By Amir Ullah Khan
Vijay Mahajan has been researching neglected markets for over two decades. His first work on this issue pointed out that Africa was rising. The second discussed the 86 per cent solution where the corporate world focuses only on the top 14% of the world and now must look at the rest. Mahajan’s third stated that the Arab World was a large market indeed. His latest that releases this month talks of the rural consumer in ten countries with the largest rural populations, with India leading the pack. The book titled Rise of Rural Consumers in Developing Countries: Harvesting 3 Billion Aspirations discusses the strategies being used to reach 3 billion rural consumers in developing countries, a vibrant, aware and aspirational market yet untapped.
The argument Vijay makes is that it is forward-looking companies and NGOs with a rural DNA that are developing inclusive strategies that take them beyond developed country markets and urban centres into a vast space that holds tremendous potential. This is not really the Bottom of the Pyramid model that CK Prahalad has pointed out. There it was the poorest level in the income hierarchy that was targeted. Here Mahajan talks of the rural, which includes people with high disposable incomes and huge unmet demands.
The rural top ten countries are India, China, Indonesia, Pakistan, Bangladesh, Nigeria, Ethiopia, Vietnam, Egypt and Philippines. The United States actually comes ninth in this list with a 60 million rural population but is excluded for obvious reasons. The GDP of these ten countries chosen comes to 15 trillion dollars with a large informal economy that thrives and does not get reflected in these GDP calculations. The rural are migrating to cities, but even then, by 2050, rural areas will contain more than a third of the world population.