have taken loan for buying consumers durables. Age group, education
level, types of houses, occupation and income group are significant
factors in influencing consumer finance. Poor repayment potential and
more documentation are main reasons for not availing the consumer
finance.
104
Nagraja (2004) conducted a study to investigate into and analyse
the impact of socio-economic influences on rural consumer behaviour in
terms of their buying practices and to throw light on the pattern of
decision-making agents with specific attention to the social status and
level of income. It was observed that the frequency of buying the
products differed consumer to consumer and between the different
income groups. To the greatest extent, the frequency of buying was
related to the type of product and its use in the households. The products
like groceries (including vegetables), tobacco and medicines were
purchased on daily or weekly basis by the lower income groups. It was
found that a great majority of labourers and artisans purchased their
groceries on a daily basis in mornings and evenings. Agricultural
labourers were found selling their wages paid in kind to the retail shop
owners like paddy and wheat to purchase other items like tobacco or
vegetables. Salaried consumers and big farmers were found purchasing
groceries, toiletries, and medicines on monthly basis particularly as these
sample consumers belong to the middle and higher income groups. The
sample consumers belonging to low income groups purchased goods like
electrical and footwear.
The study reveals that experience of the family members and easy
availability of products were considered most important while purchasing
105
goods. The sample consumers reported that quality and price of the
product respective were the important factors, which influence their
buying behaviour to the maximum extent. Surprisingly majority of the
consumers did not attach much importance to advertising. It is also
surprising to observe that the experience of neighbours in the use of
products was considered the most important factor of the consumer.
Consumer felt that price was the unimportant factor for purchasing the
products. These observations facilitate to infer that consumers attach
much importance to the quality, price, easy availability and the
experience of their own family members were the dominant factors in the
purchase of products. Advertising and the experience of the neighbours
were found to be less important factors.
Further, the study suggests that the advertisements and mass media
are influencing the buying behaviour of the sample consumers. The
experience of the family members is the chief propelling influential in the
purchase of groceries and utensils. The consumers, who consume
tobacco, are very much motivated and purchased due to the suggestions
put forth by the shop owners of the shops to which they visit regularly.
This influential also had a effect on the purchase of medicines. The
experience of the neighbour-consumers is the important influential in the
purchase of cosmetics. The consumers purchased footwear, groceries and
106
medicines respectively were influenced by the suggestions and directions
given by their neighbour-consumers. It is quite interesting to note that
advertisements particularly ‘quickies’ (short TV commercials) and
commercial ads through mass media are the prominent propelling factors
in the purchase of electrical, cosmetics, toiletries and foot wear. This
observation leads to infer that the younger generation is very much
influenced by the education combined with entertainment and the older
generation by personal experience while purchasing the products.
Sakkthivel and Mishra (2005) studied the effectiveness of sachets
in modifying rural consumers buying behaviour and their consumption
pattern with special reference to FMCG products in rural markets. The
study reveals that the majority of the rural consumers prefer some
products in sachets and other products in medium or large container
according to their requirements. Products like Shampoo, Spices, Fairness
cream and mosquito repellants are preferred in small containers and rests
of the products are mainly in medium containers.
Majority of the rural consumers prefer to buy products on monthly
basis and weekly basis. The products that they prefer in sachets are
purchased on weekly basis and monthly in medium containers. It clearly
establishes the relationship between the buying behavior and the
consumption pattern. For products like spices, they prefer sachets, which
107
indicate the shift from local products to branded products. It shows their
initial approach toward a new product. Hence, they would like to buy
sachets, till they get used to a particular product. Some of the products in
sachets like shampoo, fairness cream, spices and mosquito repellants
have created a considerable impact among the rural consumers and rest of
them failed. It also created new avenues for companies to motivate rural
consumers to use new products at cheaper prices. The best example is
coffee, which was considered as a premium product, and now being
widely used (ORG-MARG-AC Nielson Retail Audit).
It also opened new avenues for products like ketchup/sauces and
shaving creams. The study also indicates that a particular community
expects liquor to be sold in sachets. The study revealed that only some
selected products like shampoo, fairness cream, spices, mosquito
repellant etc. could create impact among the rural consumers and rest of
them could not. Hence, the companies need to focus on the reasons
behind the modification in consumers buying behavior and consumption
pattern toward the products expected in medium or large containers.
Moreover, since these products are new to the rural consumers, they
might take time to accept these products as these products are expected in
sachets. Yet, the study indicates that these sachets facilitated rural
consumers to try new products and also played a vital role in modifying
108
their buying behavior and above all, a major change in their life styles.
Hence, sachets may be viewed as a promotion tool for modifying buying
behavior rather than a yet another innovative form of packaging.
However, some studies have been conducted in other parts of the
country regarding the kind of product required by the rural consumer,
their consumption pattern, and how his purchasing behaviour differs from
that of urban consumer but in Uttarakhand, such studies are completely
lacking. Therefore, efforts are yet to be made to workout proper market
strategies, promotional programmes, media planning and distribution
system in the underdeveloped environment of newly born state. Keeping
this view in mind, the present study is a modest attempt to observe their
consumption pattern, buying behaviour, needs, expectations, and attitudes
as well as their experiences with presently available products on one
hands, and marketing practices of business on the other.
HYPOTHESIS
With in the purview of the above discussion the following
hypothesis have been formed to the present study:
The rural market offers a vast market for consumer goods, and all
persons or families above the poverty line form the market for some
branded consumer goods. It is also assumed that the rural psyche is
different from the urban one, hence different marketing strategies to be
employed in the rural areas.
109
Objectives of the Study
The main objectives of the proposed study are:
i)
To assess the consumption pattern as well as expectations of the
rural consumer.
ii)
To ascertain the buying habits and the factors affecting viz. a.
viz. brand choice of the rural consumers.
iii)
To analyse the post purchase behaviour and satisfaction of the
rural consumer.
iv)
To bring out the suggestions and implications for rural
marketing strategy.
Research Design and Methodology
The proposed study is an exploratory in nature. A different method
of data collection was implied in order to complete the survey work. Data
regarding consumption pattern, brand preferences, buying behaviour,
awareness and attitude of rural consumers towards marketing were
collected from the primary sources, for which different questionnaires
were administered. Informal discussions were also carried out with the
marketing intermediaries (Distributors) in and around the area to know
their marketing practices for the rural sector.
The universe of the study consists of consumers residing in the
rural areas of Dehradun districts. Total 300 respondents have been
selected out of 25 villages (12 respondents from each village), which
110
were identified on the basis of their accessibility, population and
convenience. The respondents were selected with the help of multistage
systematic sampling methods. The district is located in the south-west of
the State, and having an advantage of overcoming regional differences in
natural and geographic endowments. Further, there are equalities in the
consumer’s exposure to different promotional, influences, availability of
brands and price differentials.
To obtain the information from the respondents (rural masses) a
detailed structured questionnaire containing eight different sections was
prepared. The first and second sections were regarding village and
respondent profile respectively followed by consumption pattern of
durable and non-durable products and purchasing behaviour. The sixth
section was related to Haats and Melas followed by consumer awareness.
At the last in section eight, questions were related to the consumer
attitude towards the promotional activities adopted by the marketers. As
the masses are uneducated, the questionnaire (in Hindi) is filled by
personal interview. The collected data was coded, classified, tabulated
and analysised systematically. The association between variables has
been tested using cross (contingency) tables and for data analysis,
statistical techniques such as Chi-square test, ANNOVA, Average
weighted score and T-test are made use of.
Limitations
111
Due to lack of relevant studies in the region, no comparative
data/information is available, so it was difficult to compare the study.
Secondly, due to financial constraint and time limitation, this study is
confined only to Dehradun district of Garhwal region. The study is based
mainly on individual informations, which would be subjective, thus the
results could not be the ultimate fact.
Profile of the Study Area
Dehradun district is situated all most entirely with in the Shivalik
ranges of the Himalaya’s in the West of the Uttarakhand State. The total
area of the district is 3088 sq km of which 2939.60 sq km is rural area.
The total population of the district is 1025.68 thousands out of which
510.20 thousands is rural population (Census 2001). Administratively, the
district has been divided in to four tehasils viz., Dehradun, Rishikesh,
Chakrata and Vikasnagar and there are six-development blocks viz.,
Chakrata, Kalsi, Vikasnagar, Sahaspur, Raipur and Doiwala.
Village Profile
Out of the selected villages for the study, the population of Khadri
(Doiwala block) was found highest with the population of 17000 people,
while the least populated village was Lahari (Chakrata block) with the
population of 645 people. It was appreciated that every village taken into
study, have primary school, eight villages have intermediate and in seven
112
villages high school. Further, it was found that Ramnagar Dadu and
Khushal pur villages were the distant (3.5 Km) from road head while
Kalsi and Bhogpur were the nearest (0.5 Km). In case of electrification,
all the villages were electrified. [Table (2.1)]
Respondents Profile
Majority of the sample dominated by the male (62%) while about
one third (38%) were female. As far as martial status is concerned,
majorities of respondents were married (75%) and remaining (25%) were
unmarried. The distributions with regard to age a majority (45%) were
from the age group of 20-35 followed by
36-50 (35%) whereas
remaining (20%) in the above 50 age group. With respect to the
distribution of the occupation, it was found that the mainstays of the
people are agriculture (58%) followed by service (22%), whereas
remaining (20%) were engaged in business for their livelihood. The
distribution with regard to per month income of the respondents, a large
number (79%) were from the income group Rs. 2501 to Rs. 5000. A quite
less number (14%) of the respondents earn between Rs. 5001 to Rs.
10000 and very few (07%) were in the earning group of more than Rs.
10000. With respect to the distribution of the education, it is interesting to
note that none of the respondents was illiterate as a good number (31%)
were 10th passed followed by fifth passed (30%) graduate (21%) and
remaining
(18%)
were
intermediate.
113
[Table
(2.2)]
Table-(2.1): Village Profile
S. N.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
Name of Village
Sundarwala
Ramnagar Dadu
Nathanpur
Badripur
Statefarm
Rampur Kalan
Khushal pur
Sahaspur
Jassowala
Lakhanwala
Bwhar
Tinali
Lahari
Bhungar
Jogyo
Lawroli
Thana
Nevi
Koti
Kalsi
Khadri
Gumaniwal
Gadool
Bhogpur
Barhat Mafi
Block
Raipur
Raipur
Raipur
Raipur
Raipur
Raipur
Raipur
Raipur
Vikasnagar
Vikasnagar
Vikasnagar
Vikasnagar
Chakrata
Chakrata
Chakrata
Chakrata
Kalsi
Kalsi
Kalsi
Kalsi
Doiwala
Doiwala
Doiwala
Doiwala
Doiwala
Population
2082
1465
3033
1616
2716
1928
1748
4783
2021
1247
3072
1913
645
667
769
882
650
908
1144
1404
17000
3756
1733
1062
1842
School
Intermediate
High
High
High
Primary, Junior
Intermediate
Junior
Intermediate
Intermediate
Junior
Primary, High
Primary, Junior
Primary, Junior
Primary
High
Intermediate
Junior
High
Intermediate
Intermediate
Intermediate
Junior, High
Junior
Junior, High
High
Source: Field Survey
114
52
Distance from Road head
3.0
3.5
1.0
1.5
2.5
3.0
3.5
1.5
1.5
1.5
1.0
1.5
2.0
1.5
1.0
0.5
1.0
1.5
1.0
0.5
2.5
1.5
2.0
0.5
1.5
Electricity
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Electrified
Table-(2.2): Respondents Profile
S.No.
1.
2.
Gender
Males
Females
Total
No. of Respondents
183
117
300
In Percentage
61
39
100
S.No.
1.
2.
Martail Status
Married
Unmarried
Total
No. of Respondents
225
75
300
In Percentage
75
25
100
S.No.
1.
2.
3.
Age Group
20-35
36-50
Above 50
Total
No. of Respondents
135
105
60
300
In Percentage
45
35
20
100
S.No.
1.
2.
3.
4.
Education
Primary
High School
Intermediate
Graduate
Total
No. of Respondents
90
93
54
63
300
In Percentage
30
31
18
21
100
S.No.
1.
2.
3.
Occupation
Agriculture
Service
Business
Total
No. of Respondents
174
66
60
300
In Percentage
66
22
20
100
S.No.
Monthly Income
(In Rs.)
Upto 2500
2501-5000
5001-10000
Above 10000
Total
No. of Respondents
In Percentage
114
123
42
21
300
38
41
14
07
100
1.
2.
3.
4.
Source: Field Survey
115
129