The case study aims to develop marketing strategies to promote businesses in rural areas using social networking websites. This will help the entrepreneurs promote their products through sites like Facebook, LinkedIn and Twitter, by connecting them to the appropriate audience.
But, there are as many challenges as there are opportunities in this area. While some customers try to educate sellers on how to use technologies such as e-wallets, the Government should help promote digital social media marketing among these entrepreneurs. This will help increaserural employment opportunities.
The case also attempts to understand the potential of the handicrafts sector in India, its success in empowering women, and the scope of social media marketing in creating a collective of empowered artisans.
Handicrafts in India
Every State in India makes and markets unique, creative handicrafts, which provide an identity to the region. The handicrafts business has a history that dates back to the Indus Valley Civilisation. While handicrafts have always been an important part of India’s export basket, the last three years, in particular, have seen a big jump in exports.
Exports during 2011-12, which were at $1,830 million, increased to $2,301 million in 2012-13 and to $4,537 million in 2014-15. According to the Centre, India exports more than 25 per cent of its handicrafts to the US, followed by the UK and the UAE, with 9 per cent each as of financial year 2014-15.
The Export Promotion Council for Handicrafts (EPCH), a government-funded organisation that finances promotional activities regarding the handicrafts industry, is focussed on developing cost-effective strategies to promote the country’s handicrafts businesses and craftspersons. Both the Centre and State governments are using digital marketing and e-commerce to promote the items. Some sellers have found these initiatives useful and have notched up significant business growth. Similarly, there are a number of regional vendors who promote the handicrafts of different States on their websites.
As this sector is dominated by middlemen, digital marketing sometimes helps the artisans bypass the intermediaries or selling agents, and redefine the supply chain network.
Table 4 depicts a digital marketing driven channel for handicrafts in India.
This unorganised sector faces a lot of problems related to raw material sourcing, support, technology lag, marketing and promotion and, finally, skilled labour. Especially in the case of handicraft businesses based out of rural areas, the entrepreneurs struggle to meet these needs. Despite the challenges, they manage to create their own markets and find new ways to reach their customers. With the emergence of social media platforms such as WhatsApp, Facebook and Twitter, such entrepreneurs have taken to social media marketing to sell their products.
Government agencies have taken to social media marketing as well. During an interaction with the District Rural Development Agency and other agencies in Andhra Pradesh’s Chittoor district, we found that that the Collector had initiated the online sales of Kondapalli toys procured from Kalahasthi and dispatched from the Government Training Centre, Tirupati.
Internet use in rural India
A 2015-16 BCG study shows that there has been a sharp increase in the number of internet users in rural India, especially in the 18-30 age group. It is expected that rural internet use will rise to 315 million by 2020, almost double the current numbers. This could lead to a jump in e-commerce in the hinterland as well.
Another useful link in the marketing network could be postal services. If they are upgraded and modernised, there is huge potential for post-offices to function as a carrying and forwarding agency for rural artisans. The postal department could serve as a logistics service provider and a payment gateway as well, to help rural craftspersons overcome the challenges faced in shipping their goods, such as lot size, packaging, potential for breakages and instructions for use and packing. The biggest concern is that the products are often broken or damaged in transport and end up being returned.
Promotional measures
Based on our interactions with different stakeholders, we think the Central and State governments could take certain measures to promote handicrafts.
— Revival of the Postal Department and using its vast reach by leveraging its logistics and supply chain management capabilities. An MoU with the Postal Department will help cut the time from procurement to delivery of products.
— New payment options must be provided to the end customers. The option of selling handicraft products through the Postal Department website could be explored.
— E-commerce portals should charge less and/or waive administrative charges for handicraft product sellers.
— Offer advice on potential tax transactions, legal compliance and quality requirements.
— Provide subsidy electricity/assistance in purchase of, say, solar panels, especially for weavers, who work in shifts.
It is further recommended that the following can be initiated:
— Educate artisans and buyers on the need and importance of certification and quality standards for each category of handicrafts.
— Improve packaging and transportation of products.
— Training and development with a scientific approach to designing new products and to help craftspersons stay relevant to changing market needs.
— Handicrafts should be promoted as a concept, bundled with pride in the country’s artists, rather than just sold as a product.
History of the case
Tejasvi Suresh Bala (Teju), promoter of digital marketing company Samrudh Solutions, is a successful entrepreneur in the field and advises companies in the jewellery, food, healthcare and financial services sectors. During his visits to an academic institution for advice, he saw the potential for growth in digital marketing in rural areas.
According to Teju, this idea could be developed with the twin objectives of long-term substantial commercial gain and a passion for promoting entrepreneurship at a distribution level. To relate with the above sector-level and State-level information and policies promoting development of the handicrafts sector, Teju interacted with a rural entrepreneur, Gangamma, who would like to utilise social media networking to market her craft products.
Gangamma hails from a remote village near Madanapalle, in Chittoor district of Andhra Pradesh. Educated just beyond primary school, she currently works at a well-known residential school. She makes hand-crafted jewellery using seeds and wooden beads; and dream-catchers using bird feathers. Gangamma has imbibed all the qualities of an entrepreneur. She sells the products to students and their parents who visit over the weekends and makes approximately a 30 per cent profit on each product. The payments are directly made by the school, which debits the students’ expenses paid by parents.
Key observations
It is observed that Gangamma has all the qualities of an entrepreneur: she is hardworking, takes risks, is creative, focussed, vision-oriented, confident, motivated, and has a good network and people skills.
Gangamma’s method of manufacturing and selling was recorded. The process includes:
- List of items for sale and availability of raw materials: The products are prepared in-house with 75 per cent of the raw material available locally.
-Booking orders : Her business works on the basis of counter sales (push) and sales based on orders (pull). The orders are taken in a simple manner and logs are maintained in a notebook.
- Sales: All items prepared, either for immediate sale or for display in stalls over weekends, are catalogued in the records as “stock for sale”, and she maintains a ledger of all her transactions. This helps Gangamma control her inventory and production plans. She also does a few promotional sales to avoid stock pile-up and ease managerial control.
- Recovery: The students purchase products from the stalls and authorise the school to add this expense to their account. The payments are then made directly by the school to Gangamma.
Her business has seen a constant increase in customers and profits and she has started a WhatsApp account to keep in touch with customers.
She was asked to answer a set of questions to help formulate a marketing strategy. These were based on four areas:
- Ideation - Need for innovation, interest to learn, practise, impact on personal life (economic and social life)
- Raw Material - Availability, procurement, storage and cost of raw material
- Financing - Financial assistance from banks, SHGs, DRDA (DWCRA)
- Support - Social marketing plan
After she answered the questions, two digital marketing options were discussed with her. They were:
I. Self-sustained, independent marketing and sales
1. Register a small firm and link it to a bank for financial transactions.
2. Get a point-of-sale machine and link it to the bank account.
3. Create a website and display the products.
4. Create Facebook, LinkedIn and Google accounts for social marketing. Utilise free software as best as possible.
5. Advertise with national handicrafts and cottage industry websites, Google and more.
6. Apply for a Government loan.
7. Enable BHIM app for easy payments.
II. Depend on third-party sellers
1. There are many organisations in India that help sell handicrafts. They take the responsibility of displaying the products on their websites and selling them to customers. In return, they help the artisan become financially independent.
2.This helps small entrepreneurs focus on production, which is their niche area rather than sales and/or promotion.
Awareness and customer retention; and customer engagement are the two major factors that decide the success of a business.
The base for this case is the AIDA (attention, interest, desire, and action) model with a digital twist. After implementing it, one can analyse performance based on site/page visits, views, followers, fans, subscribers, sentiments, top shares, likes, tweets and retweets, wall posts, comments, sales pitches and proposals.
Gangamma was also informed about the important factors that help one succeed in social media marketing: customer engagement on social networking sites; customer satisfaction; and creating and encouraging aggressive and positive customers reviews.
Recommendations
There are some limitations in this case study as it is with reference to one woman entrepreneur at a single location. Gangamma suggested that Teju travel across Chittoor district and become an aggregator for digital marketing services and enable a suitable supply chain network for improving the livelihoods of craftspersons. She felt if Gandhiji’s dream of helping customers and rural India is to be fulfilled, digital marketing is one way to go about it.