Impacts of Globalization on Agricultural Marketing

Introduction

Agricultural marketing is an aspect of marketing which involves taking farm produce and other agricultural allied products to consumers for exchange of money. Marketing is an integral part of agriculture. Agricultural marketing is characterized with packaging, preservation, advertising, distribution and sale of agricultural products. Agricultural marketing is very delicate as farm produce are very prone to tissue decomposition and microbial spoilage because they begin to depreciate as soon as they are harvested — they have limited shelf life.

Agricultural marketing majorly involves movement of heavy physical products. Globalization has lowered cost of cross-border agricultural marketing through technological development and has brought the global markets to one place through internet.

Impacts of globalization on agricultural marketing

Access to larger markets

Globalization has dismantled physical geographical, and political borders. Developments of different means of transportation has enabled easy movement of agricultural products. Globalization balances agro import and export ratio of developing countries, allowing them to harness their comparative advantages. Sometimes, larger market potentials exist in foreign markets than in the local market with globalization making access to the foreign markets almost free, agribusinesses now explore the foreign markets, generate sales with higher profits than what’s obtainable in the domestic market. Globalization is influencing people’s lifestyle, taste for quality agricultural products, purchasing power thereby expanding the agricultural market. The revolution in Information communication technology has facilitated accessibility of agricultural goods worldwide. Internet, networking and social media permeating the nooks and crannies of the remotest parts of the world have enabled smaller agribusinesses to compete globally, regardless of the location of both the seller and the buyer. The larger businesses also leverage on internet to access larger markets. Supermarkets or retail stores like Amazon , Alibaba , etcetera are leveraging on technology for online marketing. Agricultural commodities (cocoa, coffee, cotton, cashew etc) marketers are also engaging on online marketing.

Competition

As globalization expands access to market, competition becomes stiffer as consumers get access to the global markets at the tip of their fingers. With the use of IT searching for products is becoming simplified, consumers are even served with options at the comfort of their homes by targeted ads on social media blogs and websites. Agricultural marketers leverage on the internet to advertise and sell their commodities.

Marketing cost

Transport and logistics are the major agricultural marketing. With the technological advancements on means of transportation, agricultural marketing cost. Cost of advertisement is another marketing cost that has been reduced due to globalization. Social media has given agricultural marketer access to cheap advertisement platforms.

Price

Prices of agricultural commodities are crashing because of competition. Buyers have access virtually to very market in the world, and would go for cheaper prices where ever. IT revolution is breaking monopoly in every region. Online marketing has led to price equalization — food and agricultural products are sold for same prices to all buyers, irrespective of their locations, only shipment cost makes a difference, dropshipping has also crashed shipment costs. The use of containers, trucks and vessels have led to the movement of quantum of Agro products at cheaper prices. When the cost of marketing is reduced selling prices of the goods equally reduce

Payment

Rise in the use of Fintech (electronic payments systems) like e-wallets, mobile payments apps, e-invoicing, others have enhanced agricultural marketing globally. It’s now very easy to receive payments for goods sold anywhere in the world. Globalization has also led to free and easy movement of funds from one country to another, encouraging agro allied companies to invest abroad, and for easy repatriation of profits. There are many international money transfer operators, both conventional and mobile app/ online platforms that carry out international money transfer at ease from the comfort of your home

Customer Service Management

Internet has enabled fast and 24/7 global customer service. Most businesses have e-database of their customers for effective customer service management. Some have self-service mobile Apps and online platforms where consumers can get services in real time.

Quality Standardization

Competitive nature of global market has led to standardization of agricultural products. It takes products that meet international standards to penetrate the global markets. Any good for global markets needs an international certification before it can allowed into the market. It enhances food safety. With globalization, the supply chain are carefully monitored to ensure imports meet food safety regulations and are free from tampering.

Although, standardization is good for quality assurance, food safety and consumer protection, it does have some negative impacts on agricultural marketing. Global branding hinders products variety, creates entry encumbrances to small, local producers, and rejection of products from developing countries.

Packaging and Preservation

Agricultural products are mostly fresh produce that go bad after a short period of time. With technological advancements, the shelf life of these perishable goods are improved. Experts have indeed said…
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