Rural segmentation

The presentation deals with the segmentation, targeting and positioning in rural markets

1. MODULE 5
SEGMENTING, TARGETING,
POSITIONING AND PRODUCT
STRATEGY
PRESENTED
BY
PRAVEEN PRABHU
AND
PARTHA SARTHI CHATTERJEE

2. Introduction
•With the increase in population and with the increased target
groups undifferentiated products for an undifferentiated
market is a thing of the past.
•Initially, marketers in India concentrated on segmenting the
urban market only as it contributed to 75% of the revenue.
With the saturation of the urban market in recent years and
the growing demand in rural markets simultaneously, the
need to segment the market is being felt increasingly.
•As economies evolve, consumer choice and requirements
become more focused. This calls for Segmenting, Targeting
and Positioning (STP).

3. Segmenting, Targeting and
Positioning.
DecisionActions
Segmenting•Identifying various bases for segmenting markets
•Developing profiles of market segments
Targeting•Evaluating the market segments for their
attractiveness
•Deciding the market coverage strategy
Positioning•Identifying a set of possible competitive advantages
of the brand
•Selecting the right competitive advantage
•Communicating the chosen competitive advantage
to the target customers.

4. Segmentation
•Segmentation is the process of dividing a heterogeneous
market, into several sub-markets or segments, each of which
tends to be homogeneous in all significant aspects.
•According to Philip Kotler, “Market Segmentation os dividing
a market into distinct groups of buyers who have distinct
needs, characteristics, or behaviuor and who might require
separate products or marketing mixes.

5. Segmentation
•Market Segment: A group of consumers who respond in a
similar way to a given set of marketing efforts.
•Market Segments helps distinguish one customer profile from
another within a given market.
•Segmentation facilitates in understanding the needs of target
buyers.

6. Segmentation
•75% of people in rural India are engaged in agriculture, but
they cannot all be clubbed under one omnibus category of
farmers.
•There are;
–large farmers,
–medium farmers,
–small farmers,
–marginal farmers and
–agricultural labourers.
•Their income levels, lifestyles and behaviour are different
from each other.

7. Segmentation
•Heterogeneity of the Rural Market:
There are a number of factors that display the heterogeneity of
the rural market;
•Socio-cultural differences across regions
•Variation in population size and population density
•Difference in levels of infrastructural development
•Variations in literacy levels
•Differences in income levels and patterns of income flow
•Family structure

8. Segmentation
•Prerequisites for Effective Segmentation:
–Measurable
–Accessible
–Differentiable
–Substantiable
•Homogeneity
•Largeness

9. Segmentation
•Degrees of Segmentation:
–Mass Marketing
•Considers all customers homogeneous.
–Segment Marketing
•Identifies customers as different groups
–Niche Marketing
•Serves selectively one or a few customer groups
–Micro Marketing
•Focuses on individuals or very small groups
–Local Marketing
–Individual Marketing

10. Segmentation
•Basis of Segmentation and Approaches to
Rural Segmentation:
• Geographic Segmentation
–Regions
–Village population and density
–Culture

11. Segmentation
•Demographic Segmentation
–Age & Life Cycle
–Family Structure
–Income
–Landownership
–Occupation
–Education and House Type
–Religion & Caste

12. Segmentation
•Psychographic Segmentation
–Social Class
–Lifestyle

13. Segmentation
•Behavioural Segmentation
–Occasions
–Benefits Sought
–User Status
–Usage Rate
–Loyalty
–Place of Purchase
•Multi-attribute Segmentation

14. Segmentation
Basis of Segmentation

16. Targeting

Targeting involves evaluating various
segments and selecting how many and which
one to target. The three aspects of targeting
are evaluating, selection and coverage

17. Targeting
•Evaluation:
- Evaluation and selection of segment:
The two main factors to be considered here
are: the overall attractiveness of each
segment and company’s objectives.
- Overall attractiveness:
Size of the marketing may be huge but the
purchasing power is limited.

18. Targeting
- Company objective and resource
competencies:

• Selection of segment:
Selection of the segment can be made by
rating them on predetermined scale(low,
medium, high) in respect of the evaluation
factors

19. Targeting
•Coverage of segments:
- Undifferentiated Marketing:
It takes into consideration what is
common among consumers and tries to
include it in the offer. Hence, it relies on mass
distribution and mass advertisement. Due to
this the company can afford to set its price
low.

20. Targeting
-Differentiated Marketing:
It investigates and identifies differences
between segments and tries to match the
market offer to the desires and expectation of
each segment. This strategy results in strong
identification of the company in the product
category, higher sales and can get more loyal
consumers.

21. Targeting

- Concentrated Strategy:
It is important for them to have multi-
segment strategy rather than a single
segment strategy to ensure adequate Return
On Investment and to avoid the risk of change
in preference of the consumers.

22. Positioning
Positioning is the act of designing the
company’s offering and image so that it
occupies a distinctive place in the mind of the
target segment.

23. Positioning
•Identifying the positioning concept
•Product differentiation
•Service differentiation
•People
•Image
•Selection of positioning concept
•Developing the concept

24. Positioning
•Communicating the concept
- Deciding how many differences to promote

- Deciding which positioning to promote

25. Product Strategy
•For transferring a marketing strategy into a
marketing program the marketer needs to
decide on the Marketing Mix that is to
pursue the marketing objective in the rural
market.

26. Product Strategy
4Ps (Tools) 4As (Challenges)
Product Acceptability
Price Affordability
Place Availability
Promotion Awareness
Marketing Mix Challenges

27. Product Strategy
•Product Concepts and Classification:
–A marketer should keep the following aspects ion
mind while taking the products to rural markets.
Products intended for rural markets should be:
1.Simple
2.Easy to use
3.Visually identifiable
4.Affordable

28. Product Strategy
•Five Levels Of Products:
1.Core Benefit
2.Basic Product
3.Expected Product
4.Augmented Product
5.Potential Product

29. Product Strategy
•Rural Product Categories:
1.FMCG
3.Consumer Durables
5.Agri Products
7.Services

30. Thank
You