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Marketing and Strategy

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Marketing and Strategy

June, 2012


A strategy is a plan or pattern that brings together the objectives and activities of an organisation into a cohesive whole. Manufacturers and service providers today are laying intense focus on how they market their offerings to the customers and hence are devoting substantial time, energy and finances to device appropriate strategies in order to attract the buyers.

A report released by Boston Consulting Group (BCG) and Confederation of Indian Industry (CII) projects that India's robust economic growth and rising household incomes would take consumer spending to a level of US$ 3.6 trillion by 2020. The report further stated that India's share of global consumption would expand more than two times to 5.8 per cent by 2020.

A marketing strategy looks at the longer term view of the products, goods, or services being marketed. Marketing strategies explain how the marketing function fits in with the overall strategy for a business. Marketers use several strategies such as launching new products, expanding distribution, making more investment in advertisement, public relation programme, etc. in order to gain maximum footage in rural as well as urban spaces.

Marketers are focusing on rural India

The rural population dominates the Indian market with over 720 million consumers (70 per cent of the total population) spread across 0.63 million villages. Typically Indian rural retail stores are in the form of haats and melas.

  • The NTP (National Telecom Policy) 2012 expects to take India's rural teledensity from 39 per cent to 70 per cent in the next 5 years with the target that every single Indian will have a phone by 2020
  • Most of the big retail companies have started entering the untapped rural market. For instance, ITC has taken a rural initiative through Choupal, DCM has introduced Hariyali Kisan Bazaars and Pantaloons has entered a JV with Godrej and has set up Aadhars. Also, Sony is expanding in rural areas with affordable prices and entry level models
  • Indian footwear industry, growing at a compound annual growth rate (CAGR) of about 15 per cent, is anticipated to reach approximately Rs 38,700 crore (US$ 7 billion) by 2015 from the current level of around Rs 22,000 crore (US$ 4 billion), according to a study by a leading industrial body. The projected growth is based on larger penetration into tier II and III cities and growing rural market which is making various premium footwear brands enter India's non-metro market. According to the estimates, rural India accounts for about 55 per cent of the overall footwear industry
  • The rural India, with over 0.6 million villages, provides enormous growth opportunities for cement manufacturers in the country. Companies, including Heidelberg Cement, ACC, Ultratech, Binani and Shree Cement are planning to expand their reach to the vast untapped rural market. Rural infrastructure development is expected to raise the cement consumption in the coming years. With the demand for low-cost housing increasing in rural and semi-urban areas, the cement sales may rise up to 30 per cent in the rural market

Advertising, Media & Entertainment

Advertising is an inseparable part of marketing initiatives these days. According to the Indian e-Retail report, the online advertising market, being driven by increasing internet penetration and a large number of young people, will touch Rs 7,000 crore (US$ 1.3 billion) by 2015. The online advertising market, which comprises of search, display, rich media, video, classifieds, etc., is currently pegged at about Rs 1,850 crore (US$ 332.7 million).