FICCI-KPMG-Report-13-FRAMES

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50 The power of a billion: Realizing the Indian dream State Percentage of literate population not reading any newspaper Percentage of literate people as per IRS Q3 2012 West Bengal 60% 77% Gujarat 57% 76% Madhya Pradesh 57% 64% Assam 56% 74% Orissa 54% 73% Bihar 53% 59% Chhattisgarh 51% 69% Punjab 51% 76% Uttar Pradesh 49% 64% Haryana 49% 77% Himachal Pradesh 48% 85% Karnataka 47% 74% Uttaranchal 45% 79% Andhra Pradesh 45% 67% Rajasthan 44% 66% Jharkhand 42% 63% Jammu & Kashmir 41% 86% Delhi 39% 90% © 2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Maharashtra 36% 81% Tamil Nadu 34% 83% Chandigarh 24% 90% Goa 22% 92% Kerala 17% 97% Source: IRS Q3 2012 Furthermore, as seen from the table above, there are seven states where the literacy ratio is higher than the all India average, but the percentage of people not reading any publication is also higher than the average of 44 percent. For instance, in West Bengal, which has played a pivotal role in the development of the print industry in India, 60 percent of the literate population does not read a newspaper. The above statistics highlight the challenges, and in turn, potential opportunities for the print industry. The industry needs to look at these segments and develop innovative strategies to promote reading habits.
The power of a billion: Realizing the Indian dream 51 “ Improving readership habits among youth within age group of 15 to 20 and also aligning the presentation of news to meet their requirement is a challenge which print media needs to address immediately. There exist a serious threat of this section of reader base shifting to the new and social media for news and views consumption - Sunil Mutreja Executive Director, Amar Ujala Publications Ltd Macroeconomic statistics indicate that India’s rural market presents opportunities that business cannot ignore. The rural population has the potential to become an important consumption centre by moving beyond survival mode. Marketers are hence looking at rural consumers to increase their product sales. For instance, the auto sector is increasing its share of volume in rural India. Light commercial vehicles (LCV) is the fastest growing segment that is estimated to register a sales growth of around 20 percent during FY 2012-FY 2015 21 . High dependence of companies on rural markets: Company Category % sales from rural market Rural markets on the radar Rural India accounts for 70 percent of India’s population, 56 percent of National Income and 64 percent of the total expenditure 19 . Union Budget 2013-14 has allocated INR 801 billion towards rural development schemes and INR 270 billion for agriculture. The budget has also fixed an annual agriculture credit target of INR 7000 billion in 2013- 14, up from INR 5,750 billion 20 . Hindustan Unilever Household products 45 Hero Honda Two-Wheelers 60 Dabur Personal products 40 Dish TV Media 33 The government’s decisions to extend the interest subvention scheme for short-term crop loans and higher allocation for the national rural employment guarantee scheme are expected help stir demand in rural pockets. This is expected to increase the disposable income of rural consumers, who contribute to about one-third of FMCG sales. Rural markets have been a key focus area for many consumer goods players such as Dabur, HUL, ITC and Emami; this focus is likely to increase going forward. “ As advertising spends are being directed towards tier-II and III cities, industry will witness trend of existing players launching more local editions to attract retail advertisers. However publishing houses will have to be pragmatic and balance the economics of launch with the market potential “ - Mohit Jain Director-Business and Commercial, The Times of India Group The traditional vision of the rural economy as purely agricultural is clearly obsolete. There are significant changes i.e. increasing income, rising education and technology penetration as well as globalisation that are enabling exposure and awareness. According to the National Sample Survey (Household Consumer Expenditure in India 2009 –10) the average monthly per capita expenditure in 2009 –10 was estimated at INR 1053.6 in rural India. This accounts for 60 percent increase over 2004 – 05 19 . 19. The Marketing Whitebook 2012 – 13, Businessworld 20. http://www.moneycontrol.com/news/budget-news/highlightsunion-budget-2013-14_831956.html 21. http://www.frost.com/prod/servlet/press-release.pag?docid=264693723 22. Niche magazine for rural India launched, 16 August 2012, exchange4media.com TVS Two-Wheelers 50 Source: The Marketing Whitebook 2012-13, Businessworld Recognizing the potential of rural India, i9 Media launched ‘Rural Marketing’ 22 magazine with a focus on highlighting the finer points of the rural bases, which go unnoticed by mainstream media. The favourable macroeconomic constituents of rural markets have attracted publishing players to enter and strengthen their position in the rural markets. © 2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
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FICCI 2013 143 “ The Amendments t
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Acknowledgement We acknowledge the
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