Rural India likely to recover faster than urban: Kantar GroupM Report

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December 3, 2020 6:45 PM

The report highlights the emergence of new trends which will necessitate changes in the way businesses and brands connect with rural consumers

With the pandemic accelerating digital adoption, there is a huge potential for businesses and brands to leverage mobile as a medium to reach rural consumersWith the pandemic accelerating digital adoption, there is a huge potential for businesses and brands to leverage mobile as a medium to reach rural consumers

Kantar, the insights-based consultancy company, along with GroupM’s experiential marketing unit- Dialogue Factory, on Thursday unveiled a Rural Covid Barometer Report. The report provides a fact-based perspective on consumer sentiments, their consumption choices, and the behavioral changes brought about by the pandemic.

The report highlights the emergence of new trends which will necessitate changes in the way businesses and brands connect with rural consumers. Loss of income, socio-cultural norms, health and hygiene protocols, and reverse migration are some key challenges faced by the rural population during the pandemic.

The report suggests that with 1 in 3 rural adults being impacted by Covid-19, the rural economy is likely to take a hit. However, with fewer job losses and consequent reduction in the incomes of the affluent households, the overall impact on rural consumption pattern is likely to be muted in the future. This presents an opportunity for the businesses to sharply target their brands towards the upper end of the rural consumer spectrum.

Further, the rural Indian is balancing the budget by cutting on indulgence categories like cold drinks, ready-to-eat snacks like chips, etc. and diverting the savings towards hygiene products. The study highlights that rural Indians are today more concerned about their future well-being; especially of the chief earners. With a relatively weaker health infrastructure as compared to urban areas, the mindset of rural Indians is shifting towards financial planning. They are also considering buying health and other insurance products. This opens a large market for the BFSI segment.

Like their urban counterparts, rural Indians are increasingly relying on digital services for their day to day activities. With the pandemic accelerating digital adoption, there is a huge potential for businesses and brands to leverage mobile as a medium to reach rural consumers. Moreover, with commute being restricted, the rural consumer is now increasingly shopping within the village for their FMCG needs. It is therefore imperative for the brands to focus on their distribution and last-mile connectivity since product availability in the local village stores will significantly impact the brand choices of the rural shopper.

According to Dalveer Singh, head of experiential marketing- APAC, Dialogue Factory, Rural India has always had a higher degree of resilience which makes it more confident for a rapid recovery than the urban areas during these unprecedented times. “This report speaks volumes on the new, defining values that are shaping rural India – resilience, planning for future, protection from falling sick and growing reliance on digital,” he added further.

The report also highlights a deep sense of optimism regarding India’s economic future; stemming from a healthy growth in the agricultural sector and near universal reach of targeted government programs. 75% of all consumers claimed to have received at least one of the major government schemes for Rural India; 66% claimed to have received free rations under PM Garib Kalyan Yojana.

“For businesses, we would recommend a regional prioritisation. We believe that Western India is likely to bounce back earliest. On the other hand, indications seem to suggest that rural South might take longer to recover as the impact of COVID 19 on employment has been more severe, which in turn has depressed the economic outlook of consumers in rural South. We see this as an opportunity for brands to deploy their resources across zones in a graded and phased manner. With 1 out of 3 rural migrants not planning to go back to urban India, we are likely to see a huge shift in rural consumption choices. This will also affect the availability of labor in urban India,” Puneet Avasthi, senior executive director, Insights Division, Kantar, said.

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