`

BAGGOTT: Which innovation does agriculture need most?

May 30, 2015

innovation-sig-baggott-chris.jpgA lot of people question why I became involved in agriculture and food.

On the surface, what I’m doing with farming, restaurants and food processing seems a million miles away from how I spent the majority of my career in marketing technology.

The reality is that food and agriculture present us with a greater opportunity for entrepreneurship and wealth creation than the Internet did back in 2000.

Consider the similarities. Food and ag are huge. Indiana consumes $17.8 billion in food each year. According to research commissioned by the Indiana Department of Health, 98 percent of that food is imported from other states and countries.

Food is the largest industry in the country. $5.2 trillion in 2013 versus $503 billion spent on all marketing in the same year.

Food has become concentrated, with four companies (Tyson, Cargill, National Beef and JBS) controlling 95 percent of all meat consumed in the United States.

Monsanto’s patented genes are inserted into roughly 95 percent of all soybeans and 80 percent of all corn grown domestically. Considering that corn and soybeans are the most planted crops in America, it’s obvious how the industry has become myopic.

Think back, if you can, to before the Internet. Marketing was in the same situation. There were only a few ways to “do” marketing: television, radio, newspapers, catalogs, etc. … .

For the normal marketer, these channels offered lousy quality and were too expensive to challenge. Just like commodity food.

Suddenly, from garages in Silicon Valley to dive offices in Greenfield, Indiana, entrepreneurs found this Internet thing and started to figure out how to revolutionize marketing. Not only revolutionize it, but democratize it.

Marketing had evolved since the 1920s to a point where the only criteria to being a good marketer was how much one could spend. Reach and frequency were the measures, and all it meant was that the rich got richer.

This was especially true for food. In fact, food companies created the very first national brands. From Kellogg’s to Coca Cola to Birds Eye and Green Giant, national marketers were able to out-sell the local guys and consolidate all the business among a very small cadre of national brands.

It was marketing technology that killed alternative ag and foods from 1920 to 2008, and it’s marketing technology that poses the biggest threat to the status quo of the oligarchies today.

Alternative farmers and processors have inexpensive tools like email marketing, Facebook and search engine optimization in their tool kit. Smaller, more innovative organizations are able to create new categories of food and new opportunities for farmers that allow all to break out of the monotony offered from the national brands.

Using the ability to directly engage with one’s customers is posing the first real threat to the status quo in decades.

Beyond marketing, other technologies are making alternative agriculture possible. Farm-to-door delivery is made much easier using mobile routing tools like Rout4Me and geo-location tools, and services like Lyft (which we are experimenting with).

New technologies in fencing and software enable smaller farms to stock more animals outside than ever thought possible. Innovations in freezing, cutting and packaging all are changing the game for small processors.

A lot of people think what I’m doing is going backward. “How my grandpa used to do it” is a refrain I hear a lot.

Trust me, Grandpa never had these technologies and, in the end, that’s what drove him away from a community source of food and into the global commodity market.•

__________

Baggott, formerly chief marketing officer of ExactTarget and co-founder of Compendium Software, operates Tyner Pond Farm near Greenfield.

Check out the rest of IBJ's 2015 Innovation Issue.

ADVERTISEMENT

Recent Articles by Chris Baggott / Special to IBJ

Comments powered by Disqus