Agricultural Business 2018-05-24T19:35:17+00:00

Trust your instinct, but only in the absence of dataThis one saying will help your agricultural business gain a competitive edge.

Ag decisions have long been made on instinct and intuition. This makes sense to a degree.

Farmers have been farming land for generations. There are decades, if not centuries, of knowledge that informs how those farmers make decisions.

For better or worse, farmers trust their gut. So strategy-builders in agricultural business have learned to trust theirs.

However, relying on instinct carries with it the risk that you’re wrong. No matter how small that risk is, that’s lost dollars and market share that you can’t afford to lose.

That’s why we’re adamant about the use of data in strategic decision-making. Reliable data can be the difference between a mediocre revenue strategy and one that knocks it out of the park.

Stay relevant amidst shifting industry trends

Instinct and intuition come from years of experience – both personal and institutional. As an agricultural business executive, your experience with the industry and the market gives you insight that can enable you to make good decisions.

However, a shifting ag industry is making those “gut feelings” less reliable than before. Consider the following major changes:

  • Consolidation among both growers and inputs means that competition is going up – and farmers have more buying power than before
  • Disruption caused by technology means that the ways of doing business in the past aren’t going to be as effective or profitable
  • Consumer demands mean that companies have to be more accountable in terms of sourcing, sustainability, local, etc.

With industry trends that are shifting, the “gut feeling” that was once foolproof now needs to be verified. Use data to double check before pouring large sums of money into a marketing and sales effort.

Adapt to modern marketing challenges with new approaches

Direct mail and purchasing direct placement ads – both online and print – used to be the foolproof way to market in the ag industry. And while those methods still bring great value to agri-marketers, their value has been diminished by the advancement of new marketing technologies.

Farmers are now seeing more messages online and being served more and more content. The goal now is a) create content and ads that stand out, and b) maximize on those channels that perform, versus trying to broadcast across the spectrum to everyone and everything.

Your gut may tell you to stick to tried and true. But what if your tried and true methods aren’t helping you reach your full marketing potential?

For example, are you sure that direct mail is a better investment than posting a video on YouTube (the top social media channel for farmers)? Or are programmatic ads a better avenue than a direct placement on an ag media site?

To solve both of these issues (stand-out content and maximizing each channel’s effectiveness), your agricultural business needs to understand your farmers’ behaviors and needs. That’s where good data can help.

Appeal to the modern farmer

Farmers are known for being traditional – in their values, family life and business practices. But don’t take that to mean they’re behind the times.

Contrary to some beliefs, farmers are sophisticated, especially in terms of technology and other modern advancements. Here are just a few examples:

  • Millennial farmers are some of the biggest drivers of increased technology on the farm. Not only that, but they’re taking sustainability and local living more seriously than any other generation.
  • Technology is driving farm management, planting, weather outlook and so much more.
  • Social media has grown to be an active and reliable channel for farmers. Facebook and YouTube especially are favorites.

The prevalence of modern practices on the farm means that you can’t assume you know how the farmer operates. What they do is changing from year to year, season to season.

That’s why it’s so important to use data to identify their behaviors, not assumptions. Then you’ll know exactly how they operate and be able to guide them in making agricultural business decisions – preferably toward purchasing your product or service.

Why the Agricultural Business Model is Shifting

Ag Industry Trends - Agricultural Business

Many aspects of ag haven’t changed. Community, emphasis on family and tradition are still hallmarks of the farm.

But the way farmers farm is changing. Farmers now use data, the Internet and technology to more precisely farm. And they’re becoming more active online.

These changes aren’t bad. In fact, they’re going to help farmers scale their operations so they can meet the food demands of a growing population. But if your agricultural business doesn’t adapt to them, you may suffer.

On the other hand, if you do adapt and take these three ag industry trends into account, then you’re going to stand apart from and ahead of your competition.

Disruption of the industry through technology                 

From medicine to transportation to even politics, technology is disrupting every industry. Agriculture is no exception.

Much of the conversation around ag data and technology revolves around precision ag. And there is definitely a massive role that precision ag is playing.

But understanding farmers as tech-savvy operators is only the first step. The more powerful step is to modernize your strategy, marketing and sales practices. The biggest way you can do this is through good use of data.

How ag companies are using data to stay ahead of the game

Use market data to make strategic decisions. Sources like the USDA and other third-party data providers provide information on farmers, their operations, finances and more. Use your own data analysis to identify your ideal market. Then focus your marketing and sales efforts on that specific market.

Customize your marketing efforts to your audience. Data is the bread and butter of the modern marketer. Don’t just take out an ad on an ag media site or magazine. Instead, focus your efforts on reaching your specific audience where they are. Use SEO to rank your website for terms that your audience is searching for. Use targeted programmatic and social media ads to communicate directly with your true audience. Then follow up with email marketing. These channels can tell you how your audience is behaving so you can respond in a tailored way.

Engage in sales conversations that address farmers’ needs. Data and information helps your sales teams have meaningful conversations about farmers’ needs. Don’t waste time having the farmer fill you in on their operation. Worse, don’t ramble on with a cold and generic sales pitch. Instead, let your sales team use their data intelligence to anticipate and respond to farmers’ needs. Then they’ll become trusted advisors and build a long-term relationship.

Consolidation of large suppliers and growers

The ag industry is a zero-sum game, and we see that reality coming into play with the recent consolidation of multiple large suppliers.

Agriculture is a zero-sum game. Growth for one company necessarily means loss for another. One way that large companies can do this is through consolidation. They’ll take two market shares and combine them into one

But for SMBs in agricultural business, that tactic isn’t an option. Here are some other ideas:

  • Double-down on your niche. There are some things that only your business can do as well as you can. Your niche is going to be what ends up saving you. Don’t try to appeal to a wide array of farmers. Instead, focus on your niche. Use data to find the market that best fits what you have to offer.
  • Market to smaller farms. Everyone wants to go after the big farms and close the large deals. But in reality, those farms have high competition. You don’t want to put all your eggs in that one basket. Remember to also market to smaller farms that align with your niche. Then build a lasting, sustained relationship with them.

Increased consumer demands on agricultural business

Not only are farmers and their suppliers changing, but consumers are also placing more demands on farmers.

Consumers want food that’s sourced ethically and is also sustainable. They want to know that farmers are considering how their practices are impacting the environment and the ecosystem.

This trend is especially impacting Millennial farmers, who are adopting new farming practices to respond to these demands from consumers.

Here are some ways that you can help farmers stay on top of these demands:

  • Be transparent about how your product is sourced and created. We at Farm Market iD are major advocates of transparency. We’ve created a page where we detail how our product is sourced. We’d recommend you do the same for your business.
  • Offer your insights on Millennial and Gen-Z customers. If you’ve been collecting customer data on younger generations – like marketing channel engagement, website behavior, or the products they’re buying, use that expertise to help inform your farmers. It costs both you and the farmer nothing, but it goes a long way toward building trust.

Understanding Millennial Farmers

Millennial Farmers - Agricultural Business

The world is changing, and agriculture is no exception. As more and more farmers are retiring, Millennials are managing more of America’s farms.

So it’s important for ag executives to understand Millennial farming practices. Here are a few trends to keep in mind.

Millennial farmers are tech-friendly

Technology is becoming a more integral part of the farm. From automation to mobile technology, modern farmers use technology to make farming more efficient and precise.

Drones, satellites, autonomous tractors and robotics are all everyday parts of the farm. This means that the agriculture industry is not just about sowing, planting and harvesting. It’s about technology and building a precise farm operation.

Millennial farmers are more interested in working smarter, not harder. The growing presence of technology on the farm makes that possible.

Millennial farmers move farms into the city

Urban farming is on the rise again.

As the population moves more and more into the city and away from the country, farms are moving with them. By 2050, 70 percent of the global population will live in cities. Instead of spending millions on food transportation, farmers are moving to the city.

Millennial farmers may start to spend more time in climate controlled, indoor hydroponic farmers that grow and sell food year-round, rather than the open fields.

Millennial farmers demand corporate social responsibility (CSR) from farms and other agricultural business

The farm is more than just a planting, growing and harvesting operation. It affects the environment as a whole.

Millennial farmers care about the environment. And they’re insisting that farms start addressing these issues – and more – through corporate social responsibility (CSR).

While CSR typically includes aspects of environmental conservation, it often requires much more from farms. Here are just a few things that millennials would like to see from the farms they support:

  • Active addressing of the impact farms have on climate change
  • Adopting more sustainable farming practices
  • Ethically sourcing all of their food
  • Demanding fair labor practices among farm workers

Thus, as Millennials take more control of farms, agricultural business should expect to see a trend toward more sustainable farming practices and a bent toward CSR.

Why Your Go-to-Market Efforts Must Start with Strategy

Agricultural Business - Start with Strategy

Your agricultural business needs a clear direction. Otherwise, you won’t reap the full potential of your market. Here are some of the top reasons why you need strategy for your agricultural business.

You probably don’t know your ideal market

Knowing your market is the foundation of a good strategy. Unfortunately, many ag companies go after the wrong leads because they assume they know who their market is.

Your current customer base may be a good source of revenue. However, they probably aren’t they only source. And they may not even be the ideal source.

This is where data helps. Use information on farm operations, crop history farm income and more to see which farmers fall into your ideal audience.

Find out where to hunt. Then tailor marketing and sales efforts to that precise audience.

Don’t miss an opportunity

There are opportunities in every market.  Many opportunities for that fit with your agricultural businesscan simply go unnoticed. Make it your mission to identify opportunities around you and take steps to execute against them.

You can use data analysis to mine your markets for opportunities by thinking outside the box. Look for new information about farms to gain the full picture of the operation. Instead of “large farms,” try reaching out to “corn/soy growers with 5oo+ acres in the Dakotas, Nebraska and Iowa.”

Often, the best opportunities don’t come knocking. But they’re pretty easy to uncover if you’re willing to do a little digging.

Know your competitors’ market share – so you can take it

Overcome the threat of competitors in your territory by minimizing the impact of your competitors’ strategies on your market share.

Maybe this means upgrading your technology. Or maybe it means allocating a larger portion of your budget to maintain client relations.

Take advantage of new information and implement intentional strategies in your agricultural business. Then you’ll gain the power you need to leverage your sales strategies and beat your competition to new clients and territories.

Using Data to Build a Revenue Strategy

Data isn’t helpful only for understanding your consumers. It can also provide powerful insight to your markets.

And it can help you build an effective revenue strategy.

Establish data-driven goals

You need to know how to apply data to your business practices and goals. That way, you’ll develop strategies that sell.

Maybe your best opportunity is to expand wallet share. Explore consumer data to see where your farmers are spending. Then try and meet them with a new product.

Or, try expanding your market share. Find those farmers who you aren’t marketing to that can generate $X in new business. And find the farmers that are most likely to “get” your product.

Either way, use data to establish goals. That way, you’re chasing a realistic objective, not a pipe dream.

Articulate standards for success

What does success look like for you? Goals like “improve the bottom line” or “make more sales” are great in theory, but they don’t tell you anything.

Use specific language when setting metrics for success. Lay out details like how much revenue growth you want to see within a specific time-frame. Specific goals allow for actionable next steps your whole team can get behind.

Data analysis is essential here. It helps you see where you are and examine growth potential. The right data and tools can put the power of  market analysis in your hands. That way, you can decide where to invest time, talent and dollars.

Translate data for marketing and sales teams

Data driven strategies make agricultural business goals clear. But when it comes to implementing that strategy, it’s up to marketing and sales to do the heavy lifting.

Break your strategy down into actionable steps for the team. Equip your marketing and sales teams with the tools that they need to be successful in achieving company-wide goals. While this likely won’t entail handing them thick data sets or login credentials to your data mapping software, it might include detailed reports on new markets or new buyer personas.

Get creative in making data driven strategies accessible and actionable to your sales and marketing teams to help them succeed.

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Integrating Strategy, Marketing and Sales

Integrating Strategy, Marketing and Sales - Agricultural Business

Success in agricultural business means vying for that limited amount of land by offering better products and having better marketing and sales efforts than your competition.

If you don’t have a big name brand like John Deere, then your marketing and sales efforts aren’t going to “just happen.” It takes a concerted effort on your part to make sure that farmers are aware of your offerings, and that they’re talking to your sales reps who can help guide them to a purchase.

Throughout our decades of working with agricultural business, we’ve seen first-hand how reliable data can improve marketing and sales efforts, increase market share and improve business’ ROI.

So here are five steps to building a go-to-market plan that integrates strategy, marketing and sales through the use of good data.

Strategy:  Determine your agricultural business ‘s current market share.

We’ve seen that when agribusinesses try to conduct market and market share analysis, they use their current customer file exclusively as their source for data. While this is a good place to start, namely because it’s accessible and aligns with other goals (like increasing share of wallet), it’s just that – a start.

Imagine an agricultural business whose primary market is field corn farmers with 500+ acres. Over the past few decades, this business has built a respectable customer file over 5,000 total customers, the vast majority of whom are active participants.

This is a great sample size, until you realize that there are over 60,000 farmers who farm 500+ acres of field corn. The company only serves eight percent of the total market.

If this company is using only their customer file, they’re in the dark about 92 percent of their potential market. And since, as we said before, agriculture is a zero-sum game, that 92 percent is market share that they’re conceding to competition.

That just doesn’t work.

Instead, use a reliable source of data to learn about the market as a whole – and where your agricultural business has a real opportunity to expand.

Strategy: Figure out where to hunt.

Once you’ve figured out your market share and the opportunity you have to expand, the next step is finding out “where to hunt.”

Here are some key factors to consider when figuring out where to hunt:

  • Location, location, location. If you’re selling a physical product to farmers, then location definitely matters – because you need to make sure the product gets to them! A key factor in determining where to hunt is going to be places that are near enough to your stores or shipping centers that you can get your product to them in a timely manner.
  • ROI. You can’t sell to everyone – there are simply too many farmers in the U.S. Even if you narrow your audience down, you want to market and sell to people that are going to end up gaining you money in the long run. That’s why being able to identify the Gross Farm Income (GFI) for a particular farm is so important, because it’ll help you calculate ROI so you know whether a certain group of farmers is worth targeting.

These, along with other factors, are going to influence where the best places are for you to hunt. Make sure to take them into consideration.

Marketing: Target potential customers through customized ads and marketing materials.

Now take that information and turn it into lists of marketing audiences.

This is where access to farm data is going to be a powerful ally. With the right data, you can build a series of audiences that you can use in a variety of ways:

  • Email campaigns. Use email to perform a series of prospecting/acquisition campaigns. Then send nurture emails to your high-performing leads and make them want your product so badly that they’ll make a purchase. Email has a great ROI, yielding a potential $38 for every $1 spent.
  • Programmatic and re-targeting adsWhile email is a great tool for direct communication with prospects, it’s not the only way to reach farmers. If you have the ability to combine your data with programmatic advertising, you can create engaging ads – customized to each segment of your audience – to display only to the people you’ve chosen, and on sites across the web. Why limit yourself to ag media sites when you could broadcast on news, sports, fitness, entertainment and other sites?
  • Social media ads. Programmatic ads help place your message on the sites that farmers spend a lot of time on, but you can expand your footprint even further – by placing your ads on social media sites. Farmers are increasingly spending more time on social media, making these networks an ideal place to place an ad. Click here to learn more about how to get the most out of social media advertising.

Sales: Sell who you market to.

After spending the time building strategic marketing audiences, it would be a shame if your sales team spent none of their time following up on those audiences. This is especially true with qualified leads – those leads most interested in a sales conversation.

Moving seamlessly from marketing to sales is the key to finishing strong and turning your data into dollars.

We can sum it up in one sentence: “sell who you market to.”

If your sales team isn’t following up on the same leads that your marketing team is generating, then you certainly aren’t going to realize the potential gains that you saw when you were building your strategy.

Make sure that your sales team has access to the same data that your marketing team does, so that they know where to direct their efforts. Plus, if they’re contacting warm leads rather than cold ones, it increases the likelihood that the sales conversations will go smoothly.

Sales: Equip sales team to have meaningful conversations.

Speaking of sales conversations, one way that data can help you close the entire strategy-marketing-sales process is by helping your team to have more meaningful conversations.

While your sales rep may show up to talk to the right customer – someone who’s engaged and ready to discuss – if they have a bad conversation, then all the work won’t result in anything. Data drove your strategy and marketing efforts, and data needs to follow down the funnel to the conversation with the sales reps.

Here are some ways that you can use data to have better conversations:

  • Identify pain pointsWhile farmers have needs that are pretty common, there are some that they uniquely hold. Click here to learn about ways you can use data to identify farmers’ pain points.
  • Bring meaning into conversationsYou don’t want your reps to spend their time making small talk, but you don’t want them to come across as too aggressive either and scare farmers off. Here are some tips for how to bring meaning into sales conversations with the power of data.
  • Tell stories that resonateInstitutions may respond to numbers, but people respond to stories. The key to a successful sales presentation is to tell a story that resonates with the farmer. Here are some tips for how to do just that.
Click here to schedule a FarmFocus demo

Getting Your Marketing and Sales Teams to Use Data

Marketing and Sales - Agricultural Business

To make your agricultural business ‘s data-driven strategy effective, you’re going to have to get your marketing and sales teams onboard.

Many marketing and sales team members are highly focused on their own targets, KPIs and objectives. And if you’re part of a good team, those people are excellent at hitting those metrics.

But the ultimate goal is to align strategy, marketing and sales, using data as the bridge. That means that you’re going to have to convince your team to use the data that’s available to them.

Show how data connects to targeted marketing efforts

Your marketing and sales teams are looking to achieve their own goals. Because these goals are ultimately tied to revenue, they’re going to be high priority for your teams.

So if you’re going to convince marketers and salespeople to use your data, you have to tie its value to the things that they value.

When talking to marketing people, you want to look at the long term. Here are some things that they’re looking for:

  • Better understand current and prospective customers to aid in buyer personas
  • Calculate the ROI of marketing efforts
  • Track the company’s growth in brand perception among the market
  • Identify the tactics that generate the highest number of Marketing Qualified Leads
  • Finding lookalike audiences to those who are visiting your site, converting and are current customers
  • See where the market is trending so they can stay ahead the curve

Explain data in terms of the sales funnel

On the other hand, your sales team is looking for short-term value. They’re not looking to market trends, but looking to the end of the month. At the longest, they’re looking to the end of the quarter.

Here are some of their interests:

  • Maximize price point for deals in pipeline
  • Close deals in pipeline at a faster rate
  • Predict how much pipeline and revenue they can generate each month
  • Predicting whether they’ll be able to hit their number for the month
  • Provide insights on pain points and how to address them
  • Understand why failed deals failed and how to correct future conversations

Think of this training as removing barriers. Each time, you’ll remove one barrier that may exist in your marketing and sales teams’ minds. Then, eventually, you’ll remove enough of them that they’ll be able and willing to jump on board.

Ask questions to direct marketing and sales to think in terms of data

As an executive, you’re engaged in conversations with people in your agricultural business, both formal and informal.

Whether these conversations are in meetings, over lunch or at the water cooler, you can use questions to direct marketers and salespeople to think in terms of data, by simply asking them to explain the data behind their campaigns.

Here’s a list of questions that can help you do this:

  • “How much traffic did we get from the last ad campaign?”
  • “How many more leads did we get this month?”
  • “Did you learn anything new about our target audience?”
  • “What percentage of our email list has been validated in the last year?”
  • “How much time are you spending on buyer research?”
  • “Do you have a reliable data source for X objective?”

If your marketing and sales teams don’t seem enthusiastic, that’s perfectly natural. These aren’t going to be overnight successes.

Just remember to drive the conversation where it seems like a natural fit, and help them start thinking about how they can apply data to their own needs.

Compare KPIs before and after implementation of data-driven campaigns

Once you and your team start implementing data-driven marketing and sales, it’s time to start generating results.

And don’t think that because you’ve handed off your data to marketing and sales that they’ll take it from there. If the campaign tanks or fails to meet their expectations, then you’re going be held accountable for it – fair or not.

Here are some important steps to take when implementing these campaigns.

Set realistic expectations.

There’s nothing worse than over-promising and over-delivering. And if you don’t take the time to set expectations, then you’re implicitly promising whatever is in your marketing and sales reps’ heads. Avoid confusion and disappointment by setting objectives and avoiding falling into the “silver bullet” and “quick fix” trap.

Make sure you agree on KPIs.

In addition to setting expectations, make sure that you’ve agreed on the KPIs you’re going to focus on this campaign. If you’re helping marketing with lead gen, figure out a realistic goal for the increase in leads you’re going to see. This also helps to make sure that you’re providing the right data, and that they’re using the data to achieve a particular goal, so you’re rowing in the same direction.

Make it clear that this is a two-way street.

Data can be helpful and open new doors for marketing and sales, but they have to act on them in a way that’s going to achieve results. Make it clear to them that they have to make the data work for them, and that a lot of the success depends on them.

Once you’ve set the KPIs and expectations, measure your efforts against them. If you’ve agreed upon an increase in closed deals per month as a metric of success, that’ll be the measure of success for the campaign.

But don’t close the door to tweaking and optimizing. You may discover halfway through a campaign that your efforts aren’t increasing the number of deals closed, but the increased intelligence your reps have help them to increase the average price point of each deal.

You and your sales team will then have to mutually agree to adjust the KPI based on the data.

Good data analysis in action is going to be flexible and fluid. But you have to make sure that everyone involved in the campaign agrees to change KPIs throughout a campaign if you’re going to continue to manage expectations and improve results.

Celebrate good use of data among your team

There’s nothing like positive reinforcement to encourage people to act in a certain way. Don’t underestimate the value of this tactic.

One of the great things tools that social media gives us is the chance to communicate and connect with each other without the company’s permission. You don’t need access to the company distro list to send a positive message (either publicly or privately among a small group) recognizing someone’s accomplishments using the data

Send a Facebook or LinkedIn message or post publicly to your LinkedIn profile to celebrate a team member using data in their marketing or sales efforts.

You can also send private, one-on-one messages to people. Some of your team members may honestly prefer this method.

Either way, celebrate your team when they use data in their campaigns. Eventually, as more and more people start building their marketing or sales efforts off of data, you’ll start to have an impact on your company culture.

You can turn your agricultural business into one that’s more fact-based and data intelligent than before you started working there.

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