When DCM Shriram Consolidated Limited (DSCL), a company operating in a range of energy intensive businesses in the chloro-vinyl and agri-sectors launched Hariyali Kisaan Bazaar in 2002, the aim behind this rural retail format was to provide agri inputs to farmers. But soon this rural retail format transformed into a full service, multi-category hypermarket providing groceries, merchandise, financial services, apparels, consumer durables, mobile connections, farm fuels such as LPG, etc., under one roof. A typical Hariyali Kisaan Bazaar today operates in a catchment of 25-30 kilometers, and impacts the life of approximately 20,000 households. Today, there are 270 Hariyali stores across India with plans to add 20 more by the end of this fiscal. In an interview with Rohit Nautiyal of FE, Rajesh Gupta, president, Hariyali Kisaan Bazaar tracks the journey of Hariyali – an idea that found its way into the Harvard Business Review. Edited excerpts.
What was the main objective behind the launch of Hariyali Kisaan Bazaar?
DSCL has had a long association with rural markets especially with regards to farming. As part of our portfolio, we have a strong presence in various agri inputs from fertilisers to hybrid seeds. We wanted to explore opportunities for deeper engagement with rural markets and build a direct connect with the farmers. As of now the largely unorganised rural retail in India stands at approximately $200 billion. While starting Hariyali Kisaan Bazaar in 2002, our focus areas were to work directly with the farmers in a retail format, give agricultural knowledge and a systematic information support to them so that productivity increases, and in the process build a business around all this. For the initial 3-4 years, we tried various permutations and combinations of modern retail for farmers with focus on agri inputs. Today we are a full service multi-category retail format with groceries, merchandise, financial services, apparels, consumer durables, mobile connections, farm fuels, etc. We give equal importance to regional and national brands in our stores.
What was the initial response from rural farmers when they stepped into your stores for the first time?
Due to the large format there was a certain level of intimidation. Rural consumers were under the impression that just because the store is big, the prices of commodities will be higher. We were faced with the challenge of creating something aspirational but not intimidating. Let me share a few anecdotes with you. There were times when customers coming from the fields would take off their footwear to keep the floors clean. We opened an ATM on one the national highways in association with ICICI Bank. Within a few days of installation, more than 3000 people had started using that machine. So seeing a bullock cart parked outside an ATM, we learnt how consumers in rural India are receptive to change.
How has your footprint expanded across India?
We are dominant in north India with presence in south and central India. Hariyali Kisaan Bazaar is one of the largest national rural retail chains of India with a presence of 270 stores in eight states of Uttar Pradesh, Punjab, Haryana, Madhya Pradesh, Rajasthan, Maharashtra, Uttranchal and Andhra Pradesh. We plan to open 20 more stores by the end of this fiscal.
What are the branding and marketing exercises that you have undertaken to reach out to the rural customer?
The Hariyali Kisaan Bazaar retail business is catchment area driven and mass media or ATL (above the line) activity has a high spillage ratio if the catchment areas is not too big. We use ATL activities like print media selectively in areas where our catchment area is big. For example, in UP we have 120 outlets hence the spillage is less so we use print media as a medium during festivals and the harvest season. We have also used television as a medium during the festival season to build on the brand recall in the rural areas.
Among below-the-line (BTL) activities, we have sent out mobile vans fitted out with mini-outlets to the villages, made audio announcements from auto rickshaws, distributed leaflets in villages and set up banners at village corners, sent voice messages to our customers on their phones, besides directly engaging with customers through contests, farmers’ meet before the kharif and rabi season and many more such activities.