Rural India: Future Is Here

Our father of nation Mahatma Gandhi had said the soul of India Lives in village. Seventy percent population of India lives in rural India that is 815 million (As per 2011 census), the sheer base is equivalent to the population of US, UK, France, Italy and Germany put together.  Rural India is untouched till now only some brands have tried to bottom out to this area. Lack of infrastructure and lower purchase power capacity of rural India was reasons why companies did not target to this area.

The face of rural India is changing post liberalization and with the subsequent economy reform.  Rural Indians are not only depending on agriculture, but also they have started business and jobs in towns. New technology in farming has changed the agriculture growth and farmers are earning more. Some of the India states has changed the infrastructure of its rural area, differentiating between rural and semi urban has become tough in these states such as Punjab, Haryana, Rajasthan, Gujarat and southern states.

 Pocket capacity is growing so that needs of rural populace is changing, the wants increasing, so are desire. Some highlighting points of rural India:

-          Indian rural contribute 54% of Indian GDP which in itself higher than GDP of Switzerland.

-          Thirty four percent of total sales of FMCG come from rural India. { Industry Report}

-          Urban consumer durable market is growing at almost 10% and rural 25% { Industry Report}

-          Rural + Semi urban contribute to 40 % sales of Auto Industry. { Industry Report}

-       Total rural mobile subscribers are 201 million ( Brazil- 173 million, Indonesia- 159 million and Russia- 230   million) { TRAI}

-        Color television has seen 235% sales growth. { Industry Report}

Brands has changed their products/ cost as per rural consumer affordability. Some ex are Cigarette without filter, Two rupees four biscuits pack, Face crème in five rupees, Ten rupees mobile recharge, Five rupees soap,  Ten rupees detergent bar, Smallest fridge ( Godrej), Washing machine without dryer ( Videocon) and companies are trying to sell its product in rural area at any cost as coco cola designed smallest fridge for rural area shop keepers.

In future new products will be designed for rural India market 20 rupees pack of Cadbury chocolate gift pack, affordable price skin care products, small screen and lower processor speed laptop/ used laptop and computer on less price, branded clothes, shoes and others ( left after sales in big cities), small pack of paints, different insurance policies for rural consumers and many more.

In future E-commerce companies will target to rural and semi urban market because lack of distribution this area is untouched and these companies can use this opportunity. District level distribution system will be started. Consumer Durable has great future in rural India; unavailability of electricity was the grid lock for consumer durable products sales/ usages in rural area. Government plans for rural development is good sign for rural development and electricity problem will be finished in some year.

Growth in rural income will be opportunity for construction industry such as paint, cement, electrical and other. Banking & Insurance sector has great opportunity in this area, for saving rural Indians has only one option “Post Office” and insurance “LIC India”. But now public sector banks have understood the prospect of rural India and SBI has launched non physical banking service with the help of IT and banking agents. Other banks in near future will start services. Insurance sector has very less presence in rural India but enormous market is available for this sector.

Generating brand awareness in rural area has been big hurdle for brands. Educated rural folk can bring change and companies will hire them for product sales and awareness generation.  Educated rural women and unemployed rural youth are keen to work. DTH services will make easy to advertise products.  Diminutive price set top box with easy recharge option and interest to watch television are booming sales of color television and DTH services in rural India, which will be used in future to advertise the brands. 

Till now “ Mela”  is the place where brands do their branding, But in future mela will be organized by brands.  One brand promotion company will contract different brands, will organize different brands melas and It will be organized for sales and brand awareness.  Under one umbrella different brands will be sold.  Rural marketing and advertising agencies will use different marketing tools for marketing of brands such as nursery schools, health care centers,  gram pradhan office, gram panchayat office and post offices will be used for marketing and advertising of products.  In future door to door sales and direct marketing campaigns will be used.

Rural India has great prospect, time will say how it is utilized by brands and advertising companies. Every multinational company is targeting to rural India. As we know India is a big market. But in reality 70% market is untouched and it is required to bottom out to this area and generate huge profit. It will be beneficial for Indians and brands both because Indians can get employment and brands can generate profit.