There are many problems to be tackled in rural marketing, despite
rapid strides in the development of the rural sector. Some of the common
problems are discussed below:
1.Transportation: Transportation is an important aspect in the
process of movement of products from urban production centers to
remote villages. The transportation infrastructure is extremely poor in
rural India. Due to this reason, most of the villages are not accessible to
the marketing man. In our country, there are six lakhs villages. Nearly 50
per cent of them are not connected by road at all. Many parts in rural
India have only kachcha roads. During the monsoons, even these roads
become unserviceable. Regarding rail transport, though India has the
second largest railway system in the world, many parts of rural India
however, remain outside the rail network.
2.Communication: Marketing communication in rural markets
suffers from a variety of constraints. The literacy rate among the rural
consumers is very low. Print media, therefore, have limited scope in the
rural context. Apart from low levels of literacy, the tradition-bound
nature of rural people, their cultural barriers and their overall economic
backwardness add to the difficulties of the communication task. Post,
telegraph, and telephones are the main components of the
communication infrastructure. These facilities are extremely inadequate
in the rural parts of our country. In rural areas, the literacy percentage is
still low, compared to urban areas. In India, there are 18 recognized
languages. All these languages and many dialects are spoken in rural
areas. English and Hindi are not understood by many people. Due to
these problems, rural consumers, unlike urban consumers do not have
exposure to new products.
3.Availability of appropriate media: It has been estimated that all
organized media in the country put together can reach only 30 per cent of
the rural population of India. The print media covers only 18 per cent of
the rural population. The radio network, in theory, covers 90 per cent.
But, actual listenership is much less. TV is popular, and is an ideal
medium for communicating with the rural masses. But, it is not available
in all interior parts of the country. It is estimated that TV covers 20 per
cent of the rural population. But, the actual viewership is meager. The
cinema, however, is a good medium for rural communication. But, these
opportunities are very low in rural areas.
4.Warehousing: A storage function is necessary because production
and consumption cycles rarely match. Many agricultural commodities are
produced seasonally, whereas demand for them is continuous. The
storage function overcomes discrepancies in desired quantities and
timing. In warehousing too, there are special problems in the rural
context. The central warehousing corporation and state warehousing,
which constitute the top tier in public warehousing in our country, have
not extended their network of warehouses to the rural parts. It is almost
impossible to distribute effectively in the interior outlets in the absence of
adequate storage facilities. Due to lack of adequate and scientific storage
facilities in rural areas, stocks are being maintained in towns only.
5.Village structure in India: In our country, the village structure
itself causes many problems. Most of the villages are small and scattered.
It is estimated that 60 per cent of the villages are in the population group
of below 1,000. The scattered nature of the villages increases distribution
costs, and their small size affects economic viability of establishing
distribution points.
6.Rural markets and sales management: Rural marketing involves
a greater amount of personal selling effort compared to urban marketing.
The rural salesman must also be able to guide the rural customers in the
choice of the products. It has been observed that rural salesmen do not
properly motivate rural consumers. The rural salesman has to be a
patient listener as his customers are extremely traditional. He may have
to spend a lot of time on consumer visits to gain a favourable response
from him. Channel management is also a difficult task in rural
marketing. The distribution channels in villages are lengthy involving
more intermediaries and consequently higher consumer prices. In many
cases, dealers with required qualities are not available.
7.Inadequate banking and credit facilities: In rural markets,
distribution is also handicapped due to lack of adequate banking and
credit facilities. The rural outlets require banking support to enable
remittances, to get replenishment of stocks, to facilitate credit
transactions in general, and to obtain credit support from the bank.
Retailers are unable to carry optimum stocks in the absence of adequate
credit facilities. Because of this problem, they are not able to offer credit
to the consumers. All these problems lead to low marketing activities in
rural areas. It is estimated that there is one bank for every 50 villages,
showing the poor banking facilities in rural areas.
8.Market segmentation in rural markets: Market segmentation is
the process of dividing the total market into a number of sub-markets.
The heterogeneous market is broken up into a number of relatively
homogeneous units. Market segmentation is as important in rural
marketing as it is in urban marketing. Most firms assume that rural
markets are homogeneous. It is unwise on the part of these firms to
assume that the rural market can be served with the same product, price
and promotion combination.
9.Branding: The brand is the surest means of conveying quality to
rural consumers. Day by day, though national brands are getting
popular, local brands are also playing a significant role in rural areas.
This may be due to illiteracy, ignorance and low purchasing power of
rural consumers. It has been observed that there is greater
dissatisfaction among the rural consumers with regard to selling of low
quality duplicate brands, particularly soaps, creams, clothes, etc. whose
prices are often half of those of national brands, but sold at prices on par
or slightly les than the prices of national brands. Local brands are
becoming popular in rural markets in spite of their lower quality.
10.Packaging: As far as packaging is concerned, as a general rule,
smaller packages are more popular in the rural areas. At present, all
essential products are not available in villages in smaller packaging. The
lower income group consumers are not able to purchase large and
medium size packaged goods. It is also found that the labeling on the
package is not in the local language. This is a major constraint to rural
consumers understanding the product characteristics.
rapid strides in the development of the rural sector. Some of the common
problems are discussed below:
1.Transportation: Transportation is an important aspect in the
process of movement of products from urban production centers to
remote villages. The transportation infrastructure is extremely poor in
rural India. Due to this reason, most of the villages are not accessible to
the marketing man. In our country, there are six lakhs villages. Nearly 50
per cent of them are not connected by road at all. Many parts in rural
India have only kachcha roads. During the monsoons, even these roads
become unserviceable. Regarding rail transport, though India has the
second largest railway system in the world, many parts of rural India
however, remain outside the rail network.
2.Communication: Marketing communication in rural markets
suffers from a variety of constraints. The literacy rate among the rural
consumers is very low. Print media, therefore, have limited scope in the
rural context. Apart from low levels of literacy, the tradition-bound
nature of rural people, their cultural barriers and their overall economic
backwardness add to the difficulties of the communication task. Post,
telegraph, and telephones are the main components of the
communication infrastructure. These facilities are extremely inadequate
in the rural parts of our country. In rural areas, the literacy percentage is
still low, compared to urban areas. In India, there are 18 recognized
languages. All these languages and many dialects are spoken in rural
areas. English and Hindi are not understood by many people. Due to
these problems, rural consumers, unlike urban consumers do not have
exposure to new products.
3.Availability of appropriate media: It has been estimated that all
organized media in the country put together can reach only 30 per cent of
the rural population of India. The print media covers only 18 per cent of
the rural population. The radio network, in theory, covers 90 per cent.
But, actual listenership is much less. TV is popular, and is an ideal
medium for communicating with the rural masses. But, it is not available
in all interior parts of the country. It is estimated that TV covers 20 per
cent of the rural population. But, the actual viewership is meager. The
cinema, however, is a good medium for rural communication. But, these
opportunities are very low in rural areas.
4.Warehousing: A storage function is necessary because production
and consumption cycles rarely match. Many agricultural commodities are
produced seasonally, whereas demand for them is continuous. The
storage function overcomes discrepancies in desired quantities and
timing. In warehousing too, there are special problems in the rural
context. The central warehousing corporation and state warehousing,
which constitute the top tier in public warehousing in our country, have
not extended their network of warehouses to the rural parts. It is almost
impossible to distribute effectively in the interior outlets in the absence of
adequate storage facilities. Due to lack of adequate and scientific storage
facilities in rural areas, stocks are being maintained in towns only.
5.Village structure in India: In our country, the village structure
itself causes many problems. Most of the villages are small and scattered.
It is estimated that 60 per cent of the villages are in the population group
of below 1,000. The scattered nature of the villages increases distribution
costs, and their small size affects economic viability of establishing
distribution points.
6.Rural markets and sales management: Rural marketing involves
a greater amount of personal selling effort compared to urban marketing.
The rural salesman must also be able to guide the rural customers in the
choice of the products. It has been observed that rural salesmen do not
properly motivate rural consumers. The rural salesman has to be a
patient listener as his customers are extremely traditional. He may have
to spend a lot of time on consumer visits to gain a favourable response
from him. Channel management is also a difficult task in rural
marketing. The distribution channels in villages are lengthy involving
more intermediaries and consequently higher consumer prices. In many
cases, dealers with required qualities are not available.
7.Inadequate banking and credit facilities: In rural markets,
distribution is also handicapped due to lack of adequate banking and
credit facilities. The rural outlets require banking support to enable
remittances, to get replenishment of stocks, to facilitate credit
transactions in general, and to obtain credit support from the bank.
Retailers are unable to carry optimum stocks in the absence of adequate
credit facilities. Because of this problem, they are not able to offer credit
to the consumers. All these problems lead to low marketing activities in
rural areas. It is estimated that there is one bank for every 50 villages,
showing the poor banking facilities in rural areas.
8.Market segmentation in rural markets: Market segmentation is
the process of dividing the total market into a number of sub-markets.
The heterogeneous market is broken up into a number of relatively
homogeneous units. Market segmentation is as important in rural
marketing as it is in urban marketing. Most firms assume that rural
markets are homogeneous. It is unwise on the part of these firms to
assume that the rural market can be served with the same product, price
and promotion combination.
9.Branding: The brand is the surest means of conveying quality to
rural consumers. Day by day, though national brands are getting
popular, local brands are also playing a significant role in rural areas.
This may be due to illiteracy, ignorance and low purchasing power of
rural consumers. It has been observed that there is greater
dissatisfaction among the rural consumers with regard to selling of low
quality duplicate brands, particularly soaps, creams, clothes, etc. whose
prices are often half of those of national brands, but sold at prices on par
or slightly les than the prices of national brands. Local brands are
becoming popular in rural markets in spite of their lower quality.
10.Packaging: As far as packaging is concerned, as a general rule,
smaller packages are more popular in the rural areas. At present, all
essential products are not available in villages in smaller packaging. The
lower income group consumers are not able to purchase large and
medium size packaged goods. It is also found that the labeling on the
package is not in the local language. This is a major constraint to rural
consumers understanding the product characteristics.
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