Godrej eyes rural market for sales push

MUMBAI: At a time when slow demand is eating into the bottomline of fast-moving consumer goods firms, domestic major Godrej Consumer Products Ltd (GPCL) is making a renewed effort to push rural sales, even as it looks to scale up its direct reach in urban markets.

“We have started the ‘One Rural’ strategy, where a dedicated team will look at rural sales,” said Sameer Shah, vice-president, finance, Godrej, the maker of Fairglow and Cinthol soaps, among others. The strategy is currently being piloted in Punjab, West Bengal and Tamil Nadu.

It has also started a pilot programme in the cities to improve “go to market effectiveness”, with dedicated beats for sales and marketing personnel.

“We plan to increase our direct distribution reach in urban areas by 30% to cover 375,000 outlets,” said Vivek Gambhir, MD, GPCL.

Rural sales currently account for over 27% of Godrej’s revenue. In contrast, rival Hindustan Unilever (HUL) gets over 35% of its revenue from rural markets.

HUL’s MD Sanjiv Mehta recently said urban and rural growth rates have now nearly converged. Till 2014, growth in rural India was over 1.5 times of the urban markets for HUL.

GCPL continues to see higher growth rates in rural India due to 30% penetration of household insecticides, Gambhir said.