Copyright © 2011 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Accenture presents Consulting Knights at

Intaglio 2012

(IIM Calcutta International Business Summit)

Accenture Management Consulting: Case Overview

Do you know the cause behind the tremendous growth in rural purchasing power?

Do you know the share of contribution of rural markets to leading companies?

Do you know the potential of the opportunities across value chains in rural markets?

Do you know what make the rural markets highly attractive for investing opportunities?

Do you know the key barriers that hamper entry into rural markets?

The challenge for the participants is to scope the impact of rural marketing for a company, devise the implementation

strategy, measure the impact and project the benefits. Here is what you need to do:

• Choose any industry in India

• Choose a company in the industry

• Draft a strategy for the company on how they can use Rural Marketing to redefine their competitive advantage

• Project the benefits of adopting Rural Marketing

2© Accenture. All rights reserved.

3© 2011 Accenture All Rights Reserved.

Case background

The concept of Rural Marketing in India Economy has always played an

influential role in the lives of people

The rural market in Indian economy generates almost more than half of the country's income.

Rural marketing in Indian economy can be classified under two broad categories.

These are:

• The market for consumer goods that comprise of both durable and non-durable goods

• The market for agricultural inputs that include fertilizers, pesticides, seeds etc

Though the concept of Rural Marketing is often associated with agricultural marketing, Rural Marketing is defined as any

marketing activity in which one dominant participant is from a rural area. This implies that rural marketing consists of marketing of

inputs (products or services) to the rural as well as marketing of outputs from the rural markets to other geographical areas.

To be precise, Rural Marketing in India Economy covers two broad sections, namely:

• Selling of agricultural items in the urban areas

• Selling of manufactured products in the rural regions

4

Understanding Rural Marketing

© Accenture. All rights reserved.

55

Source: Accenture Analysis

Rise in Purchasing Power

There has been significant increase in the business confidence in rural

markets on the back of multifold increase in rural purchasing power

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The increase in rural purchasing power is reflected in many ways:

• Rural incomes have been growing at more than 7 percent over

the past few years, helping to account for almost 40 percent of

India’s total consumption of goods and services

• Non-food expenditures are growing at an 8.2 percent annual

compound rate

• Rural households are purchasing a wide range of products—

cars, flat-screen televisions, microwaves—that until recently

would have been beyond their reach

• Fifty percent of revenues from the FMCG sector now come

from rural sales

• In the case of the telecom sector, subscriber base in the semi-

urban and rural markets (Circle C geographies) has grown at a

phenomenal 98 percent over the last five years in comparison

to other circles representing metros

27%

50%

69%

50%

32%

53%

71%

51%

33%

55%

76%

55%

Shampoos Toilet Soaps Washing Cakes Washing Powder

1995-96 2001-02 2009-10

FMCG- Share of Rural market as % of All India

30%

47%

2%

39% 40%

8%

40%48%

11%

Scooters Motorcycles Cars/Jeeps

1995-96 2001-02 2009-10

Auto- Share of Rural market as % of All India

1.70%

26.20%14.80%

88.70%

18.50%

102.80%

Rural Urban

2004-05 2008-09 2009-10

Total Tele density

66

Today, businesses are confident about the opportunities that rural India

has to offer and plan to strengthen their presence in semi urban and

rural areas over the medium to long term

Increasing business

confidence in Rural Markets

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12%

22%

21%

22%

23%

No plans to invest

Plan to invest witihn the next 3 years

Investments in the last 1 to 3 years

Investments in the last 3 to 5 years

Invested in rural markets for more than 5 years

More than half of Accenture’s survey respondents

foresee 20 to 50 percent of their revenues coming

from the rural market over the next three years.

And, more than 65 percent of the organizations

surveyed have already invested in rural India, in

some cases more than five years ago

42

38

36

36

28

27

7

8

6

17

6

6

8

9

54

6

9

16 2

41

31

2029

215

21

2321

223

41

1829

221

Match competitor’s strategy

Tapping into new consumer markets

Fulfill corporate commitment

Getting access to cheap labour pool

Saturation in urban markets

BenefitingBenefitting from Govt. support

Sourcing raw materials cost efficiently

Rural Markets offer opportunities

across value chain

(% of respondents)

V. Relevant Not Relevant

Source: Accenture Analysis

There are distinctive capabilities that aid companies to

achieve high performance in rural markets

7© Accenture. All rights reserved.

49

46

39

38

35

6

4

5

9

0

1

2

2

3

Product localisation and innovation

Customer Services

Supply chain and distribution efficiency

Collaborative services

Pricing 338 18

939

1326

2336

2630

Key imperatives for profitable and sustainable

growth in rural markets

(% of respondents)

Very Important Not important

Source: Accenture Analysis

Deliverables required

Participants are required to do the following

Choose any particular industry in India which can use Rural Marketing effectively

Choose a company in the industry

Draft a strategy for the company on how they can use Rural Marketing to redefine their competitive advantage. The strategy can

include applications to Marketing, Supply Chain, Sales and Distribution, Business development etc.

Stage 1 Deliverables (5 slide presentation)

Tentative date: 23rd December 2011

Choice of industry with rationale

Company definition – For whom the strategy would be defined

Executive summary of

Opportunity assessment

Go to Market/ Implementation Approach methodology

Expected final output

8© Accenture. All rights reserved.

Deliverables required (Contd.)

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Stage 2 Deliverables

Tentative Date: 5th January 2012

Strategy definition

Business case for strategy

Go To Market/Implementation Plan

Identification of key success factors

Potential Benefit to the company

Risk assessment in current plan

Other supporting industry analyses to support the recommendation (as relevant)

Please ensure that you undertake the necessary primary and secondary research effort needed to support your ideas.

All the best!

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