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Why brands need to relook their rural consumer strategy

Why brands need to relook their rural consumer strategy

With over 200 million smartphone handsets in use in India, we are the second largest nation in the world in terms of smartphone usage. With the prices of smartphones reducing and internet tariff plans becoming more affordable, the mobility platform for brands to connect, engage and transact with the rural population is already there for the taking.

Raghuram Devarakonda
Why brands need to relook their rural consumer strategy

Raghuram Devarakonda

Recently, I read a newspaper article about how a remote village in Karnataka conducted its panchayat elections campaign using smartphones and social media.  I believe this epitomises and showcases the impact digital adoption can have in rural India today. With over 200 million smartphone handsets in use in India, we are the second largest nation in the world in terms of smartphone usage. With the prices of smartphones reducing and internet tariff plans becoming more affordable, the mobility platform for brands to connect, engage and transact with the rural population is already there for the taking.

All it takes is a bit of consumer insight mining - to determine the touchpoints in the purchase journey a rural consumer would value when engaging with a company through their handset - and delivering that experience using the right content design and workflows.

Many rural consumers keen to buy branded stuff

In our research we found that nearly 60 per cent of the rural population either harbour an intent to buy or already consume branded products. The question brands need to answer is how they can make themselves relevant and available for these consumers to purchase their products and services.

Today, the emerging rural consumer wants to assert their status in society by buying branded products. They also associate branded products with quality and performance. They want their children to live a better quality of life than what they have so far. Additionally, and more importantly, their purchasing power has improved significantly over the last decade with many households now having smaller families and both the husband and wife earning money.

As a first step, the rural consumer puts in a lot of effort to "discover" which brand to consume based on "word-of-mouth" consultations with their near and dear ones and other influencers depending on the product category. Second, the rural consumer also puts in a lot of effort locating the right outlet in a nearby town or city to travel and make the purchase.

Put simply, while the consumer base may be large for companies to leverage this rapidly emerging opportunity, they need to first think of innovative ways to get into the rural consumers' minds by easing the effort these consumers are putting to "discover"  them.  Brands also need to innovate in the way they are made available and be closer to where the consumers live, thereby minimising their hardships of travel to nearby towns and cities to fulfil their needs.

Brands that succeed in cost-effectively implementing brand awareness building and bridging the last "few" miles in their physical networks stand to gain from this opportunity.

Leverage mobility to build brand awareness

The good news is that the adoption rates of smartphones in rural India are already high and are only expected to grow even more in the near future.

So, the opportunity to leverage the mobility platform is already there and brands need to figure how to reach them and the type of content - either through audio, visual or both. Some FMCG companies have already initiated interesting ways of doing this and have succeeded in connecting with the rural population that have only basic handsets.

Focus on content design for effective connect

In our research, we found that the top two spends that rural consumers want to make are on education and healthcare. Both of these are associated with their aspiration to lead better quality lives. It appears to be their primary needs.

However, brands need not limit their offerings to education and healthcare and can think of building recall with rural consumers by participating in areas like agriculture-related information such as trading opportunities in the area of agricultural and allied activities. Brands need to also look at conversing with rural consumers on topics such as employment opportunities, english language skill development, adult education, health related information, cash transfer facilities, credit information and entertainment news.

We believe such an approach will enable better brand recall which can potentially lead to loyalty. It does not matter what these brands sell as long as they take a selfless approach to build trust with these target consumers.

Each of these areas mentioned above lend themselves well to being selfless as they have a direct bearing on improving the livelihood and the quality of life of the rural consumer and therefore will be valued immensely.

With these insights as a base, companies should intersperse their efforts with information regarding their brands and products. For example, given the literacy rates in rural India, an audio message delivered over the mobile phone will be more effective when combined with a user-friendly vernacular mobile app.

The nature of the content will depend on the consumer insights. Needless to say, these insights may vary across the country and therefore what works in one part of the country may not work as well in another.

What must companies do?

In order to capture the hearts and wallets of rural consumers, CEOs of companies need to put the rural consumer market as a strategic priority for the organisation and put in place dedicated resources to understand the needs of rural consumers. Information obtained through these resources should then be used to create products that a rural consumer desires. Companies may think shrinking existing products and reducing prices will boost rural consumer demand. However, our research points out that this is not necessarily true.

To find out what needs to be done, CEOs of companies interested in tapping the rural opportunity may want to answer the following questions:

  • Has my organisation recognised the rural consumer market as a strategic priority.
  •  Has my organisation dedicated resources to understand the needs of the rural consumers?
  • Does my organisation have a product/ service range that uniquely meets the rural consumers' needs? (not shrinking it and pricing it lower!)
  • Has my organisation developed a digital roadmap to enable rural consumers to "discover" me, "buy" me, "use" me and for me to "engage" with them? Is there a "Digital" chapter in my business plan?
  • Has my organisation identified the right set of "influencers" to provide the "word-of-mouth" approval for products and services.
  • Has my organisation developed a unique physical network to reach products and services to the rural consumer?

With several socio-economic changes sweeping the rural populace in recent years coupled with the mobile phone penetration presents an attractive window of opportunity for brands to establish themselves in the minds of the rural consumer in unique and effective ways.

An end-to-end view of the rural consumer cutting across the various segments along with insights into their respective purchase journey experience at various touchpoints will help provide vital inputs to develop a cost-effective approach to leverage the mobility platform to deliver superior customer experience and to find innovative ways to reach physical products and services. This is an increasingly aspirational segment of our population that is keen to consume branded products and services to enhance their status in their society and to fulfil their need of not only providing themselves but more importantly providing their children a better quality of life.

The time is now for brands looking for sustainable and profitable growth opportunities to focus on the rural consumer and commit time and resources so that they succeed in their growth pursuits.

The author is Managing Director, Advanced customer strategy, Accenture Strategy, India