Shinmin Bali
Aug 11, 2014

'Awareness, affordability, availability': George Angelo, Dabur India

The ED, sales at the FMCG major on the environment within which rural marketing exists

'Awareness, affordability, availability': George Angelo, Dabur India
For Dabur India, rural markets account for 40 per cent of its revenue. Presenting pointers for organisations looking to win in rural India was George Angelo, ED, sales at the FMCG major. He was speaking on the second and final day of a rural marketing seminar hosted by Marcus Evans in Mumbai, on 8 August.
 
Perspective
 
Angelo pointed out, "The challenge for FMCG is that you have 29 states with at least 30 main spoken languages. Brands play out very differently in the various socio-cultural regions across India. You have categories that are at different stages of development in the country. Large organisations of the country who have understood this and developed products accordingly which are relevant to particular geographies, or have customised communications that are in line with the way people process information, have been successful."
 
He added that conformity to societal norms plays a huge role in the rural markets and greatly affects buying decisions. "We feel that the rural markets are all about tradition and culture and listening to your elders and conforming to their views. So for example, in case of pesticides you will see the same product being used in almost all fields owing to the need to conform," he said. This conformity, he stated, may apply to very sharply defined regions and may vary from one region to another. He added, "It can also happen that there is a product that enjoys about 95 per cent market share in a particular region, but if we were to travel, say, 80 km from that region we will find a completely different product enjoying similar market share." 
 
The speaker underlined the growing importance of the rural youth. While they constitute a large percentage of the rural consumer base, their role in decision making is also increasing, he explained. This, he said, gives new entrants a chance to change the paradigm within which the market operates.
 
Another point he touched upon was increasing per capita consumption, which in some cases matched urban consumption, according to the Dabur executive director. With disposable income on the rise, consumption would go up in rural markets, he contended. 
 
To keep pace with the million new consumers added each year, Angelo said organisations need to make inroads into the rural market keeping in mind the three drivers of growth: awareness, affordability and availability. 
 
Insights and challenges
 
Angelo expanded on Dabur’s strategy for rural markets. The company targeted 10 States that account for 70 per cent of the potential. These comprised about 360 districts, of which Dabur decided to focus only on 312 districts. The company also scouted for talent from within the villages.
 
“We also understood that we need to supplement our brand's messaging and activation at the ground level which led us to partner with non-competing brands to expand coverage of their initiatives and piggyback on that," he said. 
 
Challenges included determining reach of the product, sustaining that product and to have people who were actually excited about the initiative working on it, he noted. 
 
Drawing from his experience at Dabur, Angelo outlined learnings:
 
  • Conventional media is ineffective as rural people value a product's functionality over frills.
  • Marketers need to look at brands which will have traction in that terrain, and then craft a communication programme and gather insights. If the insight is not sharp enough then the communication developed from it is not likely to work.
  • At the pilot level everything works, so marketers need to keep in mind that it has to be scaled. One must concentrate on certain geographies, go into those markets and observe what happens.
  • Need to engage with people with a certain amount of frequency. Marketers must not expect them to buy the product on first exposure.
  • The challenges for a company of size is to decide what to focus on. Marketers need to have very sharp focus in terms of initiatives.
  • Definition of rural is different for everybody. Every organisation needs to have a specific definition of rural that applies to their initiatives.
  • Marketers need to assess volatility of demand.
  • Need to watch out for surrogate categories to gauge change in consumption patterns.
  • Marketers need to be aware on the consumer engagement front.
  • Marketers need to be clear about the category, and know which categories work in which markets. There may also be a case to create a category in those markets.
  • One must not underestimate the role of influencers.
  • Need to start looking at customising product or service for this segment; work carefully with scale limitations while customising.
  • Need to customise communication.
  • Decide on a real, sustainable pricing strategy.
Source:
Campaign India