The
Event Theme:
Rural India is the next growth destination.
The aspirations of today’s rural consumers, who are “better-connected” and
“more-aware”, are rising. They are fuelled further by their increasing incomes.
“Why” marketers should go rural is not a question anymore… The task now is to
devise strategies that can seize this opportunity. The “how” of it!
To help marketers navigate this future
effectively, Rural Marketing Association of India organized a Conclave with the theme “From
why rural to how rural”.
The event saw an amalgamation of two
generations of the rural marketing fraternity. Experienced industry veterans joined
the new age professionals to share the best practices and preview the next
practices through panel discussions, presentations and case studies.
My
Session Theme:
While some marketers have hopped on to the
rural bandwagon early, many have started exploring more recently. Strategies
that worked in rural markets, as also those that didn't, have been well
documented. Riding on the increasing penetration of mobile devices and
internet, social media and e-commerce are no longer the things of the future in
rural India.
Coming well after the mid-point of the event,
on Day 2, my job was to pick a few widely recommended “hows” (the strategies)
from the preceding sessions, and share my thoughts on “how exactly” does one go
about implementing them.
I picked four “hows” and went on to
prescribe “how exactlies” based on the lessons from ITC e-Choupal experience…
How
1: Because rural is a ‘connected community’ and the
rural people are ‘social’, you must work through “Opinion Leaders” to influence
the buying decisions of rural consumers.
Such Opinion Leaders could be Panchayat
Presidents, Large Farmers, Shop Keepers, Teachers, and so on…
How
Exactly does one go about finding the right Opinion
Leader relevant to my offering and my context?
Step 1 is to figure out the exact role such
a person would play in your business model, and accordingly determine the
relevant profile.
For example, it could be a Value Chain
Intermediary who is making up some missing infrastructure to improve
efficiency.
Like the way the
village money lender knows whether or not to extend an additional loan when the
previous loan has not been repaid. Despite the missing credit rating
infrastructure, he would know what to do because he knows whether the crop has
failed, or if an unforeseen domestic expense has come up, or if the farmer
simply wants to renege despite having cash on hand.
Or the way an
Adathiya in the Mandi knows if the lot of agri produce has to be priced higher
or lower than the average. Despite the missing laboratory infrastructure, he
would know whether the lot has more of good, bad or ugly material. With one
look!
That’s how the
role of Samyojak came into being in ITC e-Choupal system. One of the roles of Samyojak,
located at Choupal Saagar (the hub of the hub & spoke e-Choupal
architecture) is to disburse cash to farmers. While the Banks offered to do
this job at a cost of 1.0% of transaction value (accounting for the cost of a
bill clerk, a cashier, and a security person, working in two shifts to service
our working hours of 0700-2100), the adathiyas were ready to do this at 0.25%
by combining all three roles into one! We found a Samyojak in the adathiya. He
was making up for the missing cash-less transaction ecosystem. One day, when
the infrastructure is in place, Banks will be able to do this more effectively.
Other example could be an Influencer who
demonstrates the value of an offering through personal usage. Sort of a “lead
consumer”.
It is important that
the rest of the consumers perceive this person as “one amongst them”. Not the Agent
of a Company, promoting their offerings. Nor should the companies see him as a
Leader of the farmers / consumers as in a Trade Union context.
Thus, a medium
sized farmer became a Sanchalak in the e-Choupal system. Not a large farmer,
nor a shop keeper or a teacher with whom the majority of the farmers cannot identify
with.
The Choupal
Sanchalak was the “go to” person for both the villagers (when they had an issue
with the companies riding on the e-Choupal platform) as well as the companies (when
they had an issue with the villagers). Sanchalak was “one of us” for both the
parties!
To my mind, this
unique institution of Sanchalak is a bigger innovation in the ITC e-Choupal
model than bringing Internet to the villages when most of them hadn’t even seen
telephones!
The social capital
of the Choupal Sanchalak is further enhanced through a public oath he takes in
front of the whole village that he would act a like trustee etc.
How
2: Although the rural consumer’s aspirations are more urban-like, you must
tailor-make products for rural consumers and their contexts because rural is heterogeneous
(eg. single razor vs multi-blade systems)
You must co-create with rural consumers,
because you can’t otherwise keep up with the speed with they are changing. They
are not urban consumers with a standard time lapse, as someone said.
How
Exactly do you co-create? This is an often-used but
hardly understood phrase!
It may be easier to understand co-creation,
if we first understand what is not J
Co-creation is not
more research. It is not bringing consumer voice to the boardroom.
Co-creation is not
crowd-sourcing ideas.
Co-creation is not
even marketers immersing with consumers and developing empathy.
Co-creation is not
testing company-centric product designs with the consumers.
Co-creation is giving consumers the tools
and structure that allow them to become designers!
Sanchalaks – as lead consumers (of crop
management knowledge, for example) – were integral part of the e-Choupal web
portal design team. It was at their instance that a typical “best practices’
content was structured as “current practices, what is right or not right with
them” and “why some practice needs to be changed, and then the recommended
practices”. This helped add credibility to the portal that the scientists panel
understood their context and then only were recommending something else, rather
than a conventional expert style instruction…
The structure of periodic village meetings
with all the farmers, further rolled up into Sanchalak Sammelans, helped embed
their insights and inputs into the continuously evolving design of e-Choupal on
an ongoing basis instead of an occasional feedback system…
We pleasantly realised that the brand “e-Choupal”
was owned by the community, and that ITC was a mere trustee, when such a
co-creation process articulated the brand tagline as “kisanonke hithme, kisanonka
apna” in the very second year of the initiative. The highest level any brand can attain, to my
mind J
When everyone was looking for a
low-cost-last-mile to reach the rural markets, ITC e-Choupal was working on an
intelligent-first-mile by working together with the communities.
How
3: You must forge partnerships to win in the “high-cost-to-reach but low-ticket-size”
rural markets
Partnerships are relevant from many angles,
how exactly do you determine what
kind of a partnership does one forge?
I have a product,
you have the channel. Let’s partner to expand outreach?
I have a product
targeted at a market. You have a non-compete product for the same market. Let’s
partner and go to market together and cut costs?
All such partnerships are eminently
worthwhile. But the best partnership potential is in creating what is called a
meta-market.
There is a
fundamental disconnect in the conventional markets. Consumers think in terms of
activities; companies think in terms products / services. For example, a car
buyer would think in terms of information to understand the features of cars
available in the market, source of credit, dealer in the vicinity, insurance,
RTA etc. Each of these belong to a different industry, each trying to reach the
consumer independently!
What a meta-market
does is to cluster such complementary products / services and offer a complete
solution to the consumer.
In the context of
agriculture, farmers think in terms of weather forecasts, market prices, access
to farm inputs, credit, insurance, markets for the produce, and so on… The ITC
e-Choupal ecosystem assembled all these players from diverse set of industries
on one platform to offer a seamless market experience to farmers / consumers at
one place, right in the village! As many as 160 organisations ride on this
platform today!
How
4: You must leverage technology to operate in the rural markets, because it can
cut costs through remote delivery as well as personalise offerings
There is so much technology around me, how exactly do I use technology? Mobile
advertising, geo-coding?
Simple! You understand the unfulfilled consumer
needs and the current business processes first, and then see what role
technology can play. Not the other way round.
For example, when the farmer goes to a mandi
to sell his produce, four transactions are rolled into one. Price discovery,
Sales, Delivery, Cash Collection. The sunk cost of transportation he has incurred
even before discovering the price forces him to sell at whatever he is offered.
Taking the produce back doubles his transportation cost with no guarantee that he
would fetch a better prices next time he comes to sell.
ITC e-Choupal brought price discovery
process to his doorstep using Internet (supplemented by the quality testing by
the Sanchalak) empowering him to decide when and to whom he would sell without
the pressure of a sunk cost.
When he sells to ITC, we have the ability
to stack the produce of different farmers in different lots pooled as per our
quality norms rather than the random aggregation done by the adathiya in a
mandi. This helps preserve identity and maintain product integrity, so critical
for the success of our brands.
A win more + win more solution enabled by
technology J
