Xavier Institute of Management, Bhubaneswar

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Segmentation, Targeting Positioning in Rural
Markets

• Session II
• Xavier Institute of Management, Bhubaneswar

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Orientations to the Market

• Selling orientation - Product orientation -
  Marketing orientation
• C K Prahalad and V Ramaswamy Co- creating
  value with customers
• Market as a target to Market as a forum
• The contribution revolution
• Customer is the king/ queen
• Understanding the customer is vital
• The Mahatmas words at railway stations
• Foundation of the STP process

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The STP Process
Marketing Decision Marketing Actions to be Undertaken
Segmenting Identifying and developing profiles of market segments
Target Evaluating segments and deciding the market coverage strategy
Positioning Identifying , selecting and communicating competitive advantages
Source The Rural Marketing Book- Khasyap. P
Raut. S
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Heterogeneity in Rural India
Variable Example
Socio Cultural Differences Caste Based Habitations in Villages
Population Size Density Kerala Vs Andhra Pradesh
Difference in Infrastructure BIMARU states Vs Karnataka
Media Exposure levels Kerala Vs Orissa
Literacy Levels Himachal Pradesh Vs Bihar
Income levels patterns Farmers Daily Wage Earners
Family Structure Joint Families Nuclear Families
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Segmentation Issues Options

• Measurability- Accessibility- Differentiability
  Profitability
• Is it easy to measure segments in rural areas?
• What are the issues in accessing rural markets?
• Is it necessary to segment underdeveloped
  markets? ( need for differentiation)
• What is the appropriate pay back period by
  focusing on a segment?
• What should be the appropriate market targeting
  strategy?
• Mass Segment Niche Micro approaches

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Basis Approaches to Segmentation
Segmentation Criteria Relevant Variables ( Indicative)
Geographic Region SCRs Village Size and density Climate
Demographic Age Gender Income ( NCAER ) Landownership Education ( SEC Classification) Occupation ( SEC Classification) Type of home ( SEC Classification)
Psychographics Lifestyle Rural, Urban Rurban Personality
Behavioral Occasions Benefits sought Loyalty usage status / rate
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Demographic SEC Classification

• MRUC and IRS
• Three variables Education of chief wage earner
  durable ownership- type of house

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Multi Attribute Segmentation
Thompson Rural Market Index Mica Rural Market Ratings
Developed by HTA 26 variables Demographics,agriculture, electrification and banking facilities Weights are given to variables Data from 383 districts collected Classification into A, B, C, D and E markets 42 socio economic indicators for ranking districts Linear combination of six variables for measuring market potential of districts Classification into A, B , C , D E markets
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Contd

• Rural market ratings by RK Swamy BBDO
• Lincompass by Linterland ( Lintas IMAG)

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Effective Market Targeting

• Segment attractiveness must match company
  objectives and resources
• Undifferentiated marketing- Coca Cola
• Differentiated marketing Tractor Marketing
• Single segment concentration
• Deciding the appropriate coverage strategy
• Coca Cola An arms length from desire

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Positioning

• A distinctive place in the mind of the consumer
• Identifying the unique features of the product/
  service
• Differences with respect to competition
• Selecting differences having a greater
  competitive advantage
• Communicating the best advantage to the consumer

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Issues in Positioning

• Attractiveness-Distinctiveness-Pre-emptive
  -Affordability - Communicability
• Under positioning over positioning confused
  positioning

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Close of Session

• Thank You