Extract from The Poultry Focus Magazine
In days gone by, agricultural produce made it almost straight from the farm to the table; and most of what a farmer produced was bought and consumed close to where it was produced. Those days are gone now; and longer supply chains with larger, more powerful middle men and markets with end consumers that are often worlds away from where the produce left the farm, has turned farmers largely into price takers with little say about where their products end up and at what price it is finally bought.
The increasing competition between retailers for the rands and cents of the customer, is placing ever downward pressure on the retails price of goods. This price war inevitably impacts on the preceding links in the agricultural value chain, with everyone wanting their fair share of the pie. With retailers having direct access to the customer, and not shy to exercise their power as gatekeepers, boils down to the reality that producers are stuck earning prices for their produce that barely cover the cost of production.
Sales vs Marketing
Sales is a transactional activity: the supplier trades product in exchange for the customer’s money.
Marketing: no customer will buy goods they are not aware of, therefore traders need to tell customers about their offering.
Given the fact that agriculture is at the very core of feed and food production, one would think that farmers and other agricultural producers would not have a need for marketing … after all, everyone needs food. However, much of what is produced is seen as very similar in the eye of the consumer. Therefore, every market player must find a way to differentiate itself and their product from their competitor. To do this, you need to create a strong brand that resonates with your customers.
Successful brands are associated with positive values about quality, service and value for money. Successful brands are chosen above others and are able to earn a premium price from customers who are happy to pay more because they believe the product or service is worth it.
Over time, a strong brand will help reduce the amount to spend on marketing because the company and its product will be a known quantity to members of its target audience. Recognition of what a brand stands for can be transferred to new products and new markets much more easily.
Good branding increases customers’ demand for that product.
Businesses that operate in the agriculture sector are notoriously poor at branding, particularly those suppliers who do not deliver directly to the end user. Marketing campaigns should focus on the end user rather than the direct customer, to get the end user to drive demand by asking for the product by name. Build a strong brand by appealing to the end user’s emotions, this commits to lasting loyalty.