agritourism marketing strategies: a comparative study of apple orchards

Please download to get full document.

View again

of 18
All materials on our website are shared by users. If you have any questions about copyright issues, please report us to resolve them. We are always happy to assist you.
Information Report

Business & Economics


Views: 4 | Pages: 18

Extension: PDF | Download: 0

Related documents
Lise Héroux 31 agritourism marketing strategies: a comparative study of apple orchards in southern quebec and northeastern new york/vermont Lise Héroux, Ph.D., SUNY Plattsburgh Abstract Farmers are becoming
Lise Héroux 31 agritourism marketing strategies: a comparative study of apple orchards in southern quebec and northeastern new york/vermont Lise Héroux, Ph.D., SUNY Plattsburgh Abstract Farmers are becoming flexible in managing their roles as primary producers of agricultural products while providing growing agri-tourism services that are highly profitable. This research investigates whether there are differences of significance in the marketing strategies implemented by 24 apple orchards to meet the needs of visitors in southern Quebec and northeastern New York/ northwestern Vermont. More similarities than differences were found. Quebec orchards offer better quality products, better attractions such as picnic areas, petting zoos, live music, guided tours, and lower prices, while more coupons, bundle and group rates were given by American orchards. Improvements in promotion and personal selling initiatives is needed in both regions to attract more visitors. Résumé Les fermiers font preuve de flexibilité dans la gestion de leurs rôles comme principaux producteurs de produits agricoles qui offrent également une gamme accrue de services agrotouristiques très profitables. Cette étude a cherché à savoir s il y avait des différences entre les stratégies de marketing mises en place par 24 vergers afin de répondre aux besoins des visiteurs du sud du Québec et du nord-est de New York / nord-ouest du Vermont. Nous avons trouvé plus de ressemblances que de différences. Les vergers québécois offrent des produits de meilleure qualité, de meilleurs attraits touristiques comme des aires de pique-nique, des zoos pour enfants, des performances musicales, des visites guidées et des prix plus bas alors que les vergers américains offrent plus de coupons, de forfaits et de tarifs de groupes. Les deux régions auraient avantage à améliorer la publicité et les ventes personnalisées afin d attirer plus de visiteurs. 32 journal of eastern townships studies Introduction In response to changes in agriculture and the globalization of our food system (please see Darren Bardati s essay, The Emergent Local Food System in the Eastern Townships in this volume), small farms have diversified into agritourism to add income to their farm family s household (Hara and Naipaul, 2008). The United States Department of Agriculture s census of agriculture estimated that agritourism activities bring an average of US$24,200 in additional income to each participating farm (Newman, 2011). As farmers become more operationally efficient, there has been a gradual rise in the diversification of product offerings that can be directly attributed to the rise of interest in agritourism today. In order to promote a successful agribusiness, farmers must understand the needs of their target consumers and design a marketing strategy (i.e., Product, Price, Promotion, Place) that will appeal to them. This research paper examines the marketing strategies implemented by apple orchards and whether significant differences are found in Southern Quebec and Northern New York/Vermont, two of the largest apple growing regions in the world. At its core, agritourism provides a dedicated opportunity to keep the family farm alive by creating new revenue streams and a way to keep the younger generation involved through creating new business roles and challenges (Eckert, 2004). Agritourism is growing as a niche rural travel market because it meets the needs of modern families. Visitors are nostalgic for a simpler time and want to escape the hustle of the city, connect with their cultural heritage, be with family in a natural environment, and enjoy a richer and authentic leisure experience (Ainley and Smale, 2010; Che et al, 2006). Agritourists comprise travelers who holiday (single or multi-day) to engage in such activities as visiting an entertainment farm, staying at a farm or guest ranch, participating in harvest operations, and/or picking fruit at a farm (Che et al, 2006). Visitors have the opportunity to work in the fields alongside real farmers and wade knee-deep in the sea with fishermen hauling in their nets. According to one survey (TAMS, 2007), 10.4% of adult American have participated in an agro-tourism activity while on an out-of-town, overnight trip. Going to an entertainment farm (4.9%), or a fruit-picking farm (4.6%) were the most popular activities, followed by dining at a farm (2.8%) and visiting a harvesting or other farm operation (1.2%). Whether it is product offerings such as corn maze, crop art, hay rides, or simply picking your own apples, farmers are becoming flexible in managing their roles of being both the primary producer of the products while providing supplementary Lise Héroux 33 services that are customized for the target market and service a niche that has been steadily growing and highly profitable. Apple orchards have closely followed this agritourism trend and diversified their offerings. For example, Vergers Lafrance in Saint- Joseph-du-Lac, a family farm that started with eight or nine apple trees at the turn of the last century, now owns orchards with 12,000 fruit trees, comprising over twenty varieties, spread out over 100 acres (Demers, 2002). As apples were becoming less profitable due to the growing number of local orchards and foreign apples coming into the Quebec market, Vergers Lafrance had to diversify to remain profitable. They sold their apples to middlemen who distributed them to grocery stores, and opened a small stand where they sold apple products such as jelly, butter and jam. They expanded a few years later to include a variety of apple juice and cider recipes. The cider was so successful that it sold throughout the Société des alcools du Québec (SAQ). They offer 11 different apple-based alcoholic beverages. Furthermore, they opened a café to sell homemade pastry items, and plan on passing on a very successful agritourism operation to their sons. The Apple Industry Canada and the United States are among the largest apple producers in the world. While the United States has become one of the top 5 apple producers in the world with a farm gate value of US$2.7 billion each year (US Apple Association, 2014), Canada s apple production has been declining in recent years, to CDN$150.5 million (Agriculture and Agri-Food Canada, 2012). In the United States, New York is the second largest apple producing state after Washington. The top ten apple varieties grown in the United States are: Red Delicious, Gala, Golden Delicious, Fuji, Granny Smith, McIntosh, Honeycrisp, Rome, Empire, and Cripps Pink. Vermont apple growers have been proactive in producing cider, apple sauce or provide customers a destination for agritourism. In Canada, Ontario is the largest apple producing province, with a total marketed production of 126,623 metric tons of apples in 2010, followed by Quebec with 90,200 metric tons of apples. While Ontario s share of apples has decreased from 52% to 38% from 2001 to 2010, Quebec s share has increased from 15% to 27% in the same period. Quebec has a long history of apple production that can be traced back to the colonization period, with the most popular apple variety, McIntosh, being introduced in 1836 (Fédération des producteurs de pommes du Québec). The other major varieties grown in Quebec are Cortland, Spartan and Empire. The majority of Quebec apple production comes from the Eastern Townships, Montérégie and 34 journal of eastern townships studies Laurentides regions in southern Quebec and represents CDN$35.7 Million in farm gate value. As consumers are becoming more educated about the benefits of eating fresh fruit, apple consumption in Canada has increased by 10% over the past 5 years. Consumers are also moving to new varieties of apples such as Honeycrisp, Ambrosia, Gala and Fuji that command a premium price compared to more traditional varieties. According to an Agriculture and Agri-Food Canada report (2012), in addition to the forces of nature, Canadian apple growers are facing important challenges in an increasingly competitive environment. Market pressures include world oversupply, retailer consolidation, the rising value of Canadian currency, and greater foreign competition. However, it should be noted that the Canadian currency exchange has been variable since 2012, and has recently strongly depreciated. The growing consumer trend of buy local could potentially help Canadian apple growers regain some of their market share. The Washington State Apple Commission has promoted Washington apples through coordinated advertising efforts over several years. The estimated average return to advertising topped US$8.7 per dollar of advertising (Wilmot et al, 2008). Continuing selected promotional activities could increase revenue for growers if these activities could be carried out by voluntary, coordinated efforts. In addition, the shift to new varieties of apples opens up new opportunities for local apple growers. Therefore, a better understanding of marketing strategy in the agritourism industry for apple orchards could help foster sustainable economic development in these regions. Other Agritourism Research in the Region In an agritourism marketing study of maple sugarhouses in Quebec, Ontario, and New York/Vermont (Héroux et al, 2008), maple syrup producers were found to be more comfortable with the production side of the organization, largely ignoring the marketing needed for a business. Pricing of maple products is one of the most important differences found in the three regions. Quebec seems to have lower prices and offer more value to consumers in the form of a social event. The sugarhouse is part of a long-standing tradition in Quebec. When consumers go to the sugarhouse, they are not only there to buy products, but to enjoy a whole social experience involving a large meal of maple-related dishes with groups of relatives and friends. In New York and Vermont, there is no dining and/or social experience associated with the sugarhouse. It is merely a sales counter like an indoor farm stand. Most sugarhouses sell maple syrup and other maple-related products (e.g., maple candies, maple spreads, etc.) Lise Héroux 35 using private labels. Most of the sugarhouses have established long relationships with many of their customers. This may help explain the relative lack of promotion in all three regions. Purpose of this Study The successful marketing strategy of apple orchards requires the identification of a target market and development of a marketing mix (product/service, place, price and promotion) that will best satisfy the needs of this target market. This research was conducted to investigate marketing strategies implemented by apple orchards and whether differences of significance are found in Southern Quebec and Northern New York/Vermont, among the largest apple growing regions in the world. Methodology This exploratory study, using 24 case studies, was undertaken in the contiguous regions of southwestern Quebec (Eastern Townships and Montérégie) and northern New York/Vermont. There is substantial economic integration and cross-border traffic between the two countries in this area, and the hospitality industry targets business and leisure travelers of both nationalities (Church and Héroux, 1999). A census of the apple orchards in two communities in this crossborder region was included in this research. The online Yellow Pages directory for the United States and Canada was used to identify the sampling frame of apple orchards in the contiguous geographic regions along the border. The region under study was expanded until 24 establishments were identified, representing the regions as follows: 12 from Quebec and 12 from New York/Vermont. The typical apple orchard in this study was an independently owned and operated family business that directly controlled its marketing strategy. Marketing strategy refers to the target market of the establishment and the marketing mix variables designed to attract these customers. The marketing mix variables are categorized according to the popular 4P framework (McCarthy and Perreault, 2000): Product; Place; Price; and Promotion. Three of these categories of variables are subdivided in this study to capture the breadth of the categories: Product consists of product variety variables and service-related variables; Place refers to the location of the establishment as well as store atmospherics; and Promotion includes advertising variables and personal selling variables. A more detailed marketing strategy evaluation grid was developed from the commonly accepted variables in the marketing strategy literature (McCarthy and Perreault, 2000; Kotler and Armstrong, 2013; Jain, 2010; Pride and Ferrell, 2014; Perreault et al, 36 journal of eastern townships studies 2013, 2014; Lamb et al, 2012). These variables were also used in recent marketing strategy research (Astuti et al, 2014; Ataman et al, 2010; Dobrescu, 2012; Leonidou et al, 2013). The grid was used to collect detailed qualitative observational descriptions and quantitative data of the apple orchards marketing strategy variables. The comparison framework therefore consists of two cultural/geographic regions examined according to seven marketing variable ratings. (See table 1). Table 1: Summary Marketing Strategy Variables Evaluation Grid Product Place Product variety variables Service variables Location variables Establishment atmospherics Marketing Mix (4Ps) Breadth of product line, assortment of accompanying products, size variations, quality, private labels/brands, special features, overall evaluation. (6 variables, maximum score of 30) Customer services, customized/ standardized, credit cards, empathy, reservations (computerization), hours of operation, guarantees, customer satisfaction (complaint handling), overall evaluation. (8 variables, maximum score of 40) Primary/secondary road (visibility), site evaluation (nearness to target market), outside appearance, private/ public parking availability, detached building versus strip, general ease of access, overall evaluation. (6 variables, maximum score of 30) Interior layout (free form, grid, racetrack); atmospherics scent, lighting, color, mirrors, music, noise, signage; fixtures; cleanliness; size of crowds; type of clientele; access to disabled; overall evaluation. (12 variables, maximum score of 60) Price Pricing variables Lise Héroux 37 Relative high/low prices, competitive in region, group reductions, coupons/ rebates, bundle or value pricing (packages offered), variety of payment options, overall evaluation. (5 variables, maximum score of 25) Promotion Advertising variables Personal selling variables Newspapers, magazines, trade publications, television, radio, telemarketing, direct mail, internet, special promotions (sales, coupons, contests), outdoor ad and/or signage, advertising theme testimonial, comparison, informative, humorous, etc., overall evaluation. (6 variables, maximum score of 30) Approaching the customers, helpfulness, presenting product/service, making the sale, knowledgeable, art of listening, verbal/non-verbal cues, general appearance of staff, overall evaluation. (8 variables, maximum score of 40) Summary rating: Overall marketing strategy evaluation: addition of the overall rating in the categories. The observational research was conducted by international marketing students who were familiar with the marketing concepts. Observers received training on a variety of dimensions of the research process. They received a detailed explanation of each of the variables in the Marketing Strategy evaluation grid and how each variable is operationalized. They were shown how to find and approach their assigned apple orchards, how to record their qualitative observations, and how to determine a quantitative score (on a scale of 1 to 5, 5 being superior implementation) for each variable. For example, for breadth of product line, students would look at the assortment of products on the premises and make a judgment on the rating scale as to its appeal to consumers (5 would represent an outstanding assortment, beyond expectations; 3 would represent an average assortment usually found in such farm stores; and 1 would be the minimum one would expect). The trainer and trainees performed a walk-through of the research process prior to visiting the apple orchards to ensure their 38 journal of eastern townships studies understanding and consistent implementation of the data collection. Observation and listening were usually sufficient to gather information about each variable. For example, for the target market, they could look at license plates in the parking lot and see how many cars came from what state or province. They could tell what language, French or English, was spoken by the customers. They could ascertain, if they were repeat customers, if they appeared familiar with the establishment when they arrived, when they referred to past purchases, or when they were on first name basis with the staff. However, if some variables were difficult to observe, students were given guidelines for asking questions of the staff. Twelve teams of three trained observers were assigned a pair of establishments to compare in the two regions. Each team spent four to five hours in each location to record detailed notes of how each marketing strategy variable was implemented. Then, the three observers had to discuss and come to an agreement on a score (on a scale of 1 to 5, 5 representing superior implementation of the strategy) for each variable in an attempt to quantify the observational data. Since this process resulted in one rating for each variable, inter-judge reliability measures were not relevant. Each item within a variable category was weighted equally in this research. The data collection thus consisted of qualitative data, the recorded observations, and quantitative data, the assigned scores for each variable. This methodology was effectively applied in other rural tourism marketing contexts (Héroux, 2002; Héroux and Burns, 2000; Héroux and Csipak, 2001, 2005). Findings The findings are discussed below in terms of quantitative results and qualitative results. Table 2 presents the quantitative results of the scale ratings for each of the seven variable categories. Given the small number of cases, preliminary indicators of significance can be inferred; inspection of the table reveals that there are more similarities than differences in marketing strategy variables in the two regions. Product Variety At the majority of locations, there was a wide range of supplemental products and services offered to customers. Within the American orchards, this included four to five different types of apples, accompanying products such as apple cider, maple syrup, pies, quilts, jams, honey, candy, crafts, t-shirts, ornaments, wall hangers, mugs, hard apple cider and many baked goods. For Quebec orchards, there were similar products but higher quality, better brands and above average features. These included a petting zoo, picnic area, and live band for adults, pears grown and pear wine sold, recipes offered featuring cider, and testing packages for groups along with guided tours. Lise Héroux 39 Table 2: Comparison of Quebec and New York/Vermont Apple Orchards on Marketing Strategy Variables Ratings Overall Sample New York/ Vermont Southern Quebec Product Variety Mean St.Dev Mean St.Dev Mean St.Dev Breadth Assortment Size Quality Brands Features Service Services Customization Credit Empathy Reservation Hours Guarantees Satifaction Location Visibility Site Appearance Parking Building Access Establishment Design Layout Scent Light Color Music Noise Continues next page. 40 journal of eastern townships studies Signage Fixtures Clean Crowd Clientele Disabled Pricing HiLo Pricing Competitive Group Rate Coupons Bundle Promotion Print Broadcast Other Promos Outdoor Theme Personal Selling Approach Helpful Present Make
View more...
We Need Your Support
Thank you for visiting our website and your interest in our free products and services. We are nonprofit website to share and download documents. To the running of this website, we need your help to support us.

Thanks to everyone for your continued support.

No, Thanks