Online Marketing and the Basics of Direct-to-Consumer Sales
In order to slow the spread of COVID-19, many businesses have been forced to significantly change the way they operate. While agriculture and food production related-businesses have been deemed essential services and therefore are allowed to remain open, some farmers markets have already made the decision to close altogether while others have put limits on the number of people who can shop at one time. This summer, social distancing guidelines and people’s fears about going out in public are expected to reduce patronage of farmers markets and other in-person retail outlets, which may impact the revenue sources that farmers rely on.
In the face of these concerns, some farmers are looking into online direct-to-consumer sales options, while other farmers and co-operatives with well-established direct-to-consumer sales networks are looking to expand.
There are a wide variety of websites and online tools that farmers can use to market and sell their products. Likely the most popular, accessible, and widely known website that farmers use is Facebook. Two of the many farms which use Facebook to market their products are Wayne and Patti Chalmers’ Spring Hill Farms in Trout Creek, and Peggy Baillie and Eric Blondin’s Three Forks Farms in Warren.
Chalmers is a member and vice-chair of the North Bay farmers market, which had to close its winter market due to COVID-19, and there is uncertainty about the opening of the summer market. Chalmers reports that the market is looking into developing an online sales platform of some sort for the near future. Baillie and Blondin usually sell their products at the Sudbury farmers market, which normally opens the second week of May. The Sudbury market has not yet decided whether they will operate on their regular schedule, albeit with precautions, or stay closed altogether.
For an example of how significant the disruption of farmers markets can be to farmers, Baillie estimates that about 60-70 percent of their Three Forks Farm revenue comes through in-person sales at markets. However, Baillie says that interest in their online platforms has gone through the roof since the initiation of COVID-19 distancing measures. Chalmers has also had increased interest in his produce. With recent shortages of products at grocery stores, there certainly seems to be an opportunity for local farmers to secure more market share as consumers look for more reliable food sources with shorter supply chains.
Both Chalmers and Blondin and Baillie use Facebook to promote their products and develop a customer base. They also use other free social media platforms as well (for example, Chalmers frequently posts videos on YouTube), but Facebook is their primary outreach tool. They post pictures and updates of their farm activities, showing potential customers their growing practices and what’s available for purchase.
While Facebook doesn’t have a built in system to allow customers to pay merchants, sales can still be arranged. Chalmers’ Spring Hill Farms Facebook account boasts an audience of some 2600 people, who reach out directly to Chalmers for purchases.
Spring Hill Farms sales work on a CSA system, which stands for Community-Supported Agriculture, which essentially means Chalmers’ customers buy in to the program and receive an assortment of veggies on a regular basis. Payment for the CSA is done almost entirely online through Interac E-Transfer, with just one or two customers paying with cheques to minimize risk of COVID-19 transmission.
Baillie and Blondin have a different system for processing sales. They use Facebook in a similar manner to Chalmers, promoting their products and developing a customer base, but then for actual sales they direct customers to their other online platforms. They are a member of Click Fork (www.localline.ca/click-fork) which is an online-only farmers market for farmers in Northeastern Ontario, operating on a website platform called Localline. They also have their own website for their farm (www.threeforksfarms.com) which operates on a website platform called Square.
The Localline Click Fork market is a collective of some 17 farms and agricultural producers from across northeastern Ontario and functions rather like a physical farmers market with all of the producers and their products available at one website. Joining a virtual market like this gives customers the convenience of having all sorts of products in one place, potentially increasing sales if a customer is looking for one item but finds another item they also need.
Baillie and Blondin’s actual farm website is hosted by Square. Square is a company that provides payment services for businesses, including physical point of sale equipment. Peggy and Eric had purchased a Square system to accept debit and credit payments at the actual farmers market, and for simplicity they stuck with Square when they made a website. It allows customers to pay for purchases with credit cards directly on the farm website, and for Baillie that is just simpler than manually setting up payment from customers with cash, credit, E-Transfer or PayPal.
Chalmers, on the other hand, has no plans to switch to a platform that has a built in payment system. He has about 60 customers in on his CSA, and another 40-50 on a waiting list, and arranges payment individually with his customers through Interac E-Transfer, which is an email based funds transfer. This works well enough for him that he has no desire to try anything else.
Baillie says that both Localline and Square are quite user-friendly and straightforward to set up. Unlike Facebook, however, Localline and Square charge fees for use, but Baillie says this cost to use is also fairly accessible and works out to be about 3.5% of sales. Baillie points out that while this may seem like a lot, it’s cheaper than, or at least comparable to the costs of setting up at a physical market considering market fees, mileage, and other costs. It should also be noted that members of the Ontario Federation of Agriculture (OFA) have some special benefits when it comes to using Localline, including a free month-long trial and reduced subscription fees.
While Chalmers’ system of using Facebook to communicate with customers is free, the Interac E-Transfer payment system generally charges a $1 fee to send money, but is free to receive funds, so the customer would have to tack on an extra dollar to send their payment.
Whether or not to use a website that offers a built in payment system boils down to personal preference. Some people prefer to interact with customers to arrange payment, while some people prefer to just keep an online system to simplify bookkeeping.
For someone just starting out with online marketing and sales, Baillie and Chalmers have some suggestions. Both list Facebook as an invaluable tool to reach out to their customers, but how do you actually get people to follow your Facebook page in the first place? Chalmers suggests that, if you’re not already a farmers market member, you should join, as it’s the cheapest publicity you can get. Most farmers markets have their own Facebook pages or other marketing techniques and use those to promote their members, which can lead customers back to your own page.
In terms of content for farm social media pages, a recent OFA publication had some suggestions. Due to COVID-19, the general public is more interested in supporting farmers, so one suggestion is to be sure to show them what you grow and its potential health benefits, as well as the fact that its locally produced and reliable. Another suggestion is to tell your story, perhaps the history of your farm or family. People may feel more inclined to purchase your products if they feel like they know who you are. Finally, take a look at what other farmers are doing! There’s nothing wrong with learning lessons from others.
Another thing both Baillie and Chalmers encourage is working with other farmers. For example, Chalmers works with other another farm to put together a CSA package. Each of their farms contribute different produce items that they then combine and deliver to customers. Putting together a CSA like this has several benefits. It is a way that more established farmers can help out a newer farmer, it helps customers get a broader and more diverse supply of local produce and it can increase the customer base for both farms. Baillie notes another example of a farm working with a Fromagerie to combine their products and increase their appeal.
In order to simplify ordering and keep his workload manageable, Chalmers generally offers a set number of choices in his CSA. Rather than having each customer tell him what they want, he gives them a choice of CSA ‘A’ or CSA ‘B’ for example, and they can pick which one appeals to them more. This ensures that Chalmers doesn’t need to put together some 60 different collections of vegetables, and it also serves as a way to offload excess produce that might otherwise go to waste. This method also has the effect of exposing customers to new vegetables they might not have thought to order in the first place!
When it comes to advertising products for sale, Baillie stresses that communication and clarity is key. Be open about what you’re selling: if it’s meat for example, is it frozen or fresh, is it wrapped? If it’s produce, is it washed or unwashed? And if you’re posting photos to advertise something, be sure to use actual photos of the exact item you’re selling. The more open you can be, the more the customer knows about what you’re selling and the less likely they’ll be unhappy about a purchase. In the same vein, customer service is key, responding quickly to inquiries from the public is valuable and goes a long way to ensuring they’ll be repeat customers.
However a purchase is processed, whether through a dedicated website, E-Transfer, or another method, the product itself still needs to get to the customer in a way that minimizes physical contact. For Baillie, so far things have been simple.
This early in the growing season the only sales they’re doing is in seeds that can be mailed to the customer with no risk of contact. Chalmers, on the other hand, has winterized greenhouses and sells ripe produce all year round. Lately he’s made some adjustments to minimize contact for deliveries and pickups. He generally provides his customers with their produce in baskets that they can then return and reuse, but recently he’s switched to paper bags to avoid any back and forth spread of viruses. For deliveries, he leaves the produce on the customer’s doorstep, sends them a text message to let them know it’s arrived and leaves. Pickups go similarly, with Chalmers putting the produce outside at a pre-arranged time and the customer coming by and taking it.
In a normal season, payment could be made with cash at the time of delivery or pickup, but this is generally discouraged as handling cash can spread COVID-19. The recent OFA guideline recommends sanitizing cash if you do choose to accept it. Other recommendations for any in-person contact with customers are to try and stay at least 6 feet apart from each other, sanitize surfaces others may come in contact with, and frequently wash your hands with soap and water for at least 20 seconds.
Overall, much of how to conduct online sales depends on scale. If you have an established customer base and a significant volume of sales, it might be easier and more worthwhile to establish a dedicated website to simplify money management and bookkeeping. On the other hand, if you’re new to online sales, not entirely comfortable setting up a website, or simply don’t mind doing the extra bookkeeping, it might be best to use Facebook to arrange sales the way Chalmers does.
For additional information, the OFA has a resource document for direct to consumer sales (www.ofa.on.ca/resources/a-guide-for-direct-sales-to-consumers-during-covid-19-and-beyond). Further, many farmers are willing to help others out with guidance and suggestions.
The provincial and federal governments recently announced a new $2.5 million dollar investment to assist farmers and producers in getting their businesses online. The ‘Agri-Food Open for E-Business’ program, operating through the Canadian Agricultural Partnership, offers grants of up to $5000 to support the development of e-business and marketing systems for farmers, farmers markets, agricultural associations, and other agri-food groups. The intake is open now and applications are being reviewed and funding distributed on a first-come, first-served basis. More information can be found at www.omafra.gov.on.ca/english/cap/ebusiness.htm