Ginger S. MyersGinger S. MyersExtension Marketing Specialist and Extension Marketing Specialist and Director , Maryland Rural Enterprise Director , Maryland Rural Enterprise Development CenterDevelopment CenterUniversity of Maryland ExtensionUniversity of Maryland Extension310-432-2767 gsmyers@umd.edu310-432-2767 gsmyers@umd.edu

Defining Marketing Options

1.What will it realistically take to achieve your goals from a resources perspective?

2. How long will it take?

StartingStarting PlacesPlaces

• Wholesale or contractWholesale or contract• • Hybrid- contract, group sales, Hybrid- contract, group sales, some differentiationsome differentiation• • Direct markets-primaryDirect markets-primary

Develop a Marketing MixDevelop a Marketing Mix

OverviewOverview

• What is direct marketing?What is direct marketing?• • Driving forces underlying growth Driving forces underlying growth

in DM.in DM.• • Benefits to producers and Benefits to producers and consumers.consumers.• • Prospects for your future.Prospects for your future.

What exactly is direct marketing?What exactly is direct marketing?

Direct marketing involves sellingDirect marketing involves sellingagricultural products directly toagricultural products directly tothe consumer (e.g. PYO, the consumer (e.g. PYO, roadside stands, farmers roadside stands, farmers markets, ecommerce, etc.)markets, ecommerce, etc.)

Driving Forces Behind Driving Forces Behind Direct MarketingDirect Marketing

• • Dissatisfaction with low farm gate prices.Dissatisfaction with low farm gate prices.• • Retail buyer consolidation.Retail buyer consolidation.• • Urban sprawl.Urban sprawl.• • Consumer interest in food safety & Consumer interest in food safety & origin.origin.• • Increased emphasis on convenience andIncreased emphasis on convenience and value added (less volume purchasing).value added (less volume purchasing).

Farmer’s Share of the Food DollarFarmer’s Share of the Food Dollar

Benefits of Direct Marketing to Benefits of Direct Marketing to FarmersFarmers

CAN PROVIDE Alternative income streams.CAN PROVIDE Alternative income streams.

• • Helps to preserve small farms.Helps to preserve small farms.• • Outlet for organic/specialty niches.Outlet for organic/specialty niches.• • Capture greater share of consumer dollar.Capture greater share of consumer dollar.• • Able to be their own boss/do their own thing – Able to be their own boss/do their own thing – less dependent on wholesale.less dependent on wholesale.

Direct MarketsDirect Markets

• Pick-Your-Own• Can work for seasonal produce like berries.

– Have a phone with an answering machine that gives prices and operating hours.

– Provide an educational setting for small children.

– Display clear signs with rules and prices

Direct MarketsDirect MarketsAgri-Tourism

Inviting the public onto the farm.

Agritourism can take many forms including retail sales, hay rides, corn mazes, pick-your-own operations, and use of woodlands on farms for hunting, hiking, horseback riding, and other activities. There may be educational components including programs for schoolchildren and elderhostel tours, as well as exhibits and demonstrations tailored to specific visitor groups. Farms may combine retail sales and tours with accommodations such as bed and breakfasts and farm-stays.

Direct MarketsDirect Markets• Farm Stands and Roadside

Markets

• Location is everything.– Successful when it features one or two high-demand items

(watermelon,sweet corn).

Direct MarketsDirect MarketsFarmers’ Markets

There were 76 Farmers’ Markets in Maryland in 2008. Markets are in every county and the City of Baltimore.

Instant feedback on your products. Opportunity for on-the-job training.

CSA- Involves a single farmer, sometimes a group, selling “shares” or “subscription” at the beginning of the season and then delivering (or providing for pick-up) baskets of whatever is produced.

Direct MarketsDirect MarketsCommunity Supported Agriculture

Specialty Markets• Ethnic produce.

– Have a commitment from potential buyers before growing the product.

– Must be able to consistently supply product.

Sales to Restaurants– Talk to chefs and specialty buyers before growing

the crop.– Pre-processed produce may be required.

Direct MarketsDirect Markets

Do I Need a Website?Do I Need a Website?

• Not having a website is like not having a telephone.

• Use to tell your story.• Map, hours of operation, directions.• Sign-up, newsletters• Internet sales?

Getting StartedGetting Started• Think outside the box- Just because you don’t grow

something now doesn’t mean you can’t grow it in the future.

• Go to local farmers’ markets and see what’s there( and what’s not there).

• Talk to contacts and see if local chefs are buying local products.

• Consider tourism outlets.• Talk to other producers to hear what has worked and

what hasn’t.• Contact Extension, NRCS, etc regarding the prohibitive

potential of your property.

SWOT AnalysisSWOT Analysis

• Strengths and Weaknesses- usually internal factors that you can control.

• Opportunities and Threats- Usually external factors you can’t control

• Understanding trends, customer buying “hot buttons” and industry issues is your best “Risk Management” tool for dealing with EXTERNAL Factors.

Keys to Direct Marketing SuccessKeys to Direct Marketing Success•Focus on values and set your prices accordingly.•Know what customers in your area want.•Seek unique varieties of stand crops or unique experiences for agritourism.•Develop a marketing plan and revise as needed.•Communication is critical.Learn from othersLearn from others..

More Getting StartedMore Getting Started• Think about what you grow or produce well

(quality is critical for direct marketing)• Decide which market(s) work best for you (have

a plan).• Check out any regulatory requirements for

marketing your product(s).• Think about your story. What makes your

product unique?.• RUN THE NUMBERSRUN THE NUMBERS.

Niche/cache marketing is not a panacea for production agriculture’s problems. Less capital intensive is not the same as less management intensive. Land-use regulations may limit added

value enterprises and entertainment, yet these activities may be necessary to

justify Higher land-related costs.