- May 26, 2020
Cultivating a New Era at AgVend
We started AgVend to help both ag retailers and growers leverage technology to do business together more efficiently. We aimed to give our Partner Retailers a new channel of revenue to combat the pressures felt by third-party competitors like FBN and FarmTrade, while reaching a special segment of growers online. We call this segment of customers the transactional value-seekers, as they are primarily looking for a low-service way to purchase inputs and have no preferred retailer. At the time, this segment made up approximately 5-7% of the total market. Over the past two years, this number has grown to about 10%. We believe this percentage will continue to increase, but not as quickly as some expect.
This is part of the reason we are seeing some “disruptors” evolve their business model to become more similar to a traditional ag retailer rather than a new, “Amazon-esque” competitor. At AgVend, we’ve listened to the market and used our Marketplace to learn how different segments of growers want to do business online.
Spoiler Alert: The majority of growers still want to do business with their trusted ag retailer, they just want to do it in a more digital way.
Because of this insight, we are evolving our strategy to focus on powering Grower Portals for our ag retail partners, rather than further developing the AgVend Marketplace. Think of these portals as a more sophisticated and specialized “Shopify for Ag”, as discussed in Shane Thomas’s blog post. These tools are designed to be used by the vast majority of growers who still want to engage with their retailer, just in a more digitally-enabled way.
“It’s not that I want to stop doing business with my local guy, but I do wish there was a digital way to quickly access information like past orders, rates, etc.”
Jeff Divan, corn and soybean grower from Iowa
We estimate that about 55% of the market falls into this segment, which we call digitally-engaged loyalists. Typically these growers farm a larger number of acres and have a high adoption rate of consumer eCommerce options (think Amazon or Walmart.com), but surprisingly, they don’t necessarily fit into a certain age profile.
So, what does a more “digitally-enabled purchasing process” look like?
It can be as simple as having an app for growers to review and pay their invoices and statements in just a few clicks on their smartphone. Or, it can be as in-depth as integrating with your agronomic software to offer actionable plans in a centralized, digital location. It’s about providing the MVT (“Minimum Viable Technology) tools for your growers and your sales team to improve customer satisfaction and internal efficiency.
Our data has shown that offering growers a digital option increases customer experience and leads to an NPS (“Net Promoter Scores”) of > 95. Moreover, it results in a time savings of ~25% for your sales team with similar results seen for operations and administrative functions. These new tools deepen your customer relationships and create meaningful savings within your organization.
Our Grower Portals are already being successfully implemented by the nation’s top retailers and more slated to go live for the 2021 season.
One of AgVend’s newest partners, River Valley Cooperative in Davenport, Iowa, had been searching for the right technology partner to power a digital experience for their growers. Craig Patty, the VP of Sales and Marketing, said it best,
“AgVend is the unicorn we have been searching for.”
Don’t mistake this shift in our product strategy as a change in our mission, it is simply an evolution as we keep pace with the shifting needs of today’s growers. We will continue to advance our products in order to help growers and retailers do business more efficiently and in the ways they prefer. AgVend is not the Amazon for Ag, we are not the disruptor, but the enabler of a stronger digital future for ag retail.
AgVend powers the omnichannel experience in agriculture. We provide ag retailers with white-labeled information, engagement, and commerce portals. Our suite of products is designed to strengthen the relationship between ag retailers and their grower customers. The AgVend team is comprised of individuals with backgrounds in agriculture, digital marketing, and omnichannel retail, and operates from dual locations in Minnesota and California.