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'Haat' tricks

Getting good results from their consumer activation efforts at village haats, brands are heading in growing numbers to these weekly market places to create relevant consumer conversations. Rachit Vats writes. Rural market numbers

business Updated: Dec 18, 2011 22:29 IST
Rachit Vats

You would surely have noticed that farmer-targeted television advertising has stepped out of Doordarshan and is appearing on other nationally broadcasted channels now. The current brand push beyond tier 1 cities in India is not only encompassing smaller towns but also rural India with its growing aspirations and higher propensity to spend on branded products.

The weekly village marketplace, the haat, is increasingly seeing consumer activations by brands in an attempt to create conversations rather than mere exposure.

As Pratap Bose, COO, Mudra Group and CEO, MudraMax (Mudra's integrated engagement & experience agency), observed: "The two paradigm shifts that have affected rural consumer behavior are rooted in urbanisation and the advent of the mobile phone. In the last few years, villagers who have either studied or worked in larger cities are seen as the trendsetters, translating into increased exposure ranging across everyday product choices to financial instruments. And mobile phones have given rural consumers a gateway to information and entertainment."

While FMCG giants Hindustan Unilever, Procter & Gamble and Dabur entered the rural haats much earlier, newer rural enthusiasts from infrastructure, automotive, cosmetic, pharma, banking and others are beginning to initiate activation in haats now. It is no longer surprising to see a number of consumer firms visiting weekly rural haats, not to shop but to chase prospective rural customers.

Anacin which, according to Nielsen, is a Rs 42 crore brand and competes with biggies such as Crocin and Saridon, recently took up a pilot activation in weekly rural haats. The purpose was to test in villages around Pune and Nashik if it could take itself to smaller markets and be able to sell.

In another instance, State Bank of India (SBI) saw good traction from a small village in Durgbhillai, Chattisgarh, for its mutual funds after the rural haat activation it ran over a period of time.

Even as more companies in industry acknowledge the sense in reaching out to rural consumers through haats, Nirmallya Roychowdhury, head - brand & marketing, Hariyali Kisaan Bazaar (HKB), struck a contrarian note, saying, "Haats are dying off as development happens in an area. Wherever Hariyali Kisaan Bazaar has gone, we have seen a decline in haat activity." HKB has 265 outlets across India of which 82 are large format stores with 10,000 sq ft shop floor called centers, while the rest are small stores.

Most others involved in rural consumer activation and brand marketing, however, speak of brands-in-haats as a growing phenomenon.

"In the last decade, there has been a growing acceptance among corporates of the opportunities in rural marketing. The trend was noticed especially in 2008 during the slowdown, when there was an awakening that rural consumers cannot be ignored," said Kirti Prasanna Mishra, partner, MART.

"Under the RBI definition, a rural area is one with a population of 10,000 people while a semi-urban area would be with a population of 10,000 to one lakh people. A number of FMCG, white goods, telecom and agri sector brands are looking at rural India very seriously even as new brands are beginning to take interest," said Sanjay Pareek, president, OOH, Percept.

According to the 2001 census, India has 43,384 haats with Uttar Pradesh, Bihar and West Bengal having the majority share. The 2011 census did not have the haat data but estimates suggest the number has gone up.

The top companies promoting their brands in haats include Mahindra & Mahindra, Hero Honda (Hero after the split), Emami, Colgate, and Airtel among others.

"There are 45,000-plus haats across India and for any consumer firm, this is the best place to woo the target group," said S Venkatesh, director, RW Promotions, a rural marketing agency.

"The haat is a place for commodity exchanges. It has gradually turned into a rural showroom. We prescribe clients to go to a haat as it is a congregation point and a classic platform for brands. This is because a typical target group ventures out to shop mostly during these weekly haat days," said Sujit Kumar, senior development strategy director, Social Rural Direction.

Further, affordability is increasing in the rural space and according to estimates, 15 crore people will move out of poverty over the next five years. Brands are actively investing money to carry out recces to identify haats that they can go to.

"With rising rural income levels, there is a revival in the haat business and the number of haats is also growing faster," said Mishra.

So you'll see a Nestle or a Nokia wooing rural consumers as they step out for their weekly congregations. You may also enter a haat where all the shops are using Dabur's red umbrellas instead of the usual loose plastic sheets that serve as shades.

Nestle registered a 40% growth in rural sales last year. "The Rs 5 Kitkat, the Re 1 éclair and the Chotu Munch are doing extremely well in rural areas," said Antonio Helio Waszyk, chairman and MD, Nestle India.

SBI too, is happy with its haat activations. "The vision was to take the capital market to the smallest of places. There is a huge untapped market but it requires a lot of investor education. Such activations are cost effective," said Sreenivas Jain, chief marketing officer, SBI Mutual Fund.

"Our haat activity started out as an experiment in small villages in Maharashtra. We are now looking to expand the scope and take it to other states," said Milind Walwkar, marketing director, Anacin. Anacin will activate its haat initiative in 12-15 districts in each of the states that it covers beyond Maharashtra.

"Rural is an untapped market for direct-to-home (DTH) services and haats give us good results. On an average, we cover 75 haats every month and a strategy is being put in place to cover haats across various villages in Maharashtra, Punjab, Uttar Pradesh, Rajasthan, Bengal and others," said a DishTV spokesperson. Dish TV has carried out numerous haat activations post the harvest season in states such as Punjab, Haryana, Rajasthan and Uttar Pradesh.

As rural India becomes more aware and exposed to branded efforts, the nature of the haats themselves is changing, as are the challenges for brands reaching out to rural consumers.

"Haats are still a congregation point for consumers, but they have been extensively targeted by private companies. The rural consumer is more exposed, aware and also has more brands trying to fit into his mind space. Rural activation needs to provide novelty experiences to be remembered," Bose concluded.

Rural market numbers