Industry majors say they benefited from tapping rural markets
New Delhi, Aug 19 : Four of India's largest companies Tuesday showcased here how they
have benefited by tapping India's huge rural market.
The four - ICICI Bank, Hindustan Unilever Ltd, Hero Honda Motors and Infosys
Technologies - are among the largest in their own areas of business.
"It's a myth that profit margins get squeezed if you market to the bottom of the
pyramid," said K.V. Kamath, managing director and chief executive officer of ICICI Bank,
India's largest private lender, Tuesday in his keynote address at the Ninth Annual
Marketing Summit organised by the Confederation of Indian Industry (CII).
"Our growth strategy is now focused on tapping the Rs.500-billion credit market among
India's low-income groups who do not get any credit now," Kamath said. The two-day summit
began Monday.
"Growth is being driven by the poorest sections of the population who comprise 110
million households out of a total of 209 million households in the country," said Thomas
Puliyel, president of leading market research firm IMRB International.
The summit, an annual jamboree that brings together every year some of the country's
top marketers, advertisers and media personalities, on the whole agreed that the bottom of
the pyramid indeed represented a huge opportunity.
"There is certainly life in the bottom of the pyramid," argued Piyush Pandey, executive
chairman and national creative director of Ogilvy and Mather India.
He was referring to the only contrarion view put forth by Arvind K. Singhal, chairman
of Technopak, a global management consultancy major, who said "there is no opportunity at
the bottom of the pyramid".
But his was a lone voice.
Anil Dua, senior vice-president for marketing and sales of Hero Honda Motors, gave a
detailed presentation to show how his company has been able to capture the largest market
share in entry-level motorbikes.
Sudhanshu Vats, vice-president for home care of Hindustan Unilever Ltd (HUL), India's
largest and fast-moving consumer goods (FMCG) company, bolstered Dua's example with a few
from his own company.
HUL is credited with pioneering sachet marketing in India - a marketing format that
refers to selling in small packs with low unit price so as to be affordable to people with
low disposable incomes.
Interestingly, Aditya Nath Jha, vice-president and head of global branding Infosys
Technologies, came up with a completely different take on marketing to the bottom of the
pyramid.
He said Infosys sold jobs because, as a knowledge company, its main resource is
talent.
"The key question before us was how to get talent without reducing the currency for
selling jobs - domain skills, communication skills and analytical skills," Jha said.
"We did it through our Campus Connect programme which trains people coming from diverse
backgrounds, including from low-income and rural households," he said.
Advertising guru Alique Padamsee brought up the rear by declaring the rural poor may
seem to be visually illiterate but "they are aurally smart."
With rising disposable incomes, they have emerged as a huge business opportunity, he
said.
--IANS
