Rural Marketing in India - Rahul Mirchandani

A thorough understanding of the rural markets has become an important aspect of marketing in the Indian marketing environment today. This attraction towards the rural markets is primarily due to the colossal size of the varied demands of the 230 million rural people. In fact, the rural markets are expanding in India at such a rapid pace that they have overtaken the growth in urban markets. This rate of growth of the rural market segment is however not the only factor that has driven marketing managers to go rural. The other compelling factor is the fact that the urban markets are becoming increasingly complex, competitive and saturated.

Further, the vast untapped potential of the rural markets is growing at a rapid pace. The policies of the government largely favour rural development programmes. This is clearly highlighted by the fact that the outlay for rural development has risen from Rs 14000 crores in the 7th plan to Rs 30000 crores in the 8th plan period. These figures also prove that the rural market is emerging stronger with a gradual increase in disposable income of the rural folk. In addition, better procurement prices fixed for the various crops and better yields due to many research programmes have also contributed to the strengthening of the rural markets. Thus, with the rural markets bulging in both size and volume, any marketing manager will be missing a great potential opportunity if he does not go rural.

Importance of customs

This however raises a fundamental problem of fathoming the differences between urban and rural markets in India. This is of paramount importance in the Indian marketing environment as rural and urban markets in our country are so very diverse in nature, that urban marketing programmes just cannot be successfully extended to the rural markets. The buying behaviour demonstrated by the rural Indian differs tremendously when compared to the typical urban Indian. Further, the values, aspirations and needs of the rural people vastly differ from that of the urban population. Basic cultural values have not yet faded in rural India. Buying decisions are still made by the eldest male member in the rural family whereas even children influence buying decisions in urban areas. Further, buying decisions are highly influenced by social customs, traditions and beliefs in the rural markets. Many rural purchases require collective social sanction, unheard off in urban areas.

Another contrasting feature is the precision in the assessment of purchasing power of the consumers. In urban markets, income levels are generally used to measure purchasing power and markets are segmented accordingly. However, this measure is not adequate for defining the purchasing power in rural areas because of the single fact that rural incomes are grossly underestimated. Farmers and rural artisans are paid in cash as well as in kind. However, while reporting their incomes, they report only cash earnings, which then affects the calculation of their purchasing power. This is the reason why marketeers are often surprised to find that their products are sometimes consumed by people who, according to their surveys and estimates do not have the purchasing power to do so. Every marketing manager must therefore make an attempt to understand the rural consumer better so that he can plan his strategies in such a manner that they produce the desired results.

Changing the marketing mix

Unfortunately, most marketers of today try to extend marketing plans that they use in urban areas to the rural markets and face, on many occasions failure. They should adopt a strategy that appeals individually to the rural audience and formulate separate annual plans and sales targets for the rural segment. Changes must be made in the marketing mix elements such as price, place, product and promotion. Corporate marketers should refrain from designing goods for the urban markets and subsequently pushing them in the rural areas. The unique consumption patterns, tastes, and needs of the rural consumers should be analyzed at the product planning stage so that they match the needs of the rural people.

For most companies wanting to enter the rural markets, distribution poses a serious problem. Distribution costs and non availability of retail outlets are major problems faced by the marketers. But if one takes a closer look at the characteristic features of the rural market, it will be clear that distribution in fact, is no problem at all.

In rural India, annual melas organised with a religious or festive significance are quite popular and provide a very good platform for distribution. Rural markets come alive at these melas and people visit them to make several purchases. According to the Indian Market Research Bureau, around 8000 such melas are held in rural India every year. Besides these melas, rural markets have the practice of fixing specific days in a week as Market Days when exchange of goods and services are carried out. This is another potential low cost distribution channel available to the marketers. Also, every region consisting of several villages is generally served by one satellite town where people prefer to go to buy their durable commodities. If marketing managers use these feeder towns they will easily be able to cover a large section of the rural population.

While planning promotional strategies in rural markets, marketers must be very careful in choosing the vehicle to be used for communication. They must remember that only 16% of the rural population have access to a vernacular newspaper. Although television is undoubtedly a powerful medium, the audio visuals must be planned to convey a right message to the rural folk. The marketers must try and rely on the rich, traditional media forms like folk dances, puppet shows, etc with which the rural consumers are familiar and comfortable, for high impact product campaigns.

Thus, a radical change in attitudes of marketers towards the vibrant and burgeoning rural markets is called for, so they can successfully impress on the 230 million rural consumers spread over approximately six hundred thousand villages in rural India.

The Threat of Success - Rahul Mirchandani attempts to understand the ‘other side’ of the impact of success on human behaviour at the workplace.

Personal career success can be a grave threat to those who have climbed to the management ranks. Unfortunately, research has shown that such success often leads to inflexibility as one tends to lose the motivation and courage to change. With time, we tend to lose the ability to distinguish the new from the old, the unique from the regular. It is the very "busy-ness" of managerial life that contributes to the problem.

The reality of most executives’ days is not like that implied in management text books, neatly divided into periods of planning, controlling, structuring, staffing and directing. Rather, it is a seeming chaos of time, talking in many short conversations covering a multiple of topics, broken by five or so previously scheduled meetings per day.

On an average, studies show that managers talk to 25 different people, which takes over 60 per cent of their time (perhaps 13 hours per week on the telephone!) And the day is jumpy: the average interval of quiet time without interruption is less than 10 minutes; the average incident, such as talking to someone, lasts about two minutes.

Under such conditions, an executive’s day is extremely fractionated, devoted mainly to responding to various telephone calls, visitors and meetings. His or her life is dominated by the present and by fighting immediate fires. The future shrinks in apparent importance because there is no real time to deal with it.

Now making transitions from short-run emergencies to longer-run challenges is tough; ten minutes alone are helpful only for work on small, immediate issues. They are unsuitable for longer-range, less-structured projects.

Many executives simply do not believe they have up to 90 minutes alone each day; they feel that they scarcely have enough time to start a new task, drink a cup of coffee or even take a deep breath, before being interrupted by a ringing telephone, an unexpected fax or an uninvited visitor.

Continual dominance by immediate demands means inadequate time for future-oriented reading and thinking. As a result, many executives tend to be narrow in their interests, concentrating on technical and business reading. They take insufficient time to explore the different. They lose track of who they are and what they believe, losing touch with their own values and aspirations. They find it difficult, therefore, to initiate fundamental changes. The future is never confronted.

Short-term performance measures also encourage executives to concentrate on the ‘now’. They feel that they are evaluated, rewarded or punished for their current performance, based on annual measures of costs, earnings and growth. In the long run, they seem to follow the words of John Meynard Keynes : "In the long run, we are all dead."

Every competitive business system requires short-term performance results. Nonetheless, given nation-wide and world-wide competition, performance tends to be measured over a limited lifespan. Concentrating on the present is often rewarded, while sacrificing the future tends to be ignored.

Short-term busy-ness contributes to habits and pre-occupations that are the ultimate threats of success. As we master our jobs and get more experienced, we tend to behave without thinking, a sort of sleepwalking through our lives allowing our perceptive skills into atrophy.

One study of 2000 executives concluded that the single most important attribute of those who handled success well (and were able to maintain it) was their ability to embrace change. To stay so vital requires maintaining the ability to perceive uniquely, to see differences.

Experience can be a great source of learning. It can certainly save a lot of time as we fit current problems into the learned categories of the past. Unfortunately, it can also waste time and cause disaster if we categorise issues prematurely and erroneously. You must have heard of people who have worked for 20 years, but do not have 20 years of experience. They merely repeated the first year 20 times. Such people may treat a new problem as if it were like the past ones, when in fact it is new and unique. Keeping alive this ability to perceive deeply requires frequent brain storming. This means building into our daily lives regular repetition of the process of letting go of the known and confronting the unknown for the sake of change.

Every three to six months, executives should define an innovation objective by focusing on a major aspect of their job and putting it on trial. Could it be eliminated? Could it be ignored until someone complains? Or could he experiment with changing it?

Numerous senior executives have said that they never really felt comfortable in their careers until they ‘ transcended’ their ambitions. It is not that they give up the race, but they become less concerned with winning and happier with merely running. The key to this turning point lies in accepting and understanding oneself and giving up the tyranny of external evaluations.

The paradox for general executives is that they need to relax a little in order to work more effectively. They need to relax the intensity of their work on present problems and begin to spend at least some of their time on addressing themselves to future possibilities. They need to start valuing the future more.

Executives tend to avoid thought about the future because it is ambiguous. Clear-cut short-run problems may be difficult but they are satisfying to solve. In contrast, formulating wishes about the future, conceiving what we want the future to be and perceiving the future as history in the making, is difficult and threatening.

We tend to fear the kind of time necessary for such thought. It must be open, unstructured and seemingly non-directed attributes counter to time-haunted, efficiency-minded people. Wide open time, like space, can be frightening.

In addition, incorporating concern about the future into the present necessitates clarifying what we really want. And this means defining the fundamental values of management, organisation and society.

An old American proverb states : "All that is seen is temporary." The present is not unimportant nor is the world an illusion. But future oriented, time- transcending executives should have the detachment of people who accomplish great things while refusing to be devoured by current events.

Salesmanship - Getting to the Roots of Objections in Personal Selling.

Every salesman faces a multitude of objections during and after their sales calls. Articulation, product knowledge and other ‘marketing behaviour’ would become less significant if sales personnel are not adept at handling customer objections.

Being prepared to handle a variety of objections makes a sales executive more confident and enables him to act with alacrity. Consumers are impressed with sales personnel who can convincingly handle objections; they look forward to a mutually beneficial didactic relationship. So now it becomes obvious in these days of brand proliferation (where even leaders may find themselves ‘embarrassed’ by small players) handling consumer objections should be given an important role in training the sales force. It therefore, becomes very important to find out why consumers raise objections.

Objections may not be raised in the typical tone and tenor with which they are raised in most facts of life. Infact the slightest (but sensitive) form of objection could just be a nod of disapproval. Thus, a sales executive has to get through the sensitivity raised keeping in mind the different forms of objections :

• Image based objections :
Consumers may be used to certain brand names for several years. They may be using them for years. Such a situation is faced by salesmen handling new brands with which consumers are unfamiliar. Though it is possible that several reactions could be expected from the sales executive, it is important to note that the reaction should not be overly emotional and irrational.

• Loyalty based objections :
Consumers in this category are more difficult to handle as they have already used other brands. There is an emotional link established between the buyer and the brand. The seller in such a situation could try to persuade the buyer into making a trial purchase without putting forth the replacement possibility. Another alternative could be of reasoning out the comparison between the ‘old’ and ‘new’ brand with objective criteria.

• Performance based objections :
If a prospective buyer is fully satisfied with the performance of his existing brand, he may have little incentive to try out new brands. Here, the seller could concentrate on other aspects of the marketing mix elements and attempt a ‘modified buy’ situation in which the buyer expects a better deal on other aspects of the deal and not just on performance.

• Need based objections :
The buyer may be convinced about the quality of the product, but may still feel that he does not have a need for the product (especially so in case of new product concepts). The ‘need-offering’ match will need to be highlighted. The best way to combat this objection is to use innovative and persuasive advertising – a medium known to make one buy even things that he does not need.

• Experience based objections :
A customer may raise objections because he may have had a bad experience with the brand or the company in the past. It could be in relation to quality, after sales support or delivery. The seller in this situation needs to carefully note down details of the complaint and provide genuine solutions by highlighting the objections to the top management. This customer-oriented approach reaps long term gains.

• Credibility based objections :
The buyer may need an assurance about a brand new to the market, or launched by a new company. The seller in such a situation should be in a position to substantiate all the claims he has made during his sales call.

• Resistance based objections :
The aggressive enthusiasm of the seller may get the better of his discretion. In his anxiety to close the sale, he may psychologically pressurize the buyer without intending to do so. The buyer feels manipulated and gets a feeling that he has been sold something he doesn’t want. A salesman should be sensitive to such situations and avoid pressurising buyers.

• Price objections :
Many buyers are wary of paying too much for a product or service. Price could be discussed after the features, uses and benefits of a product are reviewed. The buyer should be presented with a cost-benefit analysis and be convinced that good quality tends to carry its own price tag. A seller should however never be apologetic about the price.

Handling customer objections is an art, which needs to be cultivated and perfected over time. When a seller expects an objection, he should get mentally prepared to overcome it, however trivial it may be.

MARKETING IN INDIA

In India, most marketers come down to the scene just when the product is ready for launch. And that's precisely why many have burnt their fingers. The true concept of marketing starts way fore there is a product - telling customers what the product is going to be - and continues long after sales are achieved in order to keep in touch with the customer. In fact, if you do good marketing," according to Philip Kotler, the guru of marketing, "you don't have to work hard on selling."

On the Indian marketing scene, Kotler feels that while companies in the country may spend crores on specialist marketing wings, hiring the best brains out of the management institutes, that's not enough. It isn't enough to just have a good unit unless it liases with all the other departments and the entire organisation regards the customer as the ultimate boss. "Make happy employees and they make happy customers," goes his logo.

The only way to create marketing awareness is to have a kind of public relations approach. Kotler adds, "Public relations is embryonic as a function in India. It is not used enough. They use salesmen to close an order. He further says, "Select examples of real marketing that constitute the accomplishments of marketing like producing value, finding out what the customer wants and creating the goods that are of value to the customers."

As to why India hasn't emerged a major player on the world arena, Kotler feels that licensing is the major hurdle for any international marketer to make a foray here. Further, he says not many manufacturers go after volume. "Segmentation is the key. You don't trust one edge because you are likely to be attacked. So build a portfolio of niches."

The model that Kotler recommends for India is a "bend of elements that fit the Indian situation" like gradual opening up of markets, improving on the quality of products and services, making it easier for multinationals to come to India, privatisation, deregulation of banks, getting rid of the licensing system and making the internal marketplace more competitive. Welcoming and encouraging Multinationals with skills and products that are absent in the Indian economy should also help. He warns that we shouldn't be deceived into thinking that India will thus benefit as local industries may not always be as competitive.

As India is a large country, to manage it in totality would be tedious. So, energy should be released at the local level. Kotler argues, "Cities are like products. They should develop economic plans centered around what competitive advantages they have in the Indian marketplace, in that it should create wealth to export to other cities and even abroad. It's not a question of managing India, but cities mange themselves better."

Marketing is War - Rahul Mirchandani.

The true nature of marketing today is not only serving your customers; it is outwitting, outflanking, outfighting your competitors. In short, marketing is war where the enemy is the competition and the customer is the ground to be won.

When we formulate marketing plans, we carefully dissect each participant in the marketplace. We then develop a list of competitive strengths and weaknesses as well as a plan of action to either exploit or defend against them.

Take a quick look at the business pages of any newspaper. You will invariably find the bloodthirsty language of the CEO’s and top marketing managers of companies. "We’ll kill them", "This is a life-or-death struggle". These are not quotes from a leftist guerilla or a right wing dictator. These are typical quotes from business leaders discussing forthcoming marketing campaigns.

Even the language of marketing has been borrowed from the military. We launch a marketing campaign. Hopefully, a breakthrough campaign. We promote people to higher positions. We report gains and losses. From time to time we go into the field to inspect and review the progress of the troops (the sales team). We have even been known to pull rank.

It is clear that we are marketing in a new era. Competition is getting brutal.The name of the game has become "taking business away from somebody else."

Marketing battles are not fought in the customer’s office or in the retail outlets. Those are only distribution points. Marketing battles are not fought in cities, towns or villages. Marketing battles are fought inside the mind. Inside your own mind and inside the mind of your prospects.

The mind is the battleground - a terrain that is tricky and difficult to understand. Marketing wars are totally intellectual wars with a battleground that no one has ever seen. It can only be imagined. Reconnaissance in marketing wars is thus, extraordinarily difficult.

One way to reconniter the human mind is the use marketing reserach. Done correctly, it can be used to look inside and contour the mind of the average prospect. Mapping the mental battleground can give you enormous competitive advantage.

When a customer uses a brand name (say Chelamin) in place of a generic name (in this case Chelated Zinc), you know that you have won the battle in that customer’s mind. Similar to us saying "Get this Xeroxed" which clearly shows that you associate ‘Xerox’ (the company) as synonymous to ‘photocopying’ (the service).

There is no one way to fight a marketing war. And knowing which type of warfare to fight is the first and most important decision you need to make.

When a company has a dominant share of the market, the way they can win is by not losing their market share to any of the smaller, existing player or new entrants. The engage in defensive warfare to defend their large chunk of the market.

There are cases when the company is a strong No.2 in the market and wants to launch an attack to gain market leadership. Who should it attack ? The temptation is to prey on the weak rather than the strong competitors. Yet the opposite is closer to the truth. The smaller the company, the harder it will fight to protect the small share it does own, with tactics like price cuts, discounts, lengthened warranties, etc. Never pick a fight with a wounded animal. It is more advisable to launch an offensive attack on the weak points in the market leader’s product line.

There is an old African procerb : "When elephants fight, its the ants that take a beating." Som companies cannot afford to pik a fight with the No.1 and the No.2 players in the market. They simply do not have the resources to launch a sustained attack. Such companies should avoid the battle between the market leaders and launch flanking attacks. In other words, you don’t attack the mountain head-on but go around it. This is usually the most effective and least expensive type of marketing operation.

Still other playrs have tiny market shares of their own. What can such companies do ? All they can do is become a guerilla. These organisations should use the classic guerilla tactic - find a market segment big enough to be profitable, but too small to be tempting to the leader. In other words, select a territory small and secure enough to defend.

We’ve never seen a company that didn’t consider itself a leader. But companies dont create leaders - customers do. It is who the customer perceives as the leader that defines a true category leader. Then there are pretender to the throne. You can never "will" you’re way to the top. Pretendership has no place in developing marketing strategies. A good marketing manager must have a clear picture of the actual situation so that he can lead from the truth. Fool the enemy, never fool yourself.

Because of a leadership position that Aries enjoys, for example, in the micronutrients market, we have a strong point in the mind of the prospect. The best way, according to marketing gurus, to improve your position is by constantly attacking it. In other words, introducing new products or services that obsolete existing ones.

The competition then constantly struggles to catch up. A moving target is harder to hit than a stationery one. Taking our example, Aries launched Agromin HiSol, a move that attacked our own Agromin Foliar Spray. But the product was a marked improvement over the current formulation and took the competition by surprise. In the minds of our customers, HiSol made an impression - we won the battle of the mind with product innovation.

In today’s competitive market, every competitor makes their own moves. But leaders cannot counter every move. He who attempts to defend everywhere defends nowhere. Effors must be made to counter only strong competitive moves or just the ones that are most likely to succeed. Further, a leader cannot waste time monitoring the situation to see what happens before making its move. Too often what happens in the market happens too fast. All of a sudden it is too late to get into the new ball game.

To play any game well, you have to first learn the rules, or principles of the game. And second, you have to learn to forget them. That is, you have to learn to play without thinking about the rules. Similarly, good marketing managers should know the rules so well that they can forget about them and concentrate on the opponents. The problem with marketing today is not just the lack of rules. The biggest problem of all is the failure to realize that one ought to have rules in the first place.

As for all of us in the field, there are many more battles to fight and many more victories to win.