Factors Influencing Purchase of FMCG by Rural Consumers in South India: An Empirical Study

Abstract

With more than six hundred thousand villages and more than 70% of the population, rural India has become a massive consumer goods market. FMCG has emerged as a major product category in rural consumption. Companies marketing FMCG to rural consumers cannot merely extend their general marketing strategies to rural markets. Instead, they need to devise rural specific strategies. In this process, they need to understand crucial issues relating to rural consumer behavior and more specifically relating to different geographic regions of the country. This paper focuses on understanding factors that affect the rural purchase of FMCG in South India. Empirical study was conducted in 8 districts of South India to identify the key influencing variables. Factor analysis was used to form 24 key variables into five groups (influencing factors). Influence of retailers’ recommendations has emerged as the most significant variable in the trust factor. According to the study, rural consumers in South India consider that usage of FMCG contributes to their lifestyle.