Marketing allows producers to be price setters, not price takers
In order to stay running, a producer’s operation must turn a profit.
While there are many factors that go into an operation’s bottom line, something that can help make a difference in profit is evaluating whether a producer is “selling” or “marketing” their products.
Profitable marketing of agricultural products takes more than just getting the highest price. It involves raising/growing/creating the type of product the market desires, marketing that product through the proper outlets and at the right time. Sometimes producers simply sell their agricultural products, meaning they produce livestock or goods, sell at the most convenient market outlet and sell at the most convenient time. As a result, they are price-takers.
As opposed to just “selling,” marketing means making choices about how or what product to produce, where to market it and at what to price to sell.
In order to effectively market goods, producers first need to learn what consumers want. Do they want grass-fed beef, or grain finished? Do they want heirloom tomatoes or commercial varieties? Do they want duck eggs or chicken eggs? Do they want alfalfa hay or a grass mix? Are they interested in a specific breed of livestock?
Talking to potential customers, visiting local markets or restaurants, and researching the latest food trends can help producers determine what to produce and where to go with it. If producers opt to direct market their products, farmers markets, local grocery stores, farm-to-table restaurants and Community Supported Agriculture (CSA) programs are options to explore.
Some producers, such as Urban Roots Farm and Millsap Farm in Springfield, Mo., market what they grow through self-service farm stands, where they set the prices on their fruits and vegetables, and customers come to shop at their convenience during the workday.
Adding value, such as breeding an animal before marketing or offering additional services helps move products and turn profit.
Dallas Jones, a cattle and hay producer in Springfield, Mo., offers a delivery service to customers who are purchasing hay. He said many of his clientele happily pay a delivery fee for the convenience of having hay delivered.
Marketing products, as opposed to simply selling them, offers producers a chance to use their creativity, turn a greater profit and establish face-to-face relations with their customers and can create repeat purchases and lasting connections.
What’s the Difference?
• The selling concept focuses on the needs of the seller while the marketing concept focuses on the needs of the buyer.
• The selling concept works to turn products into cash while the marketing concept works to satisfy the customers’ needs through the product.
• In the selling concept, competition is predominantly centered on sales while in the marketing concept the competition is centered on consumer satisfaction.
