A presentation India India Definitions… • Rural and Urban Areas – The conceptual unit for urban areas is a 'town', whereas for the rural areas it is a 'village.' The classification of an area as an urban unit in Census of India 2001 is based on the following definition: • All places declared by the state government under a statute as a municipality, corporation, cantonment board or notified town area committee, etc. • All other places which simultaneously satisfy or are expected to satisfy the following criteria: – A minimum population of 5,000; – At least 75 per cent of the male working population engaged in non-agricultural economic pursuits: and – A density of population of at least 400 per square kilometer (1,000 per square mile) – Any area, which is not covered by the definition of urban, is rural. The ground realities! The Rural Consumer Why rural? Huge business opportunities… • Rural consumers constitute about 72% of India‟s population No single-national competitor • Marketers have, so far, concentrated on the top-end consumer • Therefore, this segment is largely dominated by proxy products and local/regional/duplicate/fake brands Who is the rural consumer? Demographics • Largely working as farmers or agricultural workers • Have limited education, may well be illiterate – This leads to linear and simple thinking, abstract logic tends to go over their heads • Either live in joint (extended) families or have only recently formed nuclear families Shopping behaviour • Buy small quantities - more frequently – Unit price is critical, particularly as many of them are daily-wage earners • Look for „acceptable performance‟/ functional benefits / paisa vasool paradigm (good in relation to current product) at a reasonable price • “Transcreation” of packaging critical • Flash price of pack wherever feasible • In their own way, good at arriving at a cost per dose (or cost per month) equation: even if not expressed mathematically – More sensitive and alert to „value‟ • Make high-volume purchases at weekly village markets – Haats Shopping behaviour • Build personal acquaintance with neighbourhood retailer – Often trust the retailer who does influence brand choice – Frequently get „credit‟ from the retailer Shopping behaviour • Word-of-mouth, very important and credible • Mass driven – Buy products that are perceived to be popular: the „bandwagon‟ effect • Try to minimise their risk: tend to be stronger creatures of habit • High awareness of range of consumer brands - but propensity to actually purchase premium performance brands is low • Still influenced by popular idols/role models such as movie stars, famous sportsmen, etc Collectivism (As opposed to individualistic) • Adhere to prevailing social norms: the community they live in is very important and their behaviour is usually consistent with the community‟s shared beliefs and norms • Enjoy social gatherings: women‟s associations, celebrations, events, etc • Spend a lot of their free time chatting and gossiping with neighbours: both as a source of entertainment and information • Tend to be suspicious about people outside the community • Follow opinion leaders: school teachers, priests, religious leaders, urbanised relatives, local politicians, the village head Family and the housewife’s role • Housewives manage the household and decide on its needs – Largely determine brand choice for low-cost household products – But in rural India, males play that role too • Males are still dominant; largely a patriarchal society – Yet, housewife establishes her „territory‟ • High „power gaps‟: less powerful members of the family accept and expect that power is unequally distributed • Family is at the core of their existence - and the „self‟ is considered less important – Children are the centre of the housewife‟s life Family and the housewife’s role • Housewife is often frustrated in her own ambitions, but wishes to see these aspirations fulfilled vicariously through her children, daughter included – Aims for children to achieve academic excellence • Housewife craves for an identity outside the home • Believe in having many children: future providers Other beliefs • Strong belief in „fate‟ and „luck‟, religion and God • Active participation in religious activities • “Cleanliness is next to Godliness” Socially acceptable aspirations for the housewife • When she can stand up to her mother-in-law without being disrespectful • When the children excel in their studies/school activities • When the son sends money from the city to the village • When she exercises her own choice in brands, occasionally allows herself a minor extravagance or indulgence • When a prestigious consumer durable in brought home: the arrival of a 2-wheeler, a TV-set or a refrigerator is a proud event in itself Rural India Myths & Reality Myth • Rural consumers aren't worth bothering about since they buy loose, unbranded products rather than the branded variety. In branded they buy only inexpensive brands. Reality • The ORG study shows a high preference for branded products. In 18 categories, branded consumption accounts for 80% of sales. These include: toilet soaps, washing powders, analgesics, safety razor blades, toothpastes, shampoos, batteries, rubs and balms, skin creams, toothpowders, toothbrushes, antiseptic creams, antiseptic liquids, digestives, mosquito repellants, shaving preparations, tubelights. Reality • Penetration of premium products is being reported, even to the lowest socio-economic classification. Although the percentages may be very small, given the large universe, the actual figures may be quite significant. Myth • One family, one brand - there's one brand for the whole household. Reality • In many categories, multiple-brand usage is a fact. Rural households are not completely homogeneous. Unchanged characteristics of rural consumers India • Continued existence of an oppressive and rigid caste system, particularly in rural areas – The rural consumer normally hails from the lower castes, and therefore any depiction of him/her on an equal footing with the higher castes would be seen as aspirational • High illiteracy levels: often incapable of reading or pronouncing a brand name – E.g. Lifebuoy is referred to as „the red soap‟ Key considerations while targeting rural consumers? Targeting rural consumers… • Highlight multiple uses from the same product – Dettol liquid for cuts, gargle for bad throat, washing clothes as a disinfectant , dandruff etc – Jet mosquito coil for mosquito repellent and room freshner • Advertise small packs with a low unit price – Tiger biscuits tikki pack – Cavin Kare - Chik shampoo – Chota Pepsi 5 rupiya mein • Why pay more? – Nirma Super “Jab vohi manghe damo vali quality kam dam mein mile to koi vo kuye le” • A little (of the product) goes a long way – Rin detergent bar claims that with just a little Rin, you can get a whole lot of wash Targeting rural consumers… • Using price itself as an indicator of value has some risks attached to it; if used indiscriminately, it can: – Down-grade the perceived quality of the product – Permanently position the product at that price point making it difficult to effect price increases in the future • The rural consumer is sensitive about being portrayed as poor – Don‟t do it! – Play on their aspirations instead • Fantasy, Song & Dance, Idiom of the cinema – Nirma detergent powder employs song and dance, up-market models and a vibrant jingle – Navrattan hair oil - Govinda in a dance sequence with “Chandramukhi” • Use catch-phrases accompanied by matching signature visuals – Surf Ultra detergent powder used the hugely evocative phrase - “Dhoondte reh jaoge” along with the characteristic twirl of the finger – Rin detergent bar used the phrase “Zara sa Rin” along with the characteristic flick of the finger Targeting rural consumers… • Use opinion leaders – If they are credible, they work – Sunlight detergent powder employs a doctor to endorse the brand – Colgate dental cream endorsed by a doctor – Sarpanch - Anti Leprosy • Leverage the rural consumer‟s belief in folklore and natural ingredients – Ganga soap claims that it contains milk and is made from the water of Ganga, a river revered as holy by the majority of India‟s Hindu population. – Dabur Amla hair oil with “Anvla”, Lal Dant Manjan with “lavng” • Depict characters and families that are aspirational yet real – It is advisable to use characters that are aspirational and yet middle-of- the-road i.e. not beyond the perceived reach of the rural consumer • avoid being too freaky or too Westernised i.e. jeans are OK but torn ones may not be Targeting rural consumers… • Exploit the warmth of emotion among family members – VIP Alpha luggage - man wants to take back the wife when he goes to town to work again • Consider leveraging the appeal of mass sports – Lifebuoy soap has consistently used mass sports like football • Understand and leverage your local culture, beliefs and customs – Fair and Lovely skin lightening lotion makes use of people‟s belief in palmist – Bajaj scooters uses typical vignettes from Indian life to establish an emotional bond with the consumer Targeting rural consumers… • Make promotions relevant and „aspirational‟ – Upbeat promotions that promise the possibility of winning a dream prize such as a house, gold ornaments etc alternatively look at instant redemptions • Use radio effectively – Radio often has a much higher reach than TV or any other medium among the rural consumer - and must therefore be considered as a mainline medium • Sampling – The importance of sampling cannot be underestimated as it provides a low- risk opportunity to try the product Targeting rural consumers… • Pack – Pack is sometimes the only communication medium – Due to low literacy levels, particularly in India, recognition of the brand name is mainly through its distinct logo and visual pack properties – For this very reason, it is usually inadvisable to make drastic changes in packaging design and/or pack colours while re-launching the brand • Brand recognition signals – Distinctive colours: use lively, bright colours – Strong and bright colours usually imply a health proposition, whereas pastels and shades have a cosmetic or beauty connotation – For toothpaste, avoid using pack colours that have negative connotations - like yellow which connotes dirty teeth – Synergy across media Targeting rural consumers… • As the rural consumer tend to come to the shop frequently, POS materials act as a constant reminder of brand presence and advantage – Branding must be done through colour, brand name and symbols: strong visuals are important – POS material should be • Durable: tinplates, plastic, sun-resistant inks • Functional and reusable: calendars, mirrors, stands • Space-efficient • Decorative • Location is key: need to be placed strategically – Billboards, wall paintings, banners • Special events which are entertaining are very popular – Folk-song concerts – Road shows – Travelling cinemas – Video parlours How to select rural media… Rural Communication Planning Framework for selection and evaluation of relevant rural advertising options for a given communication task The framework • Outline media possibilities for various marketing situations • Construct an evaluation system for various rural options • Modify it for relevant state as per regional variations • Outline execution pointers • Outline costs Marketing Situations • Build penetration – launch in newer popstrata • Test market – Test acceptability of new product/mix • Pressure Test – vary advertising weights to gauge response • Promotion • Maintenance Ideally, this is the requirement. Situation Reach Frequency Increase penetration High Low Test Market High High Pressure Test Low High Promotion High Low Maintenance Low Low But ..budgets are limited. Reach or Frequency? • Depends on launch period in villages • If recently launched, <3 years, compromise reach to provide additional visibility in key markets • If established, compromise on frequency, increase reach Reach & Frequency options Learnings from projects executed by Linterland Increase penetration Van Based Advertising Melas High Direct to Home Reach Folklore groups Exhibitions/Created events Low Reach High Frequency Low Frequency Test marketing Jeep based advertising Wall Painting High Bus Stand Reach Bus Panels Haats Hoardings Postal branding Low Reach High Frequency Low Frequency Pressure Test High Reach Co-operative Notice Board Shop Front Painting Tin Plating – House Dealer Boards Village Boards Low Well Tiles Reach Calendars/Lables High Frequency Low Frequency Promotions Van Based Advertising Melas High Direct to Home Reach Folklore groups Exhibitions/Created events Low Reach High Frequency Low Frequency Maintenance High Reach Tin Plating – Trees/Shops Leaflets Posters Banners Streamers/Danglers Low Reach High Frequency Low Frequency Rural media usage grid Jeep based advertising Van Based Advertising Wall Painting Melas High Bus Stand Direct to Home Reach Bus Panels Folklore groups Haats Exhibitions/Created events Hoardings Postal branding Co-operative Notice Board Tin Plating – Trees/Shops Shop Front Painting Leaflets Tin Plating – House Posters Dealer Boards Banners Low Village Boards Streamers/Danglers Reach Well Tiles Calendars/Lables High Frequency Low Frequency Thank you!