Vritti i-Media’s unique selling proposition has been its distinct range of outdoor advertising services. The most prominent of these is a result of the company’s tie-up with Maharashtra State Road Transport Corporation (MSRTC) that has enabled it to make announcements at village bus stations, combining bus announcements with advertising. This OOH offering encapsulates a fundamental credo of the company, which is reaching the consumer when he is idle and receptive to information or communication. This service has been among Vritti i-Media’s most distinct and successful offerings since it has allowed advertisers to establish a significant degree of brand recall among the target audience. So, having met peerless success for this innovative advertising solution, Vritti i-Media has stepped up its plans for aggressive growth and expansion in the country by now taking its entire groundbreaking basket of offerings to north and south India.
In western India, especially the regions of Mumbai, Konkan and Pune in Maharashtra, Ganesh Chaturthi is celebrated with immense pomp and fervour. The celebration that marks the birth anniversary of Lord Ganesha, is typified by thousands of Ganesha idols being brought into homes, offices and temples annually; and worshipped for one and a half or 5–10 days. On the final, eleventh day, the Lord is believed to return to his heavenly abode and several grand Visarjan processions lead the idols for immersion into local water bodies. Thousands bid farewell to the God of ‘auspicious beginnings’ with artis and offerings and pray that he returns quickly next year. By the fifth day of Ganesh Visarjan, as many as 50,591 Ganesha idols and 4,419 Gauri idols have been immersed in Mumbai this year alone. (more…)
It is estimated that three-fourths of India’s population—between 750 and 800 million people live in India’s hinterlands. With statistics showing that consumer goods have 30:60 share in favour of rural demand, corporate India is exploring all possible routes to this population, most of which is completely cut off from main-steam media and mass communication. For an advertiser, reaching out to such a target group can be a daunting, if not a challenging and painstaking process, which is why the use of new and emerging technology platforms seems to be the ideal solution.
One of India’s post-independence, awe-inspiring brand successes has been the Amul OOH campaign.
The Amul girl, Amul’s 50-year old brand mascot that dons a red polka dotted dress and bow, has been amongIndia’s foremost social commentators. By embracing this evergreen and witty mode of advertising, Amul has enabled this mascot to remain relevant to all age groups for years. It has played a significant role in establishing Amul, amongIndia’s most successful cooperatives and most-recalled products in the dairy category. Today, several agro companies are trying their hands at forms of marketing that enable them to carve their own niches in consumers’ minds. We explore some regional agro brand with humble beginning and enormous prospects.
Rural marketing may be referred to as the promotion of products used in all sections and regions of Indian society—whether rural or urban locations—in a manner that especially resonates with populations residing in small towns and villages by way of cultural or lifestyle clues. So whether it is the eponymous ‘Hema, Rekha, Jaya aur Shushma’ campaign by Nirma or the ‘Desh ka namak’ tag of Tata Salt; most brands look to beguile the section of the Indian population which lives in Bharat, rather than India, to strike gold. These advertisements involved goods created for pan-India consumption and were leveraged in rural markets.
But what if there were commodities created specifically for rural markets, based on intelligence gathered over many years—how would you market these? It would be only a slight exaggeration to say that such goods would market themselves. Who better to prove this point than telecom giant Bharti Airtel.
In the telecom domain, Bharti Airtel partnered with leading Value Added Services provider Handygo Technologies Pvt Ltd to launch ‘Behtar Zindagi,’ a unique mobile service for farm communities in Rajasthan at charges as low as Rs 1/day. Through this service, it enables Airtel’s customers to use their mobile phones to receive information and updates on issues like weather, mandi rates, live stock, agriculture, fisheries, health, education and finance using a simple Interactive Voice Response system, which supports Hindi and 17 regional languages, in addition to several dialects.
To promote its beverages in power-starved hinterlands, Coca-Cola provided low-cost tin ice boxes for new outlets and thermocol boxes for seasonal outlets.
In a bid to capitalise on India’s opportune mobile phone markets, Samsung Electronics Co Ltd made India its R&D hub for the South-East Asian, West Asian and African markets. With profound knowledge of Indian rural consumers, the company crafted a made-in-India phone that allows solar charging called ‘Solar Guru.’ In a similar effort aimed at alleviating a specific problem posed by unreliable power supply, TVS’s Bike Star City offers an in-built mobile charging facility. What’s more; to promote the bike, the company has roped in star cricketer MS Dhoni, quintessentially a successful small-town-boy that vindicates dreaming big.
In the sphere of BFSI, it is seen that insurance companies that customise their products for the rural markets perform significantly better than others. In its bid to rope in customers from India’s hinterlands, HDFC Standard LIFE joined hands with NGOs and offered affordable policies including group insurance covers. In this way, the company was able to beat private insurers and sell policies worth Rs 3.5 crore in premiums.
Industry experts point out that rural India accounts for 54% of India’s FMCG sales, while Technopak Advisors and the Confederation of Indian Industry expects the rural consumer market to touch 720 to 790 million customers or a market size of US$425 billion in 2010-11. Godrej Consumer Products Ltd’s annual report for 2008-09 predicts that over 300 million people will shift from the category of rural poor to rural lower middle class between 2005 and 2025. Given this assumption, rural consumption can match current urban levels by 2017, and that is a formidable market size by any standard. Competitive consumer goods companies are already taking the requisite steps to hook the opportunity when it comes along. The success of brands like Lifebuoy, Dabur Lal Dantmanjan, Hero Cycles and Rajdoot Motorcycles may only be the tip of the iceberg.
India’s consumer market has witnessed sea change over the last decade. Like urban markets, consumers in rural markets are now more technology-savvy and are increasingly demanding sophisticated electronic durables and white goods. This trend has been driven by Minimum Support Price incomes to farmers as well as an ameliorating power situation in small towns and villages. In fact, where farmers get facilities like instant payment of cash when they sell their produce at stores like the ITC’s Choupal Saagars, they are empowered to pick up consumer products like washing machines, televisions, refrigerators, DVD players, microwave ovens, etc from that store itself. At these stores, consumer electronics comprise 15% of sales, growing at 40% each year. These factors, along with a growing perception of white goods as assets, has revolutionised the electronics segment in the consumer durables category.
Industry experts say that the consumer durable market, pegged at Rs 50,000 crore, for products like TVs, washing machines, refrigerators and air conditioners is growing between 15-20% annually in urbanIndia; in contrast to the rural market, where growth is much higher – at about 60% a year. With such a clear reason to target rural areas, several electronics big-wigs are charging ahead, and LG electronics is leading the pack. As of May 2011, 21% of this company’s turnover came from the rural market. But success has not come easy to LG, which has tried its hand at a spectrum of activities to build its presence in rural India.
LG Electronics has made use of vans and road shows to showcase their goods to villagers and, local language advertisements to communicate with rural targets. To penetrate the hinterlands, the company set up 45 area offices and 59 remote area offices, in addition to participating in rural haats, melas and mandis. LG has tied up with stalwarts in the rural space, ITC and DCM Shriram Consolidated Ltd (DSCL) to employ unconventional distribution modes. The company is now looking to boost promotional efforts in 14 states with high disposable incomes. For this, it will harness the hub-and-spoke model, by roping in distributors of commonly purchased items such as fertilisers and two-wheelers.
Another white goods brand which has always thrived in small town Indiais Philips India. The company has always used local language advertising, graffiti and radio advertising to drive its growth. It has also been reported that the company demonstrates its products to village headmen and pursues a sale to influence buying decisions in villages. Another example is of Godrej Appliances Ltd. A household name in the Indian home appliances space for generations, the company test marketed its battery-powered ChotuKool refrigerator priced at only Rs 3,700 or half the cost of a fridge, in regions that had irregular electricity. For the launch and promotion of this prototype project, locals were employed as entrepreneurs selling ChotuKool in their villages at a fixed commission. Furthermore, a tie-up with India Post helped Godrej sell the product through post offices too, and helped boost distribution and coverage in villages where there were no retailing alternatives.
ChotuKool enabled local vendors and businessmen to engage novel methods of growing their businesses. Rural flower vendors and kirana store owners were able to stock a larger range of goods for longer using this innovation. Having achieved such positive results, the company now hopes to add more low-cost innovations to its ‘Chotu’ family, namely a low-cost washing machine ChotuWash as well as a low-cost water purifier.
Today, like Whirlpool, several electronics companies face traditional hurdles and prejudices regarding the utility of goods like washing machines and refrigerators. Akin to many white goods companies, Whirlpool is already present across price points and is continually strengthening its distribution network. More and more companies are now leveraging their networks and knowledge of rural markets for the next phase of growth. In this way, several behemoths in the space are etching unique growth trajectories for striking it big in the rural India.
Whether it is a housewife cooking lunch, a professional driving to his workplace or the carwash boy hooked to his cell phone radio; radio is everywhere. It is an ‘anywhere-anytime’ mode of entertainment and information that reaches lakh of people. Radio still manages to outsmart newspapers and television, especially in remote parts of India, which remain shrouded by illiteracy and deficient power supply. Despite these facts, radio has a meager share of 4.4% of the overall advertisement budget in 2010, and is estimated to reach only 5.5% in 2015. Surveys indicate that out of total radio ‘listenership,’ 73% comes from tier II and tier III towns. This clearly presents a golden opportunity to advertisers to reach the masses. Many of them are already exploiting these opportunities.
In an effort to promote its flagship cola among rural masses, Coca Cola combined radio with some TV and cinema advertising to successfully penetrate almost 53.6% of rural households. Its memorable catch-phrase, ‘Thanda Matlab Coca Cola’ captured the interest of folks in hinterlands and cities alike. To ensure adequate supply of their beverage, Coca Cola went the extra mile to strengthen its distribution channels with a hub and smoke model, while a range of vehicles including rickshaws and bullock carts were apparently used to transport the consignments. The success of Coca Cola has prompted other brands like Idea to employ catchy tag lines like, ‘What An Idea Sirjee!’ to evoke the same sentiment through the radio medium. Traditionally, FMCG brands like Godrej have always used the AIR broadcast network in local languages to connect with their target groups.
Diverse radio content and emergence of regional channels to cater to niche audiences, is the need of the hour for advertisers. For instance, in metros, Meow 104.8 FM, which targets women, provides the right ad spot for cosmetics, personal care and home appliance companies. Likewise, Fever 104 FM, a youth channel, is an ideal platform for educational institutes and apparel companies. By employing such flexibility offered by radio to marketers, high-value consumer offerings like Nokia 1100, LG Sampoorna TV and HUL’s Pure-IT were able to appeal to rural India. Offering small product packs added to the allure of FMCG products such as Cavinkare’s Chik shampoo, Britannia’s Tiger Biscuit and Marico’s Parachute oil; all reaped resounding success.
Last year, the Indian Government launched the highly awaited third phase policy guidelines for FM Radio broadcasting services. While allowing private radio operators to carry news bulletins of All India Radio, the government has also cleared the road for awarding licenses to FM channels more freely, expanding coverage to 227 new cities in addition to existing 86 cities. The FM Phase-III Policy resulting in 839 new FM radio channels in 294 cities provides radio the ability to reach a population of more than 100,000 people through private FM channels. So, the scenario is also ripe for introducing 24*7 local radio news channels since that would be an excellent way to grab active listeners and market a suitable array of brands. At the regional level, such channels can also be a lucrative way to attract local advertisers. Local radio advertising in India exploited only a fraction of its true potential has a long way to go and several significant milestones to cross.
Mr. Kunjesh Parihar, MD and CEO, Ad Space Mart (Mumbai) provides a marketers’ perspective on the effectiveness of OOH beyond India’s metros
Considering the lagging power situation in several states inIndiaas well as how low literacy levels are, OOH has emerged as the perfect medium to reach village folks. It is particularly efficient for marketers who need to localise their communication. Traditional OOH like hoardings are extremely affordable when it comes to non metros and have no power requirements during the day. However, traditional OOH cannot be controlled; its lack of flexibility is its biggest handicap for advertisers. Fortunately, DOOH networks that comprise digital audio and audio-visual networks fill these gaps by meeting a spectrum of requirements demanded by advertisers for their campaigns in non-metros.
Far Exceeding the Effectiveness of OOH
Modern breakthroughs in DOOH enable advertising to be completely controlled and managed from a remote location. This unique form of outdoor effectively overcomes all the barriers of traditional outdoor, becoming an agent of change in the OOH advertising space. Along with these virtues, cost and time efficiency makes DOOH an alluring medium. This effectiveness and efficiency comes from the DOOH network’s wide reach to 100 million people, at less than a paise per person. Due to guaranteed listening its impact becomes 100%, while its cost is 10% of the cost of other traditional medium like TV, radio and print. Since the medium has an added advantage of reaching out to media dark areas through audio, effective communication is ensured notwithstanding the local level of literacy.
Ensuring Greater Impact
In order to be impactful, the DOOH communication should be localised and customised considering the sentiments of local people. It should empathise with social issues and problems and acknowledge events in the region. By employing local brand ambassadors, a powerful connect can be built with rural populations. These criteria works particularly well for advertising of telecom services and mobile phones; banking and insurance; agriculture and rural industry related products and services; consumer durables including vehicles and finally FMCG goods.
Traditional OOH is still ranked fourth with respect to advertisement budgets after TV, print and radio since it has been unorganised and lacked control so far. DOOH innovators like Vritti i-Media are working towards making outdoor a bankable medium, and make it a priority area. While OOH can never be a stand alone medium, new-age DOOH networks boast of several success stories; the likes of Gujarat Tea Traders and SBI, where there were no other traditional media used by clients. FMCG Company Kirti Gold has completely relied on Vritti i-Media’s DOOH media, and does not use any other traditional medium for publicity.
As marketers, we should allocate 25% of our budget for OOH. It is only about 5-10% today. The medium has the potential to go a long way in bringing rural India into the fold of consumerism.
What makes the dhoti-clad villager—sipping cutting chai on a chaupaal—an indispensable golden opportunity for the corporate giants? Why are suave city-based marketing personals struggling to formulate strategies to woo and tap such villages when they do not even fully understand their language?
The answer lies in the sheer market size of rural India. A 2011 news report in the Financial Express based on a study by Rural Marketing Association of India (RMAI) highlighted that the rural market accounts for over two-thirds of India’s population, 56% of its income and 33% of its savings. Further, rural India equals 12.2% of the global population and is therefore the world’s single largest high-potential market. It accounts for 53% and 59% of FMCG and durables sales in India, respectively. However, the key concern that confronts every marketer today is reaching the scattered landscape of six lakh villages or a population that is thrice as large as urban India.
A hidden opportunity: Haats or rural hypermarkets?
Weekly markets called haats are strategically located to cover a cluster of villages. They have become the epicentre of economic and social exchange in rural India and in doing so, provide a readymade solution to the problem mentioned above. In a report by RMAI, ‘Haats as marketing hubs,’ published in Financial Express in 2011, some interesting facts about rural India’s shopping patterns were revealed. India’s 43,000 haats generate annual sales of Rs 50,000 crore. Almost 98% of villagers regularly visit haats, while 75% of them are estimated to frequent a specific haat each week. Haats cater to anything between 21–57 villages and host footfall ranging between 5,600 to 12,000 visitors a day, depending upon its size. Anywhere between 327 and 545 stalls may be found in a haat. Two-fifths of total attendees are women.
Haats perfectly sync with villagers’ psyche of making a value-for-money purchase out of a variety of offerings. They offer a touch-and-feel experience of products and drive sales by word of mouth. The favourability of these factors for companies, along with brand awareness, low selling overheads, majority cash sales and redistribution opportunity have prompted telecom majors Nokia and Motorola to augment sales through village haats. Tata Shaktee, which offers roof sheets, has witnessed a 25% rise in sales after they devised a pilot project in 100 haats which comprised setting up direct selling stalls. Similarly, Tata Agrico has rural haats to thank for a significant expansion in their market share from 30–40%.
Festive melas and road-shows
The eponymous Kumbh Mela has become a favoured destination for MNC FMCG behemoths like Colgate-Palmolive that distributes free tubes of herbal toothpaste or for Hindustan Lever that markets its Lifebuoy soap. Similarly, Samsung’s road-show for its ‘Dream Home’ campaign constituted trips across 48 small towns in 100 days were aimed at augmenting brand awareness for its electronic offerings.
The road ahead
It’s high time that marketers evolved their notions regarding the emerging rural class in villages. From being aspirants of roti, kapda and makaan, to becoming brand and value conscious buyers, the rural consumer market is seeing sea-change. By communicating with consumers at the venues they frequent, marketers can hope to make their fortunes in markets beyond metros.