Part II in a series
Receiving a premium price for purebred cattle means developing a market and planning ahead. To do so, you must not only market your cattle, but also your program, service and – perhaps most importantly – the ideas that you believe in. Successful seedstock producers remember their livelihoods depend not only on the cattle they raise but also on how well they are able to identify buyers, meet the needs of those buyers and sell them cattle that meet and exceed their quality expectations. Without a well-planned promotion and marketing strategy and campaign, you won't receive proper compensation for your breeding and management efforts.
Successful purebred operations have three things in common:
1) Cattle that meet customers' wants and needs.
2) Realistic production costs in relation to income.
3) A well-planned, effective marketing program.
To stake your claim in the purebred market, you must analyze your specific programs and customer base. You must also analyze your competitors' programs and customer bases. By answering the following questions, you can determine the strengths and weaknesses of their programs.
1) Who are my current and potential customers?
2) Where are my current and future customers located?
3) Where do I need to direct my promotional efforts?
4) What do my customers want?
5) What genetics are they seeking?
6) What are their goals?
7) How can my program help them meet their goals?
8) Does my breeding program meet current and potential customer needs?
9) Do I have a quality product to offer?
10) How do my customers determine quality?
11) How many potential customers are there?
12) Can my cattle compete for a share of the seedstock market?
13) What is my program's reputation?
14) What are my cattle worth?
15) How much are my customers willing to pay?
16) Who are my competitors?
17) Where are they located?
18) How does their program compare to mine?
19) What do they offer that I don't?
The Marketing Plan
The traditional marketing plan consists of several steps:
1) Situation Analysis
*Assess where your marketing program has been and its current status
*Project where the program is headed with existing plans
2) Goal Setting
While goals come in many different packages for seedstock producers, here are a few examples. The key is setting them early on, defining what they are and how long you want to take to accomplish them. Then, you must have definitive methods of monitoring your progress and measuring your results.
Here are a few examples of definable and measurable goals:
A. I want to increase the percentage of new customers by five percent next year.
B. I want to increase the percentage of repeat customers from 60 to 75 percent.
C. I want to visit at least 20 of my customers this year.
D. I want to assist in selling 1,000 of my customer's calves.
E. I want to accurately report 100 percent of birth, weaning and yearling information.
F. I want to call at least three customers a week for the duration of the year.
When goal setting, producers should also look at the various market segments at their disposal. For example, you may not just be limited to selling bulls. There may a market for your extra heifers or mature cows. Marketing alternatives, such as other countries or moving your sale to another state are also worth looking into.
3) Marketing Program
*Develop the program's marketing mix (controllable factors such as product, price, promotion)
*Develop a promotion philosophy that differentiates your program from others
*Develop your marketing budget
*Develop a budget for sale day
While some of these items are optional, producers should be careful not to eliminate them from consideration because of cost. Take sale management for example. While the commission a sales manager receives may seem high, consider what it will cost you to do that work yourself. Undoubtedly, you will spend less time on the ranch and more time doing promotion. What will the direct costs of that be to your operation? Second, consider that sale management firms can often build demand and bring a higher price for your cattle, plus they're professionals at marketing cattle when most producers aren't. Just make sure you do your homework first to get the best sales management firm available.
4) Implementation Phase
*Execute the marketing program by enacting all of the components, such as advertising, personal telephone calls, etc., that are going to get your cattle sold
5) Evaluation Phase
*Measure results and compare with your plan to identify successes and areas that need improvement.
Pick Up A Good Habit
Developing an effective strategy is much like setting a New Year's resolution. It takes time, effort and discipline. Marketing plans need to be developed and updated on an annual basis. Periodic check-ups should also be conducted to re-focus your promotional efforts or realign your goals. Long-term goals also need to be evaluated on a continual basis. In return for your hard work and dedication, you will realize the potential of your cattle and receive that premium you've worked so hard for.