What the Shift in Brand Loyalty Looks Like in Agriculture
By Jennifer Hill
After spending the summer fighting old, broken equipment in the middle of haying season my husband and I decided it was time to make some upgrades and throw some cash around. That seems to be what farming is all about anyway, so we went shopping. Prior to this year we’d never lived in real farm country with local access to all the major brands so it was a great opportunity to explore equipment colors we haven’t traditionally ran. After spending days talking with dealers and salesmen, looking at what little is currently sitting on lots and seeking reviews from far more experienced farmers than ourselves I began to wonder about the ways brand loyalty has changed for Millennials and Gen Z and how that might impact some of the old agriculture brands.
Our Fathers and Grandfathers were incredibly brand loyal, especially when it comes to farm equipment. A John Deere guy was always a John Deere guy and would willingly engage in lighthearted arguments with his neighbor whose yard is full of red Case equipment. But that generation is being replaced by one that is more willing to try something different. According to Forbes, “Traditionally, awareness and familiarity metrics have been closely tracked by brands. Our data showed that these metrics are quickly losing relevance, especially among Gen Z, a generation that is not interested in holding on to the past. Millennials and Gen X are on the same page in this regard, with the baby boomers being the last hold-outs when it comes to loyalty toward specific brands. Most consumers, including the youngest shoppers, are seeking out disruptive, innovative and consumer-centric brands and experiences and comparing them to traditional offerings.”
This willingness to try something new or different could lead to some interesting places in the ag sector.
New Yard Colors
Green, red or blue. Historically that’s been the choice of tractors, but lately there’s been some different names pushing harder than ever into the US ag equipment sector. One of those potential disruptors is Kubota. The orange tractor has been widely used and accepted internationally for many years, but has, in recent years pushed harder into midwestern American markets, expanding into new types of equipment, including balers. And they are willing to shake things up a bit. A baler was on the list of our recent shopping expedition. We hit all of the traditional lots and heard all of the sales pitches. I was surprised when the John Deere dealer knew who we were by name as we walked in (remember, we’re new to this area) and talked about how he’d already sold equipment to my in-laws (of course, they bleed green). He seemed to think us a quick and easy sale, as brand loyalty does often run in families. He was so unconcerned about losing us that he never even took us out of his office to show us the equipment on the lot. The major brands were all similarly priced and had identical warranties of one year. Kubota, however, was different. The salesman was very upfront with us about their struggle to gain ground in the area and was willing to play ball on the price. But the real kicker was the warranty, four years’ worth. That’s a substantial difference. To us it signaled a company willing to stand behind their product and push a little deeper for new business. I can’t help but wonder if such a big disparity in warranty will be catching? As more of the new generations express a willingness to try something new will the old guard be forced to shake things up a bit? That would be a real win for everyone. After a ton of research we went orange.
CAB and New Breeds
Certified Angus Beef has been king of the sale ring for a very long time. It was a genius marketing plan whose execution has probably outshined what the creators ever envisioned. Today it’s standard to accept that anything other than a black hide is going to hit you with a discount. CAB was the initial market disruptor in the cattle game and just as dominoes fall CAB has led to other potential disruptors, including an entirely new breed of cattle, American Black Herefords. Black Hereford breeders are the quick adapters. When CAB created the race to black it hit colored breeds hard. Many cow/calf operations added more Angus breeding into their programs, trying to avoid red discounted calves as much as possible, but they were also frustrated about giving up some of that cross heterosis and feed efficiency. Enter Black Herefords, the guys who decided they might as well cross the two, wind up with a 5/8ths black hided Hereford animal and run with it. Pursuing such a thing shows an inherent lack of brand loyalty. Sure Angus and Herefords are great but why not try something totally new? It also shows an ambivalence to the old guard’s “rules”. In a scheme that often feels rigged by the packer we might as well game the system. Besides, who says you can’t just make up a breed? They all started somewhere. It’s not like Noah took a real Hereford onto the Ark.
What About Sector Loyalty?
Our Granddaddies operated in a world where ranching sectors knew their place. The cow/calf guy didn’t hold onto calves, the feedlot man wasn’t calving and everyone stayed in their corners. But over the years as profit margins have narrowed progressive thinking cattlemen have had to reevaluate their taste for vertical integration, both as a means of keeping more family in the business and spreading their risk. The crony capitalist system we operate in (which is not reflective of a true, free market capitalist society) aims towards consolidation and efficiency. It’s possible that in order to stay viable Millennials and Gen Z will be forced to consider pushing the sector loyalty farther.
The shift in brand loyalty amongst the post Boomer generations is challenging retailers everywhere. It will be exciting to see what shakeups we might bring to agriculture, a sector of industry that is typically slow to change.