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70% of people in rural India are concerned about their financial situation: Report

70% of people in rural India are concerned about their financial situation, according to a report by Kantar and GroupM’s experiential marketing unit, Dialogue Factory. Titled, ‘Rural Barometer Report’, the study aims to highlight the priorities of rural consumers concerning inflation and how that alters consumer behaviour and purchase patterns.

Inflation worries are trickling across rural markets and its impact can be seen in the dwindling consumer confidence in the first half of the year (H1 2022). Dalveer Singh, head, experiential marketing, APAC, Dialogue Factory, said.  “Big-ticket expenditure in the last six months is stagnant or declining. Conversely, construction categories are continuously witnessing an increase in spending in rural India, and small construction is high on future intentions as well,” he added. 

According to the report, there are concerns around the personal financial situation of people in rural India more acutely amongst skilled and unskilled workers and people who are dependent on small businesses like traders and shopkeepers, among others. Inversely, agriculturalists in rural India show relatively lower concerns about their personal financial situation but have lower confidence in the country’s overall economic resilience. Moreover, the report stated that confidence in the economy’s resilience is better in southern regions except for Karnataka, while northern India along with West Bengal in the east shows lower confidence in the economy. The claimed monthly household expenditure in rural India has increased by eight percent, while claimed monthly household income has increased by 12% during the same time, thereby offsetting the effects of inflation.

The report also stated that there has been over a five percent decline since December 2021 in the monthly purchase incidence for essential categories such as cooking oils, laundry products, biscuits and chocolates, and personal hygiene products. Additionally, the report highlighted that there is a larger proportion of the consumers in India who are managing their budget by shifting to the smaller size packs rather than buying the lower-priced brands. In terms of media, the report states that the gap between traditional media and digital media is continually narrowing, though traditional media enjoys higher credibility than the latter. 

For Puneet Avasthi, senior executive director, specialist businesses, insight division, Kantar, Inflation Concerns remain in rural India affecting two in three households, however, household income has been going up at a rate faster than inflation, as a result creating some stability for people in rural India. “In order to cope with inflationary trends, consumers in rural India are looking to move to small pack size and further, could also be doing portion control to make the pack last longer,” he highlighted. 

Kantar along with GroupM’s rural and experiential marketing unit, Dialogue Factory, has released the fourth edition of the Rural Barometer report. The research was conducted with Kantar’s data and insights network and Dialogue Factory’s rural marketing intelligence in 18 Indian states, across adults aged over 18, with representation across gender, new consumer classification system (NCCS) and age groups. 

Also Read: Nielsen India appoints Deepak Mann as new director, marketing effectiveness

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