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Marketing and Sales: Risks and Opportunities for Small-scale and Resource-limited Producers. Presented by: Dan Krotz, ISED Jim Barham, USDA Adam Diamond, USDA. Presentation Overview. Analyzing Marketing Strategies Managing Risk Alternative Marketing Channels Advantages and Disadvantages. - PowerPoint PPT Presentation
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Marketing and Sales: Risks and Opportunities for Small-scale and
Resource-limited Producers
Presented by:Dan Krotz, ISEDJim Barham, USDAAdam Diamond, USDA
Presentation Overview
Analyzing Marketing StrategiesManaging RiskAlternative Marketing ChannelsAdvantages and Disadvantages
Analyzing Marketing Strategies
Existing ProductsExisting Products
New Products
New Products
Market Penetration
Market Penetration
Product Development
Product Development
ExistingMarketsExistingMarkets
New Markets
New Markets
MarketDevelopment
MarketDevelopment
DiversificationDiversification
Ansoff Matrix
Market Penetration Existing ProductsExisting Products
New Products
New Products
Market Penetration
Market Penetration
Product Development
Product Development
ExistingMarketsExistingMarkets
New Markets
New Markets
MarketDevelopment
MarketDevelopment DiversificationDiversification
Brand identity Selling a “story” Labeling/Packaging Display/Signage Positioning
Advertisements Tastings, Recipes Cooking demonstrations Other product promotions
Marketing StrategyIncrease customer base in existing market
EXAMPLE: Farmers Market as Existing Market
Product Development Existing ProductsExisting Products
New Products
New Products
Market Penetration
Market Penetration
Product Development
Product Development
ExistingMarketsExistingMarkets
New Markets
New Markets
MarketDevelopment
MarketDevelopment DiversificationDiversification
Marketing StrategyIntroduce new products to existing market
Value-added products (transforming an existing product into a new product)
Introducing an entirely new product
EXAMPLE: Farmers Market as Existing Market
Market Development Existing ProductsExisting Products
New Products
New Products
Market Penetration
Market Penetration
Product Development
Product Development
ExistingMarketsExistingMarkets
New Markets
New Markets
MarketDevelopment
MarketDevelopment DiversificationDiversification
Other Farmers Markets Community Supported Agriculture Schemes Buying Clubs Restaurants Grocery Stores Institutional Sales (e.g., schools, hospitals, corporate cafeterias, etc.)
Marketing StrategyCapture new markets with existing products
EXAMPLE: From Existing Farmers Market to
Diversification Existing ProductsExisting Products
New Products
New Products
Market Penetration
Market Penetration
Product Development
Product Development
ExistingMarketsExistingMarkets
New Markets
New Markets
MarketDevelopment
MarketDevelopment DiversificationDiversification
Tobacco farmers transitioning to organic fruit and vegetable production for sales in grocery stores
Immigrant/refugee farmers growing green peppers for Chipotle (a restaurant chain)
New dairy farmer producing goat cheese for sales in specialty/gourmet food stores
Banana farmers transitioning to fruit/vegetable production for sales in tourist markets (e.g., hotels, cruise ships, restaurants).
Marketing StrategyEntering a new market with new products
EXAMPLE: New and Transitioning Farmers
Marketing Strategies and Managing Risk
Existing ProductsExisting Products
New Products
New Products
Market Penetration
Market Penetration
Product Development
Product Development
ExistingMarketsExistingMarkets
New Markets
New Markets
MarketDevelopment
MarketDevelopment
DiversificationDiversification
RiskRisk
Low
High
Managing Risk Existing ProductsExisting Products
New Products
New Products
Low RiskMarket
Penetration
Low RiskMarket
Penetration
Product Development
Product Development
ExistingMarketsExistingMarkets
New Markets
New Markets
MarketDevelopment
MarketDevelopment
DiversificationHigh Risk
DiversificationHigh Risk
Greater Uncertainty = Greater RiskThe element of risk increases the further the strategy moves away from known quantities – the existing product and the existing market
Market Penetration: Least risky strategy, hence most often used. Both production practices and customers/buyers are better known.
Market Development: Growing risk with greater market uncertainty
Product Development: Growing risk with greater product uncertainty
Diversification: Highest level of risk with both product and market uncertainty
