Rural vs. Urban Marketing in India: Empirical Study Based on the Socio-Economic Indicators

Abstract

A topic that is often discussed in India across political corridors, corporate boardrooms and households is the rural-urban divide and how the country's two economies ” the rural and the urban ” are increasingly growing apart. The popular notion is that growth not only has been skewed towards urban India but has also been gained at the expense of the countryside.

The India's economy can be thought of as comprising of two main sectors: - namely, Rural Sector and Urban sector. The rural market is dynamic and has stood for centuries on its own. Nobody can ignore rural India, which comprises one tenth of the world population. A revolution is sweeping the Indian countryside which has compelled companies to go rural. The rural consumer is discerning and rural markets are vibrant. Rural areas exhibit several distinctive characteristics that are different from the urban areas. Literacy levels, family structure, occupational patterns, social customs and norms, and several other features are unique to rural India. A complex set of factors influences rural consumer behavior. Social norms, traditions, castes, and social customs have greater influence on the consumer behaviour in rural areas than in urban areas. The seasonality of agricultural production influences the seasonality of rural consumers' demand. Although rural areas offer attractive opportunities to marketers at an aggregate level, about 68 percent of these markets remain untapped mainly due to inaccessibility. It is uneconomical to access a large number of small villages with a very low population density spread over a large geographic area. Up until recently, a large part of the marketing that was done in this country was done, targeting the urban population of the country. Now the marketing potential of the rural part of the country is rapidly growing. Let us get an understanding of the urban and the rural breakup of the country. Around 32% of the population lives in the cities, or in urban India and the remaining 68.84% lives in the villages or in rural India. The population of the country is spread over the villages, but is very concentrated in the cities. India has six of the largest cities in the world. The Indian rural market with its vast size offers a huge opportunity with 128 million households and the rural population is nearly three times the urban.  Rural India has a large consuming class with 41 percent of India's middle-class and 58 percent of the total disposable income. To understand this better consider the following favourable shifts that have taken place in the consumer patters of buying. There is a big difference between urban and rural India buying patterns. This research paper basically aims at bringing out the basic differences between the Indian rural market and urban market.

An attempt has been made in the paper to examine the rural-urban disparity in terms of various socioeconomic indicators. This paper empirically presents the impact of socioeconomic factors on the Indian markets. As an exploratory study on rural and urban consumers in emerging market like India, this paper found that consumers are statistically different in terms of their attitude