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Leveraging ICT For Rural Marketing: Amit K Roy - Itc LTD - Ibd

This document discusses how ICT can help address challenges facing rural marketing in India. It notes issues like low incomes, fragmentation, and poor infrastructure in rural areas. This leads to implications for farmers like weak bargaining power and dependence on middlemen. ITC's eChoupal initiative is presented as a case study of how ICT can help. The eChoupal model sets up computer kiosks in villages run by trained local farmers. This allows farmers to access real-time market prices, weather information, and farming best practices. It also provides a direct channel for farmers to sell their produce and access quality farm inputs and other products at lower cost. The eChoupal network has now expanded to over 6,000

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30 views

Leveraging ICT For Rural Marketing: Amit K Roy - Itc LTD - Ibd

This document discusses how ICT can help address challenges facing rural marketing in India. It notes issues like low incomes, fragmentation, and poor infrastructure in rural areas. This leads to implications for farmers like weak bargaining power and dependence on middlemen. ITC's eChoupal initiative is presented as a case study of how ICT can help. The eChoupal model sets up computer kiosks in villages run by trained local farmers. This allows farmers to access real-time market prices, weather information, and farming best practices. It also provides a direct channel for farmers to sell their produce and access quality farm inputs and other products at lower cost. The eChoupal network has now expanded to over 6,000

Uploaded by

raju.268864531
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Leveraging ICT for Rural Marketing

Amit K Roy – ITC LTD - IBD

FICCI RURAL MARKETING SUMMIT


May 10th 2007, New Delhi
What we keep hearing about Rural
 Large Population base
 Lower Incomes
 Monsoon Dependent
 Rural is different
 Limited Media reach
 Illiteracy
 Poor Infrastructure
 Spurious Products
 Unviable Direct Distribution
 Insufficient Research
We Believe that the Incomes in
Rural are low because of
 Fragmentation
 Geographical Dispersion
 Heterogeneity
 Weak Infrastructure

 Scope of my Presentation
 Talk about implications of these realities
 Explain how IT makes a positive Difference
 Illustrate through ITC eChoupal case Study
Implications for Farmer / Consumer
Reality Implications
Adversely Impacting Productivity &
Fragmentation of Land quality of the produce –
Weak Bargaining Power

Geographical - No access to Real time Information


Dispersion - Expensive to deliver Information
Heterogeneity - Single farmer multiple crops
- Investment Needs, Cash flow ability,
soil conditions …….
Difficult to Customise

Weak Infrastructure Dependence on Middlemen


(Roads, telecom, Few Alternatives
Power , Irrigation)
Efforts made so far
 Unbundled Institutions – Right Solutions, but one
can only go this far.

• Institutional Credit : Constrained by difficult Counterparty risk


management.

• Govt Agri Extension worker – High Cost and low impact

• Agri Input Companies- Typically Product Focus

• Cooperative Societies – Benefits Cornered by a few .

• Mandi – Ideal Price Discovery, Sunk cost on transportation , forces


Farmers to Sell.
Higher Transactions cost and malpractices by the middlemen
Which resulted in …..
Low Risk Taking Ability

Low Incomes Low Investment

Low Productivity
Implications for Rural marketers

Reality Implication

Fragmentation Reward: Effort ratio better in Urban


Geographical
Dispersion High Cost of reach

Heterogeneity Not worthwhile to customise

Weak Infrastructure Passive Distribution


Which resulted in ……………
ENTER “IT” - Illustration “The ITC eChoupal”
The Problem Faced by Farmer…The 2 Ds
 DEEP SEA - Institutional support

 Information on farming best practices/


weather

 Quality and information on Inputs

 DEVIL – Middle Men

 Price Discovery

 Quality and weighment

 Handling Loss

 Time
The eChoupal
 Information and Communication Technology Infrastructure at each
eChoupal.
 Computer with printer

 Internet connection

 Solar Panel

 VSAT

 This farmer called “Sanchalak” is


 Educated

 A progressive farmer middle size farmer.

 Well respected by fellow farmers

 Not a businessman

A formal training is imparted to the Sanchalaks on the usage of the ICT


infrastructure.
Power Connectivity

Overcoming Odds

Training Content
“e” helps overcome 2Ds…..
Unbundling Information and Transaction
 Price Discovery before deciding to sell

 Freedom of choice for transaction

 Payment – Cash on spot

Bundling Information, Knowledge and Transaction


 Knowledge on Farming best practices

 Information on Weather

 High Quality Products and Solutions – Usage

• Power of scale to farmers


• Overall improvement in productivity
• Sanchalak has build tremendous Trust and Credibility in
the Village.
The eChoupal Services
• Relevant & Real-time Information
– Commodity prices, Local Weather, News
• Customised Knowledge
– Farm Management, , Risk Management
• Direct Marketing Channel for Farm Produce
– Lower Transaction Costs, Better Value through Traceability
• Supply Chain for FMCGs, Vehicles, and Farm Inputs
– Screened for Quality,
– Demand Aggregation
– Competitive Prices
– Efficient Logistics
 Financial Services – Life, General , Health and Crop Insurance
 Education
What’s in it for the farmer?

Bottom line for the farmer


Increased yields
Improved Quality
Reduction in Transaction costs

Power of Scale to the Small Farmer


Customized Knowledge despite Heterogeneity
Real time information despite Distances
The Network Size

State Hubs Choupals


Madhya Pradesh 46 2000
Uttar Pradesh 48 2100
Maharashtra 26 1000
Rajasthan 25 870
Karnataka 2 100
Andhra Pradesh 3 100
Total 150 6170
No of Villages 33935

Our Vision - 20000 choupals ,covering 100, 000


villages in 16 states
Distribution thru eChoupal
Category Mechanism

Daily Buy Active Servicing upto rural outlets

Continuous Availability Sanchalak Facilitates Distribution


a) Continuous Inventory
b) Aggregates Demand
Bulk buy and High Value Hypermarket @ Choupal Saagar
Special Products Lead Customers to respective
Company O/ls eg TVS, Eicher etc
Marketing Services thru eChoupal

 Distribution
 Research
 Communication
 Micro Marketing
 Sampling
 Product Demonstration
Choupal Sagar Can make a difference……..
State of Art facility for
Procurement.
Setting new benchmarks in shopping experience for rural
Consumers
Wide Range of Product Categories
Coming out with Families
Increasing…….
Recap…
ICT Ingredients of ITC eChoupal
 Deliver real-time information and customised
knowledge

 Aggregate demand and access high quality


products at lower cost

 Act as a direct marketing channel allowing efficient


logistics management

 Provide products as per the needs of the villagers


Thank You

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