Saturday, June 28, 2008

Strategies for rural market focused companies

The following are very generic suggestions for companies focused on rural market.

Focus: The company/organization must focus on a single service unlike Drishtee or n-logue or Akshaya.
Training: Training is necessary for all stakeholders with the company (including employees, customers, vendors, etc). Why it is important? Because, in rural India you get raw talent. So they must be aligned to your requirements. Sometimes you may have to start from creating the whole ecosystem before actually scaling up your operations.
Adjusting to local needs: Rural India consists of varied cultures, variety of traditions, etc. Your model should have flexibility of adapting to the local needs.
Technology for masses: Use technology wherever is possible.
Word of mouth advertising: In rural India, people love to be your brand ambassadors and talk about all good things about your product/service if they like it.
End-to-end service delivery: You need to make sure that the consumer gets service-as-a-whole delivered. For example, if you just collect a resume and charge the customer Rs. 20, and this may not be scalable. However, you collect a resume, provide him a job having salary of Rs 5000 and collect Rs. 20000. This would definitely work with rural people. Take the case of SKS, they just not only provide capital to people but also help them in their businesses similar to venture capital companies engaging with their portfolio companies.
Emotional Attachment: Rural people keep the trust with your product/service and so you must live up to it. And to create such trust, you need to align with local communities in order to follow the trick, "trust is transferable".
Efficient distribution: Rural India is sparsely populated and so it is obvious that the distribution costs are high. Here, one needs to deploy innovative approaches in order to bring down the costs.

Monday, June 16, 2008

Pocket Shower for developmental activitsts or trekking enthusiasts

I usually go for treks (interested? if you are from Mumbai or Pune, do let me know!). And I just love those visits. Moreover, I also visit Rural villages just for my own understanding of grass-root issues. During those visits, sleeping bag has been exceptionally useful. However, there is little discomfort when I love to take bath in the places surrounded by lovely green (trees). Nature makes me amazingly refreshed. I think, Pocket Shower might help for such nature baths.

Description of Pocket Shower:

Made from heat-resistant waterproof fabric, the Pocket Shower is super compact, measuring only 3” x 6” and weighing just 4.25 ounces when zipped and empty. To use, simply fill the 10 Liter (2.6 gallon) Pocket Shower, hang it using its 20 feet of lightweight cord and two tough built-in rings, and enjoy your shower.

The shower features a compact shower head that you can use to adjust the flow of water from an efficient trickle to a free-flowing shower that lasts about 8 and a half minutes when fully open.

For a warm shower, fill it up early and let the black fabric soak up the sun during the day. And when not in use, you can use the Pocket Shower as a regular dry sack to transport clothes or sleeping bags.

We need this Pocket Shower to be adaptable to Indian conditions and moreover with a less price tag. Any grass-root innovator there?

Sunday, June 15, 2008

Some numbers on SME activity, employment in India

According to fifth economic census:

As of 2005, about 26 million rural enterprises employed 51 million people, whereas about 16 million urban enterprises employed 49 million.

However, this trend seems to be changing, with rural employment in enterprises (engaged in activity other than agriculture) growing at an annual rate of 3.3 per cent between 1998 and 2005, as against 1.7 per cent in the case of urban enterprises. A change in composition in favor of the former could arrest the shift of populations to cities. A growth rate of 3-4 per cent in rural enterprise employment is achieved even if agriculture sector performs poorly. Therefore, enterprises do not depend on surplus farm income. They might have come up to cope with falling agriculture incomes. Nevertheless, healthy farm sector growth helps; a 2-3 per cent growth in agriculture output is likely to lead to a growth rate of rural employment of 5 per cent or more.

Water as fuel for a car!

Many times I dream during my night sleep. And yes, my dreams are always like the following: Reuters' Ms. Michelle Carlile-Alkhouri report.
Japanese company Genepax presents its eco-friendly car that runs on nothing but water. The car has an energy generator that extracts hydrogen from water that is poured into the car's tank. The generator then releases electrons that produce electric power to run the car. Genepax, the company that invented the technology, aims to collaborate with Japanese manufacturers to mass produce it.
Click here for more details on this claim. Also you would like to see their website.

Saturday, June 14, 2008

Innovations waiting in selling Insurance policies for Rural India!

Till date most of the companies in India are always focused on urban market or at least they sell their products/services with the same models that of predominantly urban-market oriented. However, of the late, there is a slight shift due to the popularity of so called, "Bottom of the Pyramid" model.

One of the main vocal point of BoP model is that understand low-income people as your consumers and make your product affordable (units) to the BoP market. Most of the companies, these days, have started to remodel their products/services according to this principle.

However, targeting BoP market means more than this. You need to make sure your offerings suit to the local needs. That is exactly missing in Insurance sector.

Nowadays, I have come across many insurance companies selling their policies as low as Rs. 10, Rs. 25 (much less than a US dollar). This is really a welcome step. And now coming to the other innovations part:
  1. Insurance policies should be completely flexible. There should not be like separately priced like health insurance, life insurance, vehicle insurance, farm insurance etc. You price them as a combination (as a flexible percentage and choice is given to the customer). Now let the customer chooses the way he wants.
  2. Second comes from distribution aspect. Do not try to keep a separate chain of distribution. Utilize 1-2 millions telecom retail distribution chains. For the simple reason that these bring the structural efficiency in order to reduce the costs.
  3. Third comes from social angle. Most of the rural people live in joint families or at least they would love to consume services as a family. This is evident from their consumption patterns such as marriage/functions, pilgrim trips etc. So your service should consider this trick and offer them a group oriented policies. One may even consider community based policies. That would possibly become an instant hit.
In all of the above scenarios, recent advances in technology would play a great role. So insurance companies should start looking at the benefits that new tech developments could bring them.

Thursday, June 12, 2008

Copyrights of the contents of this blog

For the past few days, I have been writing regularly on this blog (I do have many more blogs). Can you believe this? Even though I maintain such a large blog, I don't know to write. Due to this weakness of mine, I have not been replying to comments for long time on most occasions. One of such comment made me to write this post. That is about copyrights of this blog.

You can freely copy or distribute any of the blog-posts here and moreover you can even remix them but with one condition that you must attribute the original source. Yes, you must have guessed it by now. I am talking about Creative Commons Attribution 2.5 India License.

Firstly, I am really suprised why I did not this licensing stuff all this while. Secondly, I have removed unrelated posts here in order to make this blog restricted to "Rural India" context alone. I decided to write all my personal or business ideas in my other blog.

Services going mobile in India

I used to wonder about the business model on providing Internet service on cycle rickshaw to Rural population in India. Ultimately it failed in terms of scalability. And nowadays I hear about many services offered on move. I am listing them here:
  1. Court (Indian government's innovative thought)
  2. Hospital on vans (equipped with X-ray machine, ECG machine, basic pathological services for blood and urine test, ante-natal and post-natal services and an out-patient department for common ailments)
  3. Hospital on Train
  4. Banking
  5. Science Train
  6. Automobile Spare parts on Bus
  7. PCO (manned pay-phone service)
  8. Female on move to sell FMCG products
  9. Micro-business school on a Mini Bus
  10. Retail stores on Vans
  11. Tools on a Truck for rural carpenters, metalworking artisans, plumbers etc
  12. Computer Training center on wheels
  13. Toilets on wheels
Guess which of these would be scalable & sustainable? I believe: banking,hospital on van, automobile spare parts on bus and retail stores would be scalable. Similarly cellphone spare parts on wheels can be a potential business opportunity.

Note: I would keep updating this list as and when I find other such ventures.

Rural India lacks focused media

These days most of the big corporates are interested to enter into Rural India. Steps needed to enter into rural market are as follows:

1. Product/service should be tailored to (large, fragmented, dynamic) rural market.
2. Efficient Distribution (click on the link to see some of the models mentioned in my previous post)
3. Effective marketing : Rural India lacks focused media. This is an opportunity in waiting to have clients like: Nokia, Airtel, Coke, Unilever, ICICI, Max New York Life, Hero Honda, Nicholas Piramal, Apollo, Mahindra, and thousands of such companies who are dying to get the attention of Rural Indians.

Auomobile spares distribution in Rural India

Automobile spares distribution is a big issue in rural India. As users live in sparse locations, the service becomes very expensive (for the distributor as well as the end user). This is one of the major reason for lesser adoption for bikes, cars, etc in Rural India. Obvious solution is mobile distribution center. How?

Satyam has created a mobile auto showroom cum service center, which can be taken door-to-door in a Bus, called Edow. This bus will be equipped with everything an auto dealer needs, a display area, a workshop, a sales office and systems, hi-tech display systems and high speed connectivity. It expects demand of 40,000 for such buses in India.

Wednesday, June 11, 2008

What iPhone-3G means to Rural India?

iPhone 3G is creating waves across the world that it's a very cheap device. Let me discuss from Rural India's perspective.
  1. It costs 8400/- + taxes, however one has to add up the Internet usage cost. It may make up Rs. 800-1000 per month plan for two years. This means, device would costs about 30000/-. Now guess, how many people can afford this price gamble? Try from this hint, there are about 300,000 blackberry users in India.
  2. As each user will have to purchase unlimited data plan along with the device, this will increase the broadband user base.
  3. Touch screen phones are more relevant to Rural India if you consider data services. Because language could be the local one. Larger keypad can be created as an application.
  4. More icons kind of look and feel makes people to be comfortable with the handsets in order to increase data services adoption. For example, enable voice and visual way of browsing
  5. Camera, MobileTV, Video on Demand, VOIP, GPS are the things which would drive this iPhone market in Rural India. Good business model is by charging each service separately.
  6. Many full-scale services, targeting rural mass, would emerge such as e-health care, banking, ticketing etc.

Strategies for rural Indian market

Recently Anisha has shared her insights/experiences in her new job. Some of those points I would like to mention here.
Till recently, a large part of marketing was done targeting the urban consumer, and with most marketers having no prior exposure to the rural audience, they are applying the same rules to connect with this completely different segment. The mistake that most companies make while chalking their rural strategies is to treat the rural consumer as an extension of their urban counterpart.
You can't do this because their life style is entirely different from the urban counterparts.
The other common mistake is to treat rural consumers as a homogeneous mass without segmenting them into appropriate segments. The most relevant point to note is that this segment is extremely fragmented and spread out over a large geographical base. The cultural and behavioral differences vary not just from state to state but from village to village. Mapping out this difference in consumer behavior is the key to any successful rural strategy.

From buffaloes to beauty parlours:
Farmers verging on retirement, sensing the decline of their own profession, are encouraging their children to enter different vocations. Around one-fifth of rural households now generate their primary income from a salaried job or a small business. Besides small village shops, loans are being taken for novel business ideas like beauty parlors, popcorn machines, spice factories, tailoring shops et al. A villager equals farmer is true no more as life has moved beyond farming and agriculture.
Farming is one of the source of revenue however, it is true that rural youth are looking at alternate sources of revenues (because farming is a seasonal activity and so, during the other seasons they take up other revenue generating activities). However, most of them are employed with unorganized sector.
Don’t just sell dreams, tell them how to live their dreams:
Thanks to the television having made substantial inroads into rural homes, villagers have also learnt to dream. Everyday they are exposed to images of ordinary people scaling extraordinary heights. This has given them enough hope about their own future, but where they flounder is the way to go about it. It is here that measured approach consisting of small actions, one step at a time, finds better acceptance and credibility. Actions where outcome can be measured from time to time and results are visible in the near future. So, go ahead and sell them dreams, but at the same time give them a solution and a formula for it to materialise.
Yes. Let us say, if you wish to a sell a insurance policy for a farmer. You can sell it only when he understands how to make use of it at its best. This is where social aspects also comes. While training the farmer, you need to relate the service to his social life.
Not just economic but emotional security:
Even though they are receptive to new ideas, they do not readily dash into new ventures. They do not only want economic security but also emotional security. They are likely to welcome innovation that satisfies their sense of security. If they feel that a particular idea will help them improve their economic position or their social relationship, they will accept it. Selling a product to them is not a cold commercial transaction (but) an agreement of trust between the marketer and the consumer. And companies that live up to the trust that this consumer places in them will benefit immensely in the long run.
Rural people are much more social than their counterparts and this makes the difference. This is the reason you need to have local alliances.
Their children are like stocks in a portfolio:
It’s always known that family ties are very strong in hinterland, but the difference is in the proportion of family budget that is being allocated to children, especially the male child and his education. Son’s education in a private school is like a stock market investment that is bound to yield returns far greater than any other investment. Any marketing effort that appeals to this agenda is bound to catch his immediate attention.
This is a recent transformation. As farmers do understand that there is not much money can be made from farming. They shifted their whole investments on children education. Particularly, southern states are much more advanced in this regard compared to northern ones.
Sharing risks and rotating savings:
This insight is the basis for the success of all micro finance ventures in rural India. A simple model that lends on the back-up commitment of small groups has minimised risks and reduced bad debts to near zero percent (certainly doesn’t need the intervention of the finance minister to help institutions recover their money)! Some of the other industries that can leverage this to their advantage are insurance schemes that offer group products and innovative saving schemes.
Particularly health insurance is a low hanging opportunity here. Rural Indians have to be treated as families rather than individuals. Most services are shared among the family. For example, if one member purchases a mobile, it is like whole family purchased it. Rural marketers should get this point while putting their business models.
Community empowerment & inclusion:
The rural communities have not been empowered in the past. So they do not participate in the development process. A participatory model that mobilises the community and makes it responsible for its own well-being is bound to find greater success. The attempt should be to turn villagers into entrepreneurs and keep the ownership of the various projects with the community. Given the vastness and diversity of the geographies involved, marketers would do well to leverage the potential of villagers themselves by creating entrepreneurial communities. Make them an extended team of your business and let them grow with you. A last word of caution, the companies entering the rural markets must do so for strategic reasons and not for tactical gains.
This is in order to maximise the market. We have to ensure that development aspects of our efforts should be implicit.

Sunday, June 08, 2008

Water from Air

Problem: As part of evolution, a 100,000 years ago or so, humans learnt that Food is the primary need. I believe, his first innovation is in the thinking that storing the food enables him to have it during odd environment conditions such as rainy, cold, etc. After he found a way to store food (pickle is the foremost innovation in this regard), the next biggest problem for him was to get drinking water. So he wanted to be near water channels, first to get water and second to kill an animal which reaches for water (later for farming purposes). If you observe the history, the whole civilization was all sided by the river beds. Such a oldest problem, which has been known for many thousands of years, human is still struggling to get water (one more hidden variable here, that is increasing population).

Current scenario: I can't resist myself without crying whenever I see rural women spend their most part of life in just fetching the water from near by wells. In many villages, one single well is served for 5-10 villages. A woman carries multiple pots (one on another) is a typical scene anywhere in those villages. And if you feel like it is just a concern of rural problem then you are grossly mistaken. When I used to live in Chennai (or Madras), a queue of hundreds of water pots near every public tap is a very very common scenario.

Is it not silly, if you feel that: water, water everywhere but nowhere a drop of it to drink. Yes, most of part of the earth is water, however 97% of it is salty one. Does it not sound like a technical problem?

Australia, UK, US, etc are spending billions of dollars on installing desalination plants, wherein salt water is converted into fresh drinkable water. What is that in this process which makes it billions of dollars cost? It is for the energy which is required during the reverse osmosis process in order to apply pressure.

What I believe is that out-of-the-box techniques are needed in order to solve the problem for billions of people. One such attempt is this "Water from the Air".

Did you ever observe that if salt is placed outside then it contains a small pieces of stones. Yes, it is after capturing the water from the atmosphere. Many technologists believe that there is a river running in the air everywhere including desert places. Using this philosophy, Aquasciences have developed a machine to produce 600 gallons of water in a day at the cost of about 7 cents (or about 3 Rs) per litre. This technology is used by American Soldiers in Iraq where the cost of logistics of bottled water is running pretty high. You may love to see the following news clip covering this technology.

Unfortunately in India, till now there are no large scale attempts in this regard. And yes, this post is about my lifetime ambitions to solve these basic problems of humans such as food, water, etc.

Mobile Services - Voice Calls

Mobile is revolutionary. Yes, it will have profound effect on human development process. In order to indicate this, I am attempting to write detailed posts on Mobile Services and this one is the second post. Wait for many more posts on this series.

Mobile is known for voice calls for decades. Typical features such as the following are already available on most mobiles.
  • Caller ID (more details such as name or number or other identification marks)
  • Reveal caller id (caller needs to input his/her number in order to continue the call)
  • Call forwarding (when you are busy/ no-answer/ selective/ every time),
  • Call waiting (with a recorded message of receiver or music is played)
  • Call hold (plays music for the receiver on hold)
  • Call blocking (automatically rejecting the numbers of your dislike, specifically, IVR calls or the unloving last call)
  • Conference call
  • Call recording (both sides)
  • Automatic call receiver
  • Call tracing
  • Missed call alerts
  • Speed dialing
  • Repeat dialing (busy or otherwise)
  • Automatic/selected call return
  • Caller tunes
  • Distinctive ring tones depending on callers
  • Priority calls
  • Scheduled silent mode
  • Do Not Disturb (send a busy/ unreachable signal to the receiver)
  • On a single mobile phone, one may maintain multiple-numbers to differentiate their purposes.
  • When you make/receive a call, you may see the notes on your counterpart such as recent calls time stamps, text notes you have taken etc
Many many more ...............

Future outlook:
  1. Managing the above features using typical Web 2.0 features such as labels (family, office, school friends, etc)
  2. Usage statistics patterns over Internet (on mobile).
  3. Number masking: Celebrities may have a number to give it for temporary purposes and later to discard the masked number
  4. Scheduled call : a call is made on scheduled time, plays a pre-recorded message and rings on caller side as well
  5. Pay for incoming calls : For selected callers, receiver may bear the cost
  6. Uploading public telephone directory into the mobile (for caller identification purposes)
  7. Random calls: If you feel bored of waiting then you may enable random call to receive a call from an unknown person (who would call to a fixed number in-order to reach you but without the knowledge of your number)
  8. At a time, call multiple numbers of a single person to get him/her for sure
Network busy or signal unreachability does hurt this voice calls service.

Video Calls:
This case is very similar to voice calls. I don't detail much other than mentioning the following.
Recording of the calls (both sides)
Exchange of data during the call and management of this data interacted
Photos of the video call
Video conferencing
Most of the Voice call features are applicable.

PS: This is an indicative post and not a complete listing. Please do write your thoughts in this direction.

Friday, June 06, 2008

Laptops for very cheap prices!

Note: These are not regular laptops. Though they have most features of regular ones, but you may love to call them, mini-laptops.

At last, OLPC has done one thing good. It has generated a lot of "noise" about the unleashed market. Because of this Asus has started a Eee PC which had been under microlense of media whenever OLPC is covered. Obviously, as media shouts about Asus laptops, more of them sold in the market (currently it is hovering around 1 Million). This has made all the standard laptop manufacturers to take a worthy note of it. And now this is about to benefit the customers. Instead of pricing low-weight, less-size laptops as 3000 USD or above, for the first time many companies quote the prices below 1000 USD. Another interesting point here is that, these companies are looking for alternate operating systems such as Windows XP, Linux, etc. instead of throwing (the worst) Vista operating system to the customers headache.

According to Wired magazine review:

Definitely, price is one of the catchy point for urban-poor/students. However, if the manufacturers wish to target rural rich customers, then they must tweak the laptops to perform under "rugged" conditions (temperature, dust, water, etc) and possibly should include technologies like WiMax.

My favorite among these is MSI Wind notebooks. How about yours?

Thursday, June 05, 2008

Why mobile penetration in Rural India is slow?

Now everyone is sure (may not be as much as I am) that mobile is a revolutionary thing and it would effect the person even who sits at the bottom of the pyramid (that includes every baby, poor, rich, old, female etc on the earth). However Indian carriers such as Airtel, BSNL, Vodafone, Tata Indocom, Reliance etc could not find a way reach rural Indians. They all want to make sure that peasants on their roll but without a clue.

Although rural people are more social and so, would obviously love the Mobile compared to their urban counterparts. So what's stopping them? Let me look at the reasons behind the less penetration in Rural India. Clues are mentioned in the bracket.
  • Although mobile appears like a easy thing to use, for most of rural Indians it is a tough nut to crack (training is needed)
  • keypads are very uncomfortable (keypad should have common standards and language one is much comfortable to educated people)
  • Good plan, in turn selecting a service provider, is virtually impossible to decide (easy plans are needed)
  • Electricity outages/load shedding makes it a relatively less useful one (good battery power is needed)
  • Signal unavailability (towers are needed)
  • Affordability of the service (keep the plans using the data the way they use it)
  • Data services are not targeted at right audience (rural semi-educated)
Reach me, to find a clear-cut solutions. My contact details are on the top of the sidebar on this blog.