India's rural consumers are an aspirational, brand-conscious lot who set little value to star-endorsed products and the latest Accenture research shows that businesses in India are more confident than ever about the growth of the country’s rural consumer markets, but are risking their competitiveness by failing to respond to the changing needs and behaviours of rural consumers.The third annual edition of the research, “Masters of Rural Markets: From Touchpoints to Trustpoints - Winning over India’s Aspiring Rural Consumers,” shows that while businesses in India have built their physical footprint in these regions they need to build trust and loyalty in a market which is more diverse and sophisticated than many of them are ready to exploit. According to the research -- involving 2,800 consumers and customer service officers at 40 businesses in several states -- rural consumers are particularly aspirational, striving to purchase branded, high quality products. Seventy-one per cent of respondents have purchased branded products and 59 per cent see them as trustworthy and reliable. Forty-two per cent indicated product upgrading was a reason for spending more in a category. These consumers are defying conventional wisdom that says rural consumers care most about price and will settle for sub-standard offerings to achieve the best deal.The report notes that rural consumers are better networked and proactively seek information through multiple sources. Additionally, women and children now play a more empowered role in purchasing decisions and travel further to buy goods and services. Half of the respondents (50 per cent) visit nearby towns and district headquarters to make small-ticket purchases. Tellingly, only seven per cent of respondents said that advertisements influence their final purchase decisions. While these findings convey a shift in rural consumption patterns, Indian businesses are still using conventional marketing channels, such as celebrity endorsed advertisements, to reach these consumers.Not Driven By Low Values“The expectations of today’s rural Indian consumers differ markedly from those of previous generations. They are moving away from purely economic concepts of value driven by low prices, towards a broader notion of value that combines price with the utility, aesthetics and features of products and services,” said Sanjay Dawar, managing director for Accenture’s Strategy practice in India. “Being present is not sufficient to be competitive. To succeed, companies must extend from physical touchpoints to experience-led ‘trust points.’ This means understanding how rural consumers are changing, and then using those insights to tailor their marketing strategies to different consumer segments.”The research also found several incorrect assumptions about rural Indian consumers that have prevented some businesses from establishing long-lasting brand relationships with them. While many businesses believe that consumers make most planned purchases on special occasions, more than half (55 per cent) of the respondents said they make such purchases as the need arises. Likewise, while many companies underestimate the importance of customer service in rural markets, almost half (49 per cent) of respondents consider high-quality customer services to be an important factor when making purchases. Sixty-three per cent said they tell others about a bad purchase experience.Accenture divided rural Indian consumers into four segments and tested just how ready companies are to serve these diverse rural consumers: Traditionalists are the conservative rural consumers who rely on conventional channels to make their purchase decisions. Necessity drives most of their purchase decisions and they typically purchase the cheapest offerings available, even if it means compromising on features and aesthetics.Steady Climbers aspire for a more comfortable lifestyle. They want to enhance their social standing among their peers, and strive to do so by buying branded products and offeringsYoung Enthusiasts are rural consumers between 18 and 28 years of age who make extensive use of digital technology and buy branded products to enhance their social image. They extend powerful influence on the decisions of the other consumers segments.Village Elites are the progressive rural consumers, boasting high education and awareness levels. They desire the best in product quality, features and aesthetics.“To meet the changing needs of the rural consumers, companies will need to adapt their product portfolio, their value propositions and their go-to-market strategies,” said Raghuram Devarakonda, managing director, Sales and Customer Services, Accenture Strategy. “Companies that act now to enhance their understanding of changing rural consumer behaviors and tailor their marketing, selling and service strategies to these consumers’ shifting realities will gain a competitive edge over those who wait until the market evolves further.”At each of the following stages of rural consumers’ purchase journey, Accenture has outlined the specific imperatives businesses must make to improve their competitiveness in rural markets:Trustpoint 1 — Need recognition: Target the right consumers according to their means. Show how offerings address their unique needs through simple and entertaining marketing.Trustpoint 2 — Awareness: Include non-traditional media in marketing that conveys consistent messages across multiple channels.Trustpoint 3 — Consideration: Define an irresistible value proposition that looks beyond pricing as a long-term source of differentiation, especially for products categories that are new to rural consumers.Trustpoint 4 — Validation: Identify and engage the most relevant influencers for targeted consumer segments to strengthen trust through word of mouth.Trustpoint 5 — Purchase: Offer expert advice and differentiated service to enhance the in-store experience as rural consumers increase their purchase expectations.Trustpoint 6 — Experience: Differentiate by offering exceptional customer service across the purchase journey to maintain loyalty well beyond the point of transaction.Trustpoint 7 — Advocacy: Nurture consumer advocates by promptly addressing problems to preempt negative word of mouth.
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The Air Passengers Association of India (APAI) on Sunday questioned the frequent "special fare" offers by domestic carriers and termed them as "non-existent", even as it urged the DGCA not to allow such schemes. The association, in a communication to the Directorate General of Civil Aviation, also sought to know as to what action the regulator intends to take against the carriers on the issue. "We strongly believe that the DGCA must put an end to this practice of offering ridiculously low fares which are non-existent and are not really available to the passenger," APAI President D. Sidhakara Reddy said in his communication to DGCA Prabhat Kumar. Stating that the association was forced to draw the regulator's attention towards the issue following several complaints received from the passengers, Reddy said, "most of the times, the schemes are similar and fares announced are also similar. How can this happen unless a cartel is working to fool the travelling public ?" The domestic carriers, led by cash-strapped budget airline SpiceJet, have been rolling our limited period "special sale" offers since January this year to woo passengers. "We have received several complaints that first the passengers do not get access to the airline's portal and if they are able to do so and look for the advertised (special) fare for a particular sector, it shows sold out, whereas most of the other types of fares are only available for bookings," Reddy alleged. Pointing out that it become a routine practice by all the airlines to announce such schemes almost once in 10-15 days, APAI said, "the Airlines seem to be doing this with certain objectives in mind as it gives them tremendous publicity at no cost." The association has also sought to know from the regulator whether the carriers do inform of the percentage of seats they offer under the special fare as they are supposed to file their fares with DGCA, indicating the quantum allocated under each type of fare offered by them under the bucket pricing method. "If they are not then what action do you propose (to take) for not following the procedure?," Reddy questioned in his communication. APAI will explore the Right to Information (RTI) route if the DGCA did not respond to its communication, Reddy added in his communication. (PTI)
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