Rural retailing: the next ‘in’ thing for indian retail? myth or reality

It might sound cliché but the reality is that India still lives in its villages. Nearly two-third of her population resides in the hinterland. So is it perilous for the players operating in the Indian retail scenario to ignore them and go ahead as if this segment doesn't exist or does it make sense to capitalize on this segment and aim to outdo the competitors? This paper tries to unravel the truth behind this quest of the Indian retail. No longer can the players in the Indian retail overlook this lucrative-yet-unorganized segment of the great Indian retail pie. But at the same time they need to ensure that they tread the rural sector in such a way that it makes business sense because ultimately any company worth its salt needs to make money to justify its existence. This paper tries to dispel some myths pertaining to the Indian retail scenario and at the same time tries to come out with some methods which might prove to be instrumental in cracking the code of rural retailing. There have been many theories trying to come out with sure-shot ways to capture the rural market and the preferences of the countryside customers but the rural market has baffled many of the experts at the same time with its sheer unpredictability and the disparate tastes and preferences of folks belonging to the varied rural segments of this vast country. The choices for the rural customers have been limited vis-à-vis their urban counterparts. Hence, those companies which have taken the first plunge in the rural lands of India have been greeted with success, but not always as has been evident from the various failed experiments made in the rural markets such as packaged food items and branded products which are expensive in nature. But the resounding success of such pro-budget and convenient concepts like sachets and combo offers as well as energy-saving and cost-effective products like Micromax mobiles (energy is a scarce commodity in the rural India), has amply proven that there is more to the rural market than meets the eye. Such initiatives forced even the established players to change the way they see the retail sector. This paper would try to explore various facets of the great Indian rural retail phenomenon with all its significance and what it holds for the future. The companies, if smart enough in their pursuit for the rural segment, can home some brawny points without spending much given the cut-throat competition which they are facing from the biggies of the Indian retail scene which is primarily focused on the urban market.