Agr 513: Agricultural Marketing Product

AGR 513
AGRICULTURAL PRODUCTS
MARKETING
CHAPTER 1
INTRODUCTION
Assessment
• 3 tests x 10% : 30%
• Individual assignment : 10%
• Individual presentation : 10%
• Final examination: 50%
• Structure of final examination
▫ Section A (True/False) : 30 marks
▫ Section B(Definitions /Listings/Differentiate) : 30
marks
▫ Section C(Explanation/Short essays) : 40 marks
Recommended text
• Kohls, R.L., and J.N. Uhl 1996. Marketing of
Agricultural Products, MacMilan, NY
• Branson, R.E., and Norvell, D.G. 1983.
Introduction to Agricultural Marketing,
McGraw-Hill, US
Chapter 1 Outline
• Definition Of Agricultural Marketing
• Marketing Scope
• Marketing Module
• Marketing Utility
• Marketing Concept
• Importance Of Marketing
• Characteristics Of Products And Production
• National Agricultural Policy
QUIZ…
• Define AGRICULTURAL MARKETING in 3
minutes…
• & your TARGET for this subject..
Definition of Product
Agricultural Marketing Definition
MARKETING SCOPE
MARKETING MODULE
• In 1960’s Mc Carthy introduced a module on
marketing. This module is known as Marketing
Module or Agricultural Marketing Circle. It
consists of 3 circles namely:
• First Circle - Target customer

▫ Examples: Clothes made from silk which is high
quality products. The target consumer is of high
income and high class social status.
Continued..
• Second Circle - Marketing Mix or Four (4) P’s
that can be controlled via- Promotion, Price,
Place, Product / Services
Price -The amount of money that a consumer has to pay for the purchase of
goods and services
-Listing of prices, discounts, allowance, credit, periods of payments, sale of
products
Products -Goods and services that a producer offers to the target market in a certain
/services locations
-Quality, styles, characteristics, brand name, sizes, services etc
Place -Refers to the company's activities that make the product available to the
target consumers at a specific location or geographical vicinity (area)
-Channels, coverage, locations, inventories, transportation
Promotion -Activities that persuade the consumers to buy the products
-Publicity, sales enhancements, direct selling, web sites, advertisements
Continued..
• Third Circle - Environmental Factors / macro
that cannot be controlled.
1)Political & Legal
• It will influence the marketing activities of firms
and organization and the countries economic
growth. It can be categorized :
▫ Monetary and fiscal policy
▫ Laws and regulation
▫ Relation of government and industries.
Continued..
2) Demographic
• Based on geographical regions, the
characteristics of the population, market
segmentation and the distribution on various
aspects such as :
 Wants factors: Urban, town, rural areas. Age,
education levels. Sex and occupation. Race and
religion. Family lifestyle.
 Sociological factors :Groups either family or social
group
 Physiological factors : Personality, attitude of buying
behavior
Continued..
3) Economic
3) Influence the level of macro economy from the
aspects of growth of gross national products,
inflation rate, consumption, money supply,
credit support, income and credit flexibility.
4) Technology
3) Influence the market by:
▫ Transportation (faster), Automobile ,Television
(advertising) , Retailers (purchasing), Packaging
(safe) , Advances in technology (new tech.) ,
Market receptiveness to technology (in
marketing process).
Continued..
5) Legal's & Regulation
5) Agricultural products are mostly substitute or
complementary , bulky & easy to deteriorate.
6) E.g.: The application of excessive insecticides to vegetables
& a proper packaging of the products.
6) Social and Cultural
▫ Will influence the economic, political, & technology of
certain countries because of shifts in populations, better
job opp., attitudes towards new tech., & trends in using
computers
▫ Social aspects of the society can be seen through the
various changes of consumer products such as artificial to
natural ingredients, product safety or environment &
consumerism awareness.
MARKETING UTILITY
MARKETING CONCEPT
Orientation Concentration Purposes
towards
Producer Production. Producer does not require prior
Total output of products feedback of consumer wants and
offered for sale in the needs.
market. Profits gained form sale of products.
May occurred surplus of products in
the market
Consumer Consumer needs & Producer produce based on the

wants. feedback of the consumer.
Total output of products Profit gained from sale of products.
offered for sale depends Surplus of products might not occur
on consumer’s wants and in the market.
needs.
IMPORTANCE OF MARKETING
Continued..
ROLE OF MARKETING
CHARACTERISTICS OF THE PRODUCTS
1) A raw material
 Output largely a raw material
 E.g. livestock to meat, wheat to cereal
 From farm product to food
 Successful farmers must be more market
oriented
Continued..
2) Bulky and perishable product
 Agricultural products are more bulky and
perishable
 Bulk effect marketing functions with physical
handling
 How to reduce bulkiness?
 Transport high value or value added instead of raw
material
 This perishable products require speedy handling
and often special refrigeration
Continued..
3) Quality variation
 Varies from year to year and season to season
 Standardization and grading to facilitate the sorting of
different variation in grades
 Variation in quality and prices may due to:
 Level of grading of products
 Natural disasters such as earthquake, floods
 Changing of marketing strategies, demand and
supplies
 Management in efficiencies in dealing with crops
practices
 How to control quality variation?
 Use the same planting material
CHARACTERISTICS OF PRODUCTIONS
Continued..
Continued..
Continued..
Continued..
HOW TO OVERCOME THE
PROBLEMS
NATIONAL AGRICULTURAL POLICY
(NAP)
Three NAP
• Since 1984, three NAP were formulated to
develop agricultural sector:
• Emphasize on NAP 1 (1984-1991)
▫ To develop the export oriented sector
• NAP 2 (1992-1998)
• NAP 3 (1998-2010)
▫ Increasing competitiveness of the agricultural
sector
▫ Maximizing income through optimum utilization
of resources
- being in the original
position
Strong growth in
exports of electronics &
electrical products to US
The value of the ringgit dropped from MYR 2.50 per USD to at one point, MYR 4.80
per USD.
Malaysia refused economic aid packages from the International Monetary Fund (IMF)
and the World Bank and by refusing aid from IMF, Malaysia was not affected to the
same degree in the Asian Financial Crisis as Indonesia, Thailand, and the Philippines.
Specific Objective Of NAP 3
• Enhancing food security
• Increasing productivity & competitiveness of the
sector
• Deepen linkages with others sector
• Create new sources of growth
• Adopting sustainable development, utilization
and management of natural resources
Strategies for achieving the NAP
objectives
• Optimizing The Resources Use
▫ Land, labor, capital and management are to be
utilized effectively.
• Human Resources Development
▫ The use of technologies in the agricultural sectors
e.g. mechanization in planting and harvesting
(paddy) will improved efficiency in used of labor.
▫ Manpower training is required to handle such
cases, efficient agribusiness in marketing, and
agro-based processing.
Continued..
• Enhancement Of Research And Development
And Technological Diffusion
▫ Would maintained the competitiveness of the
agricultural sectors e.g. rubber, oil palm, rice and
other commercial products & must be market
driven, commercially orientated and
environmentally friendly.
• Greater Role Of The Private Sectors
▫ Incentives, promotion and packages will enhanced
the sale of products for export purposes.
Continued..
• Reformed Marketing Strategies of the producers
▫ Products should be view as commodity and plays
it’s role in the export of the products to various
countries like Middle East, African, Latin America
and China as traditionally to the U.S.A.
• Expanded Food Production
▫ The finished products should supply first for the
demand of the domestic populations.
▫ The products produced must be competitive in
nature.
Continued..
• Development Of Viable And Self-Reliant
Farmers Institution
▫ The needs of this institution is highly required to
reduce or less the burden of the farmers.
▫ Some farmers are incapable to supply their
products because lack of facilities such as financial
strength, marketing, storage and transportation
purposes.

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AGR 513

• First Circle - Target customer

Consumer Consumer needs & Producer produce based on the

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