Lesson 2: Marketing

Outline of presentation Goals of marketing lesson Basic marketing concepts – Knowing your customer – Defining wholesale vs. retail markets Entering markets (examples) How to use the tip sheets How to use the marketing worksheet and how it relates to your business plan

Goals for Lesson 2 To learn about a variety of marketing channels To consider each market channel and what it would take to enter that market To identify the 2-4 market channels that seem like the best fit for your farm business To identify challenges and next steps in entering those markets By the end of this lesson, you’ll have a basic marketing plan for your farm business!

Knowing your customer Customers often value more than just the physical product they buy They may be decide to buy something or not buy it because of these qualities (such as grown locally, organic, or convenient) They may even be willing to pay more for products with the qualities they prefer

What do your (potential) customers want? Convenient – Frequent delivery, further processing Cultural diets – Halal, kosher, cabrito, organ meat, Asian vegetables Values – Organic, natural, local, grass-fed, farmer owned

So, what DO your customers want? Find out by talking to restaurant owners, grocery store managers, local produce distributors, friends, family, and coworkers Many will say low price! – HOWEVER, the key is to identify something besides price that gives them what they want. Maybe you can get the price you want if you offer better quality, freshness, variety, or more frequent delivery than your competitors. Start small – Produce a small amount of something you’d like to sell and give out samples to potential customers. Then ask people how they like it and how often they’d buy more if you could provide it.

Two kinds of market channels Direct markets Farmer sells directly to the person who eats the product Smaller volume, but higher prices Includes: – Community Supported Agriculture (CSA) – Farmers’ markets – Farm stands and You-pick operations Wholesale markets Farmer sells to wholesalers or retailers, who then resells to the eater Higher volume, but lower prices Includes: – Restaurants – Grocery stores – Distributors

Entering the Community Supported Agriculture (CSA) market What is a CSA? CSA is a way for farmers to direct market their products. Customers pay at the beginning of the growing season for weekly deliveries of a box of fruits and vegetables. Some CSA's also include meats, cheeses, eggs, or value-added products in addition to fresh produce.

Entering the CSA market Ask yourself these key questions: – How many other CSA farms are in my area and do they have waiting lists (unmet demand that I could tap into)? – Timing and planning are critical in a CSA. How will I ensure consistent weekly deliveries of a variety of vegetables and fruits to my CSA customers? (See ATTRA’s “Scheduling vegetable plantings for a continuous harvest.”) – Will I enjoy the social aspects of running a CSA, including hosting festive gatherings or work days for members, writing newsletters to include in weekly boxes, and generally creating opportunities for people to get to know the farm?

Entering the restaurant market Know your restaurant customer Fill in select key points from tip sheet

Entering the restaurant market Ask yourself these key questions:

Entering the Grocery store market Advantages Larger volumes Potential for store to buy a range of products once you have introduced the first Potential for long-term relationship with the store, especially if you build a brand identity for your farm

Entering the grocery store market Ask yourself these key questions: – What products do grocery stores near me want or need that I could supply, including specialty ethnic foods? – Does a particular chain have a local purchase initiative? – What is my plan to ensure a consistent supply of a few key products over a period of several weeks? – Do I have a Good Agricultural Practices (GAPS) plan? Do these buyers require it?

Tip sheets: how to use them You have 11 tip sheets in your packet describing 11 different marketing channels These sheets are meant to help you think about each marketing channel individually and how well it might fit for your farm Read through each one and ask yourself the questions at the bottom Try to answer those questions before moving on to the next tip sheet

Marketing worksheet: How to use it This worksheet is meant to help you think through how your selection of 2-4 marketing channels will work together as a whole marketing plan for your farm Use this worksheet to: – Write down your choices for marketing outlets – Why you chose them, and – How they complement one another