The census of India defines rural as any habitation with a population density of less than 400 per sq.km., where at least 75 per cent of male working population is engaged in agriculture and where there exists no municipality or board. Of the nearly 6.4 lakh villages in India, only 20,000 villages have populations more than 5,000.Leaving aside Hindustan Lever and ITC, most companies in the FMCG sector would define rural as any place with a population up to 20,000.Similarly,durable and agri-input companies would consider any town with a population below 50,000 as rural.
Companies face many challenges in tackling the rural markets, some of the more critical being: understanding rural consumers, reaching products and services to remote rural locations and communicating with vastly heterogeneous rural audiences. Sadly, not many companies have invested sufficient effort and money in research and nor have they spent enough time in the field to understand rural consumers, their values, aspirations, needs and usages habits. Marketing is all about ‘getting to know your customer’, but having largely ignored this cardinal principle, most corporate in rural markets find that success has eluded them.