Rural Marketing: Challenges in Distribution and Channel Management

 | June 15,2010 02:14 pm IST

Importance of Rural Market

The main reason why the companies are focusing on rural market and developing effective strategies to tap the market potential can be identified as:


Large population:  Approximately 75% of India’s population resides in around 6,38,365 villages of India spread over 32 lakh square kilometer.41% of India’s middle class resides in rural areas.


Higher purchasing capacity:  Purchasing power of rural people is on rise.


Market growth:  Market is growing at a rate of 3-4 % per annum adding more than one  million new customer every year.

  1. Development of infrastructure:  Government is taking a number of initiatives and investing towards development of infrastructure facility and public service projects in rural India, which includes construction of roads, electricity connection, telephone connection.


  1. Thus more number of rural people will start enjoying facilities like television, internet access, electricity connection, improve roads and better public transport system.
Some of the facts that will highlight the potentiality of rural market:
  • According to a study by the Chennai based Francis Kanoi marketing planning services, estimated annual size of market is


 FMCG - Rs. 65,000 crore
 Consumer durable - Rs. 5000 crore
 Agri inputs (eg tractor) - Rs. 45,000 crore
 2/4 wheelers - Rs. 8,000 crore
 Total -   Rs. 1,23,000 crore

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Jonni on 09/06/11 at 09:35 am

To think, I was cnofuesd a minute ago.