Understating Consumer Psychology for Rural Retail

Abstract

As the rural market in India is undergoing a change due to enhanced purchasing power of the rural consumer, the top retail companies are considering a market which has a potential and can be unleashed. This had drawn interest of various corporate houses as DSCL, ITC, Tata group, etc to increase their retail expanse to rural India but recent reports indicated that rural retail had a tough ride for companies, the problems includes the fluctuating rural income, infrastructure support, consumer attitude, and local kirana stores which operate at lower costs, offer credit, deliver good at home, sometimes allow barter exchange this led to loses for many companies. In early 2010 Triveni Engineering shut its rural retail arm, Khushali Bazaar, after incurring a loss of Rs 19 crore in five years (The Next Rural Economies: 2009). ITC has not expanded its Choupal Sagaar business for the past few years. Godrej sold its Aadhaar rural retail business to the Future Group and the latter revamped it into a wholesale format. Hariyali Kisan Bazaar had to shut at least 70 outlets over the past couple of years. Thus we need to understand that rural market is a lot different from the urban market as the customer attitude is different, the customer profile is different, the customer needs are different and we need to study the consumer behaviour in order to tap the rural market. The paper attempts to find out the rural retail acceptance among the rural consumer and to explore what values should be incorporated to tap the largest potential market in the world.

Keywords: Rural Retail, Consumer Psychology, Increasing Purchasing Power, Marketing Techniques, Consumer Need and Demand

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