Farmers’ Direct Selling Station: A Site to Facilitate Dialogues between Individual Farmers, Food & Agriculture Educators and Consumers

The main building of Zhubei City Farmers’ Association is located in downtown and abuts on a main road with heavy traffic flows of commuters to Hsinchu Science Park in the morning, and the adjacent large parking lot has been nearly fully occupied. Beside the main building is a building of fair-faced concrete structure with a front standing board in which a black-bean mascot smiles to receive visitors. The building houses a direct selling station specifically for farmers in Zhubei, with the station focusing on sales promotion of food products made of black beans, the locally characteristic agricultural product, and generating annual sales revenues of over NT$100 million.

What is a farmers’ direct selling station?

A marketing platform directly linking consumers to producers: Background and motivation of establishing farmers’ direct selling stations

A farmers’ direct selling station is a marketing platform boosted by Agriculture and Food Agency (AFA) under Ministry of Agriculture (formerly Council of Agriculture) based on reference to the US, Japan and advanced European countries in a bid to reduce logistics cost and shorten the food miles. Direct selling stations are spiritually intended to let local individual farmers, under the aegis of corresponding farmers’ associations, decide on prices of self-produced products for sale there. With direct selling stations being indoor exhibition/sale space, farmers rely on consumers’ trust in product selection by farmers’ associations and therefore do not introduce their products on the spot. In comparison, a farmers’ bazaar, an outdoor marketplace functionally similar to a direct selling station, is characterized by farmers’ introducing their products and interacting with customers to win their loyalty.

Promotion of either a farmers’ direct selling station or a farmers’ bazzar is motivated by setting up a platform to enable consumers to buy fresh and safe food with local features and bring business opportunities for farmers/producers as well as developing a production rule emphasizing respect to nature and friendliness to environment. Therefore, the promotion is focused on the spiritual idea of environmentally friendly “local production, local consumption” and “eating locally produced seasonal food” and hoped to develop a sustainable mode of marketing agricultural products through changing consumers’ behavior.

AFA in 2022 continued boosting the spirit of “local production, local consumption” and began to train people engaging in agriculture as food & agriculture educators for the first time. These educators are intended to explain knowledge of local agricultural products for consumers at farmers’ direct selling stations, with the knowledge including plantation, harvest, processing, recipes and nutritional information. They play a bridge between framers and consumers and transmit local charm to consumers to have local characteristics which attract them to direct selling stations. The Center, in a 2021 project concerning food & agriculture educators and farmers’ direct selling stations, handled training programs and undertook social network service (SNS) promotion for such educators to hike their publicity and consumers’ faith in them via social media.

Hoping to visually unify textual and graphic styles for SNS promotion, the Center collaborated with outsourced service suppliers to make planning for video shooting of 42 farmers’ direct selling stations around Taiwan and has had a series of surprising feeling since arranging shooting dates. “Is it Mr. Sung? Have you received a notice of shooting SNS video of your farmers’ direct selling station? Is it convenient for us to take shooting in the afternoon on the coming Thursday?” I (the author) asked. “It is okay, welcome” Mr. Sung answered.

Among such phone calls to schedule shooting, I was particularly most impressed with the farmers’ direct selling station in Guanshan, Taitung County, eastern Taiwan: Hearing roosters’ crowing on phone, I originally thought the crowing as part of music played at the station. Upon arriving in the station, I found that the station marketed locally characteristic agricultural products through combining tourism activities. In addition to introducing rice grains and letting tourists experience hand-based processing of rice grains and taste tea, the station invited local schools, community universities and community development associations to offer performance activities on the weekend. As a result, consumers’ purchasing behavior has evolved from mere buy-and-sell actions originally to intermittent social exchanges and emotional linkage via interaction so as to enrich services for consumers and motivate consumers’ buzz marketing for the station as well.

Other cases of combining tourism and/or activities to jointly market locally produced agricultural products include farmers’ direct selling station in Dongshan, Yilan County, in combination with Dongshan River, that in Wufeng, Taichung City, in combination with distillation to produce sake (Japanese rice liquor) and that in Huwei, Yunlin County, in combination with a peanut factory. (related photos are available at Taiwan Farmers’ Direct Selling Station website)

How do farmers’ direct selling stations differ from other agricultural product channels?

Combination of local farmers with food & agriculture educators to show amiability to people and attractiveness of local agriculture

Common sales channels of agricultural products are traditional marketplaces, bazaars, convenience stores, supermarkets, hypermarkets and wholesalers. Combination of authoritative marketing scholar Philip Kotler’s concepts and marketing management master Gary Armstrong’s concepts in his book “Principles of Marketing”: Good marketing is to understand what “customers” need and then design customer-oriented “products” to meet their needs and design good process of offering customer services. Based on the combined concepts, difference in customer, product, service between farmers’ direct selling stations and other sales channels is synoptically analyzed as follows.

1. Customer differentiation

Customer differentiation refers to customers’ difference in background and specific attribute. There are many factors of differentiating customers, including geography, demographic statistics, psychological statistics and behavioral variables (supplementary explanation is provided in the following box). Since customers with different attributes have different demand, marketing necessitates division of the whole market, based on factors of differentiation, into segments each with relatively similar attributes, Then, target markets are chosen among these segments for designing attracting marketing plans.

Based on results of 437 effective copies of questionnaire survey, customers visiting farmers’ direct selling stations are mainly characterized by 1. married women (43%), unmarried women and men (28%); 2. aged 30-49 accounts for 62%; 3. living habit of self-cooking for five times a week. The quantitative results in combination of on-spot qualitative interviews show that the main customer base of farmers’ direct selling stations is women aged 30-49, mostly housewives and office workers with occupation of civil servants, teachers, medical service employees and company employees.

2. Product differentiation

Products can be tangible or intangible that includes services, events or combination of persons, organization or notions. According to “Principles of Marketing”, what motivates consumers to purchase products consists of factors in three layers, that is, core benefit in the first layer, tangible products in the second one and supplemental free products in the third one. Core benefit refers to the demand that essentially drives consumers to purchase products, while tangible products are the substantial things that respond to and can satisfy consumers’ demand as well as concern characteristics of services and design, quality, brand names and packaging of products. Supplemental free products are peripheral to core benefit and tangible products, including after-sale services, warranty, installation, delivery services and credit. Besides, products can be broadly broken into consumer products and industrial ones, with the former being products for personal use or used for convenience or special purposes and the latter being those purchased for further processing or use in business operation. Based on the definition, most of products available for sale at farmers’ direct selling stations belong to consumer products used for convenience purpose which are characterized by: frequent purchases, infrequent purchase planning and comparison among same products, and producers usually adopt a marketing strategy of mass promotion.

Results of the questionnaire survey show that there are three main reasons for attracting consumers’ purchasing at farmers’ direct selling stations:

• Fresh: Most producers are local farmers.
• Willingness to support: Consumers like to support local agricultural products and farmers.
• Safety of food: Consumers believe in quality control by farmers’ associations due to their certification of agricultural products in line with government policies.

Farmers’ direct selling stations satisfy consumers’ demand for safe and fresh agricultural products in terms of core benefit, while vegetables and fruits available there are tangible products and quality assurance is a supplemental free product. Based on qualitative interviews, farmers’ associations have also provided certain after-sale services (returning of purchased products) to make consumers experience happy purchases. In addition, farmers’ associations hold activities of sight-seeing rural areas and demonstrating recipes to let consumers understand places of origin and methods of using food materials respectively.

3. Service differentiation

Highly related to sales of products, services are of four essential characteristics: Impalpability, inseparability, instability, perishability. Impalpability is inability of sensory organs to sense services; inseparability is that services cannot be separated from providers; instability is because services may vary depending on who are producers as well as time and places of supply; perishability refers to impossibility of storing services for use in later sales.

Based on the aforementioned definition and results of questionnaire survey, consumers think that services provided by farmers’ direct selling stations have the following features:

• Amiable services: Professionals of farmers’ associations introduce methods of preserving food materials and recommend recipes.
• Transparent information on producers: Stations let local farmers exhibit their products and set sales prices, with photos of producers and their production displayed at some stations.
• Online sale: Some farmers’ associations have begun to offer online ordering services through using Line social network to link local residents, a bid to save time taken by consumers in choosing products at stations as well as control volumes in demand and manage sales and procurement of products.

Besides, with the project of promoting establishment of “food & agriculture educators”, training them and certifying their qualification, such educators are expected to explain daily-life knowledge and historical stories regarding agricultural products at direct selling stations to link producers to consumers via emotional interactions. Educators are expected to be able to transmit the value of health and safety existing to Taiwan’s agricultural products as well as make consumers keep searching for products at stations and producers more willing to allow farmers’ associations to promote their products.

Therefore, farmers’ direct selling stations are the same as other channels in customer base but differ in product and service. For products, farmers’ associations control quality via product certification as well as provide after-sale services and host agricultural sight-seeing and recipe activities. For services, farmers’ associations provide LINE online ordering and transparent information on producers and, in addition, will establish food & agriculture educators to link producers to consumers.

Observation and impression from video shooting:

Direction of possibly expanding categorization and customer bases of farmers’ direct selling stations

During implementation of the project, the author and professionals related to the project have visited 41 farmers’ direct selling stations around Taiwan (one of which was under construction) and found that, except letting local farmers exhibit their products and set sales prices, planning for development of farmers’ direct selling stations varies from one to another. Based on what we have seen, these stations are categorized into five types: conventional, supermarket-like, tourism-featuring, characterized by cultural innovation, and characterized by cross-industry alliance.

1. Conventional

This refers to traditional supermarkets operated by farmers’ associations with portions of space appropriated for local farmers to directly sell self-produced products, such as farmers’ direct selling stations in Wugu, New Taipei City, that in Ruisui, Hualien County and that in Chenggong, Taitung County.

2. Supermarket-like

These are through remodeling traditional supermarkets operated by farmers’ associations, also with certain portions of space reserved for local farmers’ direct selling. For this type, there is high possibility of allowing use of credit cards and electronic payment. Examples of this type include farmers’ direct selling station inside Ziqiang Supermarket operated by Hualien Farmers’ Association and farmers’ direct selling station in Tamsui, New Taipei City.

3. Tourism-featuring

Farmers’ associations cooperate with tourism operators to develop a series of agricultural sight-seeing maps in a bid to promote their products and individual farmers’ self-produced products for direct sale. Such cases include farmers’ direct selling station in Dongshan, Yilan County, that in Wufeng, Taichung City and that in Guanshan, Taitung County.

4. Characterized by cultural innovation

Farmers’ direct selling stations of this type normally feature vivid and lively appearance of stores with decor mostly based on wooden materials, and some of them appeal by additionally operating cafes and displaying POP advertising characters. Farmers’ direct selling station in Xinpu, Hsinchu County, that in Hsinchu City, that in Qionglin, Hsinchu County, and that in Huwei, Yunlin County, are examples of this type.

5. Characterized by cross-industry alliance

This type refers to farmers’ direct selling stations that are immediately adjacent to credit units operated by farmers’ associations or convenience stores and thus partner with the latter for help in business promotion. Farmers’ direct selling station in Yuli, Hualien County, partners with its neighboring convenience store to complement its product mix, while that in Puxin, Changhua County, uses specifically designed flow lines to tacitly attract customers of neighboring credit unit operated by Puxin Farmers’ Association in a bid to increase patronage.

Field observation together with results of questionnaire survey show that elderly and middle-age people, mainly women, make up the main customer base of farmers’ direct selling stations in general. While young customers are quite few, they could be potential customer bases. Therefore, the author depicts lives of hypothetical target customers aged 24-28 and describe their potential demand.

Hsiao-Hua’s living is actually typical of some of the people with little social experience. From viewpoints of customers, people of this kind are likely to be inferior to middle-age and elderly consumers in purchasing capability, but generally have stable considerable income and possibly care about health due to influence of social media. Besides, they mostly live in the Taipei metropolitan area in which there are quite few farmers’ direct selling stations, but have demand for going to other areas for tourism on the weekend or holidays.

In theoretical analysis of marketing strategies, core benefit in the case of Hsiao-Hua is the hope of understanding sources of food materials and learning recipe skills and thus social environment for providing recreational opportunities on holidays would be desirable for Hsiao-Hua. For farmers’ direct selling stations, therefore, tangible products that can appeal to people like Hsiao-Hua are production processes of food materials and teaching of recipes. Such tangible products can be delivered through various ways, including textual and graphic explanation on packaging of products, POP advertising posters in stores or even recipe video broadcast on social media to form a self-cooking trend and boost self-cooking at home via Hashtag.

Noteworthy is that the ways of delivering the tangible products have to be of visual styles attractive to young people, such as those adopted for farmers’ direct selling stations in Dongshan and Huwei. In terms of activities, recipe kitchens and agricultural sight-seeing tours can serve demand for social activities on holidays. For supplemental free products, after-sale services provided by farmers’ direct selling stations can be organization of social networks and establishment of social exchange platforms for consumers to online share sight-seeing or recipe learning experience in order to enhance consumers’ sense of identity with and loyalty to stations.

As for services, young people good at using social media can join farmers’ direct selling stations’ LINE social networks to use online ordering services as well as keep receiving the latest news released by stations such as notice about lessons on food materials and recipes as well as agricultural sight-seeing tours. However, glossaries and graphic design used in social networks must cater to young people in order for effective marketing.

To sum up, the author holds the opinion that tourism-featuring farmers’ direct selling stations outside Taipei City have potential of attracting young people as customer base but need assistance in how to make young people understand such stations.

Conclusion

Farmers’ direct selling stations are intended to function as a direct sale-and-purchase platform between local farmers and consumers through letting local farmers exhibit self-produced agricultural products for sale and set sales prices, a bid to minimize transportation cost between producers and consumers and enhance consumers’ agricultural knowledge. Operation of farmers’ direct selling stations is differentiated from that of other channels, for selling of fresh vegetables and fruits at stations involves exchanges of warm feeling between sellers and buyers and deeply impresses middle-age and elderly consumers with the image of quality control by farmers’ association. In order to tout young customers in the future, development of farmers’ direct selling stations can be extended through offering platforms for young people to know vegetables and fruits as well as learn recipes for self-cooking. Thus, farmers’ direct selling stations will not be merely space for social interactions, but will additionally become bases of food/agricultural education for acquiring daily-life knowledge on holidays, allowing consumers to experience education-based entertainment to result in win-win.