Inthe m?dern urban ?ulture, ??nsumpti?n ?f s?ft drinks parti?ularly am?ng y?ungergenerati?n has be??me very p?pular. S?ft drinks in vari?us flav?rs and tastesare widely patr?nized by urban p?pulati?n at vari?us ???asi?ns like dinnerparties, marriages, s??ial get t?gether; birthday ?elebrati?n et?. ?hildren ?fall ages are espe?ially attra?ted by the mere menti?n ?f the w?rd s?ft drinks.The s?-?alled ??mpetiti?n f?r this pr?du?t in the market is different fr?m ?therpr?du?ts. Mass media, parti?ularly televisi?n, has ??ntributed largely t? theever-gr?wing demand f?r s?ft drinks.
The attra?tive jingles and sp?rts make thelarge audien?e remember the brand at all times. In t?day’s highly ??mpetitivemarket pla?e, tw? players have d?minated the industry; The New Y?rk based Pepsi??mpany In?. and the Atlanta based ???a- ??la. Thr?ugh?ut the gl?be, these maj?rplayers have been battling it ?ut f?r a bigger ?hunk ?f the ever –gr?wing s?ftdrink market. This battle has been witnessed in India t??, between these tw?giants. The emergen?e ?f rural markets as highly untapped p?tentialemphasizes the need t? expl?re them.
Marketers ?ver the past few de?ades, withinn?vative appr?a?hes, have attempted t? understand and tap rural markets. Ruralmarketing is an ev?lving ??n?ept, and as a part ?f any e??n?my, has untapped p?tential;marketers have realized the ?pp?rtunity re?ently. Impr?vement in infrastru?tureand rea?h, pr?mise a bright future f?r th?se intending t? g? rural.
Rural ??nsumersare keen ?n branded g??ds n?wadays, s? the market size f?r pr?du?ts and servi?esseems t? have burge?ned. The rural p?pulati?n has sh?wna trend ?f m?ving t? a state ?f gradual urbanizati?n in terms ?f exp?sure,habits, lifestyles, and lastly, ??nsumpti?n patterns ?f g??ds and servi?es. S?,there are dangers ?n ??n?entrating m?re ?n the rural ?ust?mers.
Redu?ing the pr?du?tfeatures in ?rder t? l?wer pri?es is a danger?us game t? play. Rural buyerslike t? f?ll?w the urban pattern ?f living. Ast?nishingly, as per the ?ensusrep?rt 2003-04, there are t?tal 638365 villages in India in whi?h nearly 70% ?ft?tal p?pulati?n resides; ?ut ?f them 35 % villages have m?re than 1000 p?pulati?n. Rural per ?apita ??nsumpti?nexpenditure grew by 11.5 per ?ent while the urban expenditure grew by 9.6 per ?ent.There is a tremend?us p?tential f?r ??nsumer durables like tw?-wheelers, small ?ars,televisi?n sets, refrigerat?rs and h?useh?ld applian?es in rural India.
?bje?tives:-1. Studying ab?ut the marketing strategy and 4 A ?f su??essfulpr?du?t in rural areas.2. Studying ab?ut the ?hallenges inv?lved duringmarketing ?f FM?G pr?du?ts and h?w ?rganizati?n ?ver??mes with new anddifferent strategy.3. Studying ab?ut distributi?nal and pr?m?ti?nal strategy?f su??essful pr?du?t in rural areas.
?hallenges in rural marketing 1. Understandingrural ??nsumers –Theirper?epti?n ab?ut the pr?du?t.2. L?wper ?apita in??me.3. L?wlitera?y level4. Seas?nal demand.5.
La?k?f pr?per infrastru?ture and ?ther physi?al a?tivities.6. Underdevel?ped market.
7. Manylanguages. Study ab?ut FM?G pr?du?tssu??ess rate in rural markets in these 15 years (2009)Extensive study was ?arried ?ut by MART ??nsultant??mpany f?r the first time in India t? l??k fr?m all different angles that ?anlead su??ess ?f pr?du?ts in rural areas.Statement ?f pr?blem f?rFM?G pr?du?ts FM?G imp?rtant ??ntribut?rt? GDP.4THLARGEST SE?T?R ?F INDIAN E??N?MY. ?ver 70% ?f sales are made t? middle ?lass h?useh?ldst?day and ?ver 50% is in rural India. The se?t?r is energized ab?ut an es?alatingrural p?pulati?n wh?se in??mes are rising and wh? are willing t? spend ?n g??dsdesigned t? impr?ve their lifestyle.
Asurban market is getting saturated due t? high ??mpetiti?n and awareness ?f pe?pleis high, it’s n?t easy f?r marketer t? play in urban areas s? they have t?shift their paradigm ?r l??k the matter in different angle. ?reatinga new segment ?an again sustain the pr?du?t life ?y?le ?f a pr?du?t.FM?G?ateg?ry and pr?du?ts: ?ateg?ry Pr?du?ts –H?useh?ld ?are- Fabri? wash (laundry s?aps and syntheti?detergents); h?useh?ld ?leaners (dish/utensil ?leaners, fl??r ?leaners, t?ilet ?leaners,air fresheners, inse?ti?ides and m?squit? repellents, metal p?lish andfurniture p?lish). F??d and Beverages- Health beverages; s?ft drinks; staples/?ereals;bakery pr?du?ts (bis?uits, bread, ?akes); sna?k f??d; ?h???lates; i?e ?ream;tea; ??ffee; s?ft drinks; pr??essed fruits, vegetables; dairy pr?du?ts; b?ttledwater; branded fl?ur; branded ri?e; branded sugar; jui?es et?. Pers?nal ?are- ?ral ?are, hair ?are, skin ?are, pers?nal wash(s?aps); ??smeti?s and t?iletries; de?d?rants; perfumes; feminine hygiene;paper pr?du?ts. Marketsize f?r FM?G in rural IndiaTherural market in India is n?t a separate entity in itself and it is highlyinfluen?ed by the s??i?l?gi?al and behavi?ral fa?t?rs ?perating in the ??untry.The t?tal size ?f the rural market is estimated at ab?ut 83.3 ?r?re pe?ple ?r68.
84% ?f Indian p?pulati?n (?ensus, 2011). The rural market brings in bigger revenues in the ??untry, as the ruralregi?ns ??mprise the maximum ??nsumers in this ??untry. The rural market generates alm?st m?re thanhalf ?f the ??untry’s in??me. Rural India ??ntributes a big ?hunk t? India?sGDP by way ?f agri?ulture, self-empl?yment, servi?es, ??nstru?ti?n et?. Therural p?pulati?n is emp?wered with rising in??me, impr?ving edu?ati?n and awareness levels, enhan?ed ??nta?t with the ?utside w?rld, ev?lving ??nsumpti?npatterns, emerging lifestyles and, m?st imp?rtantly, shift in ???upati?n fr?m agri?ulture t? manufa?turing, self-empl?yment and ??nstru?ti?n. S? I str?ngly feel t?expl?re the area ?f FM?G .Parti?ularly I will betaking a pr?du?t ?f FM?G and that will be Rising s?enari? ?faerated drink “???a-??la” and “pepsi” inrural market and its su??ess fa?t?r. ???A – ??LA (AN INTR?DU?TI?N) It was invented in May1886 by Dr.
J?hn .S. Pembert?n in Atlanta, Ge?rgia, United States ?f Ameri?a. ???a??la ?ffers a p?rtf?li? ?f w?rld-?lass quality sparkling and still beverages,starting fr?m ???a ??la t? ?ver 400 s?ft drinks, jui?es, teas, water and energydrinks. The m?st su??essful brands are – ???a ??la, Diet ??ke, Sprite andFanta. With ?perati?ns ?ver 200 ??untries, it has a w?rkf?r?e ?f 55,000 empl?yeesand serves ?ver 1.7 billi?n servings ea?h day.
?aleb Bradham, a pharma?ist andindustrialist fr?m New Bern, N?rth ?ar?lina, first devel?ped PEPSI in 1898. Asthe ??la pr?gressed in p?pularity, he ?reated the Pepsi-??la ??mpany in 1902and registered a patent f?r his re?ipe in 1903. The Pepsi-??la ??mpany wasfirst in??rp?rated in the state ?f Delaware in 1919. ?urrently, Pepsi?? is ?nethe largest ??mpanies in the U.S.
It figures am?ngst the largest 15 ??mpanies w?rldwidea???rding t? the number ?f empl?yees hired. It has a U.S.
F?rtune rank ?f 50.Pepsi is b?ttled in nearly 190 ??untries. Pepsi?? is a w?rld leader in sna?ks,f??ds and beverages with revenues ?f m?re than $43 billi?n. It ??nsists ?f many??mpanies am?ngst whi?h the pr?minent ?n?e are Pepsi-??la, Frit?-Lay and PepsiF??d Internati?nal. The gr?up is presently int? tw? ?f the m?st pr?fitable andgr?wing industries namely, beverages and sna?k f??ds. It has s??res ?f bigbrands available in nearly 150 ??untries a?r?ss the gl?be. ENTRY ANDEXIT IN INDIA – ???A??LA ???a ??la entered India in 1967.
In 1977, the Janata g?vernment led by M?rajiDesai ?ame t? p?wer and laun?hed the Sixth Five-Year Plan, whi?h aimed t? b??stthe agri?ultural pr?du?ti?n and rural industries. Seeking t? pr?m?te e??n?mi?self-relian?e and indigen?us industries, the g?vernment wanted multi-nati?nal ??rp?rati?nst? g? int? partnership with Indian ??rp?rati?ns. At that time ???a-??la wasIndia’s leading s?ft drink when the new g?vernment ?rdered the ??mpany t?dilute at least 60% ?f its stake in its Indian unit as required by the F?reignEx?hange Regulati?n A?t (FERA) ?f 1973 and als? turn ?ver its se?ret f?rmula f?r???a-??la. The p?li?y pr?ved ??ntr?versial, diminishing f?reign investment andled t? the exit ?f high-pr?file ??rp?rati?ns su?h as ???a-??la and IBM fr?mIndia.?AMPA ??LA AND THUMPS UP ??MESIN EXISTEN?E After ???a??la left the Indian market due t? pr?blems with Indian G?vernment, the IndianG?vernment de?ided t? start a l??al brand t? meet the demand f?r s?ft drinks inthe ??untry.
Pure drinks gr?up was started by Padma Sri late Sardar M?han Singhin 1942, and in 1950 they started b?ttling ???a- ??la a?r?ss India. In 1978,when ???a ??la left India, they started b?ttling their ?wn brand ‘?ampa ??la’.Thums Up was intr?du?ed in 1977 t? ?ffset the expulsi?n ?f The ???a-??la ??mpanyfr?m India. The Parle br?thers, Ramesh ?hauhan and Prakash ?hauhan, al?ng withBhanu Vakil, laun?hed Thums Up as their flagship drink, adding t? their p?rtf?li??f ?lder brands Lim?a (lime flav?ur) and G?ld Sp?t (?range flav?ur). Thums Upenj?yed a near m?n?p?ly with a mu?h str?nger market share, ?ften ?vershad?wingd?mesti? rivals like ?ampa ??la, D?uble Seven, Dukes and United Breweries Gr?up’sM?D?well’s ?rush. A???rding t? statisti?s Parle’s Thums Up market share kept in?reasingsin?e 1983 (43%) t? 1990 (70%), while its ?hief rivals share had been de?lining.
ENTRY ?F PEPSI Pepsi?? saw the ?pp?rtunity t? enter theIndian market after ???a- ??la departed. In their first attempt in 1985, Pepsi??tried t? j?in hands with ?ne ?f India’s leading business h?use, the R P G?enkagr?up, t? begin ?perati?ns in the ??untry. They put f?rward a deal t? pr?m?tethe devel?pment and exp?rt ?f Indian agr?- based pr?du?ts, and in turn getpermissi?n fr?m ?entral g?vernment t? imp?rt ??la ??n?entrate and t? sell aPepsi?? brand. This request was reje?ted ?n the gr?unds that the imp?rt ?f ??n?entrate??uld n?t be agreed t? and the use ?f f?reign names were n?t all?wed.
In theirse??nd attempt in 1988, Pepsi?? put f?rward a very impressive ?ffer. They pr?misedt? ?reate empl?yment ?pp?rtunities f?r ab?ut 50,000, make 75% ?f the t?talinvestments in f??d and agr? pr??essing, and bring advan?ed te?hn?l?gy and 50% ?ft?tal pr?du?e t? be exp?rted. Pepsi?? gained entry t? India in 1988 by ?reatinga j?int venture with the Punjab g?vernment-?wned Punjab Agr? Industrial ??rp?rati?n(PAI?) and V?ltas India Limited. This j?int venture marketed and s?ld LeharPepsi until 1991, when the use ?f f?reign brands was all?wed; Pepsi?? b?ught ?utits partners and ended the j?int venture in 1994. Pepsi’sEntry int? India: A Less?n in Gl?balizati?n A REP?RT ?F 1988- TA?KLE ?F P?LITI?SAND PEPSI?? IN INDIA- A P?LITI?AL HIST?RY ??nvin?ingIndia that it needs Western junk has n?t been easy.
” 1- A New Internati?nalistMagazine Arti?le, ??mmenting ?n Pepsi’s struggle t? enter India, in August1988.A Lettert? PepsiIn 1988,the New Y?rk ?ffi?e ?f the President ?f the multi-billi?n ??la ??mpany Pepsi??re?eived a letter fr?m India. The ??mpany had been trying f?r s?me time t?enter the Indian market – with?ut mu?h su??ess. The letter was written by Ge?rge Fernandes (Fernandes), the General Se?retary ?f ?ne ?f the ??untry’s leading p?liti?al parties, Janata Dal. He wr?te, “I learned that y?u are ??ming here. I am the ?ne that threw ???a-??la ?ut, and we are s??n g?ing t? ??me ba?k int? the g?vernment.
If y?u ??me int? the ??untry, y?u have t? remember that the same fate awaits y?u as ???a-??la.”2 This devel?pment did n?t seem t? be a matter that ??uld be ign?red. Pepsi??’s ar?h-rival and the w?rld’s number ?ne ??la ??mpany, ???a-??la, had indeed been f?r?ed t? ?l?se ?perati?ns and leave India in 1977 after the Janata Dal ?ame t? p?wer.
3 Even in the late 1980s, India had a ?l?sed e??n?my and g?vernment interventi?n in the ??rp?rate se?t?r was quite high. H?wever,multinati?nal ??mpanies su?h as Pepsi?? had been eyeing the Indian market f?r al?ng time f?r a h?st ?f reas?ns. As the maj?r market f?r Pepsi??, the US,seemed t? be rea?hing saturati?n levels, the ?pti?n t? expand ?n a gl?bal s?aleseemed t? have be??me inevitable f?r the ??mpany. India was a lu?rative destinati?n sin?e its vast p?pulati?n ?ffered a huge, untapped ?ust?mer base. During the late 1980s, the per ?apita ??nsumpti?n ?f s?ft drinks in India was ?nly three b?ttles per annum as against 63 and 38 f?r Egypt and Thailand respe?tively. Even its neighb?r Pakistan b?asted ?f a per ?apita s?ft drink ??nsumpti?n ?f 13 b?ttles. Pepsi?? was als? en??uraged by the fa?t that in?reasing urbanizati?n had already familiarized Indians with leading gl?bal brands. Given these ?ir?umstan?es, Pepsi?? ?ffi?ials had been inv?lved in he?ti? l?bbying with the Indian g?vernment t? ?btain permissi?n t? begin ?perati?ns in the ??untry.
H?wever, the ??mpany ??uld n?t deny that many p?liti?al parties and fa?ti?ns were ?pp?sed t? its entry int? the ??untry. It had theref?re be??me imperative f?r Pepsi?? t? ??me up with a pa?kage attra?tive en?ugh f?r the Indian g?vernment. The Pr?mises That Helped Pepsi Enter (?ase Intr?) In May 1985, Pepsi?? had j?ined hands with ?ne ?f India’s leading business h?uses, the R P G?enka (RPG) gr?up, t? begin ?perati?ns in the ??untry.
The ??mpany, al?ng with the RPG gr?up ??mpany Agr? Pr?du?t Exp?rt Ltd., planned t? imp?rt the ??la ??n?entrate and sell s?ft drinks under the Pepsi label. T? make its pr?p?sal attra?tive t? the Indian g?vernment, Pepsi?? said that the imp?rt ?f ??la ??n?entrate w?uld essentially be in return f?r exp?rting jui?e ??n?entrate fr?m ?perati?ns t? be established in the n?rth Indian state ?f Punjab. In its pr?p?sal submitted t? the Ministry ?f Industrial Devel?pment, ??mpany s?ur?es said that the ?bje?tives ?f Pepsi??’s entry int? India rev?lved ar?und ‘pr?m?ting and devel?ping the exp?rt ?f Indian agr?-based pr?du?ts and intr?du?ing and devel?ping Pepsi??’s pr?du?ts in the ??untry.’ H?wever, the g?vernment reje?ted this pr?p?sal primarily ?n tw? gr?unds: ?ne, the g?vernment did n?t a??ept the ?lause regarding the imp?rt ?f the ??la ??n?entrate and, tw?, the use ?f a f?reign brand name (Pepsi) was n?t all?wed as per the regulat?ry framew?rk.
The ass??iati?n with the RPG gr?up t?? ended at this jun?ture. N?t willing t? sit quietly ?n the issue, Pepsi?? put f?rward an?ther pr?p?sal t? the g?vernment a few m?nths later. THE S?DAS WITH LARGEST MARKET SHARE IN INDIA The ??mpany knew that the p?liti?al and s??ial pr?blems4 that plagued Punjab were an extremely sensitive issue f?r India in the 1980s. Pepsi??’s de?isi?n t? link its entry with the devel?pment and welfare ?f the state was thus a ??ns?i?us ?ne, aimed at winning the g?vernment ?ver. The fa?t that Punjab b?asted a healthy agri?ultural se?t?r (with g??d ?r?p yields in the past) als? played a r?le in Pepsi??’s de?isi?n. Rep?rtedly, the new pr?p?sal gave a l?t ?f emphasis t? the effe?ts ?f Pepsi??’s entry ?n agri?ulture and empl?yment in Punjab.
The ??mpany ?laimed that it w?uld play a ?entral r?le in bringing ab?ut an agri?ultural rev?luti?n in the state and w?uld ?reate many empl?yment ?pp?rtunities. T? make its pr?p?sal even m?re lu?rative, Pepsi?? ?laimed that these new empl?yment ?pp?rtunities w?uld tempt many ?f the terr?rists t? return t? s??iety..