Marketing and Sales: Risks and Opportunities for Small-scale and Resource-limited Producers

1. Marketing and Sales:Risks and Opportunities for Small-scale and Resource-limited Producers Presented by: Dan Krotz, ISED Jim Barham, USDA Adam Diamond, USDA

2. Presentation Overview • Analyzing Marketing Strategies • Managing Risk • Alternative Marketing Channels • Advantages and Disadvantages

3. Existing Products New Products Existing Markets New Markets Analyzing Marketing Strategies Ansoff Matrix Market Penetration Product Development Market Development Diversification

4. Brand identity Selling a “story” Labeling/Packaging Display/Signage Positioning Advertisements Tastings, Recipes Cooking demonstrations Other product promotions Existing Products New Products Market Penetration Product Development Existing Markets Market Development Diversification New Markets Market Penetration Marketing Strategy Increase customer base in existing market EXAMPLE: Farmers Market as Existing Market

5. Market Penetration Product Development Market Development Diversification Existing Products New Products Existing Markets New Markets Product Development Marketing Strategy Introduce new products to existing market EXAMPLE: Farmers Market as Existing Market • Value-added products (transforming an existing product into a new product) • Introducing an entirely new product

6. Other Farmers Markets Community Supported Agriculture Schemes Buying Clubs Restaurants Grocery Stores Institutional Sales (e.g., schools, hospitals, corporate cafeterias, etc.) Market Penetration Product Development Market Development Diversification Existing Products New Products Existing Markets New Markets Market Development Marketing Strategy Capture new markets with existing products EXAMPLE: From Existing Farmers Market to

7. 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). Existing Products New Products Existing Markets New Markets Diversification Market Penetration Product Development Market Development Diversification Marketing Strategy Entering a new market with new products EXAMPLE: New and Transitioning Farmers

8. Existing Products New Products Existing Markets New Markets Marketing Strategies and Managing Risk Risk Low Market Penetration Product Development Market Development Diversification High

9. Existing Products New Products Low Risk Market Penetration Product Development Existing Markets Market Development Diversification High Risk New Markets Managing Risk Greater Uncertainty = Greater Risk The 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