The purpose of this paper is to determine how to drive more sales to From the Farm’s website as well as increase overall brand awareness through the use of targeted marketing and advertising programs and also to gain a deeper insight of prospective customers which can assist in forming target market segments and creating targeted marketing and advertising programs that cater to those segments. Furthermore, we need to determine how to remain cost-effective with these proposed improvements to the marketing programs.
Being a small e-commerce startup with limited funds and personnel, FTF has struggled for over four years to create effective marketing programs and have seen very little positive impact of their past marketing efforts. The lack of an effective marketing strategy which includes targeted advertising has led to increased and somewhat unnecessary marketing costs because several of the marketing campaigns are built on the premise of “testing it out” and seeing what kind of response it gets.
The implementation of targeted marketing and advertising programs can not only increase From the Farm’s sales revenue, but also be more cost-effective since the campaigns are targeted and relevant to their audience. In addition, an improved digital marketing strategy can help FromTheFarm. com improve their overall market positioning due to the fact that they will gain a better understanding of their customers through the data that is collected and thus enable them to build a more effect online marketing strategy.
Furthermore, this enhanced insight of their customers can also enable them to improve their product development and product offerings on their website. All of these things combined can definitely contribute to growing their sales revenue and more importantly, by having targeted marketing and advertising programs, they can ensure that every dollar spent is not a dollar wasted. Company Background From The Farm, Inc. (FTF) is a privately-owned e-commerce company headquartered in Stockton, California which specializes in the sales and home delivery of gourmet and organic foods and produce.
FTF was founded in 2008 with the purpose and intent of becoming “America’s Online Farmer’s Market”. According to a report done by the United States Department of Agriculture (USDA), farmers only earned an average of $0. 16 for every dollar spent on the food they produced (Canning, 2011). FTF’s mission is to provide an online marketplace which connects customers with American Family farms by offering farm-fresh products and other specialty food items delivered straight to their door.
By allowing customer to purchase directly from the farmer though the website, they cut out the middle man, and therefore give customers the opportunity to taste and experience what truly fresh food and produce tastes like while also supporting the success and livelihood of hard-working farmers all over the county. FromTheFarm. com is currently funded by its parent company, Onions, Etc. , one of the largest onion distributors in the United States.
Currently, FTF only has two full-time employees – the Chief Marketing Officer (CMO)/General Manager and a Marketing Specialist – in addition to the Founder/CEO, one marketing intern, and one contract-based Marketing/PR Consultant. Any other tasks with regards to finance and accounting are handled by Onions, Etc. personnel and all IT related tasks are outsourced to an outside IT firm and web design firm. FTF has undergone major organizational changes in the past twelve months, in an effort to restructure the marketing team with the intention of implementing an improved marketing strategy in order to grow sales and increase brand awareness.
Due to limited funds and personnel, FTF has struggled to create an effective targeted marketing and advertising strategy and as a result have not seen much growth since being founded in 2008. 1. 0 Market Summary and Target Audience Being that From the Farm is a small, family-owned company they do not have the financial strength that other larger food retailers have; however they still have a tremendous opportunity to capture the market being that the food e-commerce market has yet to be penetrated. According to a recent report by eMarketer, as of 2012, U. S. -commerce sales have grown to $224. 2 billion and are expected to grow to $361. 9 billion by 2016. Currently, online food and beverage sales is the smallest U. S. e-commerce category, however, this segment reached sales of $5. 09 billion and experienced a 17% growth in 2012 (eMarketer, 2012). Another report by Nielsen indicates that the sales rate for consumer packaged goods online is expected to reach $25 billion by 2014. This trending growth can be attributed to the fact that more and more consumers are beginning to do their grocery shopping online (Nielsen, 2011).
FTF can definitely capitalize on this emerging trend since the online grocery shopping experience is primarily fueled by a needs-driven experience since there are a greater variety of options available online. In addition, e-commerce allows for smaller companies such as FTF to compete against “Big Brand” companies since the big brand physical advantages become nonexistent and opens up the opportunity to create a niche brand for customers who prefer to buy their food and groceries online.
With a creative and effectively targeted market program, FTF can reach a significant amount of customers online and leverage unique and exclusive products such as tropical fruits, figs, Piedmontese beef, and fresh cherries to capture these customers. There is a huge opportunity to capitalize on the available internet marketing technologies being that there is so much data available through these marketing channels and the fact that many consumers are turning to e-commerce to purchase goods. According to a recent Digital Marketing Report by eMarketer, “88. % of US internet users ages 14 and up will browse or research products online in 2012, an 83. 9% of that group will make at least one purchase via the web during that year” (Peart, Utreras, & Wang, 2011). Target Market Since From the Farm is a food e-commerce company, it is easy to assume that this website and its products can appeal to the masses. There is a large assortment of foods from fresh fruit and produce including exotic tropical fruits to certified organic meats to an array of desserts which means that FTF has something to offer every kind of customer.
FTF’s customers will consist of individuals who are 25 years old and up and have a wide range of preferences when it comes to food, whether it may be parents looking for healthy foods for their kids or health conscious individuals who prefer organic and gluten-free products or chefs and restaurant owners that need to order in bulk, From the Farm can accommodate a very diverse set of needs. Nonetheless, From the Farm’s products aren’t just for those who want to purchase these items for personal consumption because From the Farm also offers products that can be sent as gifts.
As stated previously, From the Farm’s customer base is diverse since it consists of individuals with varying needs and preferences when it comes to food selections. The primary market that FTF will target is the online grocery shopper market. The profile of typical online shoppers is as follows: single or dual-income households with no children and are technically savvy, affluent, and time poor. This group consists of early adopters of new technology and is heavy internet users who regularly purchase goods online.
Convenience is a main factor for this group and they have little to no concern about product price or delivery charges. The other major category within this market is families with young children. Similar to the previously discussed category, this category includes single parents, dual-income households, middle-income and above average-earning households. The key differentiator is that this category has one or more children, typically with at least one child under the age of five years old.
This group consists of adults in their late 20s to 40s. The individuals in this category turn to online grocery shopping because it saves them time, is less hectic, and overall more convenient in nature. Other categories include college students and military families who are not located close to a standard-size store or who wish to purchase products found only in their home regions. In addition, the elderly, disabled and those individuals who find it difficult to get out of the house make up a significant share of online grocery shoppers.
As such, the share of senior citizens and disabled individuals has grown over the past five years and is expected to continue growing in the future. Furthermore, online grocery shoppers are more than twice as likely as the average internet user to go online to read and post product reviews, download coupons and search for recipes, according to a study by the Nielsen Company from September 2009 (Panteva, 2012).