Television is Fueling Demands for Branded Products in Rural India -(Exclusive Interview of Pradeep Kashyap,CEO,MART with exchange4media)

8/8/2019 Television is Fueling Demands for Branded Products in Rural India -(Exclusive Interview of Pradeep Kashyap,CEO,M…

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"Television is fueling demands forbranded products in rural India. Butsadly, marketers are finding it toughto reach rural consumers. They alsoneed to handle communication more

sensitively."

Pradeep Kashyap, Founder, MART

For very many companies and product categories, rural markets contribute to over 50% of values but only lip service is paid to rural marketing and media management. If thediscussions in many power boardrooms are any indicator, it is time to change our worldviewand look beyond.

For this week's dialogue, Amit Agnihotri and Neha Pant of exchange4media had an extensivechat with someone who is regarded as one of the top professionals in the area of rural market– Pradeep Kashyap. Kashyap, after spending nearly two decades in corporate sector andheading marketing function at Denso, has been involved with the ‘development sector’ since1987. Since, then he has been a consultant to UN, World Bank and on marketing advisorycommittees of RBI, NABARD and more recently KVIC.

In 1993, he founded MART (Market and Research Team), a rural marketing and researchagency advising clients like Hindustan Lever, Dabur, Glaxo, Eicher and Escorts. He alsoauthored an important report on marketing in Rural India – ‘Traditional Haats and Melas inIndia.’

Q. Let’s start from the start. When and how did MART came into being?

A. After spending 18 years working with many MNCs, in 1987, I thought I hadenough. So, one fine day I just decided to walk out of the corporate sectorand get into the rural sector. And for the next four years, I just worked withvarious NGOs trying to understand what this sector is all about. In 1989,fortunately enough, I got an opportunity from the Ministry of RuralDevelopment to act as their marketing advisor. At the Ministry, in CAPART,which is a nodal agency for all NGOs in India, i got exposure to thousands of

NGOs and their activities. I was with CAPART for three years.

Then, in 1993, I submitted a bid for a World Bank project. They liked theconcept and they approved our bid. I hired 8-10 people to work on thisproject and that was the genesis of MART.

But, we didn’t have an organization and we still don’t have one as MART isnot registered under any act.



MART is like cricket team, which just functions as a team when the matchesare on and after that disbands except the core staff that remains. It is amanagement concept, which we are trying and it has worked successfully forthe last 10-12 years. It helps in building up a very high team spirit becausethere is no hierarchy; the team takes all decisions.

In 1999, we started getting requests from the Corporate for work in ruralmarkets and that’s when the second division, rural marketing of corporateproducts was established alongside the existing rural development division.

Q. How are the rural consumers different from the urban consumers?Do rural folks have a different purchase pattern?

A. That’s a good question. Most corporate marketers believe that ruralaudiences are not very different. They are looking for one homogenousmass, which is easy to tackle and suits their point of view. But ruralconsumers are different and their sensibilities need to be kept in mind.

First point of difference is that every rural region is different. The behavior inrural Punjab is very different from the behavior of rural of Andhra or Bihar.Punjabis are very open, aggressive, and keen to try out new things. Ruralfolks in Bihar are not willing to experiment with new technology. This is onebroad example. Much of the distinctions in behavior come from prosperity.

The problem is that while in international marketing, marketers treat everycountry differently in terms of strategy, product design, packaging andcommunication, when it come to rural India, most treat it as a homogeneous

mass.Rural markets are extremely important today. Take Hindustan Lever. 50% of their sales come from rural market

Q. So, you are saying that what differentiate the two is that they areextremely value conscious. What are the other major differences?

A. Yes. The second difference is that urban buyer is an individual; he buys hisstuff of his own free choice whereas in rural the purchase decision-making islargely in groups. For instance, when the first tractor is bought in a village,

there will be lot of debate and discussion in the village Panchayat. So, it isabout collective decision-making. The same principle will apply to evenpersonal care products. A decision to use lipstick in rural environment needssocial approval.

The level of literacy is also a big divide. While urban audiences can buy aproduct after reading product literature, the same is not true of rural buyers.For rural audiences, seeing is believing. Which is why Levers isdemonstrating the use of its shampoos in 3000 haats! And tractor companiesgive out tractors for weeks to use before purchase.



Q. Are products and communication being designed keeping in mindthese nuances?

A. Not really. Take for instance, simple products like pressure cooker or electricbulb.

Most cooking in urban households is on a tabletop whereas all rural cooking

is done on the floor and on wood flames. So ergonomically the rural cookersshould ideally have two stub handles on either sides like halwai’s kadhai,long bakelite handle on one side gets charred in open flames. Simple, butimportant stuff.

Similarly for electric bulbs. A typical rural consumer changes bulbs 5 timesmore than his urban counterpart. Reason, in rural areas, voltage fluctuatesfrom 100 volts against 300 volts. So, all your electrical equipments getblown out, even simple things like electric bulbs!

I am not saying all product categories need to be modified, but certainlysome do.

Q. How do rural audiences respond to communication messages?

A. I will give you a hilarious example and then I will explain the point. Recently,in a village in Rajasthan, women watching an ad on TV started murmuringloudly. On asking an intermediary, I was told these women were saying ‘isladki sharam nahi aati’ pointing at a model in the Shampoo ad where the girlafter shampoo is bouncing her hair! According to local tradition, womencomb her hair in the privacy of the home and do not demonstrate in public!

So, is the role of communication being met? What I am saying is that youhave to be very sensitive towards your communication. You have to be veryclear about how you address in your communication and what medium youuse. We relate much better to a worldview, which is closer to our ownworldview.

Q. But isn’t the presence of mass media, especially television, changin grural consumers? Are they not opening up and becoming brandconscious?

A. Yes they are. Today villagers are becoming more brand conscious. Forinstance, in my recent to trip to a small town in UP, a Rikshawallah sportinga branded Ruff & Tuff jeans retorted ;sahab saal mein do pehenta hoon,Readymade kyon nahin. So that’s the sense of of ‘release’ in the currentgeneration from the philosophy of ‘restraint’ that his father’s generationpracticed.

See earlier Gold used to be a major source of security. Today, the securitycomes from life insurance. There is almost a 100% recall for LIC in rural



areas, everybody knows ‘Jeevan Beema’. They all are shifting their money toLIC, or to mutual funds.

The change is very visible and that’s what m arketers are trying to use. But Ithink they are going wrong somewhere- one is in distribution and second isnot enough local customization to compete with regional brands. See, Localbrands are emerging very strong. For every Britannia ‘Tiger’ there areb rands like ‘Kwality’ in Karnataka and ‘Priya’ in West Bengal. To stock a

‘local’ washing powder –‘Ghadi’, one needs to send money in advance! Sometea brands have adopted local ‘masala’ flavor and are giving market leadersrun for their money.

Q. So are you saying that TV has created awareness but marketers arefinding it difficult to penetrate?

A. Yes. Television has created a visibility and recall. So at the surface level, ademand for brands is there but because of poor distribution, it is fuelinggrowth of spurious brands. And there are amazing take-offs of popularbrands!

Also marketers will have to adapt the sales pitch to include ‘demos’.

Q. But distribution is really the key today. And is a complex issue.

A. Yes. It is a difficult one for the marketers.

Q. What are a few basic suggestions you have for tackling ruraldistribution?

A. The huge number of 6.5 lakh villages in India bogs down marketers. But weneed to understand that small villages with population of less than 1000 donot offer any potential. Their number is 4.5 lac. It is really the 2,000+villages totalling 65,000 that have the purchasing power. For durables,having stockists in the 5,000 towns of India is enough as these categoriesare not purchased from the village. For FMCGs, the stockist in addition to hisshop distribution can target the larger 15,000 haats which serve over 50%of the rural population. Thus one can serve the needs of rural India byfeeding a few thousand locations only.

I would end by saying that growth in the next few years will come largelyfrom rural markets. Those companies that develop a long term strategy willtake the bulk of the market growth. On the other hand, companies thatignore the rural markets or make only a few, sporadic tactical forays will doso at their own peril.

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Television is Fueling Demands for Branded Products in Rural India -(Exclusive Interview of Pradeep Kashyap,CEO,MART with exchange4media)