The Rural Market - A Lucrative Destination

The Recession is affecting the world all over including India, The market in the cities are getting mature and in some sectors it is saturated. Now, the comapnies have to look for more lucrative destination and one of the most lucrative and promising market is the Rural India.
Today, The Indian Growth story is now spreading itself to India's Hinterlands. With the increasing income both, i.e the production and consumption has increased. As for the year 2007-2008, foodgrain's production has increased by 4.6% over the previous year at more than 227 million tonnes. The Rural Market has grown at an impressive rate of 25% compared to 7-10% growth of the urban consumer retail market.
In last five years the development of rural infrastructure has become an important priorty for the government. The government is making the agriculture activities highly mecahnised wchich has helped in improving the output and productivity of the agriculture resulting into higher income for the rural consumers. Government are making efforts along with the private corporations to build good infrastructure, educate people regarding the farming techniques and also making sure that the farmers get the best deal for their production. And one such example is the ITC's initiative of E-Choupal.
As today when the recession is been impacting the world allover and also the Indian Economy has been affected, Still the Rural Indian Market emboldened by a bumper harvest, generous loan waiver and growing middle class has been able to give a smile to the companies as that is where they can rely because the rural consumers are showing considerable resilience in spends on fast moving consumer goods (FMCG) despite the economic slowdown. One more reason for the increase in rural market is that people from rural market are working in urban markets so their earnings and savings are transfered to the rural market wchich gives an opportunity for the rural consumers to demand more and consume more.
But Companies must also realised that " the traditional perception of Rural India - An Agriculture dependent economy is no longer valid. Rural market in India is not only large but as diverse and also scattered. A home to 770 million in 627,000 villages which exihibits linguistic, regional and cultural disparities makes it more complex than the market of a continent as a whole.
The companies need to take specific initiatives to tap the scope of rural markets like infrastructural development eg:- ITC through E-Choupal, Unilver's Project Shakti etc. , understanding the psyche of rural consumers, communicating to them in their regional market wchich can help them to tap the market and enjoy good amount of brand image and more profit than the urban market.
So it can be said that " Improving the lives of billions of people at the bottom of economic pyramid can be challenging and hard but it can also be a lucrative one.