FICCI-KPMG-Report-13-FRAMES

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.
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with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.