Agricultural Marketing

Agricultural Marketing

Explore the Strategy of Agricultural Marketing

Centuries ago, you ate what was grown locally.

If you had the money, there might be some exceptions: dried fruits, wines, spices, maybe some olive oil. However, for the most part, you ate what you or your close neighbors grew—provided the rains came, the harvest was good, and there were no natural disasters to sweep it away. If you didn’t grow your own food, you probably knew who did, buying it from them personally at the village market.

In this article...

• Who employs agricultural marketing?
• What kinds of customers does agricultural marketing target?
• How is an agricultural marketing campaign developed?
• What career titles work with agricultural marketing strategies?
• How can a marketing school help you in this field?

Related...

• Find schools offering marketing programs

Then came the modern agricultural revolution, and suddenly a greater variety of foods were available from around the world. Improvements in technology and transportation produced food surpluses and enabled people to obtain food from the furthest reaches of the globe.

Today, instead of buying most of our food from farmers, we buy from supermarkets that have gathered selections of food from thousands of farms from around the world (See also Shopper Marketing). This is excellent news for the consumer, but a challenge for the farmer, who now must compete in a global market instead of a local one.

Our food choices today are unprecedented, but they are also increasingly complex. Consumers can buy food from other countries—but are they better off buying food grown locally to help the economy? Should a farmer use environmentally responsible practices? What about genetically modified foods? “Organic” foods?

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Such questions offer farmers many opportunities, as they attempt to differentiate their produce from similar produce in the market. But such a task depends upon successful communication with customers and distributors, as they try to market their products better than the competetion.

Agricultural marketing techniques are used in every corner of "agribusiness," including small farms, corporate farms, and collectives; distributors; manufacturers of farm equipment, pesticides, and genetic enhancements for crops and livestock; feed and seed sellers; and more. Additionally, there are also government agencies which monitor and direct agribusiness practices.

• Agricultural products are perishable; therefore, a failure to sell on time results in wasted harvest. All wasted harvest represents a cost of land, water, labor, storage—and no income to show for it.
• Agricultural prices can be quite variable, impacted by changes in weather and harvests in far corners of the world.
• Different production methods mean that not all food is the same—but this information is meaningful only if the consumer knows about it.

• Farmers seek higher prices for their produce, and protection from price fluctuations. They try to reduce the amount of post-harvest waste, and secure guarantees for the sale of their produce. They may also work to open up new markets or channels, such as selling directly to consumers instead of through producers.
• Agrichemical companies promote solutions to farm problems, offering farmers higher yields and protection from pests. However, many solutions would be more strongly resisted by consumers, if it weren’t for effective public relations.
• Government agencies at both the federal and state level campaign for farm production. The USDA Agricultural Marketing Service runs a number of different programs to promote farm sales (and prices). The agriculture-rich state of California produces some $30 billion dollars’ worth of agricultural products annually, and is one of the largest food exporters in the world. To protect this investment, the state has government-mandated programs covering about 66 percent of its agricultural production.

The ultimate target for agricultural marketing practices are those who actually buy and eat the farm produce (See also B2C Marketing). As this consumer base represents nearly everyone, marketing campaigns often focus on one segment of the population at a time. People from different regions, as well as different cultural and socioeconomic backgrounds, tend to purchase different foods.

Thus, campaigns for “organic” food, as well as those touting “environmentally responsible” practices, are more effective among the affluent than among the poor. (See also Marketing Organic Products) Campaigns promoting local produce (and by implication, the local economy) are more effective among the middle class. Since food consumption varies a great deal among ethnic groups, other campaigns leverage products’ uses in ethnic cooking or as substitutes for traditional ingredients.

Marketing is fundamentally about communicating information to increase demand for a product or service. Effectively gathering and using information in agricultural marketing poses some unique challenges.

For example, the most important information signal in the marketplace is price; however, agriculture is often subject to price controls, and thus the wrong message can be communicated to customers. Market analysts must seek additional sources of information about supply and demand, and stay aware of what efforts are being made by companies and countries to increase supplies of agricultural products.

• Community-supported agriculture
• On-farm sales and tourism
• Restaurant sales
• Subscriptions for meat products
• Extending marketing seasons
• Creating value-added products

A second challenge for agricultural marketing involves product branding. Similar or competitive products often go by different names. Some campaigns focus on the issue of naming a product, establishing its brand in the minds of consumers.

Effective agricultural marketing campaigns are developed with multiple targets, including consumers, restaurants, supermarkets, and government industries.(See also Industrial Marketing)

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In fact, some states have mandated marketing programs; that is, producers are required to pay the state for its marketing efforts on the industry’s behalf. The state engages in generic marketing instead of brand marketing, aiming to increase the consumer demand for a given product (such as potatoes from Idaho) instead of a particular brand. The state also issues requirements regarding quality, size, and packaging of products, standardizing many agricultural products between different producers.

Sales and Marketing Representatives work in a variety of agribusiness companies, promoting agricultural inputs (such as seed and fertilizer) and services (such as soil sampling).

What do they do?

• communicate about agronomy products, and make appropriate recommendations to prospective customers
• create campaigns for growing market shares and opening new markets
• sales presentations with producers
• monitor prices of competitors’ products, as well as the prices (and prospective prices) of their customers’ produce; and strategically respond

Sales and marketing representative usually have a bachelor’s degree, but in some cases may have only an assiociates’ degree. Agriculture and marketing majors are preferred.

Public Relations Specialists, Communications Managers, and Lobbyists work to inform their target audience about the virtues and needs of their business, as well as those of their business’ products.

• U.S. Department of Agriculture (USDA) Agricultural Marketing Service
  The USDA maintains several programs to promote (and control) farm production. Many states also have programs.
• Agribusiness Firms
  Corporate farms and collectives include Monsanto, Archer Daniels Midland, Ocean Spray, Land O’Lakes, and more.
• Specialty Marketing Firms
  Small farms are increasingly contracting their own marketing services, in order to sell to customers directly instead of only through distributors.
• Government Marketing Boards or NGOs (Non-Governmental Organizations)
  The international demand for agricultural marketing is high, particularly in countries with large rural areas, where agriculture is far more dominant than manufacturing.

What do they do?

• handle media relations, issue press releases, respond to negative press, and arrange for coverage of positive developments and important legislative issues
• develop official statements, question-and-answer documents, background materials, positioning messages, and other communications materials
• develop their organization’s public identity and branding (for example, by promoting the company’s dedication to “organic” methods, or reputation for quality)
• develop educational/promotional materials informing about their industry
• protect regional labeling (such as Real California cheese or Florida oranges)
• meet with legislators to advocate measures promoting or protecting their company

Public relations specialists and communication managers need to have at least a bachelor’s degree, usually in public relations or communications. Political science is a useful minor. Successful lobbyists may come from their ranks, or the ranks of marketers, buyers, and managers; such jobs also require at least a bachelor’s degree, typically in marketing and agroscience.

Agricultural Marketing Specialists work for government agencies, promoting farm and commodity interests in their state or region.

What do they do?

• direct/manage marketing campaigns for particular commodities
• promote the purchase of local produce, and seek customers for local produce in new areas
• administer government grants and cost-sharing programs
• meet with farmers, food buyers, agribusiness leaders, and members of the media
• monitor and adjust inspection and quality-control programs
• promote nutrition and education programs, if part of that agency’s mandate

Agricultural marketing specialists need at least a bachelor’s degree, with a major in marketing, business administration, or agricultural science; as well as several years’ experience in marketing.

Effective agricultural marketing requires the ability to analyze complex market data, use that data to identify changes in demand, and develop persuasive arguments for multiple audiences in order to increase demand.

Fundamentally, marketing revolves around understanding and communicating with people. In agricultural marketing, this includes people from a number of different groups, including farmers, consumers, and legislators—all with wildly different goals and concerns. Marketing and communications courses in marketing degree programs prepare you to build persuasive cases for each of these different groups.

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Classes in economics and finance will help prepare you to properly analyze economic data. Agricultural marketing specialists must be aware of market issues particular to agriculture, such as commodities markets,FUTURES TRADING, government subsidies, and the impacts of farm debt. Classes in law will prepare you for a field flooded with regulations.

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A minor in agricultural science is also important for a career in this niche. Agronomy classes will equip you to better understand both the components of the market, and the people involved.

To learn more about what a marketing school can do for you, request information from schools with degrees in marketing, and sow the seeds for your own future career.