Urban - the Spotlight is here again!

for long rural has caught imagination among brands , be it in marketing or distribution , true rural will still hold potential . while we are still at driving the great rural forays , we sense the time to focus more on Urban is now here again , here is why ....


  • Current trends indicate that most consumer spends of urban categories like high end shampoos ,diapers , sanitary napkins ,high end razors etc are up !
  • The monsoon led hit on rural continues to bogg down rural spends 
  • Rural advantage of distribution is gone from brands ,as most strong brands in relevant categories have made their presence in deep rural now .
  • Interestingly cars seem to be outperforming motorcycles sales if one were to believe media reports , indicating more urban spends .
  • Urban spends per customer is much higher than a rural consumer , which is a known fact 
  • Multiple channels ( general trade , speciality stores, modern trade , non traditional channels )are emerging in urban, add to all of this the impulsive "online channels"mode too 

In the current scenario , we are recommending a 70% of resource spends on  urban, 30% of resource spends on rural approach (it depends on the category though), as growths rates and yield per consumer will be much much higher in urban  ,this is also accentuated due to the complexity  of multiple channels( with online adding to the chaos) in urban and intense competition for the consumer wallet in urban .




Urban is the place for the bang for your buck !and its returning with force !



Comments

Ajay said…
Urban is definitely the future.with 60% of rural pupulation producing just abt 14% of the output, the future of india is definitely in urban. Specifically the tier 2 towns stand out as they are the ones that will absorb the new wave of migration from rural. We can expect more food processing, sme/smb growth in tier 2 urban now- the ones that can absorb the unskilled migrants from rural. Guess organisations need to restructure themselves to be more agile and have their ears to the ground to understand what the neo urbanites want.
Yash Gupta said…
A US study concluded that in the future urban areas will grow in density over suburbs contrary to romantic and possibly idealistic views that people like to spread out and do not like to crowd. The reason is that the technological growth is so rapid that non urban areas will fail to keep pace. People will be unable to choose any but the highest density regions as all modern day advantages will acrrue to those living in the hi tech cities. They will take holidays and go out of the cities for recreation but living is all toward the urban areas.
Avnish said…
Nicely Written.
Unknown said…
Nice article...
Rural was always enticing due to this being untapped and the sheer volume but the value as you mention has always been in urban. I don't see this changing in the next couple of decades. Continue writing...
VR said…
Sir, Most of the current urban population with high disposable income was suburban or rural at one point in time..n this will continue to be the trend n hence urban will be spotlight. Most of the companies have set up distribution in rural to "sell" n not to develop the region n govt.efforts have also have been mostly city centric from decades. why not 100 smart villages??
Swami said…
Yes, surely there will be an urban thrust, given govt. plans such as smart cities, new capital etc. However the spend split will hv to be based on the categories and where those categories are on the consumers need/want value pyramid.
Bulk SMS Mumbai said…
The trend of urbanization has to stay for a longer period of time, till attention towards infrastructure development of rural areas catches fire. Nice, informative post, thanks

V said…
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