Rural Households: Challenges and Opportunities

Strategy Briefing

About This Report

Nov 2018

Rural households present major opportunities for businesses to expand their footprint in new territories and markets. Rising incomes, growing tech penetration, and strong demographic indicators make rural consumers an appealing proposition. However, challenges that include logistics, rural flight, and poor facilities are obstacles for business. This report will illustrate the evolution of rural regions, alongside the challenges and opportunities present within them.

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Rural Households: Challenges and Opportunities

Key Findings

Huge, undertapped rural markets

The global market of rural households is huge, and underserved and undertapped in many regions of the globe. In the world’s two most populous countries – China and India – rural households represent almost half of total homes. As urban markets become increasingly saturated and hypercompetitive, urban consumers represent a lucrative opportunity.

Evolution of rural homes

Rural households are in a state of flux. Urbanisation, digitalisation, rural flight, and immigration are just some of the factors transforming rural consumer markets. There are also four distinct rural market types, each one with a major influence on local purchasing power and lifestyle.

Most rural homes in Asia, while Africa has the fastest-growing rural markets

Most of the current and future opportunities in targeting rural households lie in emerging markets, and specifically in Asia Pacific, and the Middle East and Africa. Combined, the two regions represented more than 80.0% of rural households in 2017. By 2030, this share will be more than 85.0%.

Rising incomes and remittances are major drivers of consumption

The vast majority of rural households globally will see increases in disposable income over 2018-2030, thereby increasing their appetite for consumption and expanding their purchasing power. An additional driver of rising rural purchasing power is remittances – many foreign workers globally emanate from rural areas in South Asia, Latin America and Africa.

Logistics and depopulation are major challenges

Challenges for rural homes include rural flight, food security, and the logistics of delivery. Many rural locations are experiencing depopulation and economic decline, while it can be expensive for businesses to reach mass consumers. 

Introduction

Scope
Key findings
Rural households: untapped markets with billions of consumers

introduction

Global rural households indicators in 2030
North America and Europe to see major decline in rural homes

The Evolution of Rural Homes

Transformational trends in rural households
Four types of rural markets: understanding the profile is key
Asia with most rural homes, Africa with fastest-growing markets
The proportion of rural homes is contracting worldwide
Declining in size, but still more persons than in urban homes

Opportunities

A huge and growing rural segment in Asia and Africa
inthree : building a business on rural accessibility
Rising incomes and remittances drive rural purchasing power
Unilever: Guddi Baji programme targets rural women
Improving facilities open up rural homes to appliance purchases
Reaching rural areas: mobile is a must

Challenges

Rural flight: the death of consumption in countryside towns
Immigration: potential solution to depopulation
Rural homes are less likely to engage with online activities
China’s rural revolution: bringing tech to the masses
Food security: rural areas are hardest hit by agricultural decline
Logistics and facilities: reaching the emerging rural consumer