While the number of Indians living in urban areas has increased over the last two decades, about 67% of people still live in rural areas. With increasing digitization and improved purchasing power, the rural market segment is growing at a healthy pace. Just the rural Fast Moving Consumer Goods market in India is expected to grow to US$ 220 billion by 2025 from US$ 23.63 billion in FY18.
An expanding purse of the rural consumer at the bottom of the pyramid is being matched with government programs like Digital India and measures like demonetization, which are prioritizing financial inclusion, accelerating adoption of digital payments, learning and services; while highlighting the role of start-ups, rural entrepreneurship, and the expanding pull of rural youth in the digital age.
An interview with Mr.Rajesh Radhakrishnan, Founder Director and Chief Marketing Officer of Vritti group, an expert on rural marketing, and the man behind Vritti iMedia being recognised as Champions of Rural Market in 2019 by Economic Times, and the most admired rural marketing agency three times in a row since 2016 at Asian Customer Engagement Forum (ACEF) award shines light on digitization’s pivotal role in harnessing the power of rural marketing in India.
AG: How has digitization changed consumer behaviour in rural India, and how are you helping brands to leverage the situation?
Mr. Radhakrishnan: Digitization is all about speed and transparency; both of which help enhance trust, and credibility in products and services (both B2C and G2C) being offered. The perspective of the rural customer is much impacted by expanding digitisation now because it gives easy, quick and timely access even in some of the most remote corners of our country. In the context of India, where the majority lives in rural areas and are dependent on agriculture for their livelihoods, increasing financial inclusion has put money in the hands of rural farmers, in a quick and more reliable manner.
The Indian government-sanctioned, Aadhar cards with unique identification numbers for citizens, is making ‘Know Your Customer’ (KYC) processes easier, which in turn is helping banks open customer accounts more readily, in spite of access and knowledge barriers. This is filling the last-mile gap as banks are closing the gap with a combination of finance and technology-enabled services and an intricate system if hand-on agents to support bank transactions. In rural areas, we see the country’s mission is rapidly changing from ‘financial inclusion’ to ‘financial transacting online’.
With easy access of the internet, a person in a remote village, can know of and benefit from subsidies allocated in a much more effective manner now. Digital transmission of funds under government schemes like MNREGA (Mahatma Gandhi National Rural Employment Gurantee Act), Pradhan Mantri Ujwala Yojana, Pradhan Mantri Awas Yojana, Pradhan Mantri Fasal Bima Yojana are boosting consumer confidence and helping put money in hands of rural citizens and more so our farmers. Recent government initiatives like demonetization of the Indian currency in 2018, have trigged the use of Unified Payments Interface (UPI) and other digital wallets in rural India.
For instance, after demonetization, Amul, one of the world’s largest producers of milk and milk products, was able to transfer payments worth Rs 19 Lakhs to farmer co-operatives, directly into their bank accounts, while completely removing middlemen in handling of transactions. This simply reposes faith in the system and makes it robust, both, from the provider and consumer point of view.
Vritti iMedia, an IT-enabled media company, is leveraging on this trend and helping brands reach rural India using its unique media solution – ‘Audiowala bus station, which is India’s largest digital audio network at transit places, primarily Bus Stations’, reaching 350 million people each month.
This way we are helping consumer brands, Small and Medium Enterprises (SMEs) and government departments to communicate, engage and provide services and experiences to rural India, by making them aware and educating them on their product and services. Ours is a 360 degree rural marketing agency, working to create innovative activation and engagement models for corporate and government organizations that can reach rural audience. In a nutshell, we are helping brands get ‘mind-share’ and ‘wallet-share’ of the rural customer, who is on a prosperous trajectory with the advent of the digital revolution.
AG: What are the kinds of innovations that are helping marketers to penetrate the rural market?
Mr. Radhakrishnan: Some innovative mobile-based solutions helping marketers to penetrate in rural markets are:
- E-commerce portals like Amazon, Flipkart
- Payment wallets like Google Pay
- Overt the Top(OTT) Video streaming companies like Amazon prime, Netflix, Zee5
- WhatsApp, Facebook, YouTube, and local e-commerce apps which are emerging in varied geographic clusters.
AG: How a brand’s expectations from marketers have evolved in the past years?
Mr. Radhakrishnan: The brand wants its Above-The-Line (ATL) media campaigns to be creative yet controlled and managed meticulously. Besides, they also want that in every campaign carried out, we are able to measure its impact and efficacy. They want to measure every penny that is spent. In this context digital media takes centre stage and so we see its growing leaps and bounds each day.
For its Below-The-Line (BTL) campaigns a brand wants reporting to be instantaneous (with Digital technology) and so promoters are given the mobile app for capturing pictures and reporting while doing activations.
AG: Do you think government schemes for rural India are marketed well enough to reach out to beneficiaries? What more can be done to improve the reach?
Mr. Radhakrishnan: There has been a marked improvement in how promotion of government schemes is being done in the last few years. Yet, there is still need for better marketing in terms of making people aware of the real benefits that can be availed of schemes and spotted at the right time and made use of timely.
There is also the issue of misleading middlemen whose presence threatens the robustness of the systems being put in place to support the rural customer and provider. In my opinion, government schemes if marketed to women consumers will be far more effective as they are the most influential consumers, and in fact are the emerging ‘torch-bearers’ and ‘engines’ of rural India in future.
AG: What will be your suggestions to start-ups who are looking to gain ground in the rural market?
Mr. Radhakrishnan: Develop unique value-for-money products and services that help fulfil growth aspirations of the rural population. Before launching the product, do extensive research and study your market and consumer; and most importantly understand the key insights you get when you study the pain points that are bothering the rural target group.
Education, Health, rural employment, skill development, and core farm and the agriculture sector are in dire need of innovation and stand to be just the right fillip India needs to be on track as the superpower in the times to come. There is tremendous potential for developing products and services that can cater to needs of the rural market; the rural consumer is most willing and the government is responsive. We are in an ideal setting to make the most of this setting. If we can overcome some of the basic challenges in the way of digitalization, the rural economy is a sure bet.