What is a Market?

PEOPLE
 What is a Market?

PEOPLE
BUT - not just ANY people,
they have to have
• Willingness to buy
• Purchasing power (money)
• Authority to buy
Target Marketing
Target Marketing = Segmentation + Targeting + Positioning

Identifying Market

Target Determining Market Segmentation

Marketing
Procedure Selecting a Market To Target – Market
Targeting

Positioning Through Marketing

Strategies
Market Segmentation
 With a large country
 Many different types of people

- it is too difficult to create a product that will satisfy

needs of every customer, that is why we focus on
a segment of the total market
- So MARKET SEGMENTATION can be define as……….
Market Segmentation Defn

 “Grouping people according to their similarity

related to a particular product category”

Why Market is Segmented ?
Facilitate proper choice of target market.

Facilitate tapping of the market, adapting the

offer to the market.

Makes the market effort more efficient &

economic.

Benefits the customers too

Market segmentation levels
The different levels of market segmentation which the
marketers can adopt depending on their marketing approach
and nature of products are-

1. Mass marketing ( Undifferentiated ): consider all people

as a bunch
2. Segment marketing- Customers are segmented based
on attributes such as their tastes and preferences.
Market segmentation levels cont....
3. Niche Marketing
Niche is a small segment of the market which has unsatisfied needs. In niche
marketing, marketers identify and target small groups with similar attributes,
which are generally neglected by other marketers.
For Examples: the segment of heavy smokers includes those who are trying to
stop smoking and those who don’t care.

4. Micro or Individual Marketing

In this level of segmentation , individual (one to one ) customers are targeted for
marketing. E-mails or mobile SMSs are used to market products /services to
customers at an individual level.
Market segmentation levels cont....
4. Local Marketing
Many companies with global presence have adopted ‘think global, act
local’ policy. Products which are successful at global level may fail in some
local markets if they differ from local tastes and preferences.
For example, to serve the Indian palate efficiently, global fast food chain
McDonald’s has modified its menu and used mutton instead of beef and also
introduced vegetarian burgers.
Each Market Segment should be…

Measurable

Differentiable Substantial

Actionable Accessible

4-11
Measurable – Can we identify and quantify the segment?

Accessible – Can we reach this segment efficiently and

effectively?

Substantial – Is there enough critical mass to be profitable?

Differential – Is this segment distinct from others?

Actionable – Can we serve this segment? Do we have the

capacity and budget?

 Market Segmentation
Main Characteristics
 Age

 Gender

 Geographic location

 Income

 Spending patterns

 Cultural background

 Marital status

 Education

 Language

 Mobility
Bases for Segmentation
The first step in developing a segmentation strategy is to select the most
appropriate base(s) on which to segment the market.
1. Geographic segmentation
2. Demographic segmentation
3. Psychological segmentation
4. Psychographic (life style) segmentation
5. Socio cultural segmentation
6. Use – related segmentation
7. Use – situation segmentation
8. Benefit segmentation
9. Hybrid segmentation
Market Segmentation Categories and Selected Variables.
SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES
GEOGRAPHIC SEGMENTATION
Region South India, North India, East India , Western UP , Eastern UP etc.
City Size Major metropolitan areas, Small cities, Towns
Density (thickness) of area Urban, Sub-urban ,Rural
Climate Temperate , Hot, Humid, Rainy
DEMOGRAPHIC SEGMENTATION
Age Under 15, 15-25, 25-40, 40-60, 60 +
Gender Male, Female
Marital Status Single, Married, Divorced, living together etc.
Income Under 1000o Rs, 10000-250000 Rs, 25000- 1 lack , more than 1 lack..
Education High school, Inter-mediate, Graduate, Post graduate etc.
Occupation Professional, Blue – collar, White Collar , Agricultural etc.
PSYCHOLOGICAL SEGMENTATION
Need – Motivation Shelter, Safety, Security, Affection , Sense of self worth.

Personality Extroverts, Novelty Seekers , Aggressive, Innovators etc.

Perception Low-risk, Moderate-risk, High-risk.

Low- involvement, High- involvement
Learning involvement
Positive attitude, Negative attitude
Attitudes
Market Segmentation Categories Countd…...
SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES
PSYCHOGRAPHIC
Life Style Segmentation Economy minded ,Status seekers etc.

SOCIOCULTURAL SEGMENTATION
Cultures Indian, American, Chinese , Pakistani, German.
Religion Hindu, Muslim, Sikh etc.
Subculture Guajarati, Marathi, Rajasthani , Kashmiri.
Social Class Lower, Middle , Upper
Family Life Cycle Bachelors, Young married, Full nesters , Empty nesters .

USE-RELATED SEGMENTATION
Usage Rate Super heavy user, heavy user, Medium user, Light user, Non user.
Awareness Status Unaware, Aware, Interested, Enthusiastic .
Brand Loyalty None, Some, Strong.
Market Segmentation Categories Countd…...
SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES

BENEFIT SEGMENTATION Convenience , Social acceptance , Long lasting , economy, Value – for
– the money

HYBRID SEGMENTATION Combination of demographic and psychographic profiles of.

Demographic/ Psychographic /Life Style consumer segment profile .
Steps/ Procedure in Segmentation Process
 Identify your most profitable current customers.

 Create profiles of these segments.

 Target these segments to increase retention and customer growth.

 Use profitable-customer profiles to locate prospective segments

 Evaluate prospective segments.

 Target prospective segments that are likely to respond favorably.

 Continue testing responsiveness of prospective segments.

BENEFITS OR PURPOSE OF MARKET SEGMENTATION

1. Identifies opportunities for new product development.

2. Helps design marketing programs most effective for reaching

homogenous groups of buyers

3. Improves allocation of marketing resources.

4. By developing strong position in specialized market segments,

firms can achieve a rapid growth rate.

5. By tailoring the market programmes to individual segments,

marketer can do a better marketing job and make more efficient

use of marketing resources.

BENEFITS OR PURPOSE OF MARKET SEGMENTATION cont….

6. People awareness is increasing in relation to their preferences

in these circumstances. it is necessary that marketer must
segment and then try to fulfill the needs of that segment.

4. It helps in determining the kinds of promotional devices that are

effective and also helps to evaluate their results.

5. Appropriate decision making related to introduction of new

products, promotion, distribution, pricing could easily be made.
LIMITATIONS OF MARKET SEGMENTATION

1. Market segmentation can be expensive proposition in both production and

marketing of products.

2. Other expenses like keeping adequate inventories of each style, color,

promotional expense also go up because different promotional mixes have to

be formulated for different elements.

3. Administrative expenses also increase as marketer has to plan and implement

several different marketing programmes.

Patterns of Market Segmentation
 Homogeneous preferences exist when consumers
want the same things

 Diffused preferences exist when consumers want

very different things

 Clustered preferences reveal natural segments from

groups with shared preferences
Market Targeting
Market Targeting
Choosing one’s target market signifies only those segments that marketer wants
to adopt as its market

Attributes of Good Market Targeting

 Relevancy
 Convenience
 Size
 Profit
 Growth
 Scale economics
 Low risk
Procedure of Market Targeting
The out come of segmentation analysis reveal the market opportunities available
to the firm . Market Targeting is the process of formulating market coverage
policies. the firm now has to evaluate the various segment and their structural
attractiveness and then decide how many and which ones to target.

THE MARKET TARGETING PROCESS INVOLVE FOLLOWING STEPS

Evaluating Market Segments Step 1

Selecting Target Market Step 2

Procedure of Market Targeting….
STEP 1 – EVALUATING MARKET SEGMENT

a. Forecasting segment potential to know the segment size and growth.

b. Analyzing competitor’s position to know segment structural

attractiveness.

c. Analyzing potential goal and objective achievement.

STEP 2 – SELECTING TARGET MARKET

a. Limited coverage Target marketing

b. Full coverage Target marketing

a. Limited coverage Target marketing

M1 M2 M3
P1
Single segment
P2 concentration
P3

M = Market
P = Product
e.g:Fish seller in village having single types
of fish and sell in one village only
4-27
Limited coverage Target marketing..

M1 M2 M3
P1
Selective
P2 Specialization
P3

M = Market e.g: Apple

P = Product • For Business class Laptop
• For Music lovers ipod
•For phone users iPhones

4-28
Limited coverage Target marketing..

M1 M2 M3
P1
Product
P2 Specialization
P3

e.g: Samsung
Cheaper Price class Guru 1215
M = Market Business class Galaxy Z Flip
Music lovers class Galaxy S22 Ultra
P = Product

4-29
Limited coverage Target marketing..

M1 M2 M3
P1
Market
P2 Specialization
P3

eg: Johnson & Jonhson for babies only

M = Market • Powder
• Soap
P = Product • Shampoo etc

4-30
b. Full coverage Target marketing

M1 M2 M3
P1
Full Market
P2 coverage
P3

M = Market
P = Product

4-31
METHODS FOR DEVELOPING A TARGET MARKET.

Depending upon the new patterns of market segmentation a company chooses its

target market strategy .

1. Undifferentiated Marketing – it’s a market coverage strategy in which the

company treats the target market as one. (like Coca- Cola )

2. Differentiated Marketing – it’s a market coverage strategy in which the

company go for proper market segmentation depicted by its analysis of the

total market. (HUL)

3. Concentrated Marketing –It’s a market coverage strategy in which the

company go for one product one segment principals .

FACTORS INFLUENCING MARKET TARGETING

1. Product and market homogeneity.

2. Competitor’s segmentation strategies.

3. Company recourses.

4. Product stage in the life cycle

 Product
Positioning
Product Positioning
In marketing, positioning has come to mean the
process by which marketers try to create an image
or identity in the minds of their target market for
its product, brand, or organization.
It is the 'relative competitive comparison' their product occupies in a
given market as perceived by the target market.
Positioning is the final steps in marketing targeting .as the
segmentation identifies the customer to be targeted , positioning strategy is
concerned with selecting a marketing mix appropriate to each target market
segment.
Positioning definition
Positioning is the act of designing the
company’s offer and image so that it
occupies a distinct and valued place in the
target market.

Philip Kotler
Positioning…
Although there are different definitions of Positioning,
probably the most common is: “A product's position is
how potential buyers see the product, and is
expressed relative to the position of competitors.”
Objective of Product Positioning
1. To have the brand favorable perceived by the people of target market.

2. To support the other components of Marketing Mix and marketing

strategy.

3. To Facilitate the consumer in purchase decision.

4. Reduce the risk (level) of competition.

5. Reduce the risk of future uncertainty (demand of the product ) .

6. Help in achieving organizational goal .

7. Bring the consumer close to the product.

Differentiating the Product
A very important aspect of product positioning
is differentiating the product (brand).

Differentiation is the act of designing a set of

meaningful difference to distinguish the
company ‘s offer from competitors offer .
 Ways to differentiate the company’s
Offer (Product)
There can be four broad ways to differentiate the company’s offer.

(a) Better offering:- It means that the company’s offer out

performs its competitors.

(b) Newer offering:- It means that developing the solution that not

exist.

(c) Faster offering:- Reducing the delivery time

(d) Cheaper offering:- smaller product for less money.

 SPECIFIC WAYS TO DIFFERENTIATE

Product Service Personnel Image

Differentiation Differentiation Differentiation Differentiation

 Features  Delivery  Competence

 Symbol
 Performance  Installation  Courtesy
 Media
 Durability  Consumer  Credibility
 Environment
 Reliability training  Reliability
 Events
 Reparability  Consulting  Responsiveness
 Style services  Communication
 Design  Repair
Step -1 Identifying the competitors

Determining how competitors

Step -2
are perceived and evaluated
Positioning
Step -3 Determining the competitors Procedure
position

Step -4 Analyzing the customer’s

preferences

Making the positioning

Step -5
decision

Step -6 Monitoring the position

Positioning Strategies
Product Positioning Strategies can be based on ….
1. Product attributes positioning

2. Quality based positioning

3. Use or Application positioning

4. Product Class (category) positioning

5. Product User (life style) positioning

6. Competitive (Competitor) positioning

7. Cultural Symbol positioning

Importance of Product Positioning
1. To create a proper place of a product in the minds of

potential consumer

2. To provide a competitive edge to a product.

3. Helps in service development and redesigning the services.

4. Decide the level of competition.

5. Helps in making marketing strategy.

6. Provide guidelines for the customers.

Errors / Limitations in Product Positioning

1. Error of under positioning

2. Error of over positioning

3. Error of confused positioning

Re-positioning- Re-positioning involves changing the identity of a

product, relative to the identity of competing products, in the collective

minds of the target market.(Maruti omni)

De-positioning - De-positioning involves attempting to change the

identity of competing products, relative to the identity of your own

product, in the collective minds of the target market.

-
Types of Rural Customer
Household
customer

TYPES OF
Industrial
RURAL Rural
CUSTOMER Customer

Rural
Reseller
 Household customers
Buying for satisfying personal, family or
household needs.

 Rural Industrial Customer

Buying product and services in order to manufacture
other products.

 Rural Reseller
Theses buyers are rural retailers, purchase motive is
commercial.
Rural Consumer Behaviour
Buying Process
 Problem recognition
 Information search
 Evaluation of alternatives
 Purchase decision
 Post purchase behavior
Problems Recognition
 Problem recognition is defined by obvious or
inherent need of the consumer.
 The major aim of rural marketing research
rests upon in trying to find out which are the
key products of basic needs that the rural
consumers are willing to purchase but facing
problems to buy it.
 Information search
The marketing information search process is
almost the same as for the urban markets as for
the rural markets. It includes:

 Personal sources: Family, friends, neighbours

 Commercial sources: Advertisements, Salespersons,
Dealers, Packages, Displays
 Public Sources: Mass media, Consumer rating
organizations
 Experiments self: Handling the product, experiments,
using samples of products like shampoo
Evaluation of Alternatives
 Problem: purchase of a tractor
 The decision criteria could be identified as
follows:
 Price
 Manufacture/Model
 Support
 Repair record
 Warranties
 Reliability
 Multiple uses
 Purchase Decision
 Generally rests upon a number of factors
including motivation and nature of their
needs.
 The purchase decision of a consumer is also
affected by changing nature of his goals and
needs.
 When a particular goal or need cannot be
fulfilled, a substitute goal emerges.
Purchase Behaviour of
Customers
 Motivation is the inner urge, which propels
people to act.
 Seeing and smelling food gets people
motivated to eat even if they may not be
hungry.
 Post Purchase Behaviour
 Post purchase behaviour comes from satisfaction,
use and disposal after use.

 It may be based upon the consumer’s own satisfaction

arising due to his preference for a particular more
profitable option of the available alternatives.

 Sometimes motivational research is conducted

psychoanalysis of the consumer’s mind to understand, the
sometimes not so apparent reasons for their motives and
post purchase behaviour.
Factors Influencing Rural Consumer Behavior
Needs of
Motive

Attitude Demographics

Factors
Perception Culture
Influencing
Rural
Consumer
Behavior

Stimuli Belief & Values

Influence
Social Class
group
RURAL MARKETING
RESEARCH

. 64
Marketing Research
‘the systematic gathering, recording and analysing of
data about problems relating to the marketing of
goods and services’

American Marketing Association

 What is Market Research?
The market research is an important element of the process of
marketing research. Marketing research includes the complete
analysis of the market. Information regarding the nature, size,
organisation profitability of different markets, changes in markets and
various factors- economic, social and political-affecting those
changes are studied vigorously. The main purpose of market
research is to know about the consumers and the markets of its
products or services
 Rural Market Research
• The systematic design , collection, analysis and
reporting of data and findings relevant to a
specific marketing situation facing by the
company in rural market.
• “The systematic planning, gathering, recording
and analyzing data about problems related to
marketing of goods and services.”
-American Marketing Asso.

67
It is a technique to know:
1. Who are customers of our products or services?
2. Where do they live?
3. When and how do they buy the product and services?
4. Are customers of our products satisfied with the products?
5. Who are our main competitors in the market?
6. Are the company’s products inferior or superior to
competitors’ products?
7. What policies and strategies are they following?
 Scope of Marketing Research
1. Diagnosing the current situation or problem based on detailed
information.
2. Clearly identifying competitive strengths and weaknesses.
3. Constantly analyzing what is happening in the market place.
4. Planning to watch company’s strengths with market opportunities by
outlining objectives for product and market development and devising
strategies and tactics to achieve them.
5. Watching out continuously for threats to the achievement of those
plans.
6. Monitoring the progress of strategy implementation.
 Objectives of marketing research
1. To understand the economic factors affecting the sales volume and their opportunities.
2. To understand the competitive position of rival products.
3. To evaluate the reactions of consumers and customers.
4. To study the price trends.
5. To evaluate the system of distribution.
6. To understand the advantages and limitation of the products.
7. To find new methods of packaging, by comparing other similar packages.
8. To analyze the market size.
9. To know the estimation of demand.
10. To evaluate the profitability of different markets.
11. To study the customer’s acceptance of products.
12. To assess the volume of future sales.
13. To study the nature of the market, its location and its potentialities.
14. To find solutions to problems relating to marketing of goods and services.
15. To evaluate policies and plans in the right course of action.
16. To know the development of science and technology.
17. To know the complexity of marketing.
18. To measure the effectiveness of advertising.
19. To estimate the potential market for a new product.
20. To assess the strength and weakness of the competitors.
 Advantages of marketing research
1. Marketing research is used to measure market potential, characteristics and share of
markets for a company.
2. Companies can use marketing research to evaluate new product opportunities and
product acceptance and to test existing products relative to the competitor’s products.
3. It helps to make better advertising decisions.
4. It helps to evaluate the effectiveness of marking activities and draws attention to a
potential problem.
5. It helps the manufacturer to adjust his productions according to the conditions of
demand.
6. It helps marketing of goods in efficient and economical way by eliminating all types of
wastage.
7. It helps a dealer to find out the best way of approaching potential buyers.
8. It helps to find out defects in the products and take corrective steps to improve the
product.
9. It guides a dealer in planning, advertising and promotion effort.
10. It helps to assess the effectiveness of advertising programmes.
 Advantages of marketing research
11. It helps in evaluating the relative efficiency of different advertising media.
12. It facilitates to evaluate the selling methods.
13. It helps to minimize the risks of uncertainties.
14. It helps in exploring new markets for its products.
15. It guides a firm in making sales forecasts for products.
16. It helps to explore new uses of existing products.
17. It is quite helpful for a firm to launch a new product.
18. It helps the firm in knowing general conditions prevailing in the market.
19. It helps in determining pricing policies and pricing strategy of competitors.
20. It reveals the causes of consumer resistance, etc.
 Major areas for marketing research
1. Research on Markets:
This includes market trends, market share and market potential. It is a study of the size,
location, nature and characteristics of markets; and market is segmented on the basis of many
variables-age, sex, income, education, occupation, religion etc. In short, it can be restricted to
the study of “who, what, where, when, why and how” of actual and potential buyers.
2. Research on Sales:
It covers sales forecasting, sales territory design and other sales related activities. It analyses
sales volume, salesman performance data, new product performance in test markets, opinion on
customer-related product data etc.
3. Research on Product:
It involves new product development, brand image, concept tests, product tests, test marketing
of new product etc. It analyses the strength and weakness of present products in relation to
diversification, simplification etc.
4. Advertising and Promotion Research:
It includes media research, copy research, merchandising, packaging and measuring and
effectiveness of various methods of advertising and promotion.
5. Corporate Growth Research:
It emphasizes the studies on economic and technological forecasting, measuring company
image, profitability measurement, merger, acquisitions, location etc.
6. Business Economic Research:
It is concerned with economic forecasting and business trend analysis. Planning and product
mix, price and profit analysis etc. are included.
The Marketing Research Process
1. Set objectives
2. Define research Problem
3. Assess the value of the research
4. Construct a research proposal
5. Specify data collection method
6. Specify techniques of measurement
7. Select the sample
8. Data collection
9. Analysis of results
10. Present in a final report
Terminology of Marketing Research
 Primary data - collected firsthand
 Secondary data - already exists, desk research
 Quantitative research - statistical basis
 Qualitative research - subjective and personal
 sampling - studying part of a ‘population’ to learn
about the whole
 Types of Rural Studies
• Quantitative studies
– Since penetration and consumption of most products are low,
the market is under development, hence quantitative studies
cannot be done for most products

• Qualitative studies
– 4As of Rural marketing – Acceptability, Affordability, Awareness
and Availability
– U &A (Usage & Attitudes) or KAP (Knowledge, Attitude and
Practices)
– Feasibility
– Mapping distribution, promotion and communication channels

76
4 A’s of Rural Marketing
» Availability
» Affordability
» Acceptability
» Awareness

77
Marketing Research Techniques
 Interviews
 Face-to-face
 Telephone
 Postal questionnaire
 Attitude measurement
 Cognitive component (know/believe about an act/object)
 Affective component (feel about an act/object)
 Conative component (behave towards an object or act)
 Likert scale
 Strongly agree
 Agree
 Neither agree nor disagree
 Disagree
 Strongly disagree

 Semantic differential scales - differences between

words e.g. practical Vs impractical

 Projective techniques
 Sentence completion
 Psychodrama (yourself as a product)
 Friendly martian (what someone else might do)
 Group discussion and focus group
 Postal research questionnaires
 Observation
 home audit
 direct observation
 In-store testing
 Sources & Method of Data Collection
Sources
• Ensuring the support of opinion leader
• Behaving in a manner to be liked by rural people
• Being at right places:
- Village Choupal
- Retail outlet
- Fairs
- Huts

81
 Sources & Method of Data Collection
Methods
• Secondary Data –
– Census of India, NCAER, CSO, DRDA, Panchayat office

• Primary data
– In-depth interview,
– focus group discussion,
– social research (PRA),
– Questionnaire,
– Sampling

82
 Urban VS Rural Market Research
ASPECT URBAN RURAL

Respondents Literate, brand aware, Semiliterate or illiterate,

individuals respond brand unaware. Difficult
individually to get individual
responses. Generally
group responses

Time Willing to respond. Have Hesitant. But devotes

time pressures. Spares time.
little time for researchers

83
 Urban VS Rural market contd..
Accessibility Easy to access, though Tough to access,
many suffer from Geographical barriers.
research fatigue Do not speak easy to
outsiders

Secondary data source Internal data, syndicate Less number of all

research, publish media. categories
Many sources and large
data

Primary data sources Large number of middle Less number of all

men, experts, sales categories
force, consumers,
opinion leaders

84
 Limitations & challenges in Rural
Marketing Research
• Nature of Rural Market
• Scarcity of Rural Marketing Research Budget
• Lack of Uniformity in Secondary Data
• Accessibility
• Lack of Facilities in Rural Areas
• Sensitivity of Rural People

85
 Do’s and Don'ts in rural market
research
 Wears simple clothes
 Familiar with local language or accompany a known person
 Spent time with villagers even though it is not needed to his research
 Purpose and its benefits to villagers should be explained in order to get
correct data's.
 Issues sensitive to respondents should be carefully handled
 Male researchers should approach a woman through her husband or
guardian of the woman.
 Avoid one- to-one interact as they gather as crowd.
 Researcher always carry food, water and first aid kit to avoid health
problems

86
Rural
consumer
dimensions
Education
Consumers are less literate due to fewer educational facilities.

Marketers need such strategies which generate product awareness considering this
characteristic. They can incorporate an audio-visual medium of communication in

their marketing campaign.

Low-Income Levels
The income of the rural consumer has grown over the years. But still, their
disposable income is spent on basic necessities. They prefer affordable products and
purchase only the required quantity of goods.

Marketers must try to launch their products in small packaging and at lower rates.
Occupation
The consumption pattern of rural consumers largely depends upon their income and occupation.
It is observed that the occupation of a rural consumer is framing in general.
There exist other professions as well, like service providers, technical workers, etc. The
companies must launch such products in markets that satisfy all income groups.

Impact of Reference Groups

In rural areas, the consumer is often influenced by a few people. Consequently, there is a
significant change in their buying behaviour.
Rural marketers must plan their strategies that positively impact these influencers.
The people who may influence rural consumers may include:
•Local Vendors
People residing in rural areas
•Teachers are less literate. Thus, print
•Bank ManagersLocal Leaders media does not have much
impact on rural consumers.
•Health Workers, etc
Companies must use those
•Media Habits communication channels that
reach consumers quickly.
Brand Loyalty
Rural consumers tend to be loyal to brands. With the development, rural consumers

are well aware of the available brands.

Some brands have successfully created a strong consumer base in rural markets.

Value for Money

It is the main characteristic of rural consumers. Consumers look for quality products
at justified prices.
Rural marketers should try to create a sense of trust in the mind of the consumers.
And offer products that deliver maximum benefits as per their value.
Rural Consumer Behaviour
In rural areas, consumers get highly influenced by internal and external forces.
The rural marketing strategy widely depends upon the consumer’s behaviour.
Marketers try to achieve a high level of consumer acceptance. So, they explore and
understand the preferences of the consumer. Also critically examines rural
consumer behaviour.

The rural consumers include:

•Individuals
•Groups

•Organizations, etc

We can classify buyer behaviour according to:

•Degree of involvement while making the purchase. Also, the risk and investment associated with the
product.
•The time of purchase, i.e., planned, emergency or impulse.
Factors Affecting Rural Consumer
Behaviour
•Socio-cultural factors
•Group
•Family
•Role and Status
•Sociability
•Economic Factors
•Political Factors
Classification of Rural Consumers based on their Behaviour
•Habitual Group
Such customers consistently buy specific products because they are completely satisfied with them.
•Cognitive Group
People belonging to this group have some selective perception, and their buying behaviour gets
influenced by it.
•Emotional Group
Customers in this class are influenced by their emotional intellect. They are more focused towards
the product’s image and features.
•Impulsive Group
This group make purchase considering the physical attributes of the product. Thus, there is no
brand query from the customer’s end.
•New Group
With the growth and development of a new group has emerged over the years
Rural demand refers to the consumption of goods
and services by residents living in rural areas or
villages.

It encompasses the buying behavior and spending

patterns of people in rural regions, including their
purchases of essential and non-essential items.
Factors Affecting Rural Demand
•Inconsistent agricultural productivity
•Limited access to financial services
•Lack of infrastructure
•Price of the Product. ...
•The Consumer's Income. ...
•The Price of Related Goods. ...
•The Tastes and Preferences of Consumers. ...
•The Consumer's Expectations. ...
•The Number of Consumers in the Market.
 NEED FOR TAPPING THE RURAL MARKET:

1. Rural markets are growing faster than urban markets

2. In major urban markets, there is severe competition
3. To change the attitude of the farmers so that they will treat
agriculture as a business
4. Increase in rural income and savings
5. Rural marketing creates employment opportunities
6. Over 70% of country’s population live in rural areas.
7. Brand loyalty
8. Increase in disposable income
9. Foreign Competition
10.Development of TV network
11.Life Cycle Advantage
CONSTRAINTS IN RURAL MARKETING:
1. Physical Distribution :
( a) Transportation: It involves moving goods from one place top another place.
The infrastructure is very poor in our country.
(b) Warehousing: Warehousing includes receiving the goods, dispatching small
consignments and documents.
(c) Communication: Post and telegraph system is not well developed in interior
rural areas.
2. Channel Management
(a) Multi-tier system: it is required to service rural customer.
(b) No scope for manufacturer owned outlets: Low volume do not justify own
showrooms.
(c) Limited availability of dealers: It is uneconomical to run retail shops due to
low sales turnover in rural areas.
(d) Inadequate banking and credit facility: banking facilities are in adequate in
rural areas. Marketers find it difficult to collect funds through bank.
CONSTRAINTS INRURAL MARKETING count……:

3. Sales force management: The sales person plays an important role in

promoting the products through direct contacts with the customers. A sales
person requires fluency in local language, capacity to work for extended
hours, ability to undertake long journeys, knowledge of values, believes and
perceptions that influence the behaviour of consumers. Selling skills,
knowledge of competition and general knowledge about agriculture.

4. Sales promotion: Rural marketing requires special promotion efforts, the

media and the methods have to be formulated accordingly

5. Underdeveloped people and Market: The rural markets are highly scattered
and there are barriers in reaching the rural consumers due to low literacy, low
income, seasonal demand, price sensitivity, low quality consciousness and
traditional practices.

6. Rural demand: There is need to understand the features of rural demand.

METHODS OF MOTIVATING RURAL CONSUMERS:
1. Product: In order to attract the attention of first time users, the product could be made
available in small packing.
2. Price: Making the product available in small unit packing, reusable packaging,
Extension of credit facilities, Promotional schemes.
3. Rural communication: The marketer has to pass on the messages about products
and services through rural specific promotion media and methods.
4. Sales force: The sales persons plays and important role in promoting the products
through direct contacts with the customers.
5. Opinion Leaders: The sales person should establish rapport with opinion leaders to
promote the products in rural area.
6. Distribution: The most important objective is to make the products available in rural
markets. The company has to establish an appropriate channel of distribution
consisting of wholesalers, stockiest and village level retailers and ensure that the
products are available with village merchants.