Rural Bazar - Ideas of today for a better tomorrow 

D.C.Misra, Avijit Dutta, Omkar Rai, Rama Hariharan, Rajiv Goel, Manie Khaneja 

Abstract 

This paper discusses the prevailing marketing scenario in the rural areas for products made by rural artisans and the associated process limitations, as part of domain analysis. It then analyzes the existing IT framework to overcome the stated limitations & enhance the product reach. RuralBazar, a web based software product from NIC,DIT, MC&IT, GOI, based on the stated framework addressing the problem, is then introduced. The paper concludes with a discussion on issues related to infrastructure & methodology required to sustain the operationalisation of the system. The IT based solution, for rural artisans, has also been recommended by Working Group on Information Technology for Masses setup by Ministry of Information Technology, Government of India (http://itformasses.nic.in/vsitformasses/repg3.htm#1 ) . The further details of product and processes are given in http://crisp.nic.in/ruralbazar.

  1. Domain Analysis  

A majority of our country's population lives in the rural areas and any development efforts made in the rural areas significantly impacts the country's development. Various governmental and non-governmental agencies have contributed significantly to improve the lot of the Indian rural poor and with good results. These efforts have attempted to address different needs of the rural poor. One such effort has been to provide sustainable self-employment to the rural poor by engaging them in micro-enterprises. 

Serious attempts are made to exercise care while selecting the activities on which these micro-enterprises are based. In general, the focus is on selecting those activities that exploit the existing skill set of the rural poor and for which resources are available locally. However, the importance of a marketing infrastructure for these products cannot be wished away. In fact, the impact of a near non-existent infrastructure to market these products on the rural poor will be far more severe as he/she cannot sustain the loss even for short periods. 

1.1 Current Scenario  

A look at the current marketing scenario indicates that many of the marketing issues such as demand assessment, brand identification, product promotions etc. have not been extended the desired attention. However, a few attempts have been made which merit attention. First and foremost is that most of the products, produced by rural artisans, are sold in local rural haats. Besides these haats, NGOs and the governments at various levels have also helped in promoting the sale of these products outside the confines of the local environs. For example., exhibitions and melas are organised in major urban centres to publicize and promote the sale of these products. In many states, the State Government bodies have made contribution to the sale of these products by extending preferential treatment to these products at the time of procurement. Even in the above cases where an attempt has been made to address the issues, the results have not been very forthcoming. 

1.2 Challenges 

As an entrepreneur, the individual or group of rural poor engaged in manufacturing activities of the micro-enterprise faces a number of challenges. Some of these are given below

• Most of the products are still sold at the local rural haats. This means that the products may not fetch a good price as there is limited demand for the products in the limited local market. Limited demand also implies a low turnover, resulting in turn in, low income for the producer. Also, as these consumers are not overly conscious of the quality, the chances for product improvement remain bleak.
• There is limited awareness in the global market either about the availability of these products or about the existence of these micro-enterprises and their activities. With limited publicity, the products can hardly hope to build a market for themselves. 
• The exhibitions and melas are not a frequent phenomena. Also, their venues keep changing and are limited to a few towns/cities. Thus, the products are not available all the time in most of the places.
• There is no denying the fact that an intelligent market analysis goes a long way in sustaining the market for any product. Though a formidable task in itself, it assumes gigantic proportions in the present context as the rural poor, with his limited knowledge and finances, can hardly be expected to carry out this exercise. Not only this, the existing marketing infrastructure is equally ill equipped to undertake the task. Nevertheless, such an exercise will help in analyzing the market for customer preferences and accordingly sensitizing the rural poor producers to the demand patterns of the market. 

1.3 Requirements  

In order to meet the challenges outlined above, there is an urgent need for a marketing infrastructure that is designed to address these very challenges. 

•  First and foremost requirement is that the proposed infrastructure should be durable in terms of time as return-on-investment may span a longer time frame in view of expected low turn-over of rural products, atleast in the initial phases. 
•  Next in the line of requirements comes the facility for publicizing and promoting the products. Not only should the marketing infrastructure facilitate the publicity and promotion of the products to the widest possible customer base, it should facilitate this for any and every kind of product. 
•  Publicity and promotion exercises will be grossly undermined for want of accessibility to the sale centres. The infrastructure should provide an any time - any where access to the customers. 
•  To further enhance the sale of products, an understanding of the potential demand for existing as well as new products is an absolute essential. The marketing infrastructure must support this through a built-in mechanism that reveals and analyzes customer preferences. 
•  Lastly and probably a very important requirement, particularly in the context of rural producer, is that the financial benefits, generated from the sale of products must flow unhindered to the producer. This is of paramount importance so as to ensure that the rural poor is not exploited and is assured of his/her share of profits. 

The above analysis of the domain leads us to the question: Is it possible to put forth a viable and self-sustaining solution that addresses the issues outlined above? If yes, how cost-effective is it? 

2. Information Technology, a facilitator  

2.1 Elements and Characteristics of IT framework  

The emergence of Information Technology in the last century as a prime driver and facilitator of change in the socio-economic development of the people has revolutionized lives across the globe. Aggressive investment in research & development in areas of Compunication (Computer and Communication) has yielded highly positive results. And, with the advent of Internet, international boundaries have melted away and the dream of a global village is eventually becoming a reality. The Internet characteristics of simplicity, openness, availability and global ubiquity are starting to impact all aspects of life, be it governance, education or business, in ways that were neither comprehended nor imagined a few years ago. Internet, more than any other infrastructure of IT, has introduced unprecedented changes in our daily lives so that even mundane activities are carried out in whole new ways.

 India's contribution and participation in this revolution has been commendable, to say the least. However, most of the efforts have been service oriented and less at adoption of IT for benefit of Indian citizen. The last few years have witnessed a phenomenal growth in the country with respect to the usage of IT in almost every aspect of the lives of people, primarily in urban and organized sections of the society. However, despite this widespread usage of IT in the urban areas of the country, the IT wave has failed to touch the shores of rural India, keeping it marginalized, from modern digital highways and the benefits associated with it. 

But the rural people in general, and the poor in particular, are in no way to be blamed for the situation. Though successful attempts have been made to exploit the power of IT and the Internet for the benefit of the rural poor, most of them have had an indirect and delayed impact, not resulting in any direct, tangible and immediate benefit. For example., the creation of information kiosks (like Warana and Gyandoot projects) in the rural areas to disseminate information to the local rural people has proved to be a very effective means of disseminating information of importance to the local people. However, such information kiosks can hardly help the rural poor who suffer from want of basic literacy and livelihood. As rightly observed in the Background Report of Information Technology for Masses, focused attempts must be made to exploit the power of IT to provide new opportunities, preferably in a form that translates into financial benefits, for these people so that they are able to better confront the poverty. With their daily bread & butter assured, the rural poor will be in a better position to appreciate and reap the benefits of the information kiosk. 

Intellectual wealth associated with Internet has been one of the major factors that has propelled its popularity and growth. Another factor that is assuming equal importance is the enormous growth potential that Internet holds for small and big businesses alike. Electronic Commerce or e-commerce, as it is commonly known, over the Internet is becoming a very attractive proposition for any entrepreneur including the rural poor. The advantages of conducting business over the web are many. The ones that specifically appeal to the problem domain at hand are outlined below: 

•  The major advantage that the Internet offers for a business is its global availability. Even a little known enterprise can realize the vision of expanding its market reach beyond geographic boundaries and local customer segments. 
•  The Internet allows an enterprise to conduct its business at a very low cost.The cost for operating and service support can be reduced greatly through the use of internet. 
•  It facilitates greater visibility; once the enterprise and its products are better known, more business flows in. 

Accuracy, speed and availability have remained prominent characteristics of the various elements of IT and Internet framework. These offerings must be carefully picked up, seamlessly assembled and relentlessly sustained to strengthen and enrich the endeavors of the rural poor while at the same time overcoming the limitations confronted by them. 

3. RuralBazar - An Internet based solution

  NIC, MIT, GOI is committed to strengthen the efforts of other groups and agencies working for the benefit of rural poor and to that end, offers a solution in terms of an IT based marketing infrastructure to provide better visibility & sale of products produced by rural artisans. 

NIC addresses the problem by adopting the e-commerce approach, suggested earlier, through its product RuralBazar. RuralBazar is a web store that allows customers to carry out the complete business transaction starting from browsing the products to paying for the chosen products. It offers several services to its users who may be broadly classified as the producer, the content manager, the business manager, the technical manager and the customer. 

The following paragraphs highlight the services offered by RuralBazar to each of its users. 

3.1 Customer Services 

•  Allows a customer to browse a product catalog online or offline (by downloading the catalog from the web-site or through e-mail) 
•  Accepts orders online or offline (through email) 
•  Accepts payment online using credit/debit card and offline through demand drafts 
•  Allows the customer to track order status 
•  Automatically confirms an order through e-mail 
•  Accepts customer feedback 
•  Maintains customer data on profile, preferences, bill & shipping addresses etc 
•  Provides individualized customer services on the basis of customer profile and preferences 
• A host of other services and help facility 

3.2 Producer Services 

The producer is the individual or group who is responsible for producing the products. Keeping in mind the literacy standards of the rural poor and with a futuristic view, RuralBazar offers the following services to the rural poor: 

•  It automatically generates letter or e-mail (whichever is desired) in the local language, intimating the producer of any new order placed for his products. The same information can be viewed over the web also, again in the local language. 
•  Once payment is received for an order, RuralBazar offers a facility to automatically credit the earnings to the respective producer's account, thus eliminating the role of any unwanted intermediaries. 
•  The producer can also choose to be educated/updated, through reports, about the demand for his products as well as for any new products. This will help the producer in modifying or changing his product line. 3.3 Business Manager Services The role of business manager is to manage the whole business of marketing the products. RuralBazar provides an interface to the business manager through which he/she can 
•  Conduct an on-line market survey either by posing questions directly to the customers or collecting data from customer profile, preferences and behavior. 
•  Analyze the data collected from the market survey through a no. of pre-defined textual and graphical reports. 
•  Launch advertisement and discount campaigns for the products 

3.4 Content Manager Services 

The content manager is responsible for maintaining the content of the web site. RuralBazar provides a user-friendly interface for the content manager to do the following: 

•  Updation and maintenance of the product catalog such as modifying the price and other info about products 
•  Updation and maintenance of producer information
•  Automatic generation of letters that may be required to be posted to a customer, a producer or a bank 

3.5 Technical Manager Services 

Technical Manager of the web store is the key person maintaining the technical aspects of managing the equipment and software and ensuring the smooth functioning of the same. RuralBazar helps the technical manager modify the functional capability of the site on the fly without requiring re-development of the software. 

3.5 Special Features Besides the above services, RuralBazar has certain features that are unique and therefore merit special mention: 

•  It may be configured to market the products of the rural poor belonging to a particular state or a particular district in a state. 
•  RuralBazar can be configured to act 

   as a simple advertising medium that displays product images and their info 

   Or as a site that accepts orders but accepts only offline payment (through demand draft) 

   Or as a total e-commerce site that accepts orders as well as payment online. RuralBazar allows such high-level customization on the fly. 

4.0 Operationalization Issues 

NIC is responsible for problem analysis, design, development and training activities associated with software preparation and will extend support on maintenance of the application software to client organization. However, it is upto the client organization to ensure the availability of the recommended computing/networking environment, adequate manpower & other infrastructure and sustain the operations that includes activities such as content collection, preparation, entry, updation and software utilization as per the stated needs of application software package. 

RuralBazar is built using the latest technology to provide an enabling marketing infrastructure for the products produced by the rural poor. However, the journey doesn't end here. Several issues need to be addressed before the fruits of the efforts are reaped. 

4.1 Technical Requirements 

To maintain and sustain the operations of the web site, the following hardware, software and communication environment must be made available: 

•  One strong server (with very good RAM, Hard disk and clock-speed) where the web-site will be hosted 
•  Another server with the same configuration to act as the backup for the first server 
•  A few client machines (depending on the data load at the site) which will be used by content managers and business managers to carry out their activities 
•  A few scanners (again depending on data load) to capture the images of the products 
•  High-bandwidth connectivity to the internet for the web server 
•  SQL Server 2000 to host the database 
•  Commerce Server 
•  Round-the-clock availability of power with UPS support or through other adequate means 
•  IT professionals 
•  Digital Certificate, to enable online payment and legalise any electronic communications made through RuralBazar 

4.2 Operational Requirements 

Once the technical requirements are satisfied, several non-technical issues arise which must be suitably addressed for successfully operationalising and sustaining the infrastructure. These issues are highlighted below and need to be addressed by client organization before proceeding further. 

•  The location of the computing environment for RuralBazar must be decided. In view of the technical requirement highlighted above, it appears that the location of RuralBazar web store has to be urban-centric (away from Rural Area). This could be the state capital or district headquarters or wherever the client organization can ensure the availability of the above stated facilities. 
•  A means for collecting product profile from the rural poor (who is located remotely in a village) and sending it to the web store regularly for updation needs to be worked out. 
•  Once an order is placed (on WebStore), arrangements must be made to intimate the producer (located in a remote village) about the order requirements.
•  It must be determined, with focus on cost-effectiveness, speed and ease of shipment of products, whether maintaining an inventory would be cost-effective or just-in-time ordering. In case maintaining an inventory seems a better solution, then where should the warehouse be maintained?
•  If it is desired to enable on-line payment, a tie up withan acquiring or merchant bank and a payment gateway is required. 

5.0 Conclusion 

The paper has discussed at length all aspects of the problem domain, possible stakeholder and IT based RuralBazar WebStore. The rural poor, the rich products produced by them, the unexplored but promising global market and RuralBazar are all necessary units of a possible solution. What is required is a few government agencies or NGOs, that are committed to the cause of the rural poor and are willing to provide the binding force required to strengthen and realise the entrepreneurial dreams of rural poor.

  About the authors 

The authors are members of Rural Development Informatics Systems(RDIS) Division, National Informatics Centre(NIC), Ministry of Information Technology(MIT), Government of India (GOI), A - Block, CGO Complex, Lodi Road, New Delhi - 110 003. The division is dedicated to strengthen the Rural Informatics in the country. Any further dialogue with authors regarding the paper, could be done using e-mail: crisp@hub.nic.in or tel: 011-4360563.