Description
Project report on Rural Marketing for Suraksha Toothpaste
Rizvi College of Arts, Science and Commerce Adnan Abdulally 01 Murtaza Jaffar Alamgir 05 Adnan Amin Dhiyan 13 Rishaad Hirani 18 Aftab Hudda 19 TYBMS A
Rural Marketing Plan
For Prof. Sameer Virani
Suraksha Toothpaste
INDUSTRY OVERVIEW
India is still a nascent country in dental hygiene, with the majority of the population still not having access to modern dental care but relying on substances like coal ash and neem sticks. In India, per capita toothpaste consumption stood at 74g in 2005, which is amongst the lowest in the world, compared to 350g and 300g in Malaysia and Vietnam respectively. Toothpaste enjoys a country wide penetration level of 50%. The penetration levels of dentifrice in the country have been on an upward trend over the last few years driven by strong improvements in toothpaste penetration With the huge consumer base waiting to be tapped and the expected rise in purchasing power as the economy picks up, oral hygiene in India may receive a fresh lease of life.
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THE TOOTHPASTE MARKET
Oral hygiene continues to be under aggressive competition, with sales increasing by a modest 3% in current value terms in 2006 to Rs. 2,400 crs. Toothpaste accounted for a whopping 83% of value sales. Toothpaste market in value (in Rs. crs.) Period Apr-Mar04 Apr-Mar05 Apr-Mar06 Urban + Rural 1897 1950 2009 Urban 1340 1386 1414 Rural 556 565 594
Apr-Mar07
2200
1555
650
Toothpaste market in volume (in tonnes) Period Apr-Mar04 Apr-Mar05 Apr-Mar06 Apr-Mar 07 Urban + Rural 77320 84501 86562 95451 Urban 53791 59172 59922 68713 Rural 23529 25329 26640 32100
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SEGMENTS IN THE INDUSTRY
Price-based segmentation of the toothpaste category On the basis of price, the toothpaste market can be broken down into two distinct categories: The Regular segment: Volume ( 64,922 tons ) Price range 50 gms 100 gms 150 gms Rs. 12.5-24 Rs. 25-30 Rs. 35-45 The Low price point segment: Volume ( 21,641 tons ) Price range 50 gms 100 gms 150 gms Prominent brands: • Colgate Cibaca • Babool • Anchor • Ajanta Rs. 8-10 Rs. 14-20 Rs. 25
Prominent brands: • Colgate • Pepsodent • Close-up • Meswak • Dabur Red
KEY PLAYERS
The toothpaste segment is largely a two player industry, Colgate Palmolive & HLL accounting for 80% of the entire market.
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Top 6 Brands
? COLGATE DENTAL CREAM
Colgate Dental Cream is the most widely distributed oral care brand in India has a market share of 34% in value terms. It was revitalized in 2003 with an improved germ fighting formulation. Its anti-bacterial ingredient has been boosted to offer superior germ fighting efficacy. These improvements come in addition to its calcium and minerals formula that helps repair weak spots on teeth and locks in additional calcium and essential minerals to make teeth stronger than ever before.
? CLOSE-UP ACTIVE GEL
Launched in 1975, Close-up was the first gel toothpaste in India. It has since then undergone periodic relaunches. In 2004, Close-up was relaunched with a bang. And this time it was packed with the power of Vitamin Fluoride System – a powerful mix of Vitamins, Fluoride, Mouthwash and Micro whiteners, the perfect combination of ingredients for fresher breath and stronger, whiter teeth. Close-up is now the first Gel toothpaste with Fluoride in Indian Market. Current market share stands at 14%.
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? PEPSODENT COMPLETE 10
Pepsodent, the second offering from HLL with a market share of 11% was launched in 1993 and was the first toothpaste with a unique antibacterial agent to address the consumer need of checking germs even hours after brushing. Pepsodent has always been regarded as a mother‘s oral health care ally and has been associated with inculcating good dental habits amongst kids. Currently the brand is championing night brushing habits amongst kids through its latest TV commercial. The thrust is on making brushing at night a fun activity for kids. The brand plans to continue with its initiatives to promote healthy brushing habits.
? ANCHOR
Anchor belongs to Anchor Health and Beauty Care (AHBC), a part of the Anchor Group (makers of Anchor Electrical switches). Anchor forayed into the FMCG market with the launch of Anchor White Toothpaste, which was positioned as India‘s first British Dental Health Society certified 100 per cent vegetarian toothpaste, in 1997. In fact this proposition had so strong a consumer-pull that by 2002 it was the number three toothpaste brand. In 2006, Anchor decided to directly compete with Colgate Dental Cream, thereby differentiating itself from the LPP segment. It significantly upgraded its product bundle, both in terms of superior formulation (almost parity to CDC) claims and by the development of an All-round Protection sub brand. This is currently endorsed by Dravid with strong TV support.
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? BABOOL
Babool originally a Balsara product was acquired by Dabur last year. Babool straddles the economy and herbal platforms. Its natural toothpaste contains ayurvedic and medicinal benefits of the Babul tree, 'Acacia Arabica‘. While Babool still pursues an aggressive promo strategy on all its SKUs, it has also upgraded its bundle ever since the acquisition, by putting the Dabur brand on its pack and signing up Vivek Oberoi as a brand ambassador
? AJANTA
Ajanta toothpaste is an offering from the personal care division of Ajanta Clock Manufacturing Company. With aggressive pricing as its USP, the company decided to do a Nirma in the toothpaste Industry. Originally priced at one-third of a Colgate or a Pepsodent, Ajanta rewrote the rules of the game for oral care products. It targeted its offering in the low price, mass-market segment.
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COMPANY PROFILE
SURAKSHA is a leading manufacturing company in oral care which includes toothpaste, toothpowder and tooth brush. The word ?SURAKSHA? is the Hindi translation for the word ?protect?. Protect or suraksha stand for cover or shield from danger and injury, to guard and to preserve in safety. This name suits are company perfectly. Belief in the Indian system of herbals combined with modern western techniques has resulted in wide product range of SURAKSHA. Since the quality of our products manufactured play an important and crucial role in rural trade, SURAKSHA ensures that all its products meet the specified standards. As a matter of principle, the Company has always adhered to using purest raw material and processing them in an infrastructure that's absolutely state-of-theart. Over the past three years, the company has consistently delivered quality products and services, which has been the hallmark of the company.
Our Products
? Suraksha Toothpaste: Strong Teeth Keeps dental problem away
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It is just the kind of toothpaste you need for complete oral hygiene. It has a natural calcium base that cleans teeth thoroughly, down to the gums. And, with proper brushing, ensures complete removal of plaque. In addition, the natural astringency of the herbs contained in Suraksha Herbal Toothpaste keep your mouth feeling fresh and clean all day.
Contains:
It contains Laung which helps prevent toothache, Pudina which helps prevent bad breath and Tomar which kills harmful germs. It is therefore, the first ever toothpaste which keeps all your dental problems away, thereby providing you strong teeth. ? Suraksha Toothpowder: Good health means strong and healthy teeth. Give your teeth the best natural care - with Surakha Lal Dant Manjan. The herbal Ayurvedic Red tooth powder that cleans while giving you strong teeth and healthy gums. Contains : Lavang Ka Tail, Kaali mirchi, Pudina Satva, Pippali, Sunthi, Karpoor and Tomar seed, Sugandhi Dravaya, Kasni, Gairic powder, other natural ingredients. ? Suraksha Toothbrush
Available in a range of innovative and attractive angular designs, with medium and soft bristles for sensitive teeth care. The range of toothbrushes is
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scientifically designed to reach the innermost corners of the mouth for effective oral care.
? ? ? ?
Suraksha Mouthwash with Flouride Herbal Rinse for Fresh Breath With Pure Suraksha Extract Anise Mint Flavour Suraksha mouthwash contains pure extract of Suraksha plant. Suraksha mouthwash is a rare combination of ancient wisdom and modern science. Suraksha helps strengthen gums, prevents tooth decay, and eliminates bad breath. Rinse your mouth every morning and through the day with Suraksha Mouthwash to ensure fresh breath, healthy teeth and gums.
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Understand the Rural Market
With a population already in excess of one billion people, India has caught the eye of multinational corporations across the globe as a place of opportunity for exploring new markets. While India has portions of their population that would be considered wealthy or middle class by Western standards, a much greater percentage of India‘s population is low income. As a result, they spend money, live, and use products differently than the countries where most multinational corporations originate. Rural areas, in particular, exemplify these differences. Understanding the characteristics that make the people and the market in rural India unique can help corporations to enter this market with success. The key characteristics define the term rural, determine the amount and flow of income, and determine the types of products and packages that are typically used in rural India. Interestingly, the rural market is growing at a far greater speed than its urban counterpart. Clearly the main challenge that one faces while dealing with rural marketing is the basic understanding of the rural consumer who is very different from his urban counterpart. Also distribution remains to be the single largest problem marketers face today when it comes to going rural.
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So the fact remains that the rural market in India has great potential, which is just waiting to be tapped. Progress has been made in this area by some, but there seems to be a long way for marketers to go in order to derive and reap maximum benefits. Moreover, rural India is not so poor as it used to be a decade or so back. Things are sure a changing!
TARGETTING RURAL MARKET FOR OUR PRODUCT
IN RURAL INDIA in the long term toothpaste players have a tremendous potential to grow in this market. The reasons being that income levels are rising and the population is becoming more aware of personal hygiene. To add to this there is an increase in literacy levels across the country. As media will play an important role hence advertising keeping the rural Indian in mind will provide the much needed impetus for growth to this market.
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? Consumption of toothpaste in rural India
The oral care market can be segregated into toothpaste (60%), toothpowder (23%) and toothbrushes (17%). While 60% of toothpaste is sold on the family platform, around 35% is sold on cosmetic propositions. On the other hand, while toothpowder accounts for 52% of the market, red toothpowder accounts for 40% and black toothpowder accounts 8%.
The penetration level of toothpaste/powder in urban areas is 3TIMES that in the rural areas. Traditional materials such as neem and tobacco are popular for cleaning in the rural areas, Frequency of usage for toothpaste is only 1.5 times among other consumers, compared with 2 times in the developed world. Per capita consumption of toothpaste is only 70 gm compared with 300 gm in Europe and 150 gm in Thailand.
Given the low per capita consumption and penetration rates, toothpaste demand is mainly being driven by the overall market growth of 8-10%. Toothpowder growth is also being driven by the rural segment.
India's per capita consumption of toothpaste is one of the lowest in the world, it currently stands at 70 grams as compared to the global average of 362 grams. This is because 74 percent of our population live in rural areas and are not well versed with personal health and hygiene. As the penetration level of this rural segment is at a low of 30 percent, this means that only 200 million of our 740 million rural population uses toothpaste.
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Rising Rural Prosperity
SURAKSHA has realized that India is now seeing a dramatic shift towards prosperity in rural households. With an average income equivalent to $42 per month ($504 dollars per year), rural Indians have a very low disposable income. Most rural homes have minimal storage space and no refrigeration. Very few people own or have access to cars. As a result, rural Indian purchasing habits tend to be of an ?earn today, spend today? mentality. Rather than buying in bulk, which would mean paying more for a large quantity upfront, rural Indians tend to buy what they need for short segments of time. These factors result in consumers buying products locally, as well as on a daily basis. In addition to the fact that income levels are low, rural incomes also vary greatly depending on the monsoons. When a monsoon hits, this devastates the livelihood of most rural consumers because they are dependent on agricultural work for income. Corporations are also directly affected because this makes it difficult to predict demand . To drive home the potential of rural India just consider some of these impressive facts about the rural sector. As per the National Council for Applied Economic Research (NCAER) study, there are as many ?middle income and above‘ households in the rural areas as there are in the urban areas. There are almost twice as many ?lower middle income‘ households in rural areas as in the urban areas.
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Percentage distribution of households and income Area Rural Urban All-India Households 72.6 27.4 100.0 Population 74.6 25.4 100.0
The absolute size of the rural market is expected to double that of urban India. Thus SURAKSHA has realized that there is great potential for our product in the rural market. SURAKSHA‘S research shows that there is great opportunity for them in the rural market.
Growth in Market
The purchasing power in rural India is on steady rise and it has resulted in the growth of the rural market. The market has been growing at 3-4% per annum adding more than one million new consumers every year and now accounts for close to 50% of volume consumption of FMCG. The growth rates of lot of FMCG are higher in rural markets than urban markets. SURAKSHA therefore has to look at the rural market very seriously for future expansion. Therefore keeping all these points in mind SURAKSHA has decided to sell their toothpaste in the rural areas as well.
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Effectiveness of Communication
An important tool to reach out to the rural audience is through effective communication. ``A rural consumer is brand loyal and understands symbols better. This also makes it easy to sell look - alike?, the rural audience has matured enough to understand the communication developed for the urban markets, especially with reference to FMCG products. Television has been a major effective communication system for rural mass and, as a result, SURAKSHA has identified themselves with their advertisements. Advertisements touching the emotions of the rural folks, it is argued, could drive a quantum jump in sales. Therefore keeping all these points in mind it has realized that consumers in the rural are spending more than they used to on products that give them value for their money and this is also another reason why SURAKSHA is ready to sell its toothpaste in the rural areas. SURAKSHA‘s research shows that this is because of the growing reach of electronic media that has created a huge change in the lifestyles of rural consumers.
CONCLUSION
With an approximate population of 700 million people, the rural Indian market is important for multinational corporations to tap. Although rural Indians need to purchase consumer goods just as their Western counterparts do, rural Indian consumers have a different set of needs that must be met by both package and product. Spending time researching the rural Indian consumer as well as the market before diving in can help to prevent unnecessary struggles and failures. Understanding the characteristics that make the people and the market in rural India unique can help corporations to enter this market with success. The key characteristics define the term rural, determine the amount and flow of income, and determine the types of products and packages that are typically used in rural India. Trends indicate that the rural markets are coming up in a big way and growing twice as fast as the urban.
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RURAL INDIA - CHALLENGE AND OPPORTUNITY
To expand the market by tapping the countryside, more and more MNCs are foraying into India's rural markets.
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THE OPPRTUNITY AND THE CHALLENGE OF THE INDIAN RURAL MARKET
• • • • • • • • • • •
775 million Indians in 638,000 Indian villages 1 in 8 people on this planet is an Indian villager 4 million distinct outlets A different life 44% of urban per capita income Low literacy, media reach: 624 million people lack access to TV 30 million homes remain under the poverty line A case for business 52% of domestic product, 60% of consumption expenditure Share of agriculture less than 50% of the rural economy 50% decline in poor households, doubling of mid-income homes
Opportunity
The Indian rural market with its vast size and demand base offers a huge opportunity that MNCs cannot afford to ignore. With 128 million households, the rural population is nearly three times the urban. 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 rural market may be alluring but SURAKSHA realised that it is not without its problems: Low per capita disposable incomes that is half the urban disposable income; large number of daily wage earners, Acute dependence on the vagaries of the monsoon; seasonal consumption linked to harvests and festivals and special occasions; Poor roads; power problems; and Inaccessibility to conventional advertising media.
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Availability
The first challenge is to ensure availability of the product or service. India's 627,000 villages are spread over 3.2 million sq km; 700 million Indians may live in rural areas, finding them is not easy. However, given the poor state of roads, it is an even greater challenge to regularly reach products to the far-flung villages. Any serious marketer must strive to reach at least 13,113 villages with a population of more than 5,000. Marketers must trade off the distribution cost with incremental market penetration.
Affordability
The second challenge is to ensure affordability of the product or service. With low disposable incomes, products need to be affordable to the rural consumer, most of who are on daily wages. Some companies have addressed the affordability problem by introducing small unit packs.
Acceptability
The third challenge is to gain acceptability for the product or service. Therefore, there is a need to offer products that suit the rural market. With large parts of rural India inaccessible to conventional advertising media — only 41 per cent rural households have access to TV — building awareness is another challenge. Fortunately, however, the rural consumer has the same likes as the urban consumer — movies and music — and for both the urban and rural consumer, the family is the key unit of identity. However, the rural consumer expressions differ from his urban counterpart. Outing for the former is confined to local fairs and festivals and TV viewing is confined to the state-owned Doordarshan. Consumption of branded products is treated as a special treat or indulgence.
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MARKET RESEARCH
Rural marketing has been witnessing a lot of action from both fast-moving consumer goods sector as well as consumer durables products manufacturers, but there‘s been little improvement in the manner in which rural marketing research is carried out. Marketing research is formalized means of obtaining information to be used in making marketing decision. Sometimes, rural marketing is confused with agricultural marketing – the later denotes marketing of produce of the rural areas to the urban consumers or industrial consumers, whereas rural marketing involves delivering manufactured or processed inputs or services to rural producers or consumers. A market research is conducted in order to understand the scope in rural areas and also the techniques in which more sales can be made. SURAKSHA‘S job is to brighten the smile of others. While it has done the same admirably for millions of Indians, now the turn has come to brighten its own smiles as its performance is inching up. We have two distinct missions that guide its operations: To study social issues with commitment, expertise, objectivity and an orientation towards action ability, and to set up databases and research expertise with regard to marketing in rural India , where hitherto there has been a scarcity of data. THERE ARE USUALLY TWO SOURCES OF CONDUCTING RESEARCH
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? PRIMARY SOURCES
For conducting market primary sources would be a better option, as primary data basically addresses to a specific research objective.
RETAIL SHOPS/STD BOOTHS: Collecting information from retail shops would be an informative source as the shop-keepers have good idea about the demand of the product. Which products are already available in the market? What is the scope of a new product in the market? Retailers can also provide us with information about the kind of dental products used, awareness about importance of dental products, usage of the products etc. HAATS AND FAIRS: Also research was made through local forms of entertainment like annual haats and fairs. As people from surrounding villages also come in large numbers to these gatherings, which is very useful for conducting market research. Thus, this is our main source to inform people about our product and to know about the consumer behavior.
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Consumer Behaviour
India is a big country with 28 states, over one billion people and 120 dialects/languages. From the market perspective, people of India comprise different segments of consumers, based on class, status, and income. An important and recent development in India‘s consumerism is the emergence of the rural market for several basic consumer goods. The growth in the Indian economy has also led to the tides of prosperity making their way felt even in remote villages in the country. The purchasing power of rural communities has multiplied manifold and its time that this huge potential is tapped. But before venturing into any rural market it is necessary to understand the consumer behavior in that market. Consumer Behaviour is a key factor in positioning the product in the market and making it a success. The research techniques and tools help to accurately map buying behavior patterns and build powerful and focused communication campaigns. The contours of the rural marketing environment are totally different from urban markets. Rural consumer behavior is deeply tied to their culture and belief system and a clear insight into it is needed if marketers want to be success.
Rural Consumer
About three quarters of the Indian population are in the rural areas and with the growing middle class, specially in the Indian cities, the spill over effect of the growing urban middle class is also felt in the rural areas. Over the years, as a result of the increasing literacy in the country, exposure to the west, satellite television, foreign magazines and newspapers, there is a significant increase of consumer awareness among the Indians. But The Indian consumers are price sensitive and prefer to buy value for money products. The population is dispersed to such an extent that 90% of the rural population is concentrated in villages with population of less than 2000. So the geographical spread is not as homogeneous as it is with the urban areas owing to vast differences culture and education levels. Also with agriculture being the main business of rural sector the purchasing power of rural consumer is highly unpredictable which can lead to high variations in demand patterns.
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One more gray area that needs to be probed into is the importance of retailer in rural trade. Rural consumer‘s brand choices are greatly restricted and this is where the retailer comes into the picture. The rural customer generally goes to the same retailer to buy goods. Naturally there‘s a very strong bonding in terms of trust between the two. Also with the low education levels of rural sector the rural buying behavior is such that the consumer doesn't ask for the things explicitly by brand but like "laal wala sabun dena" or "paanch rupey waali chai dena". Now in such a scenario the brand becomes subservient to the retailer and he pushes whatever brand fetches him the greatest returns. Thus, as there is a need for our company Suraksha to understand the rural consumer, similarly need is there to study the retailer as he is a chief influencer in the buying decision. IN THE RESEARCH SURAKSHA DISCOVERED THAT FOLLOWING WERE THE CHARACTERISTICS THAT WERE INFLUENCING THE VILLAGES OF MAHARASHTRA: ? TRADITIONAL OUTLOOK: The rural consumer values old customs and tradition. Basic cultural values have not yet faded in rural India. Buying decisions are highly influenced by social customs, traditions and beliefs in the rural markets. Today more and more consumers are selective on the quality of the products/services. This awareness has made the Indian consumers seek more and more reliable sources for purchases such as organized retail chains that have a corporate background and where the accountability is more pronounced. The consumer also seeks to purchase from a place where his/her feedback is more valued. Indian consumers are now more aware and discerning, and are knowledgeable about technology, products and the market and are beginning to demand benefits beyond just availability of a range of products that came from ?trusted‘ manufacturers.
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? THE VITAL IMPORTANCE OF CARE AND TRUST The consumer must be able to trust the quality of the product. In this sense, the quality includes aspects of safety and of the environment, of animal welfare and other ethical aspects. This makes high demands upon the care taken in production, processing and characteristics (safety). CONSUMER > TRUST < QUALITY < CARE < PRODUCERS Our company SURAKSHA has a strong field team who collects data and collates it. This is analyzed by market research experts and the findings are generated via a comprehensive report. This helps us build our marketing strategy on a sound foundation. The direct contact between producer and consumer as it was before and which, to a high degree, formed the basis of trust - has largely disappeared. The way in which this trust must now be achieved is therefore organized in quite a different way: personal trust is replaced by institutionalized trust. The consumer of today is remote from the production which makes it much more difficult for the consumer to form a clear picture of the circumstances in which the production takes place and of the composition of the final products. At SURAKSHA we have realized that it is of utmost importance to have proper personal relation with the rural customers so that our company can gain their trust and maintain it.
Market Segmentation:
Market segmentation is the selection of groups of people who will be most receptive to a product. The most frequent methods of segmenting include demographic variables such as age, sex, race, income, occupation, education, household status, and geographic location; psychographic variables such as lifestyle, activities, interests, and opinions; product use patterns; and product benefits. Much segmentation involves combinations of these methods. The purpose for segmenting a market is to allow your marketing/sales program to focus on the subset of prospects that are "most likely" to purchase your offering. If done properly this will help to insure the highest return for your marketing/sales expenditures. Depending on whether you are selling your
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offering to individual consumers or a business, there are definite differences in what you will consider when defining market segments. Before planning the product it is very necessary for a company to understand the various environments such as: GEOGRAPHIC Demographic Social
GEOGRAPHIC:
? REGION: PALNI is a small village in Vidharbha District. It is 72 km north of Nasik. The nearest town, Dhul, is 18 km away. The closest airport is Mumbai. It is situated just 8km East of NH 210.It is well connected by road and has at least 75 buses covering ? VILLAGE SIZE: PALNI is a small village in Vidharbha District, Maharashtra, India. ? DENSITY: RURAL
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DEMOGRAPHIC:
? ? ? ? ? As of 2007 India, PALNI had a population of 15OOO. Males constitute 49% of the population and females 51%. PALNI has an average literacy rate of 62%. 12% of the population is under 6 years of age. OCCUPATION: MAILNY AGRICULTURE. There are also teachers and doctors present in the village along with a very small population in the crafts and handicraft business.
SOCIAL ENVIRONMENT
Social environment is one major area of total business environment and exerts greatest influence on business activities. Social environment is dynamic and changes with social changes and growing consciousness among different social groups. Cultural environment is treated as a part and parcel of social environment. The progressive changes taking place in cultural aspects such as festivals, music, dance, celebration of important days etc. create demand for new products and changes in the demand for existing ones. Even the changes in the fashions, lifestyles, cultural needs of the people, religious and cultural festivals, bring corresponding changes in the cultural environment. ? As Maharashtra is a vast state, the people of this colourful state wears different types of costumes, take different cuisines, has different forms of dances and music according to the physical features of their locality. The dance forms like Povada, Lavani and Koli with mesmerizing music and rhythmic movements entertain the Maharashtrians. Dhangri Gaja, Dindi, Kala and Tamasha are the folk dances that attach to the heart of the people of this state. ? Main languages are Marathi, Hindi and English. Marathi and Hindi are mostly understood all over the state. But different regions have their own dialects. In the district of Vidharbha, the main languages are English, Hindi, Marathi and the local language Varhadii.
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TARGETING
Target market is, in marketing, the market segment to which a particular product is marketed. Targeting strategy or targeting is the selection of the customers you wish to service. The decisions involved in targeting strategy include: ? which segments to target ? how many products to offer ? which products to offer in which segments
Targeting strategy decisions are influenced by: ? ? ? ? market maturity diversity of buyers' needs and preferences strength of the competition the volume of sales required for profitability
After a thorough evaluation of the selected segment, SURAKSHA had to choose a target market. we also studied the completion in the market.A marketer cannot formulate an effective strategy without proper targeting. ? The toothpaste Suraksha is basically targeting all the age groups of the Pa villages. Only around 12 % of the population is under the age of 6 years and only 30 % are above the age of 60. So our main target is the age group between 3 years to 60 years that accounts to around60 percent of the population/
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? Around 45 % people in the village come under the income level of rs.24000rs.30000 annually. And so Suraksha is targeting this 45% as well as the 20% income group that comes under the annual income of rs.16000 annually.
Positioning- Competitive landscape
Ayurvedic (Meswak) Fights germs (Pepsodent) Herbal/neem (Babool)
Strong teeth
Colgate
Smell -clove oil Essence (Promise) Freshness (Close up)
Vegetarian Toothpaste (Anchor)
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Competition
Competition is sometimes referred to as a "goal" and at other times as a "tool" that can be used to achieve other goals. Suraksha has been facing immense competition from organised as well as unorganised players as this is a direct market HLL and Colgate is the closet rival of Suraksha with a share of 34% with its Pepsodent and Close-up (gel where it has a lion's share) brand and Colgates undisputed share of 45% of the total market. Suraksha major competitor is Colgate a name synonymous with the Indian oral care industry, Colgate is the undisputed market leader in toothpastes with over 45% share in the oral care segment. The company's parent has a presence in over 200 countries worldwide. In India, Colgate ranks No.1 in top of the mind recall in many consumer surveys. Rest of this has been lost to HLL and smaller players like Dabur and Anchor, Balsara and Suraksha.
The potential: As per our estimates, 12.2% of the total world population lives
in rural India. Currently, only a small portion (about 15%-20%) of region has been tapped. Although, expansion in rural areas requires huge investments, it is a market that cannot be overlooked and has huge potential. To put things in perspective, the per capita consumption of toothpaste in India is only 82 gms, as compared to 262 gms for Thailand, 376 gms for Mexico and 518 gms for USA (Source: Colgate, Equitymaster Research). In India, urban per capita consumption is 153 gms whereas rural consumption is a mere 38 gms.
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Product Planning for Rural Marketing
Product in the rural perspective is a need – satisfying entity unique to a rural consumer and not a futile extension of an urban offering. Consumer will buy only what suits them. What is accepted in the urban market may not be accepted in rural markets. The product being offered to the rural customers must have something special, either in terms of attraction or advantage which will motivate them to opt for this one in preference with others. The product must be planned and designed in such a manner that it not only satisfies the needs of the rural customers but also must be affordable. The concept of rural product is unique since it has been observed that the rural consumer‘s outlook is very different from that of his urban counterpart, and it is seen that what works for the latter may not work for the former. SURAKSHA observed that the type of product that a rural consumer intends to buy, or has the potential to purchase, also depends on his attitude towards it and the cost-benefit analysis done by him before buying. SURAKSHA believes that the product for the rural markets has to simpler, easy to use and supported by after sales service or maintenance.
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SURAKSHA understands that the product literature has to simple enough for the rural consumer to understand. The product has to be conveniently packaged for a low price and convenient use. The customers must be induced to buy the product. The rural market is not looking for the kind of products that are the rage of the global market. The product attributes, features and price determine value. Rural customers want product of quality; however the parameters of quality differ from one region to other region. Marketers are keenly interested in understanding the process of adoption of a product in a new market.
Packaging
Packaging is heavily integrated into our daily lives, we see it all around us, on everyday items such as chocolate bars and crisp packets- As explained below, the main use for packaging is protection of the goods inside, but packaging also provides us with a recognizable logo, or packaging, we instantly know what the goods are inside. Innovative packaging may actually add value to the product if it meets a consumer need therefore at Suraksha we have packaged our product keeping in mind portion control, recyclability, tamper-proofing, child-proofing, easy-open, easy-store, easy-carry, and no breakability. Our product is packaged in this attractive white and peach colour package with a silver lining The labels on packages are important. Our labeling consists of the name of the toothpaste, the key ingredients that are Laung, Pudina and Tomar and a natural calcium base. It is therefore, the first ever toothpaste which keeps all your dental problems away, thereby providing you strong and healthy white sparkling white teeth. To win over the customers confidence and establish brand identity we have got our
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toothpaste approved by F.D.I ie the world dental federation which specifies that brushing with Suraksha everyday leads to healthy white teeth. Our labeling also contains the Registered trademark, the name and address of the manufacturing unit and the first character of the code . It must also contain an adequate amount of product to keep the unit price competitive. We have mentioned the M.R.P which includes all the taxes and the expiry date which is due after 2 years from the day of manufacturing. We have a 100% vegetarian and ayurvedic symbol printed on all our packages
Distribution
Distribution is one of the 4 aspects of marketing. A distributor is the middleman between the manufacturer and retailer. After a product is manufactured it is typically shipped (and usually sold) to a distributor. The distributor then sells the product to retailers or customers.
THE DISTRIBUTION CHANNEL
Frequently there may be a chain of intermediaries; each passing the product down the chain to the next organization, before it finally reaches the consumer or enduser. This process is known as the 'distribution chain' or the 'channel.' Each of the elements in these chains will have their own specific needs, which the producer must take into account, along with those of the all-important end-user.
CHANNELS
A number of alternate 'channels' of distribution may be available:
? ? ? ? ?
Selling direct, such as via mail order, Internet and telephone sales Agent, who typically sells direct on behalf of the producer Distributor (also called wholesaler), who sells to retailers Retailer (also called dealer or reseller), who sells to end customers Advertisement typically used for consumption goods
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Distribution channels may not be restricted to physical products alone. They may be just as important for moving a service from producer to consumer in certain sectors, since both direct and indirect channels may be used. Hotels, for example, may sell their services (typically rooms) directly or through travel agents, tour operators, airlines, tourist boards, centralized reservation systems, etc. Distribution is a challenge in a country like india. Most of the roads are destroyed during th rain and most areas don‘t even have proper communication facilities.
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SURAKSHA‘S DISTRIBUTION SYSTEM
Suraksha manufactures products. It then needs to deliver the manufactured products to the consumers. The place of manufacturing and the place (Palni village) the consumers require the products is very far away from each other. Therefore, lot of focus has to be made on the distribution system. Distribution channels Distribution channels are all the sub-marketers or intermediate marketers of the company. They include selling agents, wholesalers, retailers, authorized representatives; showrooms etc. are basically distribution channels. Suraksha distribution channel for the particular product will follow:
All of these members of the distribution channels also want to sell the products that they hold so they too try to market the products in their own small way. Using these distribution channels our company is sub-marketing its product at various localized levels. Using these distribution channels, our company markets itself in all the local neighborhoods and streets of the country.
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MECHANICS OF DISTRIBUTION CHANNEL The supply chain of products in the FMCG market in India is one of the longest supply chains an industry could really have. There are as many as 5 levels of intermediaries involved in the entire supply chain through which a product passes before reaching the end consumer. Suraksha products are transported from manufacturing units via c & f agencies or warehouse to distributors who further sell the same to wholesalers or stockiest who finally sell it to the retailers in the market. These products are transported either via roadways or railways within the domestic markets and normally don‘t take more than a week to reach the retailers. Our products are normally a high volume ball game and products have to essentially be available in the market at all given points of time and at all given points of purchase and therefore the distribution activities are highly volatile and dynamic. The supply of products takes place virtually on a daily basis in fixed quotas or otherwise to retailers as per their requisitions and the anticipation of demand and the performance of products in the recent past. All such criteria are taken into consideration before the quantum of products being dispatched to the next level of intermediary. Since it‘s a volume game, our manufacturers make all possible efforts to boost sales and promote their distributors to earn more and more orders from the retailers and wholesalers. A close check is maintained on the flow of the products on a daily, weekly, fortnightly and monthly basis to determine the trend in the business and flow of products and consumption. This activity also helps us to find out drawbacks of the distribution system, if any, and rectify them within time. The company has to give some commission to the people along the distribution channel. It also gives incentives to them if they sell more products. This way, the distribution and marketing of the product takes care of itself to some extent. Later on, distribution channels may prove to be costly as the price of the product rises at every level. So, our company may choose to by-pass all distribution channels and directly market the product and deliver it to the consumer itself. However, whatever the method of distribution used, the products still have to reach the distribution channels or the consumer from the point of production.
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Therefore, physical distribution plays an important role: Physical distribution is the process of delivering products to the marketing channels and consumers. It encompasses the various activities involved in the physical flow of the product, from the manufacturer to the consumer. Some of the major aspects of physical distribution are: ? Transportation ? Warehousing and Inventory Management ? Communication
PROMOTION/COMMUNICATION /ADVERTISING...
Guidelines for rural communication Keep the communication as simple as possible --Brand promise in 1 or 2 words Packaging and brand experience are the key--Need for glitzy packaging Propensity for trial is relatively poor--Importance of below the line, Promotions and Sampling, Need to push for trials. Need to talk rural language as well as use signage for Communication--Localize the communication, Greater use of signage To help brand recall
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In rural India advertising plays a minor role. It can enhance demand only when favorable environment conditions have been created. Advertising does not create immediate demand. There is always an information gap. Rural India is a set of regional markets where cultural factors play a very important role. If the company wants the people in the rural market to accept their product it is necessary for the company to follow the strategies like Talk their Talk and Walk their Walk. Word of mouth plays a very significant role here. Thus to put forth its idea in the most effective manner SURAKSHA adopted the following techniques and methods of communication. Communication Strategies adopted were as follows: Pitched against low priced products using SURAKSHA lineage and the resultant global quality assurance at the same price point A well planned mobile marketing activity, which included interactive product oriented game, an edutainment film using well know TV stars of Maharashtra, Marathi television ,besides product sampling, sales and placement. As a result awareness for the brand has increased multifold and is reflected in the spontaneous increase in sales. The various Medias used by SURAKSHA are as follows: RADIO- radio today has become a very popular and effective medium and media channel especially in the rural areas thus SURAKSHA utilized this method and for the promotion and advertising of its toothpaste it arranged a Revisiting SURAKSHA geetmala.
WALL PAINTINGS- this very effective and economical way of communication and thus almost all the companies adopt this method as even SURAKSHA has. SURAKSHA kept in mind that the advertisement should have high vision content and should be colourful, attractive and should be appealing.
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PAMPHLETS & POSTERS – these are typical Indian‘s respect for printed matter thus even SURAKSHA opted for them. The company has decided to put up a few posters and distribute pamphlets in the public areas of the village showing the benefits of using the toothpaste in the form of before and after situations. DEMONSTRATIONS- as it is a fact that the villagers have the tendency of gathering in crowds and thus even SURAKSHA made use of this method. The van activity consisted of dances and a live skit performed by a husband / wife couple with a small child who played the role of their son together with a grandfather to put forth the idea more efficiently.
The product story was integrated into the skit. The activity also targeted residential localities and haats where product sales were undertaken with special offers.
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As HAATS AND MELAS USUALLY CONSIDERED THE SUPERMARKETS OF THE VILLAGES SURAKSHA IS CONDUCTING: • Sampling Experiential Marketing is the key to success’ Inducing trial’
• Sales Promotion • SURAKSHA also used a creative strategy and organised a puppet show in order to covey the essentials and need to brush regularly. Puppet show was opted by SURAKSHA because this is a kind of entertainment that is usually used by the rural population. This way would be an effective way to communicate the required message to the targeted population especially the children and women of the village.
Story Board for Puppet show:
• A child trying to bite a sugarcane piece hurts his tooth • Rushes up to his mother • Mother gets worried • Takes child to a doctor • Doctor cites out the – benefits of brushing – incremental benefits of toothpaste over natural alternatives • The family takes to brushing • Child bites sugarcane and lives happily ever after.
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PRICING
The price of Suraksha toothpaste in the Village of Palni is Rs. 9 for 50 gms. Pricing is like a tripod which is cost, demand and competition. As regards demand in rural market, it is subject to a number of factors which are different from those operating in the urban market. E.g. Tastes and customs, of the rural consumers may differ widely from those of the urban population.
Prices of the products of SURAKSHA are framed by taking into consideration the factors such as the demand of the product, competition in rural market and cost of the product.
PRICING STRATEGIES ADOPTED BY SURAKSHA:
LOW COST CHEAP PRODUCTS: This follows from the product strategy itself. The price is kept low, compared to the price offered in the urban market using low unit packaging, i.e in the urban areas the product is sold for Rs.15 and in the rural areas the product is costing Rs.9. this strategy has been widely adopted by Suraksha to penetrate the market.
AVOID SOPHISTICATING PACKAGING: Since the rural consumers are more interested in the sturdiness and the utility of the product, it is possible to avoid sophisticated packaging, which adds considerably to the cost. The packaging used for the rural
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areas by SURAKSHA is simple, informative, and small in size as compared the glitzy packs offered in the urban areas. Thus SURAKSHA has applied some innovation in Packaging which is very essential today for rural markets.
Methods of Pricing: pricing also differentiates a brand from its competitors. Urban pricing methods may not suit rural market. The following are the methods of pricing that are adopted for the Palni village by SURAKSHA. VALUE PRICING, which is popularly know as VFM-value for money. Value Pricing means assigning a low price tag for a product. Suraksha, a herbal toothpaste is priced at Rs. 9 in Palni which is affordable by the villagers there because their annual income is around Rs. 24000-Rs.30000. DIFFERENTIATION PRICING: this involves different prices for different markets. A product may be priced differently in rural and urban markets. As mentioned above we have changed the pricing of our product in Palni Village. Differentiations pricing can also be used to attack the competition in rural markets. As mentioned above, SURAKSHA is facing a big competition from Brands like Colgate, Pepsodent. SURAKSHA has studied the pricing strategy of these Brands and then formulated its own.
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Conclusion
A strategy, when executed has to be carefully monitored. Controlling in SURAKSHA will be done through constant feedback. Quarterly results, dealer feedback, salesman feedback and market survey are tools that SURAKSHA used to collect feedback and maintain effective control on rural marketing strategy. After this survey the company realised that the consumption of SURAKSHA product is increasing and the brand name is being accepted. All the three steps of Rural marketing, i.e. Planning, Implementation and Feedback were carried out in a comprehensive way by SURAKSHA. This is a systematic way to achieve success and building up a well known name in the urban as well as the rural areas.
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doc_123000145.docx
Project report on Rural Marketing for Suraksha Toothpaste
Rizvi College of Arts, Science and Commerce Adnan Abdulally 01 Murtaza Jaffar Alamgir 05 Adnan Amin Dhiyan 13 Rishaad Hirani 18 Aftab Hudda 19 TYBMS A
Rural Marketing Plan
For Prof. Sameer Virani
Suraksha Toothpaste
INDUSTRY OVERVIEW
India is still a nascent country in dental hygiene, with the majority of the population still not having access to modern dental care but relying on substances like coal ash and neem sticks. In India, per capita toothpaste consumption stood at 74g in 2005, which is amongst the lowest in the world, compared to 350g and 300g in Malaysia and Vietnam respectively. Toothpaste enjoys a country wide penetration level of 50%. The penetration levels of dentifrice in the country have been on an upward trend over the last few years driven by strong improvements in toothpaste penetration With the huge consumer base waiting to be tapped and the expected rise in purchasing power as the economy picks up, oral hygiene in India may receive a fresh lease of life.
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THE TOOTHPASTE MARKET
Oral hygiene continues to be under aggressive competition, with sales increasing by a modest 3% in current value terms in 2006 to Rs. 2,400 crs. Toothpaste accounted for a whopping 83% of value sales. Toothpaste market in value (in Rs. crs.) Period Apr-Mar04 Apr-Mar05 Apr-Mar06 Urban + Rural 1897 1950 2009 Urban 1340 1386 1414 Rural 556 565 594
Apr-Mar07
2200
1555
650
Toothpaste market in volume (in tonnes) Period Apr-Mar04 Apr-Mar05 Apr-Mar06 Apr-Mar 07 Urban + Rural 77320 84501 86562 95451 Urban 53791 59172 59922 68713 Rural 23529 25329 26640 32100
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SEGMENTS IN THE INDUSTRY
Price-based segmentation of the toothpaste category On the basis of price, the toothpaste market can be broken down into two distinct categories: The Regular segment: Volume ( 64,922 tons ) Price range 50 gms 100 gms 150 gms Rs. 12.5-24 Rs. 25-30 Rs. 35-45 The Low price point segment: Volume ( 21,641 tons ) Price range 50 gms 100 gms 150 gms Prominent brands: • Colgate Cibaca • Babool • Anchor • Ajanta Rs. 8-10 Rs. 14-20 Rs. 25
Prominent brands: • Colgate • Pepsodent • Close-up • Meswak • Dabur Red
KEY PLAYERS
The toothpaste segment is largely a two player industry, Colgate Palmolive & HLL accounting for 80% of the entire market.
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Top 6 Brands
? COLGATE DENTAL CREAM
Colgate Dental Cream is the most widely distributed oral care brand in India has a market share of 34% in value terms. It was revitalized in 2003 with an improved germ fighting formulation. Its anti-bacterial ingredient has been boosted to offer superior germ fighting efficacy. These improvements come in addition to its calcium and minerals formula that helps repair weak spots on teeth and locks in additional calcium and essential minerals to make teeth stronger than ever before.
? CLOSE-UP ACTIVE GEL
Launched in 1975, Close-up was the first gel toothpaste in India. It has since then undergone periodic relaunches. In 2004, Close-up was relaunched with a bang. And this time it was packed with the power of Vitamin Fluoride System – a powerful mix of Vitamins, Fluoride, Mouthwash and Micro whiteners, the perfect combination of ingredients for fresher breath and stronger, whiter teeth. Close-up is now the first Gel toothpaste with Fluoride in Indian Market. Current market share stands at 14%.
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? PEPSODENT COMPLETE 10
Pepsodent, the second offering from HLL with a market share of 11% was launched in 1993 and was the first toothpaste with a unique antibacterial agent to address the consumer need of checking germs even hours after brushing. Pepsodent has always been regarded as a mother‘s oral health care ally and has been associated with inculcating good dental habits amongst kids. Currently the brand is championing night brushing habits amongst kids through its latest TV commercial. The thrust is on making brushing at night a fun activity for kids. The brand plans to continue with its initiatives to promote healthy brushing habits.
? ANCHOR
Anchor belongs to Anchor Health and Beauty Care (AHBC), a part of the Anchor Group (makers of Anchor Electrical switches). Anchor forayed into the FMCG market with the launch of Anchor White Toothpaste, which was positioned as India‘s first British Dental Health Society certified 100 per cent vegetarian toothpaste, in 1997. In fact this proposition had so strong a consumer-pull that by 2002 it was the number three toothpaste brand. In 2006, Anchor decided to directly compete with Colgate Dental Cream, thereby differentiating itself from the LPP segment. It significantly upgraded its product bundle, both in terms of superior formulation (almost parity to CDC) claims and by the development of an All-round Protection sub brand. This is currently endorsed by Dravid with strong TV support.
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? BABOOL
Babool originally a Balsara product was acquired by Dabur last year. Babool straddles the economy and herbal platforms. Its natural toothpaste contains ayurvedic and medicinal benefits of the Babul tree, 'Acacia Arabica‘. While Babool still pursues an aggressive promo strategy on all its SKUs, it has also upgraded its bundle ever since the acquisition, by putting the Dabur brand on its pack and signing up Vivek Oberoi as a brand ambassador
? AJANTA
Ajanta toothpaste is an offering from the personal care division of Ajanta Clock Manufacturing Company. With aggressive pricing as its USP, the company decided to do a Nirma in the toothpaste Industry. Originally priced at one-third of a Colgate or a Pepsodent, Ajanta rewrote the rules of the game for oral care products. It targeted its offering in the low price, mass-market segment.
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COMPANY PROFILE
SURAKSHA is a leading manufacturing company in oral care which includes toothpaste, toothpowder and tooth brush. The word ?SURAKSHA? is the Hindi translation for the word ?protect?. Protect or suraksha stand for cover or shield from danger and injury, to guard and to preserve in safety. This name suits are company perfectly. Belief in the Indian system of herbals combined with modern western techniques has resulted in wide product range of SURAKSHA. Since the quality of our products manufactured play an important and crucial role in rural trade, SURAKSHA ensures that all its products meet the specified standards. As a matter of principle, the Company has always adhered to using purest raw material and processing them in an infrastructure that's absolutely state-of-theart. Over the past three years, the company has consistently delivered quality products and services, which has been the hallmark of the company.
Our Products
? Suraksha Toothpaste: Strong Teeth Keeps dental problem away
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It is just the kind of toothpaste you need for complete oral hygiene. It has a natural calcium base that cleans teeth thoroughly, down to the gums. And, with proper brushing, ensures complete removal of plaque. In addition, the natural astringency of the herbs contained in Suraksha Herbal Toothpaste keep your mouth feeling fresh and clean all day.
Contains:
It contains Laung which helps prevent toothache, Pudina which helps prevent bad breath and Tomar which kills harmful germs. It is therefore, the first ever toothpaste which keeps all your dental problems away, thereby providing you strong teeth. ? Suraksha Toothpowder: Good health means strong and healthy teeth. Give your teeth the best natural care - with Surakha Lal Dant Manjan. The herbal Ayurvedic Red tooth powder that cleans while giving you strong teeth and healthy gums. Contains : Lavang Ka Tail, Kaali mirchi, Pudina Satva, Pippali, Sunthi, Karpoor and Tomar seed, Sugandhi Dravaya, Kasni, Gairic powder, other natural ingredients. ? Suraksha Toothbrush
Available in a range of innovative and attractive angular designs, with medium and soft bristles for sensitive teeth care. The range of toothbrushes is
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scientifically designed to reach the innermost corners of the mouth for effective oral care.
? ? ? ?
Suraksha Mouthwash with Flouride Herbal Rinse for Fresh Breath With Pure Suraksha Extract Anise Mint Flavour Suraksha mouthwash contains pure extract of Suraksha plant. Suraksha mouthwash is a rare combination of ancient wisdom and modern science. Suraksha helps strengthen gums, prevents tooth decay, and eliminates bad breath. Rinse your mouth every morning and through the day with Suraksha Mouthwash to ensure fresh breath, healthy teeth and gums.
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Understand the Rural Market
With a population already in excess of one billion people, India has caught the eye of multinational corporations across the globe as a place of opportunity for exploring new markets. While India has portions of their population that would be considered wealthy or middle class by Western standards, a much greater percentage of India‘s population is low income. As a result, they spend money, live, and use products differently than the countries where most multinational corporations originate. Rural areas, in particular, exemplify these differences. Understanding the characteristics that make the people and the market in rural India unique can help corporations to enter this market with success. The key characteristics define the term rural, determine the amount and flow of income, and determine the types of products and packages that are typically used in rural India. Interestingly, the rural market is growing at a far greater speed than its urban counterpart. Clearly the main challenge that one faces while dealing with rural marketing is the basic understanding of the rural consumer who is very different from his urban counterpart. Also distribution remains to be the single largest problem marketers face today when it comes to going rural.
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So the fact remains that the rural market in India has great potential, which is just waiting to be tapped. Progress has been made in this area by some, but there seems to be a long way for marketers to go in order to derive and reap maximum benefits. Moreover, rural India is not so poor as it used to be a decade or so back. Things are sure a changing!
TARGETTING RURAL MARKET FOR OUR PRODUCT
IN RURAL INDIA in the long term toothpaste players have a tremendous potential to grow in this market. The reasons being that income levels are rising and the population is becoming more aware of personal hygiene. To add to this there is an increase in literacy levels across the country. As media will play an important role hence advertising keeping the rural Indian in mind will provide the much needed impetus for growth to this market.
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? Consumption of toothpaste in rural India
The oral care market can be segregated into toothpaste (60%), toothpowder (23%) and toothbrushes (17%). While 60% of toothpaste is sold on the family platform, around 35% is sold on cosmetic propositions. On the other hand, while toothpowder accounts for 52% of the market, red toothpowder accounts for 40% and black toothpowder accounts 8%.
The penetration level of toothpaste/powder in urban areas is 3TIMES that in the rural areas. Traditional materials such as neem and tobacco are popular for cleaning in the rural areas, Frequency of usage for toothpaste is only 1.5 times among other consumers, compared with 2 times in the developed world. Per capita consumption of toothpaste is only 70 gm compared with 300 gm in Europe and 150 gm in Thailand.
Given the low per capita consumption and penetration rates, toothpaste demand is mainly being driven by the overall market growth of 8-10%. Toothpowder growth is also being driven by the rural segment.
India's per capita consumption of toothpaste is one of the lowest in the world, it currently stands at 70 grams as compared to the global average of 362 grams. This is because 74 percent of our population live in rural areas and are not well versed with personal health and hygiene. As the penetration level of this rural segment is at a low of 30 percent, this means that only 200 million of our 740 million rural population uses toothpaste.
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Rising Rural Prosperity
SURAKSHA has realized that India is now seeing a dramatic shift towards prosperity in rural households. With an average income equivalent to $42 per month ($504 dollars per year), rural Indians have a very low disposable income. Most rural homes have minimal storage space and no refrigeration. Very few people own or have access to cars. As a result, rural Indian purchasing habits tend to be of an ?earn today, spend today? mentality. Rather than buying in bulk, which would mean paying more for a large quantity upfront, rural Indians tend to buy what they need for short segments of time. These factors result in consumers buying products locally, as well as on a daily basis. In addition to the fact that income levels are low, rural incomes also vary greatly depending on the monsoons. When a monsoon hits, this devastates the livelihood of most rural consumers because they are dependent on agricultural work for income. Corporations are also directly affected because this makes it difficult to predict demand . To drive home the potential of rural India just consider some of these impressive facts about the rural sector. As per the National Council for Applied Economic Research (NCAER) study, there are as many ?middle income and above‘ households in the rural areas as there are in the urban areas. There are almost twice as many ?lower middle income‘ households in rural areas as in the urban areas.
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Percentage distribution of households and income Area Rural Urban All-India Households 72.6 27.4 100.0 Population 74.6 25.4 100.0
The absolute size of the rural market is expected to double that of urban India. Thus SURAKSHA has realized that there is great potential for our product in the rural market. SURAKSHA‘S research shows that there is great opportunity for them in the rural market.
Growth in Market
The purchasing power in rural India is on steady rise and it has resulted in the growth of the rural market. The market has been growing at 3-4% per annum adding more than one million new consumers every year and now accounts for close to 50% of volume consumption of FMCG. The growth rates of lot of FMCG are higher in rural markets than urban markets. SURAKSHA therefore has to look at the rural market very seriously for future expansion. Therefore keeping all these points in mind SURAKSHA has decided to sell their toothpaste in the rural areas as well.
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Effectiveness of Communication
An important tool to reach out to the rural audience is through effective communication. ``A rural consumer is brand loyal and understands symbols better. This also makes it easy to sell look - alike?, the rural audience has matured enough to understand the communication developed for the urban markets, especially with reference to FMCG products. Television has been a major effective communication system for rural mass and, as a result, SURAKSHA has identified themselves with their advertisements. Advertisements touching the emotions of the rural folks, it is argued, could drive a quantum jump in sales. Therefore keeping all these points in mind it has realized that consumers in the rural are spending more than they used to on products that give them value for their money and this is also another reason why SURAKSHA is ready to sell its toothpaste in the rural areas. SURAKSHA‘s research shows that this is because of the growing reach of electronic media that has created a huge change in the lifestyles of rural consumers.
CONCLUSION
With an approximate population of 700 million people, the rural Indian market is important for multinational corporations to tap. Although rural Indians need to purchase consumer goods just as their Western counterparts do, rural Indian consumers have a different set of needs that must be met by both package and product. Spending time researching the rural Indian consumer as well as the market before diving in can help to prevent unnecessary struggles and failures. Understanding the characteristics that make the people and the market in rural India unique can help corporations to enter this market with success. The key characteristics define the term rural, determine the amount and flow of income, and determine the types of products and packages that are typically used in rural India. Trends indicate that the rural markets are coming up in a big way and growing twice as fast as the urban.
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RURAL INDIA - CHALLENGE AND OPPORTUNITY
To expand the market by tapping the countryside, more and more MNCs are foraying into India's rural markets.
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THE OPPRTUNITY AND THE CHALLENGE OF THE INDIAN RURAL MARKET
• • • • • • • • • • •
775 million Indians in 638,000 Indian villages 1 in 8 people on this planet is an Indian villager 4 million distinct outlets A different life 44% of urban per capita income Low literacy, media reach: 624 million people lack access to TV 30 million homes remain under the poverty line A case for business 52% of domestic product, 60% of consumption expenditure Share of agriculture less than 50% of the rural economy 50% decline in poor households, doubling of mid-income homes
Opportunity
The Indian rural market with its vast size and demand base offers a huge opportunity that MNCs cannot afford to ignore. With 128 million households, the rural population is nearly three times the urban. 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 rural market may be alluring but SURAKSHA realised that it is not without its problems: Low per capita disposable incomes that is half the urban disposable income; large number of daily wage earners, Acute dependence on the vagaries of the monsoon; seasonal consumption linked to harvests and festivals and special occasions; Poor roads; power problems; and Inaccessibility to conventional advertising media.
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Availability
The first challenge is to ensure availability of the product or service. India's 627,000 villages are spread over 3.2 million sq km; 700 million Indians may live in rural areas, finding them is not easy. However, given the poor state of roads, it is an even greater challenge to regularly reach products to the far-flung villages. Any serious marketer must strive to reach at least 13,113 villages with a population of more than 5,000. Marketers must trade off the distribution cost with incremental market penetration.
Affordability
The second challenge is to ensure affordability of the product or service. With low disposable incomes, products need to be affordable to the rural consumer, most of who are on daily wages. Some companies have addressed the affordability problem by introducing small unit packs.
Acceptability
The third challenge is to gain acceptability for the product or service. Therefore, there is a need to offer products that suit the rural market. With large parts of rural India inaccessible to conventional advertising media — only 41 per cent rural households have access to TV — building awareness is another challenge. Fortunately, however, the rural consumer has the same likes as the urban consumer — movies and music — and for both the urban and rural consumer, the family is the key unit of identity. However, the rural consumer expressions differ from his urban counterpart. Outing for the former is confined to local fairs and festivals and TV viewing is confined to the state-owned Doordarshan. Consumption of branded products is treated as a special treat or indulgence.
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MARKET RESEARCH
Rural marketing has been witnessing a lot of action from both fast-moving consumer goods sector as well as consumer durables products manufacturers, but there‘s been little improvement in the manner in which rural marketing research is carried out. Marketing research is formalized means of obtaining information to be used in making marketing decision. Sometimes, rural marketing is confused with agricultural marketing – the later denotes marketing of produce of the rural areas to the urban consumers or industrial consumers, whereas rural marketing involves delivering manufactured or processed inputs or services to rural producers or consumers. A market research is conducted in order to understand the scope in rural areas and also the techniques in which more sales can be made. SURAKSHA‘S job is to brighten the smile of others. While it has done the same admirably for millions of Indians, now the turn has come to brighten its own smiles as its performance is inching up. We have two distinct missions that guide its operations: To study social issues with commitment, expertise, objectivity and an orientation towards action ability, and to set up databases and research expertise with regard to marketing in rural India , where hitherto there has been a scarcity of data. THERE ARE USUALLY TWO SOURCES OF CONDUCTING RESEARCH
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? PRIMARY SOURCES
For conducting market primary sources would be a better option, as primary data basically addresses to a specific research objective.
RETAIL SHOPS/STD BOOTHS: Collecting information from retail shops would be an informative source as the shop-keepers have good idea about the demand of the product. Which products are already available in the market? What is the scope of a new product in the market? Retailers can also provide us with information about the kind of dental products used, awareness about importance of dental products, usage of the products etc. HAATS AND FAIRS: Also research was made through local forms of entertainment like annual haats and fairs. As people from surrounding villages also come in large numbers to these gatherings, which is very useful for conducting market research. Thus, this is our main source to inform people about our product and to know about the consumer behavior.
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Consumer Behaviour
India is a big country with 28 states, over one billion people and 120 dialects/languages. From the market perspective, people of India comprise different segments of consumers, based on class, status, and income. An important and recent development in India‘s consumerism is the emergence of the rural market for several basic consumer goods. The growth in the Indian economy has also led to the tides of prosperity making their way felt even in remote villages in the country. The purchasing power of rural communities has multiplied manifold and its time that this huge potential is tapped. But before venturing into any rural market it is necessary to understand the consumer behavior in that market. Consumer Behaviour is a key factor in positioning the product in the market and making it a success. The research techniques and tools help to accurately map buying behavior patterns and build powerful and focused communication campaigns. The contours of the rural marketing environment are totally different from urban markets. Rural consumer behavior is deeply tied to their culture and belief system and a clear insight into it is needed if marketers want to be success.
Rural Consumer
About three quarters of the Indian population are in the rural areas and with the growing middle class, specially in the Indian cities, the spill over effect of the growing urban middle class is also felt in the rural areas. Over the years, as a result of the increasing literacy in the country, exposure to the west, satellite television, foreign magazines and newspapers, there is a significant increase of consumer awareness among the Indians. But The Indian consumers are price sensitive and prefer to buy value for money products. The population is dispersed to such an extent that 90% of the rural population is concentrated in villages with population of less than 2000. So the geographical spread is not as homogeneous as it is with the urban areas owing to vast differences culture and education levels. Also with agriculture being the main business of rural sector the purchasing power of rural consumer is highly unpredictable which can lead to high variations in demand patterns.
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One more gray area that needs to be probed into is the importance of retailer in rural trade. Rural consumer‘s brand choices are greatly restricted and this is where the retailer comes into the picture. The rural customer generally goes to the same retailer to buy goods. Naturally there‘s a very strong bonding in terms of trust between the two. Also with the low education levels of rural sector the rural buying behavior is such that the consumer doesn't ask for the things explicitly by brand but like "laal wala sabun dena" or "paanch rupey waali chai dena". Now in such a scenario the brand becomes subservient to the retailer and he pushes whatever brand fetches him the greatest returns. Thus, as there is a need for our company Suraksha to understand the rural consumer, similarly need is there to study the retailer as he is a chief influencer in the buying decision. IN THE RESEARCH SURAKSHA DISCOVERED THAT FOLLOWING WERE THE CHARACTERISTICS THAT WERE INFLUENCING THE VILLAGES OF MAHARASHTRA: ? TRADITIONAL OUTLOOK: The rural consumer values old customs and tradition. Basic cultural values have not yet faded in rural India. Buying decisions are highly influenced by social customs, traditions and beliefs in the rural markets. Today more and more consumers are selective on the quality of the products/services. This awareness has made the Indian consumers seek more and more reliable sources for purchases such as organized retail chains that have a corporate background and where the accountability is more pronounced. The consumer also seeks to purchase from a place where his/her feedback is more valued. Indian consumers are now more aware and discerning, and are knowledgeable about technology, products and the market and are beginning to demand benefits beyond just availability of a range of products that came from ?trusted‘ manufacturers.
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? THE VITAL IMPORTANCE OF CARE AND TRUST The consumer must be able to trust the quality of the product. In this sense, the quality includes aspects of safety and of the environment, of animal welfare and other ethical aspects. This makes high demands upon the care taken in production, processing and characteristics (safety). CONSUMER > TRUST < QUALITY < CARE < PRODUCERS Our company SURAKSHA has a strong field team who collects data and collates it. This is analyzed by market research experts and the findings are generated via a comprehensive report. This helps us build our marketing strategy on a sound foundation. The direct contact between producer and consumer as it was before and which, to a high degree, formed the basis of trust - has largely disappeared. The way in which this trust must now be achieved is therefore organized in quite a different way: personal trust is replaced by institutionalized trust. The consumer of today is remote from the production which makes it much more difficult for the consumer to form a clear picture of the circumstances in which the production takes place and of the composition of the final products. At SURAKSHA we have realized that it is of utmost importance to have proper personal relation with the rural customers so that our company can gain their trust and maintain it.
Market Segmentation:
Market segmentation is the selection of groups of people who will be most receptive to a product. The most frequent methods of segmenting include demographic variables such as age, sex, race, income, occupation, education, household status, and geographic location; psychographic variables such as lifestyle, activities, interests, and opinions; product use patterns; and product benefits. Much segmentation involves combinations of these methods. The purpose for segmenting a market is to allow your marketing/sales program to focus on the subset of prospects that are "most likely" to purchase your offering. If done properly this will help to insure the highest return for your marketing/sales expenditures. Depending on whether you are selling your
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offering to individual consumers or a business, there are definite differences in what you will consider when defining market segments. Before planning the product it is very necessary for a company to understand the various environments such as: GEOGRAPHIC Demographic Social
GEOGRAPHIC:
? REGION: PALNI is a small village in Vidharbha District. It is 72 km north of Nasik. The nearest town, Dhul, is 18 km away. The closest airport is Mumbai. It is situated just 8km East of NH 210.It is well connected by road and has at least 75 buses covering ? VILLAGE SIZE: PALNI is a small village in Vidharbha District, Maharashtra, India. ? DENSITY: RURAL
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DEMOGRAPHIC:
? ? ? ? ? As of 2007 India, PALNI had a population of 15OOO. Males constitute 49% of the population and females 51%. PALNI has an average literacy rate of 62%. 12% of the population is under 6 years of age. OCCUPATION: MAILNY AGRICULTURE. There are also teachers and doctors present in the village along with a very small population in the crafts and handicraft business.
SOCIAL ENVIRONMENT
Social environment is one major area of total business environment and exerts greatest influence on business activities. Social environment is dynamic and changes with social changes and growing consciousness among different social groups. Cultural environment is treated as a part and parcel of social environment. The progressive changes taking place in cultural aspects such as festivals, music, dance, celebration of important days etc. create demand for new products and changes in the demand for existing ones. Even the changes in the fashions, lifestyles, cultural needs of the people, religious and cultural festivals, bring corresponding changes in the cultural environment. ? As Maharashtra is a vast state, the people of this colourful state wears different types of costumes, take different cuisines, has different forms of dances and music according to the physical features of their locality. The dance forms like Povada, Lavani and Koli with mesmerizing music and rhythmic movements entertain the Maharashtrians. Dhangri Gaja, Dindi, Kala and Tamasha are the folk dances that attach to the heart of the people of this state. ? Main languages are Marathi, Hindi and English. Marathi and Hindi are mostly understood all over the state. But different regions have their own dialects. In the district of Vidharbha, the main languages are English, Hindi, Marathi and the local language Varhadii.
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TARGETING
Target market is, in marketing, the market segment to which a particular product is marketed. Targeting strategy or targeting is the selection of the customers you wish to service. The decisions involved in targeting strategy include: ? which segments to target ? how many products to offer ? which products to offer in which segments
Targeting strategy decisions are influenced by: ? ? ? ? market maturity diversity of buyers' needs and preferences strength of the competition the volume of sales required for profitability
After a thorough evaluation of the selected segment, SURAKSHA had to choose a target market. we also studied the completion in the market.A marketer cannot formulate an effective strategy without proper targeting. ? The toothpaste Suraksha is basically targeting all the age groups of the Pa villages. Only around 12 % of the population is under the age of 6 years and only 30 % are above the age of 60. So our main target is the age group between 3 years to 60 years that accounts to around60 percent of the population/
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? Around 45 % people in the village come under the income level of rs.24000rs.30000 annually. And so Suraksha is targeting this 45% as well as the 20% income group that comes under the annual income of rs.16000 annually.
Positioning- Competitive landscape
Ayurvedic (Meswak) Fights germs (Pepsodent) Herbal/neem (Babool)
Strong teeth
Colgate
Smell -clove oil Essence (Promise) Freshness (Close up)
Vegetarian Toothpaste (Anchor)
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Competition
Competition is sometimes referred to as a "goal" and at other times as a "tool" that can be used to achieve other goals. Suraksha has been facing immense competition from organised as well as unorganised players as this is a direct market HLL and Colgate is the closet rival of Suraksha with a share of 34% with its Pepsodent and Close-up (gel where it has a lion's share) brand and Colgates undisputed share of 45% of the total market. Suraksha major competitor is Colgate a name synonymous with the Indian oral care industry, Colgate is the undisputed market leader in toothpastes with over 45% share in the oral care segment. The company's parent has a presence in over 200 countries worldwide. In India, Colgate ranks No.1 in top of the mind recall in many consumer surveys. Rest of this has been lost to HLL and smaller players like Dabur and Anchor, Balsara and Suraksha.
The potential: As per our estimates, 12.2% of the total world population lives
in rural India. Currently, only a small portion (about 15%-20%) of region has been tapped. Although, expansion in rural areas requires huge investments, it is a market that cannot be overlooked and has huge potential. To put things in perspective, the per capita consumption of toothpaste in India is only 82 gms, as compared to 262 gms for Thailand, 376 gms for Mexico and 518 gms for USA (Source: Colgate, Equitymaster Research). In India, urban per capita consumption is 153 gms whereas rural consumption is a mere 38 gms.
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Product Planning for Rural Marketing
Product in the rural perspective is a need – satisfying entity unique to a rural consumer and not a futile extension of an urban offering. Consumer will buy only what suits them. What is accepted in the urban market may not be accepted in rural markets. The product being offered to the rural customers must have something special, either in terms of attraction or advantage which will motivate them to opt for this one in preference with others. The product must be planned and designed in such a manner that it not only satisfies the needs of the rural customers but also must be affordable. The concept of rural product is unique since it has been observed that the rural consumer‘s outlook is very different from that of his urban counterpart, and it is seen that what works for the latter may not work for the former. SURAKSHA observed that the type of product that a rural consumer intends to buy, or has the potential to purchase, also depends on his attitude towards it and the cost-benefit analysis done by him before buying. SURAKSHA believes that the product for the rural markets has to simpler, easy to use and supported by after sales service or maintenance.
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SURAKSHA understands that the product literature has to simple enough for the rural consumer to understand. The product has to be conveniently packaged for a low price and convenient use. The customers must be induced to buy the product. The rural market is not looking for the kind of products that are the rage of the global market. The product attributes, features and price determine value. Rural customers want product of quality; however the parameters of quality differ from one region to other region. Marketers are keenly interested in understanding the process of adoption of a product in a new market.
Packaging
Packaging is heavily integrated into our daily lives, we see it all around us, on everyday items such as chocolate bars and crisp packets- As explained below, the main use for packaging is protection of the goods inside, but packaging also provides us with a recognizable logo, or packaging, we instantly know what the goods are inside. Innovative packaging may actually add value to the product if it meets a consumer need therefore at Suraksha we have packaged our product keeping in mind portion control, recyclability, tamper-proofing, child-proofing, easy-open, easy-store, easy-carry, and no breakability. Our product is packaged in this attractive white and peach colour package with a silver lining The labels on packages are important. Our labeling consists of the name of the toothpaste, the key ingredients that are Laung, Pudina and Tomar and a natural calcium base. It is therefore, the first ever toothpaste which keeps all your dental problems away, thereby providing you strong and healthy white sparkling white teeth. To win over the customers confidence and establish brand identity we have got our
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toothpaste approved by F.D.I ie the world dental federation which specifies that brushing with Suraksha everyday leads to healthy white teeth. Our labeling also contains the Registered trademark, the name and address of the manufacturing unit and the first character of the code . It must also contain an adequate amount of product to keep the unit price competitive. We have mentioned the M.R.P which includes all the taxes and the expiry date which is due after 2 years from the day of manufacturing. We have a 100% vegetarian and ayurvedic symbol printed on all our packages
Distribution
Distribution is one of the 4 aspects of marketing. A distributor is the middleman between the manufacturer and retailer. After a product is manufactured it is typically shipped (and usually sold) to a distributor. The distributor then sells the product to retailers or customers.
THE DISTRIBUTION CHANNEL
Frequently there may be a chain of intermediaries; each passing the product down the chain to the next organization, before it finally reaches the consumer or enduser. This process is known as the 'distribution chain' or the 'channel.' Each of the elements in these chains will have their own specific needs, which the producer must take into account, along with those of the all-important end-user.
CHANNELS
A number of alternate 'channels' of distribution may be available:
? ? ? ? ?
Selling direct, such as via mail order, Internet and telephone sales Agent, who typically sells direct on behalf of the producer Distributor (also called wholesaler), who sells to retailers Retailer (also called dealer or reseller), who sells to end customers Advertisement typically used for consumption goods
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Distribution channels may not be restricted to physical products alone. They may be just as important for moving a service from producer to consumer in certain sectors, since both direct and indirect channels may be used. Hotels, for example, may sell their services (typically rooms) directly or through travel agents, tour operators, airlines, tourist boards, centralized reservation systems, etc. Distribution is a challenge in a country like india. Most of the roads are destroyed during th rain and most areas don‘t even have proper communication facilities.
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SURAKSHA‘S DISTRIBUTION SYSTEM
Suraksha manufactures products. It then needs to deliver the manufactured products to the consumers. The place of manufacturing and the place (Palni village) the consumers require the products is very far away from each other. Therefore, lot of focus has to be made on the distribution system. Distribution channels Distribution channels are all the sub-marketers or intermediate marketers of the company. They include selling agents, wholesalers, retailers, authorized representatives; showrooms etc. are basically distribution channels. Suraksha distribution channel for the particular product will follow:
All of these members of the distribution channels also want to sell the products that they hold so they too try to market the products in their own small way. Using these distribution channels our company is sub-marketing its product at various localized levels. Using these distribution channels, our company markets itself in all the local neighborhoods and streets of the country.
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MECHANICS OF DISTRIBUTION CHANNEL The supply chain of products in the FMCG market in India is one of the longest supply chains an industry could really have. There are as many as 5 levels of intermediaries involved in the entire supply chain through which a product passes before reaching the end consumer. Suraksha products are transported from manufacturing units via c & f agencies or warehouse to distributors who further sell the same to wholesalers or stockiest who finally sell it to the retailers in the market. These products are transported either via roadways or railways within the domestic markets and normally don‘t take more than a week to reach the retailers. Our products are normally a high volume ball game and products have to essentially be available in the market at all given points of time and at all given points of purchase and therefore the distribution activities are highly volatile and dynamic. The supply of products takes place virtually on a daily basis in fixed quotas or otherwise to retailers as per their requisitions and the anticipation of demand and the performance of products in the recent past. All such criteria are taken into consideration before the quantum of products being dispatched to the next level of intermediary. Since it‘s a volume game, our manufacturers make all possible efforts to boost sales and promote their distributors to earn more and more orders from the retailers and wholesalers. A close check is maintained on the flow of the products on a daily, weekly, fortnightly and monthly basis to determine the trend in the business and flow of products and consumption. This activity also helps us to find out drawbacks of the distribution system, if any, and rectify them within time. The company has to give some commission to the people along the distribution channel. It also gives incentives to them if they sell more products. This way, the distribution and marketing of the product takes care of itself to some extent. Later on, distribution channels may prove to be costly as the price of the product rises at every level. So, our company may choose to by-pass all distribution channels and directly market the product and deliver it to the consumer itself. However, whatever the method of distribution used, the products still have to reach the distribution channels or the consumer from the point of production.
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Therefore, physical distribution plays an important role: Physical distribution is the process of delivering products to the marketing channels and consumers. It encompasses the various activities involved in the physical flow of the product, from the manufacturer to the consumer. Some of the major aspects of physical distribution are: ? Transportation ? Warehousing and Inventory Management ? Communication
PROMOTION/COMMUNICATION /ADVERTISING...
Guidelines for rural communication Keep the communication as simple as possible --Brand promise in 1 or 2 words Packaging and brand experience are the key--Need for glitzy packaging Propensity for trial is relatively poor--Importance of below the line, Promotions and Sampling, Need to push for trials. Need to talk rural language as well as use signage for Communication--Localize the communication, Greater use of signage To help brand recall
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In rural India advertising plays a minor role. It can enhance demand only when favorable environment conditions have been created. Advertising does not create immediate demand. There is always an information gap. Rural India is a set of regional markets where cultural factors play a very important role. If the company wants the people in the rural market to accept their product it is necessary for the company to follow the strategies like Talk their Talk and Walk their Walk. Word of mouth plays a very significant role here. Thus to put forth its idea in the most effective manner SURAKSHA adopted the following techniques and methods of communication. Communication Strategies adopted were as follows: Pitched against low priced products using SURAKSHA lineage and the resultant global quality assurance at the same price point A well planned mobile marketing activity, which included interactive product oriented game, an edutainment film using well know TV stars of Maharashtra, Marathi television ,besides product sampling, sales and placement. As a result awareness for the brand has increased multifold and is reflected in the spontaneous increase in sales. The various Medias used by SURAKSHA are as follows: RADIO- radio today has become a very popular and effective medium and media channel especially in the rural areas thus SURAKSHA utilized this method and for the promotion and advertising of its toothpaste it arranged a Revisiting SURAKSHA geetmala.
WALL PAINTINGS- this very effective and economical way of communication and thus almost all the companies adopt this method as even SURAKSHA has. SURAKSHA kept in mind that the advertisement should have high vision content and should be colourful, attractive and should be appealing.
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PAMPHLETS & POSTERS – these are typical Indian‘s respect for printed matter thus even SURAKSHA opted for them. The company has decided to put up a few posters and distribute pamphlets in the public areas of the village showing the benefits of using the toothpaste in the form of before and after situations. DEMONSTRATIONS- as it is a fact that the villagers have the tendency of gathering in crowds and thus even SURAKSHA made use of this method. The van activity consisted of dances and a live skit performed by a husband / wife couple with a small child who played the role of their son together with a grandfather to put forth the idea more efficiently.
The product story was integrated into the skit. The activity also targeted residential localities and haats where product sales were undertaken with special offers.
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As HAATS AND MELAS USUALLY CONSIDERED THE SUPERMARKETS OF THE VILLAGES SURAKSHA IS CONDUCTING: • Sampling Experiential Marketing is the key to success’ Inducing trial’
• Sales Promotion • SURAKSHA also used a creative strategy and organised a puppet show in order to covey the essentials and need to brush regularly. Puppet show was opted by SURAKSHA because this is a kind of entertainment that is usually used by the rural population. This way would be an effective way to communicate the required message to the targeted population especially the children and women of the village.
Story Board for Puppet show:
• A child trying to bite a sugarcane piece hurts his tooth • Rushes up to his mother • Mother gets worried • Takes child to a doctor • Doctor cites out the – benefits of brushing – incremental benefits of toothpaste over natural alternatives • The family takes to brushing • Child bites sugarcane and lives happily ever after.
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PRICING
The price of Suraksha toothpaste in the Village of Palni is Rs. 9 for 50 gms. Pricing is like a tripod which is cost, demand and competition. As regards demand in rural market, it is subject to a number of factors which are different from those operating in the urban market. E.g. Tastes and customs, of the rural consumers may differ widely from those of the urban population.
Prices of the products of SURAKSHA are framed by taking into consideration the factors such as the demand of the product, competition in rural market and cost of the product.
PRICING STRATEGIES ADOPTED BY SURAKSHA:
LOW COST CHEAP PRODUCTS: This follows from the product strategy itself. The price is kept low, compared to the price offered in the urban market using low unit packaging, i.e in the urban areas the product is sold for Rs.15 and in the rural areas the product is costing Rs.9. this strategy has been widely adopted by Suraksha to penetrate the market.
AVOID SOPHISTICATING PACKAGING: Since the rural consumers are more interested in the sturdiness and the utility of the product, it is possible to avoid sophisticated packaging, which adds considerably to the cost. The packaging used for the rural
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areas by SURAKSHA is simple, informative, and small in size as compared the glitzy packs offered in the urban areas. Thus SURAKSHA has applied some innovation in Packaging which is very essential today for rural markets.
Methods of Pricing: pricing also differentiates a brand from its competitors. Urban pricing methods may not suit rural market. The following are the methods of pricing that are adopted for the Palni village by SURAKSHA. VALUE PRICING, which is popularly know as VFM-value for money. Value Pricing means assigning a low price tag for a product. Suraksha, a herbal toothpaste is priced at Rs. 9 in Palni which is affordable by the villagers there because their annual income is around Rs. 24000-Rs.30000. DIFFERENTIATION PRICING: this involves different prices for different markets. A product may be priced differently in rural and urban markets. As mentioned above we have changed the pricing of our product in Palni Village. Differentiations pricing can also be used to attack the competition in rural markets. As mentioned above, SURAKSHA is facing a big competition from Brands like Colgate, Pepsodent. SURAKSHA has studied the pricing strategy of these Brands and then formulated its own.
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Conclusion
A strategy, when executed has to be carefully monitored. Controlling in SURAKSHA will be done through constant feedback. Quarterly results, dealer feedback, salesman feedback and market survey are tools that SURAKSHA used to collect feedback and maintain effective control on rural marketing strategy. After this survey the company realised that the consumption of SURAKSHA product is increasing and the brand name is being accepted. All the three steps of Rural marketing, i.e. Planning, Implementation and Feedback were carried out in a comprehensive way by SURAKSHA. This is a systematic way to achieve success and building up a well known name in the urban as well as the rural areas.
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