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MARKETING INNOVATIVE
STRATEGIES EFFECTS ON FMCG
COMPANIES IN RURAL MARKETS
Presented By:-
KIRAN RAMDAS SINALKAR10/366
AKASH BALASAHEB SHELKE
10/365
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INTRODUCTION
The scope for the FMCG in Rural market is fast growing.
There are nearly 6,38,000 villages in INDIA. Of these only 0.5%have the population above 10,000. And 2% of the population
between 5,000 to 10,000. 50% of the villages have a populationbelow 200.
At least 75 per cent of the male working population engaged inagriculture and allied activities would qualify as rural.
70% of the total population live in rural India.
From this it becomes clear that the rural India is the best market everfor the FMCG in the country.
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SOMEOFTHEFASTMOVINGCONSUMERGOODS
IN INDIA
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FMCG COMPANYSFOCUSONPRODUCT
INNOVATION
Many FMCG companies a large chunk of their revenues up to about60 per cent comes from new product launches.
Companies like Dabur, ITC, Britannia Industries, Nestle and AmulHUL, ITC, Nestle, Procter & Gamble and GlaxoSmithKlineHealthcare account for almost 70 % of FMCG revenues in thecountry spend almost 10 % of their turnover on advertising and
brand promotion.
They market their brand through heavy expenditure on brand
promotion, advertisement and a proper marketing channel.
The promotion strategy includes tying up with Bollywood actorsand other celebrities, brand ambassadors to advertise and
promote their products.
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DABURSBRANDAMBASSADORMR
AMITABH BACHAN
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Marketing and advertising differs from region to
region, there can't be a single strategy for the whole
of India, as one marketing strategy will not work in
other region as there might be a total disconnect in
terms of the whole concept or an ad or the strategy.
And especially if one is placing a product targeted
at the rural consumers, here also it is a different ball
game altogether.
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NIRMA PRODUCTS - A BREAKTHROUGHIN
INDIANRURALMARKET
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STRATEGIESOF NIRMA
NIRMA is considered to be one of the leading brand which used
various innovative techniques to capture the rural market.
It introduced various small budget consumer goods to attract the
rural consumers. They targeted mainly on the third class consumersto marker their products.
They introduced toilet soaps, detergents and other consumer
attractive goods at a low cost.
They were considered one of the toughest competitor to Unilever
India ltd.
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UNILEVERINDIARURALMARKETING
INITIATIVES
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HLL derived around 50% of its sales from rural areas.
HLL's rural marketing initiatives began way back in 1988, when the
company had launched 'Wheel' for the rural and lower income urban
consumer.
As a competition to the NIRMA products they introduced Wheel to
demolish the market of NIRMA and to capture the rural market.
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HLLS CLINIC PLUS SHAMPOO
HLL introduced Clinic Plus.
They made the rural people to understand the product by
demonstrating its uses to the people in public.
They made the people understand the effect of using shampoo and
they demonstrated how it makes the hair smooth.
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RETAILERANDDISTRIBUTIONNETWORKAND
WITHINNOVATIVEMARKETINGSTRATEGIES
The two major Cola brands Coca-Cola and Pepsi apart from their
usual battle over market share have been trying hard to enter into
rural markets.
They have come up with many marketing strategies such as pricing,distribution strategies etc, like providing ice boxes, refrigerators,
credit facilities etc.
They provided small bottles apart from 1 liter bottles to attract the
low income groups.
They both used a good effective distribution channel to make the
product available in the rural consumer markets.
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TINSATAMUCHCHEAPERRATE
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BRAND-BUILDINGACTIVITIESANDCOST-
REDUCTIONSPURSALESINTHE FMCG SPACE
Almost 50 per cent of the FMCG companies cited earlier reported a
double digit growth in sales. Companies like P&G, ITC, Tata Tea,
Dabur, Marico, GlaxoSmithkline, Gillette and Godrej recorded good
top line growth.
This is because of the various techniques they used to develop their
products according to the rural consumers needs.
They adopted various new technologies to out run their competitors.
They concentrated more on the product diversification.
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NEWLYDIVERSIFIEDPRODUCTSUNDERFMCG
SECTOR
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COLGATE
Colgate-Polmolive India Ltd, which makes oral care and personal
care products kept expenses down by reducing its stock keeping
units or SKU.
They also diversified their products. Colgate herbal, Colgate Salt,
Colgate white, Colgate gel and much more.
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BRITANNIA INDUSTRIES LTD
They increased their net profit by 10.0% after entering in to the
rural markets.
They increased the price of their products by 5% to 7%.
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DABURINDIA LTDAND NESTLE INDIA LTD OTHERS
They focused to reduce their operational cost by reducing their cost
they spend on the purchase of the raw materials.
Godrej Consumer Products Ltd focused on reducing the cost by
organizing a good supply chain management process andselecting a better and a cheaper mode of transport.
Wipro Ltd provided the consumers with a reduction in the weight
of the products at the same price thus improving their margin of
profit.
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CONCLUSION
From all the above information's it is clear that the rural India can be
one of the most feasible market for the development of the FMCG in
INDIA.
FMCGs companies or marketers make consistent attempts toinnovate tools and strategies to overcome the challenges the face in
the business area.
Corporate India and government bodies alike have made several
efforts to bridge the gap between rural and urban India.
Thus if planned properly and with the use of new strategies and
technologies the rural India market can be captured and a great
margin of profit can be earned by the FMCG companies.
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