FOCUS GROUP TECHNIQUES
Focus group interviews are another method of learning more about customer
attitudes and one that is widely used by agribusiness marketers. The focus group allows
companies to gain solid purchase decision information or other insights from a group of
customers. Depending on the situation, focus groups can also be quite cost effective.
A focus group interview is simply a discussion among six to ten customers or other
individuals of interest, guided by a skilled moderator. In many cases this discussion is
recorded so careful analysis of the comments can be made. It is not a formal interview
so much as it is an informal discussion where people get to know each other well enough
to talk freely. As barriers to discussion break down, participants begin to react to each
other and the conversation unfolds, hopefully yielding much valuable information about
how the group feels about important marketing issues.
The key to success in a focus group interview is the synergistic effect of the informal
discussion. The group chosen for the interview is extremely important. It must fairly
represent the population of interest and it must be a group where free-flowing discussion
is possible. The moderator plays a very important but extremely subtle role, making sure
the right subjects are covered and that no one individual dominates the discussion. The
moderator must also be careful not to bias responses in any way.
Focus group interviews can provide many new ideas and perceptions from the
customer’s viewpoint about advertising programs, packaging, quality of products,
performance, and relative comparisons of competitors. Group interviews also add a
great deal of support and help to clarify more quantitative surveys because they can
suggest how strongly impressions are held.
However, focus group interviews can also be misused. They will likely generate very
little factual or quantitative data. As such, results are very difficult to tabulate or quantify.
Some group members may tend to dominate and to influence the thinking of others,
perhaps creating a “bandwagon” effect. And any results must be interpreted with the
nature of the group in mind. Thus, it is critical not to extend the results of a focus group
interview beyond their designed use. Still, focus group interviews offer a highly productive
and relatively inexpensive method for gaining insights into customer attitudes and for
generating marketing ideas.
Internal data analysis
Agribusiness marketers can often get so involved in developing and implementing
a marketing plan that they have little time for detailed market analysis. This is particularly
true in smaller or local agribusinesses, where marketing people may have a number of
responsibilities and have limited time to devote to careful exploration of what is going on
in the market. One typically underutilized resource for better understanding customer
attitudes and preferences is internal customer and transactions data. By looking at the
data a firm has on its own customers and their transactions with the firm, a marketer can
learn much that will be helpful in developing or refining a successful marketing strategy.
Transactions data can provide a wealth of insights into a market. Sorting customers
by their sales volumes can begin to help a firm understand the composition of its portfolio
of customers. Looking at sales across product lines may point out important cross-
selling opportunities. Exploring the timing of purchases may allow a firm to improve
customer retention. If a firm knows that the Hendricks Vegetable Growers always place
their seed orders by January 15, then any delay past that date becomes a warning sign
that the customer may be looking elsewhere for seed. In many cases, firm transactions
data are obtained and stored solely for accounting purposes. However, the investment it
may take to make these available for market planning purposes is likely time and money
well spent.
Another tool for analyzing internal data is market mapping. It is common, for
example, for much of the sales volume in a small agribusiness to be concentrated in
limited geographical areas or among relatively few accounts. At the same time, other
geographic areas have relatively little market penetration with many potential accounts
left for someone else to serve.
In any given market, there may be physical reasons for an imbalance in market
penetration. An interstate highway may make access to some areas difficult. Certain
types of farms may be concentrated in some parts of the market area. More often,
however, friends, relatives, or just well-established customers seem to predominate in
one local area. Salespeople tend to spend less time in areas with which they are less
familiar. In short, many agribusinesses have undiscovered market potential near them, if
they were just able to discover and cultivate this potential.
One way of discovering these areas of untapped potential is through a market-
mapping technique. This exercise can be done by hand in smaller firms. All current
customers are pinpointed on a map of the market area. It is a good idea to color-code
customers by volume of business, type of products purchased, or other informative
characteristics when developing this map.
A market map can also be developed using any one of a number of computer
software products designed specifically for this purpose. Recent developments in
computer mapping software and geographic information systems (GIS) make it possible
to download a variety of data on market characteristics such as number of pigs on feed,
number of households with at least two children and family income of $60,000, and so
on. Then, these data can be overlaid with store locations or competitor locations to get a
graphic picture of the market situation.
Once this mapping has been completed, visual observation provides a great deal of
information about weak and strong areas. When this mapping technique is fi rst used, it
is often a real revelation for marketing and management people. The market map
suggests areas in which sales efforts should be targeted. When effort is concentrated in
a new area and new customers are obtained, it may be possible to expand the firm’s
presence in that area rapidly.
