Cattle Today

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CATTLE TODAY

MARKETING TOOLBOX CONTAINS MANY USEFUL COMPONENTS

by: Clifford Mitchell

Time and time again, we are reminded cattlemen often do just fine at their job. The production arm of the system can thrive in almost any conditions, with the availability of resources that will get the job done. Skilled operators make adjustments to the program to fight drought, winter storms and unforeseen changes in input cost. Even though producers can survive with that same tractor for another year or cull heavily when it's dry, lack of time or experience can leave dollars on the table when it's time to market what they worked so hard to produce.

In production agriculture, it is often the marketing department that fails the firm. After all, calving cows, preparing fields for crops or making sure the hay meadow is fertilized and ready to produce maximum yields are a full time job. The marketing model has been created for seedstock producers. There is no reason to reinvent the wheel. Tailor the marketing program to your strengths and borrow ideas from colleagues in the business. Sure differences exist, but the fundamentals are the same.

“With all the marketing tools available today, we have to become smarter in the ways we attack marketing. Each situation is a little different, but large or small, producers have to make a diligent effort to follow-up with old customers and track new leads,” says Alan Sears, General Manager, Fives Star Cattle Systems LLC, Loveland, Colorado. Five Star markets three breeds of bulls and offers potential customers a variety of services.

“If you're going to advertise, you have to be willing to improve your herd and make changes to meet the demand of your customers. Right now, I am doing a lot of testing for homozygous polled and black because that's what customers want. The more I do to market my program, the harder job I have to keep improving the product,” says Bill Helton, Circle H Ranch, Vinemont, Alabama. Circle H markets Limousin bulls through private treaty sales.

“We have to communicate that we have complete data sets. Originally, we were lucky to have a birth, weaning and yearling weight. Now we have very predictable Expected Progeny Differences, DNA tests for tenderness, polled and coat color and ultrasound data,” says Ken Holloway, American Cattle Services, Chattanooga, Oklahoma. Holloway has been marketing seedstock for over 30 years.

A variety of marketing scenarios exist. Breeders must use tools that will allow them to maximize the opportunities for potential sales. Personal attention still seems to be the number one goal for most seedstock producers when dealing with customers.

“I took a little different approach to marketing semen on my herd bull. I got a list of every person who bought semen and gave them a call,” Helton says. “Most of them were happy I called and wanted to talk about the calves. I have bought a lot of semen in the 17 years I have been in the beef business and no one ever called me.”

“With all the different tools we have to help us market cattle, people are still going to want to see the cattle themselves at some point or have a representative look for them and talk to the seller,” Holloway says. “I don't know if we need to keep using methods that encourage people to stay away from the sales. A lot of times, the local market is set by the auction. We can't maintain that market through absentee bidding.”

For most, the internet or electronic media has caused a lot of interest as technological advances have made home computers affordable and economical. The World Wide Web offers many opportunities, and its search engines allow “surfers” to find almost whatever goods or services they're looking for.

“The internet has allowed me to communicate better, one-on-one with my customers, than we have in the past,” Sears says. “I can e-mail a sortable spreadsheet containing data on all the bulls I have for sale to my customer. He can sort the bulls by whatever traits fit his goals and then call me back that afternoon.”

“My web site has helped my program. I have had over 45,000 hits in four years,” Helton says. “I was excited when I first got my web site and a man two hours from here called me up and bought a bull because he saw his picture on the web site. I knew it was a powerful tool when I paid for it that fast.”

Electronic media is a proficient manner to communicate with customers. The power of the World Wide Web exposes your operation to many potential customers. Even though the tools are available to search the web in a fairly efficient way, without other forms of advertising, producers may get lost in the shuffle.

“Some breeders are frustrated with the internet because there is no activity on their site. I list my web site on every ad and my business card so people know where to find me,” Helton says. “You have to keep current information and update it all the time. If the content gets stagnant, people will not keep coming to the site.”

“The internet is an amazing tool. It saves a lot of trips to the post office when a potential customer can download a catalogue off the internet,” Holloway says. “I think the internet is comparable to an electronic handbill. For the older crowd, like myself, who don't spend a lot of time surfing the web we need printed handbills. Properly placed print media is just as important.”

“Print media is still very important to any marketing program. We are more demanding of the print media because we want to make sure we're hitting our target audience,” Sears says. “I am not sure we know exactly how best to use things available to us like e-mail blasts. People are getting bombarded with e-mail blasts and internet newsletters. It's hard to get a response from these because it's no longer new. We have to study our lesson and learn how to use this technology. It is in a very primitive stage right now.”

As technology continues to advance, the usefulness of the web may be at the tip of the iceberg. Comfort level must increase with users and the boundary must be extended for high speed connections to see full benefit of this marketing tool.

“In the future I see bull listings on the internet accompanied by a short video presentation,” Sears says. “We're not there yet because most of rural America still has poor internet capabilities.”

The web opens doors to a broader audience, but is that the target audience a producer needs to reach. Programs have different needs, some need to reach way out; others would be better served to take care of business at home. Obviously, many factors will fine tune this approach, but simplifying the process could lead to successful marketing programs.

“The first thing I tell people is to put up a road sign then saturate the local area (75 to 100 mile radius) with advertising,” Holloway says. “If you take care of your marketing program at home, the rest will take care of itself.”

“I have had great success marketing bulls through the local shopper's guide that goes to all my local customers. I advertise in the Alabama Farmers Bulletin and it's free,” Helton says. “I leave business cards at all the local businesses and I am actively involved with our cattlemen's association. I think it's important to be actively involved with the local cattlemen's organization because you meet all the breeders and you are in the mix.”

“For us, putting up a flier at the local sale barn is the biggest waste of time there is. It's not a defined enough audience and you get lost in all the clutter because every wall is wallpapered with this type of information,” Sears says. “We like to try and make face-to-face contact with our customers once every two or three years because it is physically impossible to get to everyone in a year's time. This doesn't necessarily mean a ranch visit. It could be at one of our designated producer meetings, places like Denver or the NCBA convention, where we make ourselves available to our customers.”

Services offered to buyers range from free delivery to guarantees to calf buy-back programs, depending on what level outfits choose to supplement their marketing program with additional services. The service package can be as basic or sophisticated as the operation deems fit to market the desired product.

“A producer can offer any package he wants to potential customers. Breeder guarantees are used by a lot of breeders, but I am not sure it's the best thing for all parties involved. Never misrepresent the product and remove all problem cattle before the sale. There are a lot of places to market them without sending them to a bull customer,” Holloway says. “Volume discounts and free delivery seem to be good programs if a breeder wants to offer them. Delivering bulls to a buyers place is one of the best things you can do to build a relationship.”

“I offer local delivery for all my bull customers and I think it helps out a lot. I will give a discount if a guy buys more than one bull,” Helton says. “I transfer all the papers to the new owner because they get some correspondence from the breed association. Every bull buyer gets a cap or a pocket knife, whatever I ordered that year. A good-fitting cap will get worn a lot of places.”

“Once the bulls have been delivered to the customer, we'll make a follow-up phone call to make sure everything went well,” Sears says. “Our services include marketing feeder cattle for our customers. Whether I list or buy the calves, it's a great opportunity to talk with the customer. I can cover two bases at once. A lot of times I will have to go to the ranch to inspect or deliver the calves we helped market and I can look at his cow herd.”

Live cattle displays, at a stock show or at consignment sales, have been a large part of the marketing program in the past. These events are often places for smaller purebred breeders and commercial cattlemen to identify potential genetics that can help the program. Over the years, these displays, which were once the cornerstone of the marketing program, have lost some of their shine. Every operator evaluates his firm differently and justifies these programs based on help to the bottom line.

“Overhead never had a bad day and these events have become very expensive. Define your potential market and decide if it's more important to have a display at the local cattlemen's day or take a string to key events that fit the budget,” Holloway says. “It is more important than ever to have a good display of bulls and a ranch sign with contact information out by the highway.”

“In our area, there is not a lot of opportunity to display cattle at certain functions. I have sold cattle in consignment sales which has increased awareness of my program. I displayed a bull at a consignment sale and sold enough semen to justify it,” Helton says. “I have a sheet with all the current information and my bulls have color-coded tags. Orange means Homo black, white means heterozygous black and lavender is Homo black and polled. I have buyers look at the bulls when I am not there, this is an easy way for him to pick a bull and if I have e-mail access I can get him all the information.”

“Commercial cattlemen are looking for somewhat of a visible seedstock component. He's not concerned necessarily with which animal won the show, but if he reads his seedstock supplier did well at a show, it gives him a subconscious comfort level,” Sears says. “Different target audiences will dictate how a producer uses this tool. If he's marketing to small breeders or top-end commercial customers, then it is important to be visible at certain events. For us, we get more out of being there and shaking hands than a live cattle display.”

In the beef business, sound marketing programs are not just confined to the size of the firm. Depending on the overall goal, large and small operations can be successful with the right effort. The key to being profitable marketers is growing with the times, being able to continually satisfy repeat business, while, at the same time, being open-minded enough to attract new customers.

“Reputation building is an important part of selling bulls. How firms are perceived by the buying public is a way to generate new leads,” Sears says. “My personal viewpoint has changed over the years. One-on-one conversation is the most valuable marketing tool. My goal is to communicate with each customer once or twice a year.”

“It's a face-to-face people business and always will be. Whether a producer is selling in volume or private treaty sales,” Holloway says. “I have always said you're insurance is only as good as your agent. It doesn't matter what business it is, the product is only as good as the person who stands behind it.”

“Advertising pays off with the perception that you're doing well. I ask every customer how they found me, because that gives me a good idea of what's working in the marketing program,” Helton says. “You have to keep advertising to get new clients, especially in my market area. I periodically visit my customers and have sent Christmas cards to all my customers for the last three years. Honesty and treating people right have taken me a long way in this business.”

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