Horticultural Marketing

Wen-fei UvaSenior Extension Associate

Department of Agricultural, Resource, and Managerial Economics

Cornell University

October 27, 1999

Today’s Agenda:

• Marketing Functions and Channels in the Horticulture Industry

• Trends in the Horticulture Industry

• Examples of Marketing Strategies Used by Different Sectors

• Field Trip to Wegman & Iron Kettle Farm

The Horticulture Industry

Including Fruit, Vegetable and Ornamental Horticulture Sectors

The Fastest Growing Industry in Agriculture

Diversified, Exciting, and with Unlimited Opportunities

What is Marketing?

Marketing is a total system of business activities designed to plan, price, promote, and distribute products to target markets.

Marketing is an exchange of a wanted product or service for a price.

Major Functions in Marketing Horticultural Products

• Production

• Wholesale

• Retail

• International Marketing– Exports/Imports

• Services– Harvesting, Packaging, Processing, Brokerage,

Warehousing, and Transportation– Landscape Design, Installation, Maintenance

Growers

Production Suppliers

Exports

Imports

Wholesalers & Distributors

Brokers

Consumers

Retail Outlets

Institutions & Food Service Outlets

Processors

Service Businesses

Marketing Channels for the Horticulture Industry

Shippers & Packers

Wholesale Opportunities:

• Shippers/Packers• Brokers• Wholesale Buyers• Grower Cooperatives - i.e. Ocean Spray

• Retail Buyers– Supermarkets, Mass Marketers, Food Services,

Farm Markets, Garden Centers, and Florists

• Terminal Markets – Hunt’s Point in NYC

• Auctions

Retail Opportunities:

• Chain Stores / Mass Marketers– Supermarkets, Wal Mart, K Mart

• Independent Retail Stores– Farm Stands, Roadside Markets, Independent

Grocers, Florists, Garden Centers

• Pick-your-own Operations• Farmer’s Markets• Community Supported Agriculture• Mail Orders and E - Commerce

Trends in Horticulture Industries

• Global Sourcing and Competition

• More Consumer Oriented

• Differentiated Product Development

• Industrialized Production

• Industry Consolidations

• Utilization of Information Technology

• More Demand for Suppliers

Successful Horticulture Enterprises Start with Good Marketing

Where Are the Best Opportunities?

Developing Marketing Strategies:

• Objectives

• Target Markets

• Products

• Prices

• Promotion

• Distribution

• Competition

• Skills, Preferences and Resources

Marketing Strategies for Mass Marketers Targeting Retail Opportunities

• Low Prices

• Convenience– Longer store hours, One-stop shopping

• Product Selection

• Higher operation efficiency and lower costs

• More Marketing Power

• Special Marketing Emphasis– Organic, Value-added, Local produce

• Tour: Wegman

Marketing Strategies for Small Marketers Targeting Retail Opportunities

• Specialty/Niche Marketing

• High Quality

• Value-added Products

• Agri-Tourism

• More Services

• Owner’s Identity

• Collaboration, Joint Ventures, Alliances

• Tour: Iron Kettle Farm

Marketing Strategies When Targeting Wholesale Opportunities

• Be Competitive - Price and Service

• Quick to Respond to Customer Needs

• Sharing Costs and Risks of Customer

• Maintain Good Relationship with the “Customer”

• Know the Marketing Channel and Keep Up with Changes

• Take Advantage of Information Technology

• Become a Preferred Supplier

Give the Customer a Reason to Do Business with You

Don’t Just Satisfy the Customer; “Delight” the Customer

Exceed the Expectations

Growers

Production Suppliers

Exports

Imports

Wholesalers & Distributors

Brokers

Consumers

Retail Outlets

Institutions & Food Service Outlets

Processors

Service Businesses

Opportunities in the Horticulture Industries

Shippers & Packers