5 Reasons to allocate Market Research budgets to do Customer Segmentation.

Farmers have a dual role as both producers and consumers. While they produce agricultural goods, they also need to purchase various inputs for their farming operations. This duality gives them a unique perspective on the way they would react to or consume your products and services.  They have extensive knowledge of agriculture practices but are also greatly influenced by their peers, experts, the village retailer, the agriculture officer and even the ‘arthiya’ he sells his crop to. Hence there are 2 parts to decode a farmer – his practices i.e., the way he grows his crop or uses products and his general attitude and behavior towards consuming agri inputs.

Most agriculture market research studies are brand or category focused which will dig deep into usage of products and feedback to them. Understanding the general category and segmenting the market however has very unique value and significance for you as a marketer.

Why should you as a marketer be considering segmentation?

1. Targeted Marketing: Agriculture encompasses a diverse range of products and services, including crop protection, crop enhancement, nutrition, seed, machinery and more. Market segmentation helps identify specific customer groups who depict certain common behavioral characteristics and purchase habits. This enables companies to tailor their marketing efforts to address the unique needs and preferences of each segment. By understanding the characteristics, demands, and behaviors of different market segments, agricultural businesses can develop targeted marketing strategies to effectively reach and engage their intended audience.
2. Customized Product Development: Market segmentation allows agricultural businesses to identify specific customer needs and develop products or services that align with those requirements. Different market segments may have distinct preferences regarding seed varieties, molecules they use, purchase channels and how they consume information. Thus, by segmenting the market, companies can gather valuable insights and create customized offerings that address the unique demands of each segment, leading to improved customer satisfaction and higher adoption rates.
   Our segmentation studies are often followed by Customer Journey Mapping studies, which study the segments individually using extended in-depth interviews with farmers to understand the challenges, need gaps and detailed path to purchase. This helps marketers form individual strategies for each segment.
3. Resource Allocation: Market segmentation helps agricultural businesses allocate their resources efficiently. By understanding the size and potential of different market segments, companies can prioritize their efforts and allocate resources such as capital, manpower, and research and development investments accordingly. This ensures that resources are directed towards segments with the highest potential for profitability, optimizing operational efficiency and maximizing returns on investment.
4. Competitive Advantage: By identifying and targeting niche markets or underserved segments, agricultural businesses can differentiate themselves from competitors. By catering to specific customer needs, companies can build customer loyalty and establish themselves as experts in those segments. This can lead to increased market share, higher customer retention rates, and reduced vulnerability to price competition.
5. Market Expansion Opportunities: By analyzing consumer trends, demographics, and evolving needs, agricultural businesses can discover new opportunities for expansion. This could involve targeting new geographic regions, exploring alternative crops or diversifying product lines to meet emerging demands. Market segmentation enables companies to identify and capitalize on these growth prospects, expanding their reach and revenue potential.

In conclusion, market segmentation plays a crucial role in agriculture by enabling targeted marketing, customized product development, efficient resource allocation, competitive advantage, and identifying market expansion opportunities. By understanding the diverse needs and preferences of different customer segments, agricultural businesses can optimize their operations, enhance customer satisfaction, and drive sustainable growth in a highly competitive industry.

Q&Q has solid expertise in segmentation studies. We have worked with over 25000 farmers in India and APAC markets and conducted segmentation within crops, crop protection categories or even for the entire country as a whole.

Speak to our team of experts to understand how segmentation can help your business/ category or brand.