Pradeep Kashyap, Founder and CEO, MART
Widely regarded as a guru of Rural Marketing, Pradeep Kashyap founded and heads MART, a consulting practice on emerging markets specialising in understanding of ‘base of the pyramid’ markets. Since founding MART in 1993, Mr Kashyap has advised leading companies from the FMCG sector to those in telecom, pharma and banking about breaking into rural markets. He has also been Marketing Advisor to the Ministry of Rural Development and has served in the Prime Minister’s Office.
PaGaLGuY caught up with Mr Kashyap at a TEDx event at Birla Institute of Management and Technology, Greater Noida on November 26 and shot a few quick questions about emerging trends and challenges in rural marketing. Here are some excerpts from the interview.
Can you explain what you do and what your organisation MART is all about?
I have worked with the corporate sector for 20 years. I eventually recognized my strength in the marketing area and observed that its application was completely missing in the social and developmental sector. Initially nobody believed that you needed marketing in the social sector. This led me to establish MART as an organization in 1993. It became a partnership in 2003. At MART we follow the philosophy of a ‘social heart’ and a ‘business mind’.
Where does rural marketing fit into the grand scheme of things today?
Rural marketing has already arrived in the world of business and is one of the single largest segments of activity. Previously, we faced the challenge of making the corporate world accept the importance of rural marketing. However, today companies are taking pains to tap into unexplored sections of the Indian society.
What changes have you observed in rural markets over the past two decades?
A visible microfinance movement is the one major change in the rural sector, which has helped empower rural women. The second major change is that women have been given 30% reservation in village panchayats. Improvement in road connectivity is the third major change in villages. While the first 50 years of independence saw only 40% road connectivity between villages, an additional 30% road construction has happened over the past ten years. Education has increased in villages. Finally, technology and media reach in villages has also experienced a dramatic rise.
How are companies responding to this?
Although global companies are not yet ready to reach out to Indian rural markets, local companies have started various schemes to tap the market. For example, because electricity is one of the major problems faced in rural India, local companies such as Jolly TV in Uttar Pradesh are producing televisions which run on rechargeable battery systems. Such innovations help rural consumers use products even during electricity cuts, thus expanding the scope of marketing in rural areas.
How does rural marketing help in empowering women in villages?
In most cases, rural women do not work, and even if they do, they are involved in seasonal activity making for low income. Through MART, we help these women gain bargaining power so that they can get appropriate prices for their produce. The first step towards this objective is to organise the women into collectives by identifying definite clusters based on the products they make, the consumers for the products, etc. This helps them aggregate their produce. Also, we teach them value addition by helping them understand the importance of drying, cleaning, sorting and packaging their products. All these aspects ultimately provide them access to wider markets.
If a young management graduate were to join the rural marketing profession today, what kind of a work scope is he looking at?
Rural marketing is the single largest sector today in terms of population it impacts. It caters to roughly 800 million people in India. The opportunity in the field is great and companies across the world are beginning to understand it. While the urban market deals majorly with a replacement policy, where old branded products are continuously replaced with new branded products, the rural market is still untapped. There is no penetration of any sort of brands into these markets. This offers great scope to companies.
What are the most challenging aspects of working in rural marketing?
Firstly, most of us are still victims to an urban mindset. We tend to not understand the mindset of the rural consumer. Secondly, even if companies reach close to understanding rural consumers, they face great difficulty in finding distribution options to the rural sections. Finally, 50% of the rural markets are still media-dark sections of the society. The people living in these areas do not have access to televisions or newspapers. This makes the consumer unaware of what new innovative things the world has to offer.
As the country undergoes urbanisation, will rural marketing become irrelevant over time?
When we got our independence, the census survey claimed that 84% of the countrys population was living in rural areas. In the 1991-2001 census the number came down to 74% and the recent 2011 census marks it at 68%. Despite all the big talk about urbanisation, 62% of the countrys population will still be living in villages by 2021. It is also a myth that the country is urbanising rapidly. In most metropolitan cities, population growth is slowing down. While Delhi saw a population growth of 32% in the 2001 census, the growth came down to 20% in 2011. Most people who migrate prefer to shift to smaller cities since there are more growth options there.
How will the proposed Foreign Direct Investment in Retail change rural marketing?
According to the draft policy, big retailers cannot enter towns and villages where the population is less than 5 lakhs. Since most of the rural population lives in small clusters, FDI will have zero impact on the 800 million people in rural markets.
For youngsters looking to join rural marketing, what are the three big opportunities waiting to be tapped?
Firstly, for the next 10 years, the rural segment is going to literally drive the Indian markets. That translates to great opportunity. Secondly, there is not enough knowledge generation within rural marketing today. As educated young graduates enter rural marketing, the amount of knowledge of various practices inside the discipline will increase. Finally, and most importantly, rural marketing offers limitless opportunities to youngsters in terms of innovation in rural distribution, promotion and so on. It is a virgin market which will provide youngsters an opportunity to innovate.