Agriculture Reference
In-Depth Information
promotional DVD is a relatively simple process. Such efforts are very cost effective and well
received by the target audience as the information is targeted to their specifi c needs. Likewise,
such databases can drive telemarketing efforts or email/e-letter campaigns with similar,
positive responses.
Many of the direct mail tactics also apply to the email delivery of important information
to key customers. Often, a targeted direct email is customized with the grower's name and
specifi cs related to their operation. Links to videos or fact sheets are readily positioned
within the direct email, making a customized approach directly targeted toward a specifi c
customer. Agribusiness fi rms often fi nd value in tracking who has read the email, followed
through to the link or visited their website as a result of the communication.
Cell phones and text messaging can be an important means of connecting with customers.
Another strategy taking advantage of communications technology is word of mouth market-
ing. Word of mouth teleconferences, where an expert leads a dialogue on a new product or
service that is supported by a customer who relates personal experience with a product, can
be a powerful way of providing information to potential buyers.
As alluded to earlier, the Internet is an important promotional tool for food and agribusi-
ness fi rms. Company websites provide important product information, including the location
of dealers who carry the product. Food companies have created highly educational and
entertaining web sites to encourage frequent access to the sites. Password-protected areas
are used to allow customers to access personal data, or to allow access to a higher level of
information that the fi rm only wants to make available to qualifi ed individuals. Banner ads
can be used to promote goods and services on other sites. The ability to collect detailed
information on customers allows the agribusiness marketer the ability for personalized email
campaigns, and other more sophisticated website strategies. When the information manage-
ment, communications capabilities, and convenience of the telephone/Internet are consid-
ered, it is clear that the Internet is part of a fi rm's product and place/distribution strategies,
in addition to the promotion strategy role.
Determining how much to invest in advertising is a challenge for most agribusinesses,
since it is diffi cult to determine the actual effect of advertising on sales. Large manufacturers
of agribusiness products and their advertising agencies spend a great deal of money
attempting to measure the effectiveness of different advertisements. As one executive put it,
“I know half of my advertising is wasted—and if I could determine which half, we'd cut it
out!” This is a big problem for smaller agribusinesses because they may not have the
resources to effectively monitor the impact of advertising/promotion. Most local agribusi-
nesses tend to do little media advertising, tending to focus on other promotion strategies.
These fi rms argue that their best advertising in the local market is “satisfi ed customers,” and
choose to allocate their promotional dollars to customer meetings and personal contacts, or
simply to sell at a lower cost. Advertising budgets for local farm-oriented businesses are
generally limited to 1 to 2 percent of total sales or less. Larger organizations may spend 5 to
10 percent of total sales on advertising, especially if they are consumer goods companies
looking to build national or international brands.
As with any economic equation, there may be a cost associated with choosing to limit or
decline advertising opportunities. Companies large or small must consider the cost of not
advertising, or of investing too little in an advertising effort. Competitors may take advan-
tage of a fi rm's absence in advertising channels, thereby gaining an advantage in presence
before the customers. Understanding the target market and where they get their news and
information helps agribusinesses to determine where and how to invest their advertising
budgets.
 
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