Do farm operators benefit from direct to consumer marketing strategies?

Timothy Park, Ashok K. Mishra, Shawn J. Wozniak

Research output: Contribution to journalArticle

29 Scopus citations

Abstract

Using farm-level data this study investigates factors associated with the choice of three direct marketing strategies (DMSs). Particular attention is given to the role of management and marketing skills in selection of DMSs. Additionally, the study applies a selectivity-based approach for the multinomial logit model to assess the relationship between DMSs and the financial performance of the business. Results suggest that both management and marketing skills significantly affect direct-to-consumer sales. Farmers choosing the strategy of sales only through direct-to-consumer outlets report earnings that are significantly lower than earnings from the other marketing strategies. Marketing skills prove to be beneficial to direct-to-consumer (DTC) earnings. Finally, the selectivity correction terms in the direct sales model are significantly negative in the choice of DTC, indicating the presence of sample selection effects. Accounting for selectivity is essential to ensure unbiased and consistent estimates.

Original languageEnglish (US)
Pages (from-to)213-224
Number of pages12
JournalAgricultural Economics (United Kingdom)
Volume45
Issue number2
DOIs
StatePublished - Mar 2014
Externally publishedYes

Keywords

  • Direct marketing outlets
  • Farm sales
  • Multinomial logit
  • Selectivity correction

ASJC Scopus subject areas

  • Agronomy and Crop Science
  • Economics and Econometrics

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