Capturing the imagination of the rural markets and serving the Bottom of the Pyramid (BoP) is high priority for most Indian companies now.
— Capturing the imagination of the rural markets and serving the Bottom of the Pyramid (BoP) is high priority for most Indian companies now. A paradigm shift in the market has put rural India on every company’s marketing roadmap. Every company wants to go rural but for many, it is an unknown territory. The Rural marketing Congress, organised by The Ideas Exchange was a forum designed to share knowledge and facilitate networking to help address these challenges.
Day 1 of this two day event saw a power packed session where seasoned rural marketing practitioners shared their experience. “Rural marketing is all about understanding the consumer,” said Deepak Saksena of Hindustan Unilever, “There are major infrastructural and emotional barriers to overcome,” he added. Mandeep Singh, Managing Director of d.light India said, “Rural marketing is not a low hanging fruit.” D.light is the manufacturer of the world’s most cost effective solar lanterns.
“The rural consumer takes time to make the buying decision, especially when it comes to consumer durables. Try and buy or a seed and sell model has worked for us,” Mandeep said. Rahul Sharma, Head – Centre for Rural Information & Insights, Mahindra & Mahindra shared his insights. “The rural retail market has a potential of about 140,000 crores, the rural consumer is aware and there is an increased demand for high quality products.”
V N Saroja, CEO, Indian Agribusiness Systems and Amit Mehra, Founder & Managing Director, Reuters Market Light offer knowledge driven services on the internet and mobile platform. Saroja expressed her challenges to deliver services on a platform that has a great potential but limited penetration in the rural market. Amit spoke about his innovative model of delivering real time agricultural data on farmers’ mobile phones. “Some farmers are not ready to use SMS based services because they are not comfortable with it,” he said.
Gaurav Gupta, Regional Director, Dalberg Global Development Advisors answered the 1000 crore question for marketers today – “To franchise or not to franchise.” He cited several examples of franchisee models successfully implemented in several parts of the world. Anu Valli, Head of Rural Energy Network Enterprise, IFMR Ventures explained the banker’s perspective when it comes to financing products for the rural market. “Product focused finance brings in reputation risk for the financer,” Anu said. She presented a model for financing products for distribution in rural markets and pointed out the tactics to avoid.
Atul Joshi from Envirofit, Anuj Sharma, COO, Piramal Water and Prema Gopalan, Director, Swayam Shikshan Prayog debated on the need and the definition for the ‘rural entrepreneur’. Prema spoke about Sakhi Retail a SHG model that helps brands reach the last mile consumer. She expressed the need for the corporate sector to invest and de-risk the rural entrepreneur.
Anuj explained how the micro franchising model has worked, Piramal Water’s Sarvajal that provides technology for clean RO and UV processed drinking water for as less as 3 paise/litre. There lies a huge potential in India’s hinterlands. But turning the potential into reality is not going to be an easy task. So, what is the future of rural marketing?
Do you foresee web and mobile technologies being widespread across all the 0.6 million villages in India with rural shopkeepers setting up shops on GroupOn and attracting customers? Do you see supply chains being managed completely using mobile-based systems? Do you see the end of ‘rural marketing’ due to migration to cities and up-gradation of villages into semi-urban areas?
These insightful questions came up during Day 2 of the Rural Marketing Congress. The topic of the discussion was ‘Rural Marketing 2020 – Accessing the fortune at the bottom of the pyramid’ and the panellists included senior management from Hero Honda, Mahindra and Mahindra and Advanta Seeds. The panel moderator was Rama Bijapurkar, a thought leader in market strategy and consumer related issues, and author of ‘We are Like That Only’.
The conference had several interesting sessions on investor-entrepreneur dynamics, rural supply chains, and ICT4D. Tarun Agarwal from FINO spoke about how FINO through biometric recognition and an army of business correspondents, provides all kinds of financial services to the poor, from savings and credit to insurance and remittance. They have reached 23 million customers already and add a million every 20 days. ‘Har dukan, makan ek bank ban jaye – is the mantra of FINO’, said Tarun.
Shailesh Naik, General Manager and Head at ITC eChoupal brought out another interesting side of the story – ‘Rural people do not look for products. They look for solutions; you can’t sell televisions without caring about electricity supply.’ Shailesh stressed that building trust, creating income for rural people, enabling inclusion, and striking the right partnerships are key to success in rural marketing.
On a higher level, the conference was about sharing learnings on the best strategies to market products and services in rural areas. Anuj Pasrija, Country Head, Arogya Parivar, a subsidiary of Novartis India Ltd, spoke about how the government spends less than 1% on public healthcare, a startling fact indeed.
Arogya understands the healthcare market in rural areas and has realized that educating villagers is the key to customer acquisition. Unless your consumer understands how critical your product or service is, she wouldn’t even consider paying for it. He talked about the 4As of rural marketing – awareness, adaptability, accessibility, and affordability. Arogya is indeed a great example of an initiative whose roots lie in creating large scale social impact. They have touched 42 million people in 31,000 villages.
In the investor panel session post lunch, the investors spoke about funds, what they look for in prospective investees, and what expertise do they bring in terms of helping entrepreneurs. The session had representatives from Acumen Fund, SONG Investment Advisors and Intellecap. Karthik, Energy Portfolio Manager at Acumen spoke about unit economics and how it is the most critical parameter in determining a successful business plan. Anurag from Intellecap talked about information asymmetry in this space.
Partnerships seemed to emerge as a critical area for both large corporations and SMEs who want to get into rural areas. NGOs (or non-profits) and local government bodies can play a very critical role in enabling this. Businesses who want to set shops in these regions can partner with these organizations to jointly create products, market them, and even test distribution channels.
Source: Press release distribution via India PRwire
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