Spurious Products in Rural area

Rural Marketing

1. RURAL MARKETING
Assignment – 1:- Spurious products in rural areas

Introduction
Spurious product are those product which have a look like name, identity, color, pattern, design and
could have same identical name. They are counterfeit or fake product. These are products that are
similar in shape, size and colour to the prominent brands. Manufacturers of such spurious brands
mostly ride piggyback on the advertising campaign of larger players and establish their own brand in
the region. The look-alikes sport colour schemes that resemble that of popular brands, but the brand
name is totally different. The spell-a likes are more dubious than the look-alikes.
Indian rural market with its colossal size and demand base offers tremendous opportunities to
marketers. Almost 65 percent of India’s consumers live in rural areas and almost (or nearly or about)
one third of the national income is generated from rural India. It is only natural that rural markets
form an important part of the total market of India. Everyone sees it as a profusion of opportunities,
whether for marketing of durables, textile and garments, personal care products and financial
services. Abstract When taking the subject of rural marketing in India, everyone related it to the
enormous size and demand base as it brings huge opportunities to marketers. Huge revenue is
generated in this field owing to the majority of population residing in rural areas. This brings about
the threat of counterfeits and pass-offs, the knowledge of which is of utmost importance to the
consumers in this part who tend to go about the purchasing based on the look, design and many
more features of a brand. Recently, researchers have paid increasing attention to rural marketing,
but the rural marketing domain has unique characteristics that require industry specific knowledge
development. Marketers in this area face unique challenges in every aspect of rural marketing. Rural
marketing, from the point of view of spurious products is an under researched area within the rural
marketing discipline.

Objectives of the Study
The following are the objectives of the study wishes to enquire and understand in the process. To
understand the role of spurious products in rural retailing with respect to the following broad
outlines:
(i) Identify the major problems due to spurious products.
(ii) Various factors influencing rural consumers in buying spurious products.
(iii) Identifications of spurious products by consumers.
(iv) To understand the spurious brand manufacturer marketing strategies and possible
countering strategies to fight against spurious manufacturers.
(v) Awareness regarding hazardousness nature of spurious products.
(vi) Purchase sources of spurious products.

2. Research Methodology
Nature of Study: -
The study is exploratory in nature as it endeavours to uncover the latent behavioural
aspects of rural consumers and retailers with respect to the role of spurious products in
the state of Karnataka. Universe of Study and Population The universe of the study is
rural retailers and consumers in the rural villages of Karnataka. The universe of the study
is classified as North Karnataka, South Karnataka, East Karnataka and West Karnataka.
The scope of the study is limited to role of spurious products in rural areas. The study is
based on the empirical survey of 200 villages situated in the state of Karnataka.
Primary Data Source
First-hand information was obtained from respondents through a structured
questionnaire. An interview schedule was constructed to elicit information from the
respondents. The researcher had to construct two sets of questionnaires; one for
eliciting information from the rural retail respondents and another distributed across all
strata of consumer respondents, the strata decided by the distance to the nearest town
and every seventh household in the selected strata. The questionnaire contained
different sections and each section concentrated on particular aspect of the retailing
and buying behaviour of spurious products.

Pilot Study: -
Before scaling for full research, the researcher initiated a pilot study with 30 rural retail
respondents and 100 rural consumers. These collected questionnaires were analysed to
determine whether the data collected helped the researcher in fulfilling the objectives
of the study, apart from testing the validity of the questions put across to the
respondents – both rural retail respondents and rural consumers. In this section, the
researcher discusses the results of the survey with reference to the validity of the
questionnaire and profiles of the respondents and retailers simultaneously with the
researcher discuss the testing of the proposed hypotheses. The validity of the
questionnaire was adjudged using Cronbach’s coefficient (α) calculated to test the
reliability and internal consistency of the responses. Cronbach’s coefficient having a
value of more than 0.5 is considered adequate for such exploratory work. The values of
α in this study for the three reported questions were found to be 0.736, 0.805and 0.765
giving an average value of 0.768. It implies that there is a high degree of internal
consistency in the responses to the questionnaire.

3. Define Fake Products
Rural markets suffer from the problems of low penetration and poor availability of branded
products. Hence, although there exists a huge demand for branded products, there are no
distribution channels to make the product reach the customer. This has led to the growth of fake
brands. Ex-Ponds has been replaced by Bond’s talc, Fair & Lovely by Four & Love, Colgate by
Coolgate.

Types of Fake Brands: -
1. Look-alike- Products where the colour scheme on the packaging material closely
resembles that of a popular brand but the pack carries a different name. Lifeboy for
Lifebuoy, Lalita Amla for Dabur Amla.
2. Spell-alike- Fakes of original brands packaged in colours and designs similar to those
of the originals but have names that are subtly and cleverly misspell. E.g., Colgate by
Coolgate, Fair & Lonely for Four & Love.
3. Duplicates- Exact copies of original brands. The colour, design, and name on the
package are the same as those of the original brands.

4. Reason for Rural Exploitation
1. Consumers: The major victims of fake or spurious products are consumers themselves who are
cheated by manufacturers of such products again and again. A major chunk of Indian consumers live
in villages also who is not educated and aware of such practices.
2. Transport Problem: Transportation infrastructure is very poor in rural India. Though India has the
fourth largest railway system in the world, many villages remain outside the railway network. Many
villages have only kaccha roads while many of rural interiors are totally unconnected by the roads.
Because of this the physical distribution is difficult in rural areas.
3. Communication Problems: Communication infrastructure consisting of posts, telegraphs and
telephones are inadequate.
4. Warehousing Problems: Central Warehousing Corporation and State Warehousing Corporation do
not extend their services to the rural parts. The warehouses at mandi level are managed by co-
operative societies who provide services to members only.
5. Many Languages and Dialects: The number of language and dialects vary widely from state to
state, region to region and even from district to district. Though the recognized languages are only
16 the number of dialects is around 850.
6. Market Organization & Staff: Rural marketing needs large marketing organization and staff to
have an effective control, which requires huge investment.
7. Non-Availability of Dealers: It is not possible to have direct outlets in each rural market; firms
need to have service of dealers, which is not easily available.
8. Hierarchy of Market: Rural consumers have identified market places for different items of their
requirements. Thus, depending upon the purchase habit of rural people, the distribution network of
different commodities has to be different.

Reason of spurious Industry
1 Heavy profit
2Low income group
3Low level of literacy
4Lack of Awareness
5 Lack of distribution channel
6 Lack of transportation facilities
7 Available of fake products.

5. Strategies to curb the practices of fake producers
 One method is to strengthen the distribution network.
 Another way to tackle this problem is to make the packaging tamper-proof with more
sophisticated and capital-intensive method.
 Yet another approach is to organize consumer contest in haats and big villages to distinguish
the original products from the counterfeits in order to increase consumer sensitivity to the
issue.
 Finally, another approach to tackle the menace of fake brands is to initiate legal action
against the counterfeiters.

Conclusion
Rural market in India badly affected due to sales of spurious products. Still rural consumers are
unaware and unable to differentiate the branded FMCG products from spurious products available
at retail shops. Although in last decade literacy level of rural consumers rises from59% (Approx.) to
69% (Approx.), but still availability of spurious products indicates the other factors behind its sales.
Spurious products badly affect the rural market sales of many branded FMCG companies. FMCG
companies have taken some initiatives to counter them but unable to implement a holistic strategy
to counter spurious product manufacturers strategy in long run.


Submitted by
Ankit sha
PG19021