Seed Selling: Loyalty Pays

In today’s highly competitive market, it is difficult to achieve a sustainable competitive advantage without achieving superiority in service delivery. As part of AgKnowlogy’s Customer Experience Monitor, we measure the willingness of growers to recommend their Primary and Secondary retailers to another grower. When this willingness to recommend is analyzed from many growers, a Net Promoter Score can be calculated, which is a comparison of the percent of Promoters vs. Detractors within a retailer’s customer base and trading area. Promoters are highly willing to recommend you, while Detractors won’t recommend you, and actually look for opportunities to tell other people about their concerns. Passives are vulnerable customers who are receptive to competitive offers.

Here is why you want to care about your Net Promoter Score, particularly if you want to grow your seed business: The “willingness to recommend” is highly correlated to loyalty and the current share of business customers give their Primary and Secondary retailers. AgKnowlogy recently completed Customer Experience Monitor projects that measured how willing growers were to recommend a full service retailer to another grower vs. their willingness to recommend a farmer dealer seed specialist. We expected farmer-dealer seed specialists would have higher Net Promoter Scores vs. full service retailers, but were surprised at how big the advantage was. The Net Promoter Score for several leading full service retailers was quite low at about 20%, while the Net Promoter Score for a Pioneer or DEKALB farmer seed specialist was typically about 60%.

Having More Promoters

In other words, the farmer seed specialists had considerably more Pro­moters within their customer base and prospects in their trading area than the full service retailers we compared them to. Conversely, the full service retailers had more Detractors than the farmer seed specialists they compete with. Re­member — a retailer’s Net Pro­moter Score is calculated by subtracting the percent of Detractors from the percent of Promoters. These segments behave very differently, and this has significant impact on your business.

The graph shows full service retailers receive approximately 60% of the available business from Promoters, and only 19% of the available business from Detractors. If full service retailers have more Detractors than farmer seed specialists, and Detractors give less of their available business to a retailer; then this has serious implications for growth in the seed category for many full service retailers.

I suggest calculating a potential seed opportunity for corn and soybeans per acre based on receiving 100% share of business. Then estimate the financial impact per acre on your seed business from Detractors using the approximate numbers in the Share of Business graph. If we are correct and there is roughly a 40% “hit” from Detractors, this represents a formidable challenge to full service retailers as they attempt to organically grow their seed business.

More Emphasis On Seed

As we all know, there have been extensive mergers among ag retailers over the past decade. At the same time, the value of corn and soybean seed has increased due to the trait package in current hybrids and varieties. Consequently, retailers have seen the value of their seed business expand significantly. I suggest, however, the two trends of mergers and trait value can mask the important question of whether you are growing your share of your customer’s seed business.

At the same time, our focus always needs to be on customers first. Unless we truly understand the needs of customers in our local market and how we perform relative to those needs, it is difficult to focus improvement efforts precisely enough to achieve sustainable results.

The information AgKnowlogy is uncovering with the Customer Experience Monitor represents real strategic insight for full service retailers. We believe there is a bigger opportunity trying to grow at the expense of farmer seed specialists rather than attempting to take share from other full service retailers. By identifying the customer priorities and experiences that drive customers into Promoter, Passive, and Detractor segments, full service retailers can make improvements that will increase the percent of Promoters within their business. If you would like more information on the performance evaluations we have made between full service retailers and their farmer seed specialist competitors, please contact me.

Leave a Reply

Seed/Biotech Stories

Golden Harvest Corn stalks
Crop InputsMonsanto: Syngenta Not The Only Horse In Crop Protection Acquisition Race
August 28, 2015
Monsanto Co, having ditched an audacious $46 billion (£30 billion) offer for Syngenta AG, may downshift to a humbler strategy Read More
Rendering of Syngenta Seedcare Institute expansion
Seed/BiotechSyngenta Announces Seedcare Application And Resource Center
August 19, 2015
Syngenta recently announced the Seedcare Application and Resource Center, a collaborative new website designed exclusively for Syngenta Seedcare customers to Read More
Rendering of Syngenta Seedcare Institute expansion
Seed/BiotechSyngenta Breaks Ground On $20 Million Expansion Of North America Seedcare Institute
August 11, 2015
The Syngenta North America Seedcare Institute in Stanton, MN, one of the premier seed treatment research facilities in the world, Read More
Crop InputsMonsanto Petition To Deregulate Dicamba And Glufosinate-Tolerant Corn Now Available For Comment
August 11, 2015
The USDA’s Animal and Plant Health Inspection Service (APHIS) is making available for public comment a petition from the Monsanto Read More
Top 100 Articles
Crop InputsLand ‘O Lakes, United Suppliers Finalize Merger
August 24, 2015
According to a press release on August 24, owners of United Suppliers, Inc. and members of Land O’Lakes, Inc. “have Read More
West Central Cooperative, Jefferson, IA
CropLife 100Iowa Cooperatives To Explore Unification
August 19, 2015
The boards of directors at two of Iowa’s leading farmer-owned cooperatives yesterday signed a letter of intent to study the Read More
CropLife 100Southern States Coop Hosting Drone Flight This Friday
August 3, 2015
Southern States Cooperative — No. 9 on the CropLife 100 — is hosting an FAA-approved drone demonstration at Grandview Farms Read More
CropLife 100Aligned Ag Distributors Adds Four New Owners
July 30, 2015
Aligned Ag Distributors LLC has announced the addition of four new customer/owners to Franklin Holding Co. LLC. They are: The Read More
CropLife 100Pinnacle Purchases California-Based Specialty Crops Retailer
July 20, 2015
Pinnacle Agriculture Holdings has successfully acquired California-based NH3 Service Co.  Operating as part of Pinnacle’s Performance Agriculture brand, the new locations Read More
Asmus Farm Supply liquid fertilizer facility features 20,000 square feet
CropLife 100Slideshow: Asmus Farm Supply Shows Off Its New Liquid Fertilizer Facility
July 15, 2015
Asmus Farm Supply, Rake, IA, recently added a new liquid fertilizer facility to its company operations. The new liquid fertilizer Read More
Latest News
EquipmentDeere Announces Soucy Track Distribution Alliance
August 28, 2015
John Deere announces an alliance with Soucy Track to sell and distribute products through the John Deere dealer channel. “This Read More
FertilizerFall-Applied Phosphorus: A Rooted Investment
August 28, 2015
As commodity prices decrease and input prices continue to rise, farmers are seeking more efficient strategies for meeting a high Read More
Monsanto Sign
Crop InputsWhat’s Next For Monsanto, Syngenta?
August 28, 2015
After dropping its $47 billion bid to take over Swiss agribusiness firm Syngenta, Monsanto may be turning its focus to Read More
Golden Harvest Corn stalks
Crop InputsMonsanto: Syngenta Not The Only Horse In Crop Protectio…
August 28, 2015
Monsanto Co, having ditched an audacious $46 billion (£30 billion) offer for Syngenta AG, may downshift to a humbler strategy Read More
ManagementConsolidation hits and a miss; And a look at China’s ch…
August 28, 2015
As Monsanto suspends its pursuit of Syngenta, consolidation news at the retail and distribution level heats up. CropLife magazine’s Executive Read More
Corn Field
MicronutrientsHuma Gro Introduces New Boron Liquid Nutrient Formulati…
August 28, 2015
BORO-MAX, a new boron (B) 10% liquid nutrient formulation, has been added to the Huma Gro product line. This new Read More
Crop InputsNFU: Monsanto Decision To Withdraw Syngenta Bid ‘…
August 26, 2015
National Farmers Union (NFU) President Roger Johnson said the organization was very pleased by the news that Monsanto has withdrawn Read More
Crop InputsMonsanto Withdraws Bid For Syngenta
August 26, 2015
Monsanto Co. abandoned its latest effort to acquire Syngenta AG, the world’s top maker of pesticides, after a sweetened bid Read More
Syngenta Sign
Crop InputsSyngenta Comments On Monsanto Announcement
August 26, 2015
The Board of Syngenta confirms that it received a verbal proposal from Monsanto to acquire the company at a price Read More
Case IH Patriot 2250 Sprayer
EquipmentHigh-powered Case IH Patriot 2250 Sprayer Pushes Throug…
August 26, 2015
Engineered with more muscle, the new 660-gallon-capacity Patriot 2250 sprayer features best-in-class horsepower, along with the fuel efficiency that comes Read More
Crop InputsLand ‘O Lakes, United Suppliers Finalize Merger
August 24, 2015
According to a press release on August 24, owners of United Suppliers, Inc. and members of Land O’Lakes, Inc. “have Read More
TMX-2050 In-Cab Display Launch Run Screen
Eric SfiligojPrecision Ag Could Shine In Increased Spotlight On Agri…
August 24, 2015
By any measure, 2015 is turning into one of the most challenging years agriculture has ever experienced. All throughout good Read More
ManagementCrop Conditions In Minnesota and Traveling Time
August 21, 2015
Editors Paul Schrimpf and Eric Sfiilgoj discuss the crop outlook from a field trip to Minnesota and upcoming travel plans. Read More
HerbicidesREUTERS: Anti-GMO ‘Scientist’ Calls For New…
August 20, 2015
EDITORS NOTE: We feel that it is important to note that there are those that believe one of the lead Read More
Rendering of Syngenta Seedcare Institute expansion
Seed/BiotechSyngenta Announces Seedcare Application And Resource Ce…
August 19, 2015
Syngenta recently announced the Seedcare Application and Resource Center, a collaborative new website designed exclusively for Syngenta Seedcare customers to Read More
Winter Wheat
Industry NewsArysta LifeScience Announces Two New Regional Sales Man…
August 19, 2015
Arysta LifeScience North America recently announced Steve Vining and Phil Reding have each accepted new positions as Regional Sales Managers. Read More
West Central Cooperative, Jefferson, IA
CropLife 100Iowa Cooperatives To Explore Unification
August 19, 2015
The boards of directors at two of Iowa’s leading farmer-owned cooperatives yesterday signed a letter of intent to study the Read More
Golden Harvest Corn healthy leaves
Industry NewsAligned Ag Distributors Names Vice President, Crop Prot…
August 18, 2015
Aligned Ag Distributors LLC have appointed Warren Hragyil to VP Crop Protection. Hragyil comes to Aligned Ag Distributors LLC with Read More