It’s one thing to have a great idea for a farm business, but an entirely different thing to bring that idea to market.
Bonnie Nelsen, business management specialist with Cornell’s Lake Ontario Fruit Program, recently presented “From Seed to Success: Turn Your Idea Into an Actionable Plan – Developing a Marketing Plan.”
Nelsen defined the “marketing mix” as “all the controllable elements that you use to influence and meet the needs of target customers in the most effective and efficient way possible.” She listed product, pricing, place, promotion, packaging, physical evidence and people as part of the mix.
Where products are marketed can vary. Market channels (also called distribution channels) are how products get from the producer to the end user. For farmers, it’s usually wholesale or direct-to-consumer (DTC).
Wholesale channels could include storage operators, packers, processors, milk haulers and distributors. DTC sales may include farm stores, on-farm sales, CSAs, farmers markets, restaurants and food hubs.
“If you sell wholesale, you have to sell a large quantity of products,” she said. “It’s very difficult to grow sufficient product to make a profit. It has to pass through many hands and every one of those hands takes a bit of the profit.”
For example, apples go through the picker, packer/processor, storage facility and finally the retailer.
“A farmer gets 50% on average of the retail price – or probably less,” Nelsen said. “With DTC, that’s not the case. You get to keep everything that isn’t a fixed or variable cost associated with producing that product. If you’re a small operation, I strongly suggest you go there. It’s the way to be profitable.”
Choosing marketing channels relies upon numerous factors. For a farmers market, Nelsen advised looking at “availability in your region, close to your target market and availability in that you can attend and sell there,” she said. “It’s not guaranteed. What’s the volume like in a particular channel? Have an idea about their scheduling. If they’re all during the day, that can be a problem if you’re still working a day job.”
Farmers don’t have to – and in most cases shouldn’t – select only one channel. For instance, CSAs, farmers markets and on-farm sales “work very well together,” Nelsen said. “Use multiple marketing channels if you can. Give some serious thought to online sales. People like the convenience and they’re accustomed or ordering online and picking things up. You’re offering additional convenience; you can charge for that.”
Most farmers markets limit the number of vendors with a particular item. For example, if the market already has two vendors selling eggs, the market manager may not allow a third.
Nelsen advised asking for an assigned space rather than taking whatever is available because sticking with the same spot helps customers find your products.
Selling at a farmers market can also lead to other sales, such as customers visiting the farm store/stand or dining at restaurants that carry your farm’s goods. But Nelsen warned that this isn’t as likely if the farmers market is located too far from the farm.
“If you have a destination farm where there’s attractions and activities, they could stop, but they won’t stop on a casual basis,” she said. “It will also be more costly as there’s more fuel and driving time. I stopped going to certain markets I had selected and even paid for because I finally realized it wasn’t worth my time and effort. The markets or events turned out to not be as good as I thought they would be.”
Promoting the farm’s goods should rely upon a variety of efforts to share information on the farm, products and brand, including advertising, social media, sales promotions (coupons, discounts and buy-one-get-one deals), website, signage, direct marketing, email, flyers, logos, custom merchandise and events.
Using the same colors, font and logos on all materials, packaging and signs helps customers identify your farm’s goods and aids in generating a following.
Giving out free samples at a farmers market represents one way to market farm products. Melinda Rodas (right) is at a farmers market, serving samples of syrup from her farm, Stoney Ridge Farms in Farmington, NY. Photo by Deborah J. Sergeant
As customer excitement and commitment increases, farmers should engage in more promotion to help inform them.
“People want to know who you are, where you’re located and who you’re doing business with,” she said. “The key is for them to have a relationship with you … It gives them a reason to buy from you, buy repeatedly and tell friends and families and coworkers about your business and a reason for you to tell them about your new products.”
If they cannot do it themselves, farmers should either hire someone to manage their social media and web presence or enlist a family member to do it.
“Your site needs to look professional and nothing says that more than pictures,” Nelsen said. “Images are that important – at least 80% of a site.”
Taking close, focused, uncluttered shots can elevate photos. Try shooting during the “golden hours” (one hour after sunrise and one hour before sunset). Photographing outdoors on cloudy days or using other indirect lighting situations also improves photos.
Nelsen advised farmers to think about their product packaging, like boxes, containers, bags, wrappings and labels, storage and display.
At the farmers market, farm stand or CSA, “you never want any food product on the ground; it won’t sell,” Nelsen said. “And people can see it better if it’s higher up.”
How farmers sell goods also matters. Selling by weight requires a legal-for-use scale. Selling by volume or piece, such as quart, basket or bunch, stem or stalk, simplifies transactions.
“Physical evidence” are objects and elements surrounding the product in the sales area – whether that’s clutter, used napkins and takeout containers on the farmers market table or junk, weeds, mud and manure around the farm. Be aware of it.
It can help to restrict customer movement on the farm to certain areas and keep these areas tidy and clean. But remember that not all customers will abide by signs directing them away from more private areas.
Nelsen said secret shoppers can help you evaluate your sales area from a third-party perspective. These are paid critics who pose as customers and interact with employees while looking for flaws and problems. Farmers can enlist family and friends whom the sales staff don’t know.
“They may approach a sales associate with a request,” Nelsen said. “This is a good technique to spot any potential problems at your farm market and your sales space. Get someone that your employees don’t know on sight to check it out and give you feedback.”
You and any employees who interact with customers affect how people view your farm. “They have a huge impact on the customers’ experience and have a big impact on their happiness and loyalty,” Nelsen said. “If a customer has a poor experience with one of your employees, they probably won’t come back again.
“Marketing is all about forming lasting, positive relationships,” she added.
Salespeople should have product knowledge, be able to answer basic questions, have good customer service skills and know the prices and operational procedures. These factors are even more important for farms selling agritourism experiences.
Farms should have plenty of change since most people either don’t pay with cash. Any money they have will likely be withdrawn 20-dollar bills from ATMs. Farmers can accept cashless payments through apps like Venmo, CashApp and PayPal.
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