I have worked on this case study during my college days (Dec \'08). I have choosen 2 village of Gurgaon for this which are Budhera and Chandu. Please do drop your comments for the same.

1. IILM Institute for Higher Education
School of Business
Gurgaon
CASE STUDY ON
MARKET PENETRATION OF WIRELES COMMUNICATION IN
RURAL AREAS
Abhishek Tewari
Prepared By Mr. Abhishek Tewari.

2. INTRODUCTION
India lives in villages, close to 72 percent of Indian population lives in rural areas. In the
country we have 6.36 lakh villages out of which only 13 percent have population above
2000. The rural economy contributes nearly half of the country’s GDP (ETIG 2002-03)
which is mainly agriculture driven and monsoon dependant. More than 50 percent of
the sales FMCG and Durable companies come from the rural areas. The McKinsey
report (2007) on the rise on consumer market in India predicts that in twenty years the
rural Indian market will be larger than the total consumer markets in countries such as
South Korea or Canada today, and almost four times the size of today’s urban Indian
market and estimated the size of the rural market at $577 Billion.
Census of India defines rural as any habitation with a population density less than 400
per sq. km., where at least 75 percent of the male working population is engaged in
agriculture and where there exits no municipality or board, and the same definition
being accepted. A marketer trying to market his product or service in the rural areas is
faced by many challenges; the first is posed by the geographic spread and low
population density in the villages in the country. The table below gives us the
population and village size details in the country.
Table 1: Rural Population Statistics
Number of Percentage of total
Population
Villages villages
Less than 200 114267 17.9
200-499 155123 24.3
500-999 159400 25
1000-1999 125758 19.7
2000-4999 69135 10.8
5000-9999 11618 1.8
10000 & above 3064 0.5
Total 636365 100
The second challenge is from the low purchasing power and limited disposable incomes
in these parts of the country. But this has been changing in the last few decades with
agricultural growth rate faster in the 1990’s and 80’s than the 1970’s (CMIE 1996). Green
revolution through the introduction of hybrid seeds, fertilizers and systematic irrigation
had a major impact on agricultural productivity, and combined with it was a price
policy which ensured minimum support price, and in turn insulated the farmers from
market risk, cheap input policy and a stable demand (Vyas 2002) . These all lead to a
Prepared By Mr. Abhishek Tewari.

3. quantum jump in the incomes of farmers in the country. Initially the impact of green
revolution could be seen only in the prosperous agricultural states of the country but
now slowly its influence has spread across the country with the increase in irrigation.
Though the income levels overall are still very low there are many pockets of prosperity
which have come up in the rural areas in the country.
According to NCAER 2002, the number of rural middle class house holds at 27.4 million
is very close to their urban counterpart at 29.5 million. The improvement in the support
prices being offered to farmers also has an impact on the disposable income with the
farmers. And between, 1981-2001 there has been tremendous improvement in the
literacy levels, poverty and rural housing in the villages of the country. Rural literacy
levels have improved from 36 percent to 59 percent, the number of below poverty
houses have declined from close to half to 46 percent and the number of pucca houses
have doubled from 22 percent to 41 percent. These figures provide us with a clear
picture that rural India with the increase in agricultural income and improving
standards is on the verge of becoming a large untapped market which marketers have
been aspiring for a very long period of time. Thus the current status of rural markets
makes it an attractive market for marketers.
The wireless market is growing very fast whereas wire line is declining.
Exponential Growth
350 Growth of Telephone Connections 325.43
300.15
WIRELINE WIRELESS TOTAL
Connections (In Millions)
300
281.94
250 206.83
256.20
200
140.32
150 157.96
98.41
76.53
100 54.78
44.87 90.14
36.29
28.53
18.68 22.81
50 14.88 52.22
33.69
46.19 50.18 48.87
41.4813.30 42.84 43.95 43.49
0 0.34 0.88 1.20
26.65
1.88 32.713.58 38.336.54
17.80 21.61
14.54
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2008
JUNE
Year (as on 31st March)
From this graph we can say that wire line connection is declining day by day(43.49mln)
and the wireless is increasing substantially(281.94mln) by 31st March 2008.
Prepared By Mr. Abhishek Tewari.

4. TELEDENSITY: RURAL & URBAN
TELEDENSITY
RURAL URBAN TOTAL
70
65.9
60
50
GROWTH
48.52
40 39.45
30
26.88 26.19
20 20.74
18.31
14.32 12.74
10 10.37
12.2
8.95 9.21
6.94 8.36 7.02
5.11 5.88
2.86 3.58 4.29
0 2.32
0.52 0.68 0.93 1.21 1.49 1.57 1.73 1.86
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
YEAR AS ON 31ST MARCH
The graph shows that by 31st March 2008, that tele density (The number of landline
telephones in use for every 100 individuals living within an area.) in urban area is 65.9,
whereas in rural areas only 9.21. This means that there is a huge potential in the rural
areas for the telecom industry.
Prepared By Mr. Abhishek Tewari.

5. OBJECTIVE OF THE CASE
To know the market penetration of wireless communication in rural areas.
RESEARCH METHODOLGY
For the purpose of the study rural consumer, we asked various question so as to know
their opinion of what motivates them to buy a mobile and what they think about mobile
phones.
The present study is based on primary data. The mobile phone consumer belonging to
rural area of Budhera and Chandu of Haryana.
• Data Source- The present study is based on primary data of Budhera, Haryana.
• Research Approach- Survey
• Research Instrument- Questionnaire in their local language.
• Sampling Plan
 Sampling Unit- data collected from mobile user
 Sample size- 20 user from both the villages of different ages.
 Sampling Procedure- Judgment and convenience basis.
Prepared By Mr. Abhishek Tewari.

6. VILLAGE- BUDHERA
This village is 25 Km away from Gurgaon city. In this village schedule caste is
approximately 35% of the total population and rest is of different caste.
Route Map
Gurgaon Sec-10 Hero Hyatpur
Honda Pataud Pataud
Bus Pataud Kadipur Village
Stand i Road i Road i Road
Village Chawk
Road
Farukhnagar
Bhureda Gharihar
Village suru
3 Km
Village
Overview of the Village
Total area of the village - 1Km in radius.
Total population in the village - 5500 people.
Total House in the village - 725 families
Total Land Holding - 2500 acres
Total Voters in the village - 2400
 Male - 3300
 Female - 2200
 Children(M+F) - 3100
Prepared By Mr. Abhishek Tewari.

7. Kachha + Pakka house - 20% - 25%
1 Storey House - 75% - 80%
Employment Status
The major source of income in the village is Agriculture (i.e. around 70% of them are
either directly or indirectly related to agriculture).
Government Services - 30%
Private - 30%
Own Business (ex-Kirana Shops) - 5% - 10%
Labour - 30%
Below Poverty Line - 250 families ( Ration card available)
Agriculture
Total Land Holding - 2500 acres
Fertile land
Crops Grown
 Primary - Bajra, Jawar, Wheat, and Mustard.
 Secondary - Rice and other seasonal crops.
Cultivation of Flower - Ganda and Jaffrey
Contract Farming - Flowers
Cattle Owned
Cows - 1000 Cows.
Buffalo - 700-800 Buffaloes
Goat - 100-150 Goats
Vehicles Owned
Prepared By Mr. Abhishek Tewari.

8. Tractors - 60
Motor cycle - 80% - 85% of the families owned a motorcycle.
Cycle - Each family has minimum 1 cycle (100%).
Four Wheeler - 50-60
Infrastructure of the Village
School - 2 Govt. School ( 1 Primary and 1 till Class 12)
Aangan Wari Kendra (play school) - 3
Hospital - 1 (Dental College near to village)
Private Doctors - 3, and no Community Health Center (CHC)
Sewing Center - 1 (For women only)
Water Supply(Tube well) - 1 Own by the village Panchayat
3 Owned by Govt.
Water Tank (sweet water) - 2 (capacity of 3 lakhs gallon)
No. of Hrs Electricity Supply - 3 hours during day and 7-8 hours at night.
Electricity Transformer - 7 in different locations of the village
1 Booster to withdraw and store water from nearby passing canal.
Literacy Level
Man & Woman - 70% are matric pass.
Higher Studies - 5% - 10%
Family Size
Prepared By Mr. Abhishek Tewari.

9. Nuclear Family - 90%
Joint Family - 10%
Size - average 6(husband, wife and 4-5 kids)
Festivals and Celebration
Main Festival - Diwali, Holi and dushera.
Mela - Navratam Mela (2 times a year).
Marriage season - Post Diwali.
Other Information
Child marriage - No
Kiryana Shops - 40-50 shops
100 days of employment Scheme from Govt. has not been implemented yet.
Mobile Phone Status
Towers in the village - Only Airtel
Major Brands Used - Airtel and Idea
Minor Brands Used - Bsnl, Vodafone, & Tata Indicom (Reliance very
few).
Pre-Paid Connections - 95%
Post-Paid Connections - Less than 5%
Landline User - 200 Families (use mobile phone also)
VILLAGE- CHANDU
Prepared By Mr. Abhishek Tewari.

10. This village is 30 Km away from Gurgaon city. In this village schedule caste is
approximately 25% of the total population and rest is of different caste.
Route Map
Gurgaon Sec-10 Hero Hyatpur
Bus Pataud Honda Pataud Pataud
Kadipur Village
Stand i Road i Road i Road
Village Chawk
Road
Farukhnagar
y
awa
Chandu KM Bhureda Gharihar
Village 4 Village suru
Village
Overview of the Village
Total area of the village - 1.5Km in radius.
Total population in the village - 6000 people.
Total House in the village - 900 families
Total Land Holding - 3000 acres
Total Voters in the village - 3000
 Male - 3200
 Female - 2800
 Children(M+F) - 3500
Kachha + Pakka house - 15% - 20%
Prepared By Mr. Abhishek Tewari.

11. 1 Storey House - 80% - 90%
Employment Status
The major source of income in the village is Agriculture (i.e. around 75% of them are
either directly or indirectly related to agriculture).
Government Services - 35%
Private - 30%
Own Business (ex-Kirana Shops) - 10% - 15%
Labour - 20%
Below Poverty Line - 300 families ( Ration card available)
Agriculture
Total Land Holding - 3000 acres (The land is very fertile-black soil)
Crops Grown
 Primary - Wheat, Mustard, Jawar, and Bajra
 Secondary - Rice and seasonal vegetables
Cultivation of Flower - Ganda and Jaffrey
Contract Farming - Vegetables & Flowers
Cattle Owned
Cows - 1200 Nos.
Buffalo - 800-900 Nos.
Goat - 100-150 Nos.
Vehicles Owned
Tractors - 75 Nos.
Prepared By Mr. Abhishek Tewari.

12. Motor cycle - 85% - 90% of the families owned a motorcycle.
Cycle - Each family has minimum 1 cycle (100%).
Four Wheeler - 55-60
Infrastructure of the Village
School - 2 Govt. School ( 1 Primary and 1 till Class 12)
Aangan Wari Kendra (play school) - 3
Hospital - 1 Community Health Centre (CHC)
Private Doctors - 2 Nos. (Have Small Clinic)
Sewing Center - 2 (For women only)
Water Supply(Tube well) - 2 Own by the village Panchayat
1 Owned by Govt.
Water Tank (sweet water) - 2 (capacity of 3 lakhs gallon)
No. of Hrs Electricity Supply - 4 hours during day and 7-8 hours at night.
Electricity Transformer - 8 Nos. in different locations of the village
1 Booster to withdraw and store water from nearby passing canal.
Literacy Level
Man & Woman - 80% are matric pass.
Higher Studies - 10% - 15%
Family Size
Nuclear Family - 95%
Prepared By Mr. Abhishek Tewari.

13. Joint Family - 5%
Size - average 6(husband, wife and 4-5 kids)
Festivals and Celebration
Main Festival - Diwali, Holi and Dushera.
Mela - Teej Ka Mela, 15th Aug Ka Mela.
Marriage season - Post Diwali till June
Other Information
Child marriage - No
Kiryana Shops - 60-70 shops
100 days of employment Scheme from Govt. has not been implemented yet.
Mobile Phone Status
Towers in the village - Vodafone & BSNL
Major Brands Used - Airtel and Vodafone, BSNL
Minor Brands Used - Idea & Tata Indicom (Reliance very few).
Pre-Paid Connections - 90%
Post-Paid Connections - Less than 10%
Landline User - 300 Families (use mobile phone also)
KEY FINDINGS
Prepared By Mr. Abhishek Tewari.

14. The Key findings of the case are as follow:
Mobile Phone Used:
Information pertaining to the survey indicates that most of the people in ruaral areas
have either Nokia phones or Chinese mobile. They prefer Chinese mobile because of
their features like fm, music, and camera which they can get at a very cheaper price.
They prefer mobile phones ranging from Rs.1000-Rs2500, eg. Nokia 1100.
Source of Information
The received information pertaining to the survey indicates that rural consumer
normally use friends (most of the time), followed by TV commercials, Mobile phone
Retailer and Newspaper.
Purchase Decision
It is interesting that information regarding Purchase Decision indicates that most of the
rural people take self decision, followed by family help, sarpanch, and friends to make
purchase decision of mobile.
Consumer Satisfaction
Majority of the people are satisfied with the mobile phones and with the services and
yet few of the people are dissatisfied though the reason are not known.
(People were asked whether they will recommend their phones to a friend it is assumed
that positive answer (yes) will indicate satisfaction and negative answer (no) will
indicate dissatisfaction).
Motivational Factors
Price : Price play an important role for rural areas. They mainly prefer mobile phones
between the range of Rs. 1000- Rs 2500.
Quality: They are very less quality conscious.
Function: They are very less function conscious i.e. as per their knowledge of the
product.
Prepared By Mr. Abhishek Tewari.

15. Brand Consciousness: Rural people are not brand conscious. They normally go for
value for money and features.
Style: Rural people use mobile phones as a status and style symbol. They use it to show
people. -
LIMITATION
Prepared By Mr. Abhishek Tewari.

16. The present study is confined to 2 villages i.e. Budhera and Chandu of Haryana, and so
the findings may not be applicable to other states of the country because of socio-
cultural difference. Further Consumer Behaviour being Dynamic in nature, there is
every possibilities that over time and space findings of today may become invalid
tomorrow.
CONCLUSION
The father of the nation Mahatma Gandhi rightly stated that India lives in villages and
villages constitute the very heart of India. This has been aptly put by a Hindi poet
“Bharat Mata Gram Vasisni”, which means, Mother India lives in her villages.
In order to utilize the immense potential of rural market in India, companies need to
develop specific marketing strategies and action plans taking into account the complex
set of factors that influence consumer behavior. Rural marketing cannot succeed if the
marketing strategy and action plans are only extrapolations or minor modification of
the urban market strategy and plans. Innovative companies who adopted an integrated
approach have succeded in utilizing market opportunities that rural areas offer.
-
Prepared By Mr. Abhishek Tewari.