“A STUDY OF RURAL MARKETING MIX WITH RESPECT TO ESSENTIAL COMMODITIES IN AHMEDNAGAR DISTRICT” Thesis submitted to Tilak Maharashtra University, Pune For the Degree of Doctor of Philosophy (Ph. D.) In the subject of Marketing Management Under the Faculty of MANAGEMENT By Nitin Raghunath Zaware Under the guidance of Dr. M. D. Lawrence APRIL- 2010 DECLARATION I hereby declare that the thesis entitled “A Study of Rural Marketing Mix with respect to essential commodities in Ahmednagar District” completed and written by me has not previously formed the basis for the award of any Degree or other similar title upon me of this or any other University or examination body. Nitin Raghunath Zaware Research Student Place: Date CERTIFICATE This is to certify that the thesis entitled “A Study of Rural Marketing Mix with respect to essential commodities in Ahmednagar District” which is being submitted herewith for the award of the Degree of Ph. D. in Management of Tilak Maharashtra University, Pune is the result of original research completed by Nitin Raghunath Zaware, under my supervision and guidance. To the best of my knowledge and belief the work incorporated in this thesis has not formed the basis for the award of any Degree or similar title of this or any other University or examining body upon him. Dr. M. D. Lawrence (Research Guide) Place: Date: ACKNOWLEDGE In the long and arduous journey of research, many people have been encouraging and supportive to me. I would like to extend my heartiest thanks to those provided help and guidance to make this research work a success. It was really a pleasant and highly educative experience to work on this dissertation. This is an opportune moment to express my feeling towards all those who have untiringly helped me in completion of this work. I owe a deep felt sense of gratitude and admiration to all rural household respondents as well as rural retail store of Ahmednagar District and local village authorities, who ; tired after their hard day’s work, willing to co-operated with me in doing this thesis. I wood like to place on record my deepest sense of gratitude to the guide of my research thesis Principal Dr. M. D. Lawrence for his valuable guidance and support. I am very thankful to the Assistant Registrar Mr. Jagadish Salve and Dr. Keskar, Registrar Tilak Maharashtra University for encouragement and support given me time to time. I am also thankful to Shri. Rambhau Moze , President, G S Moze Trust, Pune, Dr. C. M. Chitale, Dean Management Faculty University of Pune, Dr. B.V. Sangavikar, Head, PUMBA, Dr. S. B. Kolte, Director General IMS Ahmednagar, Dr. B. S. Savant Dean, Commerce Faculty, Shivaji University, Kolhapur, Dr. S. U. Gawade, Research Director Sighgadh Institute of Management, Dr. E. B. Khedkar, Director, Sinhagadh Management Institute, Dr. D. M. Deshmukh, Ex Chairman BOS Faculty of Commerce. I am greatly influenced by Dr. S. S. Bhola, Dr. S. D. Doke, Prof. V. P. Jadhav whose continuous encouragement has helped me a lot in the completion of this work. Words cannot express my sense of gratitude and respect towards all those who helped me in completion of this work. Place: PUNE Nitin Raghunath Zaware Date: (RESEARCH CANDIDATE) CONTENTS Chapter Page Title No. No. a. Acknowledgement I b. List of Contents II c. List of Tables III d. List of Figures IV e. Abbrevisions V 1. INTRODUCTION 1-19 1.1 Introduction 2 1.2 Rural Market 7 1.3 Rural Marketing 8 1.4 Potential and Size of Rural Markets 8 1.5 Rural Consumer Behaviour 10 1.6 Profile of Rural Markets 11 1.7 Classification of Rural Consumer on Economic Status 13 1.8 Distinguishing factors of rural customer from his urban counter 14 part 1.9 Share of consumer goods in rural consumption 16 1.10 Impact of globalization on rural India 17 1.11 Selection of the Topic 18 1.12 Justification of the Topic 19 2. RESEARCH METHODOLOGY 20-54 2.1 Introduction 21 2.2 Formulation of Hypothesis 21 2.3 Objectives of the Study 22 2.4 Scope of the Study 23 2.5 Research Methodology 23 2.5.1 Research Design 23 2.5.2 Data Collection 24 2.5.3 Sample Design 29 2.5.3.a Selection of target rural villages 29 2.5.3.b Sample Frame 31 2.5.4 Selection of Commodity Group 33 2.5.5 Method of conducting Survey 34 2.5.6 Reference period 35 2.5.7 Method of Analysis and Statistical Tools used 35 2.5.8 Limitations of Research Methods 35 2.5.9 Organization of the Thesis 35 2.5.10 Concepts and Terms 37 3. REVIEW OF LITERATURE 40-82 3.1 Introduction 41 3.2 Indian village system 41 3.3 Rural Economy 47 3.4 Rural Marketing in Indian Economy 54 3.5 Rural Marketing in changed scenario 55 3.6 Theoretical concept – Marketing mix and rural Marketing 60 4. RESEARCH STUDY CONDUCTED ON RELETED TOPIC 83-162 4.1 Introduction 84 4.2 Chronological order work done on the subject area so far 84 4.3 Chronological order books on the subject area so far 142 5. PROFILE OF TARGET AREA 163-181 5.1 Introduction 164 5.2 Maharashtra State 167 5.3 Ahmednagar District 177 6. HYPOTHESIS TESTING 182-217 6. Introduction 183 6.1 Hypothesis One 184 6.2 Hypothesis Two 189 6.3 Hypothesis Three 197 6.4 Hypothesis Four 203 6.5 Hypothesis Five 205 6.6 Hypothesis Six 207 6.7 Hypothesis Seven 210 6.8 Hypothesis Eight 212 7. DATA INTERPRETATIONS AND ANALYSIS 218-264 7.1 Introduction 219 7.2.A Data Collection, Interpretation and Analysis of Questionnaire 220 one- Rural Village Household 7.2.B Interpretation and Analysis of 252 Questionnaire Two- Rural Retailer 8. FINDINGS AND OBSERVATIONS 265-285 8.1 Attributes of rural consumers 266 8.2 Rural consumers market awareness 268 8.3 Rural consumption pattern 269 8.4 Rural buying behaviour 271 8.5 Marketing mix 273 8.5.A Product 274 8.5.B Price 276 8.5.C Place 278 8.5.D Promotion 282 9. CONCLUSIONS AND SUGGESTIONS 286-312 9.1 Introduction 287 9.2 Attributes of rural customer 287 9.3 Rural consumers market awareness 287 9.4 Rural consumers consumption pattern 288 9.5 Rural buying behaviour 288 9.6 Customisation of marketing mix for rural market 289 9.6.A Product 289 9.6.B Price 291 9.6.C Place 292 9.6.D Promotion 295 9.7 Direction for future research 303 9.8 Guideline for Planning rural marketing 304 10. ANNEXURE 313-334 10.1 Sample questionnaire for Rural House-hold 314 10.2 Sample questionnaire for rural retailer 322 10.3 Tahasil wise Villages selected for survey with their 330 characteristics BIBLIOGRAPY 335 LIST OF TABLES Page Table No. Title No. 1.1 Population living in rural India 3 1.2 Development indicators of India 5 1.3 Distribution of population in rural villages in India 12 (2001) Share of Consumer goods in per capita consumption of Rural 1.4 16 India 1.5 Share of Services in per capita consumption of Rural India 17 2.1 Process of sample selection 32 3.1 The Government Initiative in the last few decades 58 3.2 Product Strategies- an Overview 63 3.3 Components of an offer 65 3.4 Levels of Appeal by Packages 66 3.5 Marketing systems 71 3.6 Elements of Logistics Service 74 5.1 All- India population Distribution (by Age) 172 5.2 Language speaks in Maharashtra 172 5.3 Selected Indicators of Human Development of Maharashtra State 176 5.4 Age Group wise Sex Ratio 176 5.5 Geographic details of Ahmednagar District 177 5.6 Population as per census 2001 178 5.7 Agriculture (Temporary) 2001-02 178 5.8 Transport and Communication (31.03.2004) 179 6.1 Marketing Mix difference in rural and urban market: 184 6.2 Cross tabulation of satisfaction level and product mix attributes: 189 6.3 Results of Chi-square test (Hypothesis 2.a) 190 Cross tabulation of satisfaction level and Price attributes in 6.4 191 marketing mix 6.5. Results of Chi-square test (Hypothesis 2 b) 192 Cross tabulation of satisfaction level and place attributes in 6.6. 193 marketing mix: 6.7. Results of Chi-square test (Hypothesis2.c) 194 Cross tabulation of satisfaction level and promotion attributes in 6.8. 195 marketing mix 6.9. Results of Chi-square test 196 6. 10. A Demographic Characteristics of rural consumer respondent 197 Family income, expenditure and saving pattern of rural 6. 10. B. 200 respondents 6.11 Impact of Marketing mix variable on buying decision making: 202 Rural Consumers are aware of rural market for essential 6.12 205 commodities 6.13 Cross tabulation of family size and annual consumption patterns 208 6.14 Results of Chi-square test (Hypothesis 6) 209 Tahasil -wise Demographic Characteristics of rural consumer 6.15 210 respondent Cross tabulation of family purchase decision of essential 6.16 212 commodities 6.17 Chi Square Test (Hypothesis 8.a) 213 Cross tabulation of family store decision of essential commodity 6.18 214 group 6.19 Chi Square Test (Hypothesis 8. b) 215 6.20 Purchase budget decision in rural households 216 6.21 Chi Square Test (Hypothesis 8.c) 217 7.A 1 Consumption Patterns of rural consumer per annum 220 7.A 2 Nature of Rural Accommodation 220 7.A.3 Rural Consumer Personality 221 7.A4 Family Members relation 222 7.A.