Reaching the Rural Market-a Hybrid Model for Distribution

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Date Submitted: 09/14/2012 01:56 AM

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Reaching the Rural Market-A Hybrid Model for Distribution

Mr. R. Suresh


The Indian rural market is going through a transformation and this emerging market is witnessing a significant change in its growth and challenges. MNCs and national players are experimenting with new distribution models to cater most challenging rural Market. Consumer dynamics in rural India are changing and the marketers need to take note of this and formulate their strategies and tactics to deliver value to the rural consumer. This paper presents the challenges and opportunities of rural marketing and evaluates the existing models of rural distribution. It also suggests a new model for rural distribution.

Keywords: MNCs, distribution models, consumer dynamics, rural marketing, SHG



The Indian rural market with its vast size and demand base offers great opportunities to marketers. Two-thirds of countries consumers live in rural areas and almost half of the national income is generated from rural markets. It is only natural that rural markets form an important part of the total market of India. India is classified in around 600 districts, and approximately 6,30,000 villages, which can be sorted in different parameters such as literacy levels, accessibility, income levels, penetration, distances from nearest towns, etc. As a result of the growing affluence, fuelled by good monsoons and the increase in agricultural output to 200 million tonnes from 176 million tonnes in 1991, rural India has a large consuming class with 41 per cent of India's middle-class and 58 per cent of the total disposable income. The importance of the rural market for some FMCG and durable marketers is underlined by the fact that the rural market accounts for close to 70 percent of toilet-soap users and 38 percent of all two-wheeler purchased. The rural market accounts for half the total market for TV sets, fans,...