RURAL MARKETING

•UTKARSH SAXENA

WHAT IS RURAL MARKETING?

Rural marketing is now a two-way marketing process. There is inflow ofproducts into rural markets for production or consumption and there is alsooutflow of products to urban areas.

ITC

ITC is the country’s leading FMCG marketer, the clear market leader in theIndian Paperboard and Packaging industry, a globally acknowledged pioneerin farmer empowerment through its wide reaching Agriculture Business, thesecond largest Hotel Chain in India and a trailblazer in Green Hoteliering.

ITCBRAND ARCHITECTURE

BUSINESS SEGMENTS OF ITC

ITC have created over 50 popular brands across categories that serve millionsof households and support and sustain over 5 million livelihoods across India.Within a relatively short span of time, ITC has established vital brands acrossdiverse business that include branded packaged foods, personal care,

educationand stationery, incense sticks & safety matches, lifestyle apparel and hotels.Each of ITC’s brands has today garnered significant market standing in theglobal Indian marketplace.

MAJOR BRANDS OF ITC

FMCGKey product segments in FMCG sector are

• Branded Packaged Foods• Personal Care• Cigarettes and Cigars• Lifestyle Apparel• Education and Stationary Products• Agarbattis and Safety Matches

HOTELS

Launched in 1975, ITC Hotels, India’s premier chain of luxury hotels, hasbecome synonymous with Indian Hospitality. ITC Hotels pioneered theconcept of “Responsible Luxury” in the hospitality industry, drawing on thestrengths of the ITC groups sustainability practices. Responsible Luxurypersonifies an ethos that integrates world-class green practices withcontemporary design elements to deliver the best luxury in the greenestpossible manner.

PAPERBOARDS AND SPECIALITY PAPERS

ITC’s Paperboards and Speciality Papers division is India’s largest,technologically advanced and most eco-friendly, paper and paperboardbusiness. The business caters to a wide spectrum of packaging, graphic,communication, writing, printing and speciality paper requirements through itsfour world-class manufacturing units, 7 sales offices and a network of morethan 50 dealers in India, along with an international trade network of 18distributors/agents and 4 finishing operations close to the market for providingfaster service to the customers.

PACKAGING

ITC’s Packaging and Printing Business is the largest value added converter ofpaperboard packaging in South Asia. It converts over 70,000 tonnes of paper,paperboard and laminates per annum into a variety of value added packagingsolutions for the food and beverage, personal products, cigarette, liquor andconsumer good industries.

AGRICULTURAL BUSINESS

ITC’s pre-eminent position as one of India’s leading corporate in theagricultural sector is based on strong and enduring farmer partnerships that has revolutionized and transformed the rural agricultural sector. A unique ruraldigital infrastructure network, coupled with deep understanding of agriculturalpractices and intensive research, has built a competitive and efficient supplychain that creates and delivers immense value across the agricultural valuechain. One of the largest exporters of agricultural products from the country.

INFORMATION TECHNOLOGY

ITC Infotech is a fully owned subsidiary of ITC Ltd. Formed in 2000, ITCinfotech has today carved a niche for itself in the arena of global IT servicesand solutions. The company has established technology Centres of

Technologyto deepen capabilities and incubate cutting-edge technical competencies. With over 5600 employees, ITC Infotech conforms to the highest standards inprocess quality, with ISO 27001, ISO 9001 and CMMI level 3 accreditations.

ITCRural Marketing Strategies

Key Rural Marketing Strategies employed by ITC are:

• BY communicating and changing quality perception.• By proper communication in Indian language.• By understanding social and cultural values.• By promoting Indian sports teams.• By developing rural specific products.• By adopting localised way of distribution.• By giving Indian words for brands.

ITC e-choupal

e-choupal is an initiative of ITC Ltd., a conglomerate in India, to link directlywith rural farmers via the Internet for procurement of agricultural andaquaculture products like soyabean, wheat, coffee and prawns. e-choupaltackles the challenges posed by Indian agriculture, characterised byfragmented farms, weak infrastructure and the involvement of intermediaries.The programme installs computers with internet access in rural areas of Indiato offer farmers up-to-date marketing and agricultural information. Today theinitiative of ITC has empowered the lives of people living in 10 states where40,000 villages have 6500 e-choupals and around 4 million farmers have beenempowered.

4As in e-choupal

• Availability: It emphasise on the availability of the goods and services to the end consumers.

• Affordability: It focuses on product pricing. ITC buys directly from the farmers in the last days closing price and even pays them for transportation.

• Acceptability: It focuses s on convincing the customer to buy the product. ITC’s e-coupal initiative is providing the farmers with real time updated information on weather.

• Awareness: It focuses on making people aware of the product. It is providing active servicing up to rural outlets.

4Ps of ITC Rural Marketing Strategies(Product, Price, Place and Promotion)

1.Product: - Highly diversified product range. - Products are of relatively high quality.

2. Price: - Agricultural inputs are aggressively priced. - Comparable products at lower price under different brand name.

3. Place: - Developed procurement hubs, rural mini malls in the vicinity of villages. - All products available under one roof. - Selling, purchasing and storage at the same place.

4. Promotion: - Skilled central management group. - Awareness among farmers, CSR activities job opportunities, farmer

self-efficacy.

Challenges Faced and Recommendations

Key Challenges Faced by ITC in Rural Marketing and Possible Alternatives are:

1. Infrastructure Barrier: - Technology innovation. - Cooperative with government bodies.

2. Knowledge Barrier: - Enhance Publicity and Training. - Simplify interface of e-choupal.

3. Cost: - Extend lifecycle of equipment. - Increase revenue by adding advertisements.

Key Recommendations for ITC e-choupals are:

• Increase the utilisation of e-choupal.

• Sign contract with farmers.

• More innovations are needed.

• Provide faster and more responsive customer service.

• Create incentive programs for farmers.

CONCLUSION

• Rural wealth creation in agriculture through securing empowerment, collaboration and competition.

• A transformational initiative for sustainable development of society.

• Commitment to transparency and the respect and fairness with which both farmers and local partners are created.