The Size of Rural Market in India

Introduction

Mahatma Gandhi truly said that ‘The soul of India lives in its villages’.

In the 1960s, the rural market of India started showing its potential. In 1970s and 1980s there was steady development. Recently due to COVID-19 people started reverse migration from city to villages. So, 21^st century is all about Rural Market.

Students, as you imagine rural areas you may get the image with open fields with low population village. The term ‘rural marketing’ used to be an umbrella term for the people who dealt with rural people in one way or other.

The Size of Rural Market in India

India is a land of diversity and about 70% of the population lives in villages. There are approximately 600,000 big and small villages in India. 

25% of villages account for 65% of the total rural population. So it can be calculated that 65% of 700 million populations by targeting only 150,000 villages – which becomes a huge potential of this market.

To expand the market by making inroads into the countryside, more number of MNCs are getting into India's rural markets. Among those are the bigshot companies like Hindustan Lever, Coca-Cola, Pepsi, LG Electronics, Britannia, Philips, Colgate Palmolive and the foreign-invested telecom companies as well.

Rural marketing involves a bunch of processes that includes developing, pricing, promoting, distributing rural specific product and service which satisfies the consumer demand and also achieves organizational objectives as expected from the target market. It is basically a three-way marketing stage where the transactions can be:

1) Urban to Rural 2) Rural to Urban 3) Rural to Rural

Urban to Rural: It is a process of selling the products and services by urban marketers in rural areas. These products mostly include pesticides, FMCG products, consumer durables, etc.

Rural to Urban: It is a process where a rural producer sells his products in urban market. This may or may not be direct, but mostly there are middlemen, agencies, government co-operatives etc. who take initiatives in the successful running of the selling process happen at appropriate price.

Rural to Rural: It is a process which includes selling or exchange of agricultural products, tools, cattle, carts and others to another village in its proximity.

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