TVs go flat out in Bengal villages

Kolkata | Updated: Jan 2 2006, 05:47am hrs
With multinational companies going into overdrive, a new buyers profile is emerging in the backwoods. In Chinsurah, a district town 50km from Kolkata, one could not get a packet of soup powder or pasta even a year back. A pizza or burger was a far-fetched dream. Today, the local market has almost everything that is available in Kolkata. And people are in a buying mode.

According to PK Chowdhury, a Kolkata-based stockist, almost all FMCG majors are focused on rural and semi urban markets. They have appointed super stockists offering high margins or percentages to ensure regular supply of their products.

Marico officials said the company recorded 8% growth till November this year, in West Bengals rural and semi-urban markets, while the Kolkata area grew at half that figure.

The city market is nearly saturated. Population, a key factor, is growing the most in the suburban and rural areas.

An area sales manager of Colgate-Palmolive has the same view. Requesting anonymity, he said the company has cut prices of many products to penetrate rural areas, with no losses to boot.

Shifting gears over the past few years, Colgate makes available most of its range in the districts and has hiked up its sales promotion budgets. The firm is still conservative about villages though.

Pepsi has a different view. The rural market, perceived to be huge with rising income levels, fetched poor business even after Pepsi cut prices of its aerated drinks to Rs 5 for 200ml.

Watchmaker Titan has done a fresh market survey; according to a senior marketing official, rural demand for lifestyle products is bound to grow if there is a value proposition. The company plans to cut prices of their Sonata brand watches to bring the lowest down to around Rs 300 from the current Rs 550-600 level.

Ravi Poddar, chairman of Ravi Auto Ltd, said the two-wheeler market is rapidly picking up in rural areas. Poddar, who is also the CIIs eastern region chairman, said showrooms selling two-wheelers have mushroomed.

However, rural Bengal is yet to get crazy about cars. Mr Poddar says the car market is expected to pick up, as the number of people moving out to Kolkata's outskirts increases and the conditions of roads are improved.

With the states per capita income growth among the highest, consumers in semi-urban and rural areas are also upgrading to high-end models of consumer durables.

For Korean white-goods major Samsung India Electronics Ltd, this means more demand for its flat-screen televisions and semi-automatic washing machines in the rural areas. Till about two years back, these product categories were targeted at cities like Kolkata.

The volume of products like flat-screen televisions, direct cool refrigerators and semi-automatic washing machines is definitely going up in the semi-urban markets, a Samsung spokesperson said.

However, for the present, Kolkata continues to absorb the single-largest share of Samsung products. For Samsung, the upcountry market in Bengal accounts for 55% of total sales by volume in the state. Kolkata takes care of the balance 45%, the spokesperson said.

For most of our competitors in the state, semi-urban and rural markets would command a higher share of 60%, with Kolkata accounting for 40%. For us, the share of the urban market is higher because of our focus on the premium end of product portfolio, the spokesperson said.