Aayvagam an International Journal of Multidisciplinary Research | Volume 5C | Issue 2 | February 2017 68 ISSN - Print : 2321 – 5739 | Online : 2321 - 5259

Consumer Behaviour On Rural Marketing –With Special Reference To Guntur District, B. Sudhakara Reddy Lecturer in Commerce, Government Degree College, Chebrole-522212, Guntur, Andhra Pradesh, , E-mail:[email protected] Dr. K. Lalitha Professor& Dean,Department of MBA, Guntur Engineering College, Yanamadala, Guntur, Andhra Pradesh, India, E-mail:[email protected] Abstract The present 70 percent of India's population lives in rural areas. There are about 6, 38,365 villages in the country as against about 300 cities and 5,161 towns. Of the 121 crore Indians, 83.3 crore live in rural areas while 37.7 crore stay in urban areas, as per the Census 2011. The National Council of Applied Economic Research (NCAER) survey report says that there are 720 million consumers across the villages in rural India. Hence, the development of the nation largely depends upon the development of the rural population. Majority of the rural population is dependent upon agriculture for their endurance. The consumers in the form of farmers and entrepreneurs are using agricultural inputs and technology to a considerable extent. Fast Moving Consumer Goods (FMCG) products are reaching of audio and video man Medias, rural people are aware of products and brands. But when the researcher travelled across many small towns and villages in Andhra Pradesh for marketing projects, did not find organized sales network even by reputed FMCG firms. The present study objectives to analyze the factors responsible for formulating a strategy, examine the product pricing strategies adopted by FMCG companies investigate the recent trends in marketing strategies for FMCG companies find out the distribution strategies of FMCG companies in Guntur District. In this context the present research paper emphasis consumer behavior on fast moving goods in Guntur district of Andhra Pradesh. Key Words: Agriculture, Consumer, Development, Entrepreneur, Rural, Strategy,

Introduction Liberalization of India economy in 1990 had far reaching consequences; many reputed MNC’s entered India, with their popular brands. In the beginning, their concentration was on urban markets, but with tough competition among domestic and other companies, urban markets got started. The growth of an economy is indicated by an increase in the Gross National Product (GNP) and per capita income. Per capita income in country requires an increase in the production goods and services. Hence, the level of production is significant in determining the level of income whether of individual economic unit or of the economy as a whole. Marketing has both micro and macro aspects. In its micro aspect, an efficient system of marketing enables him to earn larger income and helps him maintain a higher standard of living. In its macro aspects, it enables society to get different products, which its members need to responsible prices and thereby enables them to improve their consumption standards and levels of living. It avoids waste of economic resources by mobilizing goods from places where they are in plenty and hence do not have a great value in terms of such satisfaction. Worldwide marketing is undisputedly the most important function of all business organizations. Today, it has become a significant function of services and non-profit organization as well. Further this is the age of information technology, which facilities development of communication as an integrating process of civilized societies. The growing sophistication in technology, the improving maturity in the thinking and living habits of people, the expanding horizons of marketing the intensifying competition in satisfying consumers with myriad of products and services and the rising levels of standard of living altogether constitute a new era, marketers have to adopt a new philosophy, new strategic approaches to achieve their goals. Statement of the Problem Approximately 2/3rds of Indian population live in villages and they have sufficient purchasing power. FMCG products are reaching of audio and video man Medias, rural people are aware of products and brands. But when the researcher travelled across many small towns and villages in Andhra Pradesh for marketing projects, did not find organized sales network even by reputed FMCG firms. Though so much of thrust is given to rural markets, companies seem to be not serious enough to deliver goods to smaller villages. As there is lot of gap in the market, small manufacturers from Andhra Pradesh and neighboring states are selling lesser known or unbranded FMCG products with marginal quality and gaining more business than reputed firms. If proper sales network is developed, any FMCG company can get 3 to 4 fold more business than what they are doing now. But are corporate really serious about rural markets? What special efforts they are putting in to woo rural customers? Do they have rural specific products or strategies? It is high time to analyze opportunities and efforts put forth by corporate to match the demands. Keeping all these in mind, researcher wants to make an in depth study of select FMCG products, their existing strategies and to provide meaningful suggestions to serve the rural markets better. As a micro approach, Guntur District has been selected for the study. Aayvagam an International Journal of Multidisciplinary Research | Volume 5C | Issue 2 | February 2017 69 ISSN - Print : 2321 – 5739 | Online : 2321 - 5259

Conceptual Framework According to Philip Kottler, “Marketing as social and managerial process by which individuals and groups obtain what they need and want through creating, offering and exchanging of values with others”. As per definition by the American management association (AMA), “Marketing is the process of planning and executing the conception, pricing, promotion and distributing of ideas; goods and services to create exchange that satisfy individual and original goals”. Marketing has moved away from the selling a basic necessities to selling specific facilities. The application of marketing concepts makes a company to view consumer needs as focal points for identification, analysis, and development of strategies, which are evolved out of clear understanding of consumer needs. To be practice, target market needs Consumer Behaviour: In economic systems consumers are utilities expressed in the decision to trade or not. The consumer is the one who pays to consume goods and services produced. As such, consumers play a vital role in the economic system of a nation. Without consumer demand producers would lack one of the key motivations to produce; to sell to consumers. The consumer also forms part of the chain of distribution. Every customer shows inclination towards particular products and services. Consumer interest is nothing but willingness of consumers to purchase products and services as per their taste, need and of course pocket. Consumer Behaviour is the study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society. Since ancient times, Indian villages had the concept of village markets popularly known as the village haats. The haats are basically a gathering of the local buyers and sellers. The barter system was quite prevalent, which still continues in a number of places even today. Haats are basically a weekly event, and are central to the village economy. The Rural Consumer in India: As on March 2015, the population of India stood at 1,282 million, with 925 million people living in rural areas and 357 million in urban areas. Whereas the urban population of India is concentrated in 5,480 towns and urban clusters, the rural population is scattered across 638,000 villages. The inference is clear; unlike urban demand, which is highly concentrated, rural demand is scattered over a large area. Factors influencing Consumer Behaviour in rural markets: Consumer behavior refers to the selection, purchase and consumption of goods and services for the satisfaction of their wants. There are different processes involved in the consumer behavior. Initially the consumer tries to find what commodities he would like to consume, then he selects only those commodities that promise greater utility. After selecting the commodities, the consumer makes an estimate of the available money which he can spend. Lastly, the consumer analyzes the prevailing prices of commodities and takes the decision about the commodities he should consume. Meanwhile, there are various other factors influencing the purchase of Consumer’s buyer behavior is influenced by four major factors i.e. Cultural, Social, Personal, and Psychological. These factors cause consumers to develop product and brand preferences. Types of consumers in India Market Indian Markers originated from the center of villages and towns, where there was a sale or barter of farm produce, FMCG product and other products. Later on these street markets went on to become consumer-oriented markets like the specialist markets, shopping centers, supermarkets.

ConsumerConsumer

Commodity Capital Goods &Industrial Markets

Commodity Markets – In India, with high oil and food prices, the commodity markets have again gathered all the attention. The prices of the essential commodities steer the economy to a desired level. CapitalGoods& Industrial Markets – Indian capital goods markets help business to buy durable goods that can be used in industrial and manufacturing methods. There are usually wholesale trades that take place with bulk goods being transacted at very cheap prices. Importance of Indian Markets Markets in India after the liberalization era have been leveraged to the extent that they are well protected by legal procedures and boasts of efficient administrators. The government has always been proactive in its strategies to make the future of Indian market lucrative and attractive. Indian market has witnessed outstanding growth over past few years. The liberal and transparent financial policies have steered the economy towards free flow of FMCG products and Indian Market Aayvagam an International Journal of Multidisciplinary Research | Volume 5C | Issue 2 | February 2017 70 ISSN - Print : 2321 – 5739 | Online : 2321 - 5259 has achieved a sound place in the international arena. The returns on investments in the India market have been substantially moderates from the entire FMCG product. Public Private Partnership (PPP) is the new trend in the Indian marketplace, with red tape and brides being shed off to quite an extent. FMCG Sector in India Fast Moving Consumer Goods (FMCG) can be defined as packed goods that are consumed or sold at regular and small intervals. The prices of the FMCG are relatively less and profits earned through such sales are more volume based. The organized FMCG retailing in India is a new concept and is fast catching up in urban and semi-urban India. The FMCG Sector in India has witnessed a range of recent developments. Tax deductions on various items, rise in the penetration levels and per capita consumption are some of the major developments in FMCG. The FMCG Sector in India is the fourth largest sector in the Indian economy. As per the reports of the 2005-06 financial years, the market size of the sector was the organized and unorganized sectors of consumer durables. India offers an abundance of raw materials (Some product categories such as jams, toothpaste, skin care products, hair care products, etc have experienced a low per capital consumption as per a report presented in 2006.), low-priced labour costs, and also has a presence across the entire value chain. Approximately 200 million people are expected to become the consumers of processed and packaged foods by the year 2010. The major activities of the food-processing sector are permitted 100% foreign equity or 100% NRI and Overseas Corporate Bodies (OCB) investment to meet the rising demand of the consumers. In the year 2012 (Table. 1), the recent developments in FMCG, it is assumed that the consumption of the FMCG products will have a satisfactorily growth with the rising income level of Indian populace in both the rural and urban areas. The market size of the Indian FMCG Sector is expected to reach USD 33.4 billion by the year 2015. The Indian government has declared several tax sops for the FMCG sector in India. It has emphasized on the infrastructural developments in the same. The consumption of health and personal care products in FMCG sector has increased in the recent past with rise in disposable income especially among the early stages group in India. A few of the FMCG product are: Toiletries, Soaps and detergents, Cleaning and disinfecting agents, Cosmetics, Non-durables and Pharmaceuticals. Further, the packaged food products and drinks are also sold under the FMCG, since these items are consumed or bought at regular intervals. Furthermore, recently the electronic items like mobile phones, MP3 players, external hard drives, etc, which has less life owing to its technological development, has also been brought under the gamut of FMCG sector. India often throws up surprising sales strategy successes. For example Amway, an American direct sales retailer, has become one of India’s largest consumer goods companies since the government allowed it to start selling its products door-to-door, However, the markets will get tougher as consumer tastes evolve rapidly based on rising incomes, more companies enter the fray and established market leader step up their game, for example Nestle has been in India for almost a century. Now it is moving to keep pace with the market. Five years ago it under took” Project Epicure” under which it made 1,500 visits to Indian homes, rich and poor, to see how people cook and eat. On 30 July 2011, it reported a 20% increase in total sales to Rs 17.63 billion (US$ $394-million) and a 9% rise in its net profit for the second Quarter to Rs 2.14 billion (US$ 47.8 – million). It is planning to invest US$ 450 – million to double its capacity. Emerging as future growth markets based on the rise of the young, urban, increasingly affluent Indian consumer. 2012 Outlook for the for the Retail and Consumer Product Sector in Asia Territory 2008 2009 2010 2011 2012 2013 2014 2015 Asia & Australasia 4.3 6.5 5.2 5.9 7.0 5.9 5.8 5.3 China 13.3 18.6 3.2 12.0 12.7 9.7 9.3 7.3 Hong Kong 3.9 7.0 8.7 8.6 6.8 3.7 3.4 3.0 India 10.2 16.6 14.1 11.1 9.9 10.5 9.8 9.8 Japan -0.8 0.6 3.5 -0.6 2.4 1.5 1.4 1.0 Taiwan -0.8 2.0 5.0 5.5 5.4 4.1 4.8 4.7 Source: Economist intelligence unit

It is developing products suited for the Indian market and even express product development in India to both Asian and Eastern European countries. The real anticipates that almost 70% of its launches in India in 2011-12 will be if products that are locally developed, including skincare product for men. Objectives of the study To study the nature of rural markets in Guntur District 1. To analyze the factors responsible for formulating a strategy 2. To examine the product pricing strategies adopted by FMCG companies in Guntur District. 3. The investigate the recent trends in marketing strategies for FMCG companies 4. To find out the distribution strategies of FMCG companies in Guntur District and offering suggestions & conclusions. Aayvagam an International Journal of Multidisciplinary Research | Volume 5C | Issue 2 | February 2017 71 ISSN - Print : 2321 – 5739 | Online : 2321 - 5259

Research Methodology Sources of the Data The significant and distinctive stage of research in social science is collection of necessary information to provide hypothesis. The sources of information are generally classified as primary and secondary data. Primary data Primary data is the information collected or generated by the researchers for the purpose of the project immediately at hand. Questionnaires are used to collect this the primary data. Questionnaires are the most frequently used methods of data collection. These methods are considered to have particularly relevance to collect data on personal preference social attitudes, opinions, beliefs and feelings etc. Secondary data Secondary data refers to the information that has been collected by someone, other than those involved in the research project at hand for the purpose. Secondary data can be gathered from various sources. Selection of sample Indian rural market its size and demand base offers a great opportunity to markets. Rural market has 742 million consumers throughout India. Urban market is 27% in the total market. Durable products in the rural marketing are one of the latest mantra of business organization. In Andhra Pradesh, Guntur is one of the Major districts, in which majority of people are living in rural areas. This study has selected six Villages from Guntur, Narasaraopet and revenue divisions in Guntur district. In each revenue division researcher has selected three villages depending on socio–economic standards of villages. One is developed and another is developing and the third under developed village. In Narasaraopet revenue division this study selected Ravipadu, Uppalapadu and Yadlapadu. In Tenali revenue division this study selected Pedaravuru, Samgam Jagarlamud, and Mulukuduru. In Guntur revenue division this study selected Nambur, Koppuravuru villages and Gorantla as per their socio-economic conditions. Coming to the sample taking this study selected the durable products, 1. Oral care: Tooth paste and Tooth brush 2. Personal care: Bath soap and Talcum powder 3. Fabric care: Detergent cakes and soap powder 4. Hair care: Hair oil, shampoos and Hair dye. Which are useful in households? At the time of selecting the samples I have taken into consideration all socio–economic conditions as per my selected study area concerned. Selection of the Sampling Technique Random sampling method was used in selecting samples. It was decided to select respondents from all age groups. Both male and female samples were chosen for data collection and opinion survey. The purpose of selecting from all age groups was to get a comprehensive idea of what the respondents think of FMCG products and brands, and what factors influence them for buying decisions. 1000 respondents were selected from 100 villages, depending on their ability to understand and answer questions. Design of questionnaire The purpose of this research was to analyze the respondent’s awareness of brands, branded products, what promotional measures attract them for buying decisions. It is the consumer who dictates the success of a Brand. To collect the information on all above mentioned aspects, a detailed questionnaire was prepared comprising 40 questions. Data analysis Data analysis is the significant function of the research. After collection of data, the next step is data analysis and interpretation. The analysis of data involves processing of data and statistical analysis. The data collection through the interview schedule has been classified and tabulated into many tables for analysis purpose. Simple statistical tools like averages, percentages and values have been used to analyze the data. Conclusion Indian rural consumer durable market is very vast size and having lot of opportunities. To capture the rural markets, the industries which are producing/ marketing the consumer durables for that they has the follow the different types of creative strategies to tapping the rural markets. And to know consumer behavior is also important for tapping rural markets. Modify the product to market it more suitable for the needs/usage conditions of rural consumer. Develop entirely new products for rural markets. . To capture durable market share, the organizations has to consider the pull strategy and Aayvagam an International Journal of Multidisciplinary Research | Volume 5C | Issue 2 | February 2017 72 ISSN - Print : 2321 – 5739 | Online : 2321 - 5259 push strategies in rural market. To promote the consumer durable products in markets better to use mixed strategies of promotional techniques in rural market. To select best pricing method for durables, by considering demand of the product, competition, infrastructure facilities, economic conditions of particular rural areas. By conducting the campaigns, exhibitions and trade fairs to crate the awareness about products and brads. Arrange customer care units it all areas for clarifying and giving the information about their products, collecting feedback among the products after using the products in terms of price, durability, service, and satisfaction. . By considering the density of people, the organizations have to establish or open new sales outlets. To encourage social activities for development of rural areas for brand loyalty, it is better to use right promotional techniques in rural areas for win rural consumer’s mind. Impact of socio-economic variables on rural consumer behavior requires an enquiry. Consumer –seller relationship in rural areas is an interesting area of study. Such a study will help in identifying the factors responsible for enhancing sales and consumption in rural areas. References Ahmed, Shamim (1991), Rural Marketing in India, Ashish Publishing House, New Delhi. 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