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RM Assignment 2 Word

Edible oils are an important part of rural Indian households' food expenditures. While rural Indians traditionally used locally produced oils, branded vegetable oils have grown significantly. Challenges in branding edible oils in rural markets include relating brands to local lifestyles and processing, lack of awareness about adulteration and benefits of brands, and distribution challenges. To build brands in rural areas, companies use elements like identity, communication, essence associated with color, and tools like word-of-mouth, audio, visual, video, and event branding localized for rural audiences.

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65 views6 pages

RM Assignment 2 Word

Edible oils are an important part of rural Indian households' food expenditures. While rural Indians traditionally used locally produced oils, branded vegetable oils have grown significantly. Challenges in branding edible oils in rural markets include relating brands to local lifestyles and processing, lack of awareness about adulteration and benefits of brands, and distribution challenges. To build brands in rural areas, companies use elements like identity, communication, essence associated with color, and tools like word-of-mouth, audio, visual, video, and event branding localized for rural audiences.

Uploaded by

Chinnari Sriraksha
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Assignment 2: RURAL MARKET FOR EDIBLE OILS

Date of submission: 09-03-2020

SUBMITTED TO:
Dr. S. John Mano Raj
Associate professor (Marketing)
IIPM - Bengaluru

SUBMITTED BY, SECTION 1-GROUP 5

Chinnari. Sri Raksha 19 PGDM- ABPM 07


Mada Pradeep Chandra Sharma 19 PGDM -ABPM 21
Rathnaswathy.S 19 PGDM- ABPM 32
Shaik Batti Riyaz Basha 19 PGDM -ABPM 34
Nandakishor wangikar 19 PGDM -ABPM 44

INTRODUCTION:
Edible oils constitute an important component of food expenditure in Indian households. Edible oil
industry is the most important industry in agriculture sector in India. The most consumed edible oil
is palm oil and sunflower oil in both rural and urban India. About 21-40% branded edible oil is in
rural India under the category of super- premium. Edible oil category penetration is 86% with
highest penetration for mustard oil and palmoline. these trends indicate that rural markets are
growing in a big way twice as fast as urban.

EVOLUTION OF BRANDED VEGETABLE OIL FROM COMMODITY:

 Traditionally, Indians have broadly used two types of edible oils.


 The first was ‘vegetable’ oil obtained from crushing local oilseeds —
mustard in northern and eastern India;
groundnut in Gujarat, Maharashtra, Karnataka and Andhra Pradesh;
sesame and groundnut in Tamil Nadu;
and coconut in Kerala – in what was known as “Kachchi-ghanis” (bullock driven cold
presses).
 The second cooking oil medium was ‘animal’ fat, mainly desi-ghee prepared from milk.
 Emergence of solvent extraction and refining - These processes, unlike normal expeller pressing
and filtering, involved use of chemicals. While with mechanical pressing, only 85 per cent of the
oil from groundnuts could be recovered, the use of a solvent (edible-grade hexane) could take
99 per cent of oil.
 The first-ever solvent extraction plants came up during the late 1940s, mostly in Gujarat’s
Saurashtra region, for extracting oil from groundnut cake.
 By the early 1950s, Ahmed Umar Oil Mills in Mumbai had also introduced refined groundnut oil
under an iconic “Postman” brand.
 In 1962, a company called Foods Fats & Fertilisers Limited established a solvent extraction plant
to produce oil from rice bran, a by-product of paddy milling. 
 This period also coincided with the “Yellow Revolution” by the National Dairy Development
Board (NDDB).
 Acreages under mustard, groundnut, soybean, and also other oilseeds like sunflower and
safflower rose considerably.
 In 1988, National Dairy Development Board (NDDB) launched “the golden flow operation” to
curb the sale of loose oil in India.
 Under the program of NDDB, “Dhara” was the first branded packed edible oil in India by
“Mother Dairy”
 It is one of India’s most trusted brands as it stands for purity, freshness, taste and value for
money. 
 It was the first to launch the tamper proof tetra packs in edible oils and it continues this unique
distinction till today
 Today, there are many other popular brands in edible oil such as:
1. ADANI WILMAR - FORTUNE BRAND:
The Company has the largest range of edible oils spanning across the categories of Soya, Sun,
Mustard, Rice bran, Groundnut, Cottonseed and the revolutionary Vivo oil. 
2. MARICO – SAFFOLA BRAND:
For the last years, Saffola life has been creating awareness about heart health and inspiring
people to heave a healthy lifestyle for a healthy heart.
It has the categories in safflower, rice bran, soya bean oil. 
3. RUCHI SOYA -MAHAKOSH, NUTRELA, SUNRICH AND RUCHI GOLD BRANDS
Categories include cotton seed oil, ground nut oil, soya bean oil, mustard oil, sunflower oil and
rice bran oil.

CHALLENGES IN BRANDING OF EDIBLE OILS IN RURAL MARKET:

• RELATING BRAND WITH LIFE STYLE:

1. Local processing units: Farmers with oil seed farms send their oil seeds to the local
extraction units, get oil and use the byproduct of oil cake as animal feed. Rural belief
systems also play an important role.

2. Filtered oil produced in villages is mainly by the small-scale village-based processors.


The oil is mostly sold loose directly to the consumers from a variety of containers, often
within two to three days of production.

• LACK OF AWARENESS ON ADULTERATION AND BRANDED EDIBLE OILS:

1. Edible oil adulteration: Procure low-grade palm olein oil and produce fake mustard,

refined and castor oil by adulterating it with essence and color before packing and

supplying them to retailers 

2. Pricing: Due to the above factors, oil is available at cheaper rate to rural consumers
which becomes a challenge for branded edible oils. (because branded edible oils have
higher price compared to locally available oils -mixing costly sunflower oil and soya bean
oils with cotton seed oil and castor oil)

 Lack of proper distribution channels to make the branded product reach to the customers.
 This led to the growth of fake or spurious brands to fill this gap in the demand.
 Fake brands: Anmol: Amol (look alike); Saffola: Safola (spell alike)

BRAND ELEMENTS AND BASIS FOR BRANDING OF EDIBLE OILS IN RURAL


AREAS:

1. BRAND IDENTITY: Brand identity is the visible elements of a brand, such as colour,


design, and logo, that identify and distinguish the brand in consumers' minds. It is the way
people recognize the brand.
Example: brand logo of edible oil in local languages.
 Brand tagline like Sehat bhi- swaad bhi
Maa ke haatho ka swaad
100% sudh tel
 Shape of packaging: Saffola – good to store.

Food Safety and Standards Authority of India (FSSAI- edible oils be sold in packaged form, but
in rural areas these oils are being sold in smaller quantities from opened packs. For people
earning their wages on a daily basis, it is difficult to afford oil packages of larger quantities.

2. BRAND COMMUNICATION: the combination of activities that influence consumers


opinions of a company and its products.
Example: ghar ka khana campaign by fortune brand.

Spread the warmth of a nice home-cooked meal- the target group for its products are
residents of semi urban and rural areas.

3. BRAND ESSENCE: Brand essence is the core characteristic which defines a brand. It is
an intangible attribute that separates your brand from your competition’s brand by your

audience. It is emotional and based on feelings.  It is the essential feeling evoked in
your audience when they hear your brand name.
Example: Saffola brand - heart care.

4. Brand association with colour: Rural people always associate brand with colour. Mostly
edible oil are packaged with yellow colour because yellow indicates pure. And also,
rural people differentiate different kinds of oil based on colour.

Example: sunflower oil – yellow, rice bran oil – brown

SUGGESTIONS FOR BRAND BUILDING TOOLS:

1. WORD OF MOUTH: An unpaid form of promotion in which satisfied customers tell


other people how much they like a product or service. Encourage the happy rural
customers to spread the good will of brand.

2. AUDIO BRANDING: create a unique audio identity that connects the abstract elements


of your brand with your rural audience.

Example- brand names and slogans in different accents of local languages.

3. VISUAL BRANDING: Visual branding are the visual elements that give a brand a


unique identity in a crowded market. Visual elements should be in local languages and
should be easily understood by rural people to grab their attention. Can be done through
posters in village public places, bus stands, on buses etc.

4. VIDEO BRANDING: Video branding is the practice of distributing your brand message
in a recognizable, distinct way through video. The idea is to both promote brand
awareness and recognition while also helping you to define what your brand is and what
makes you different.

5. EVENT BRANDING: It is capturing the essence of your organization's brand and


giving it its proper due in your event marketing campaigns. Edible oils brands can be
popularized through various marketing campaigns in rural areas.

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