Bill Pershing had a problem. After operating a successful insurance agency for several years and putting his four kids through college, he and his wife, Kim, sought greener pastures. After living in town for most of their married lives, they decided to buy a 24-acre parcel in the country. Their homestead had 15 acres of pasture, a suburban-style lawn close to the house and heavy forests. The existing home was built in the 1960s and was in good shape, but it had been many years since the barn and a fallen-down fence around the pasture had held livestock. This created a dilemma for the Pershings who were enamored with the idea of restoring the fence and boarding horses so they could see them grazing peacefully from the house. Having horses meant rebuilding the fence, which meant restoring the barn so that it would be the same color and style as their home. In the end, Bill and Kim chose to make the improvements, but not bother with the horses. Instead they decided to turn part of the pasture into a small orchard. All of this required new equipment, which prompted Bill’s first visit to an agricultural equipment dealer 5 miles away.
Bill and Kim represent one end of a segment of equipment buyers called “ruralpolitans,” a term used broadly to describe country residents who bridge the gap between suburban property owners with no farming operations and full-time commercial farmers. Sometimes referred to as lifestyle farmers, part-time farmers, hobby farmers and about 15 other titles, this segment of buyers has garnered the attention of the equipment industry over the last 5 years because it represents a very large, and growing, group of potential customers.
Most analysts agree that more than 50% of all farms fall into this category. What defines a “farm” may vary though, since census definitions are liberal with the term. The U.S. Farm Household Typology identified by Brian Briggeman, now at Oklahoma State Univ., categorizes ruralpolitans as having both on- and off-farm work hours. A version of this definition was used in this Purdue Univ. study of ruralpolitan buying preferences.
The Changing Population
To understand this segment of buyers, it is important to think about how they have emerged within our communities. After each of the world wars, the U.S. saw a movement of population from farms to cities. After World War II, this movement was fueled by three factors. The Eisenhower highway system, which allowed better access to sprawling cities, also meant longer commutes to work. Longer commutes meant that, in addition to work transportation for wage-earners, homemakers would need a second car to reach shopping centers. That need for transportation was gladly filled by U.S. automakers, which fortunately had hired workers and retooled to make automobiles after the war.
To accommodate the households that now owned two vehicles, home builders began building two-car garages. While seemingly innocuous, this expanded home footprint resulted in proportionately larger houses and, more importantly, large building lots. These were constructed at the fringe of urban areas where there was “vacant” land. Some of these areas became suburbs, but often rural areas close to cities were home to small farming operations referred to as “gentleman farms.”
At the same time, the agricultural landscape was changing. Military training for World War II and the GI bill resulted in educational opportunities for a generation of people who would have otherwise become farmers. Some of these educated rural people turned their attention to improving efficiencies on the farms where they had worked and lived in their youth.
Manufacturing capacity and workers were both available to produce these agricultural innovations following the war. As farmers adopted new practices, the greater efficiencies resulted in less labor. Improvements in healthcare and longevity extended the productive years of family heads, stretching farm resources across multiple generations. It was hard for small farms to support extended families, so many young people moved closer to urban areas for job opportunities.
This history is important because it explains the diversity within the ruralpolitan segment.
There are a group of ruralpolitans who pine for farming. Some are retired farmers (fully or in part); some are younger people whose passion for farming was inspired by parents or grandparents who farmed or wanted to. These folks farm part-time, working for larger producers or owning small parcels themselves while earning a primary living from jobs in more urban areas in order to earn higher wages or benefits.
Some ruralpolitans are city dwellers who moved to the country for the wide-open space — for its own sake, for nature, for privacy or for a second home to accommodate hobbies like horses, hunting or fishing. More recently, attention to food safety and health have prompted some ruralpolitans to begin small farms that mostly produce “natural” or organic foods. For many ruralpolitans “farming” may mean very small levels of production.
By the Numbers
This description of ruralpolitans and how they evolved will not surprise many farm equipment dealers.
In the last census, there were 1.2 million farms with $1,000 to $10,000 in farm revenues and 400,000 with less than $1,000 in farm revenues.
It has been reported that 42% of all ruralpolitans have multiple income sources, but these vary, perhaps including factory jobs, cash rents or thriving medical or law practices. By the averages, ruralpolitan farms are more likely to generate revenue from livestock than crops. Some 40% have cattle or dairy cows with an average of 10-20 head, but many own sheep, goats, poultry or exotics like alpaca, llama or ostrich.
Ruralpolitans average around $30,000 per year in gross farm revenue, 74% of that from specialty crops, beef or other livestock. Horse ownership is reported by 26%, tractor ownership by 82% and pick-up ownership by 81%.
At the same time, 80% of ruralpolitans don’t consider themselves to be farmers. There are ruralpolitan groups that are both wealthier and poorer than their traditional farm counterparts, but on average ruralpolitans are better educated. But the size and description of the farming operation may not say as much about the needs of ruralpolitans as other characteristics.
A ‘Very’ Diverse Group
Marketers have segmented ruralpolitans by their proximity to urban centers, by their assets and by their occupations, using proportion of income from farming to sort them further.
Research done in the forestry area in 2005 by Angelina Kendra of Central Connecticut State Univ. and Bruce Hull at Virginia Tech captured the motivations of various ruralpolitan groups. In the research ruralpoplitans were classified as: absentee owners who treat their holdings as an investment; professionals who are wealthy and highly educated; preservationists who appreciate nature and see ruralism as a romantic notion; farmers who raise animals and grow food; planners who see themselves as farmers but lack the time to pursue it as an occupation; and young families who are transient and live in the country primarily for their children. All of these descriptions are probably valid, making ruralpolitans a very diverse group.
In terms of behaviors, ruralpolitan research by Mike Etzel at Notre Dame and Bill Bearden at Univ. of South Carolina have shown that the more publicly displayed the purchase is, the more the ruralpolitan’s self-identification as urban or rural will influence it.
This means that if buyers see themselves as farmers, they’ll act like farmers when purchasing items that other people see — clothes, equipment, buildings, etc. But for purchases such as equipment services, food, vacations or media, they’ll act more like consumers.
Outwardly, ruralpolitans say that buying from their local communities is very important, but this has not shown to be enough to influence decisions. Instead, researchers Nancy Miller and Mary Littrell at Iowa State Univ. and Rita Kean at the Univ. of Nebraska report that this group is influenced by relationships, so local dealers who are visible in ruralpolitan communities may garner some benefit. Understanding the factors that drive decision making for ruralpolitans may be very helpful, not the least of these being how they wish to be treated — like consumers or like farmers.
Ruralpolitan buyers’ preferences for rural living were evident in a question in a 2007 Purdue study about rural buyers’ “comfort zone.”
When asked, “Do you feel more at home in the country or in the city?” 97% of ruralpolitans preferred the country. This is significantly higher than even their non-ruralpolitan farming counterparts of which 93% preferred the country.
This suggests that marketers should emphasize this reference group when selling their products and services.
It would be dangerous to assume from this that all ruralpolitans can be treated the same, however. Purchase behavior depends, in part on the degree of profit intention for the specific purchase — whether or not they tend to use the purchased item for a personal use or to help them make money.
In terms of profit intention, ruralpolitan purchasers fall into three categories. Consumer-types of buyers tend to think of purchases as transactions; farm-business-types of buyers tend to think of purchases as ongoing and relational; and the largest category, hobbyists, possess a mix of these traits.
One of the most difficult choices to be made by equipment dealers who work with all of these ruralpolitans is figuring out how to position their products and services. Should they be assembled in a practical, “traditional” way, with emphasis on farm business features and benefits, or should they be presented like a department store, in the manner that consumers are used to shopping?
This decision extends to the ways salespeople approach potential buyers. Equipment dealers must decide whether salespeople should approach ruralpolitan customers like farm businesses or like consumers. This is a significant issue.
Salespeople, like all of us, are creatures of habit. Tailoring a different “style” of selling from one customer to another has not been shown to be an effective strategy for selling. Very few salespeople are chameleons who can change their colors in a genuine way with customers. Therefore, a better way to offer varying sales approaches may be to staff differently — to hire some individuals who are good at business selling and others who are good at consumer selling. This may be impractical and at a minimum, may create difficulties in blending sales cultures at the same location. Instead of hiring different people, perhaps it makes more sense to think about what specific sales activities are appropriate with different ruralpolitan buyers.
The ruralpolitan study completed at Purdue identified several factors that can help equipment dealers understand how ruralpolitans want to be treated.
Ruralpolitans want a relationship when they need information to make a decision about buying; they tend to want more of a relationship when they will be using the item purchased to make a profit; and, if they aren’t confident about their decisions, a relationship with their dealer is even more important to them.
Relationships were also found to be slightly more important to female buyers than their male counterparts. The Purdue study showed that purchases tend to be more transactional — with less focus on the experience of buying; less concern about the salesperson and less willingness to share information when purchases were more visible in the community, like a tractor. It is surmised that this is because, when the purchase would say something to others about the buyer, the buyer did not want a salesperson to influence what was said.
Prioritizing Buying Issues
There is a prioritization to these issues. The most important thing that salespeople must bring to buyers who are looking for relationships is information, but it is most critical to define what is meant by “information.”
First, the information presented must be material that the buyer did not have access to from other sources. This probably means online, in brochures, magazines and from other farmers or dealers. In this information age in which buyers have access to numerous sources, this presents a challenge for sales professionals.
Their first line of questioning should begin with trying to understand what the buyer already knows about the product. Second, the information presented must be relevant to the purchase decision. This will vary depending on each individual buyer’s perceptions of what is relevant. Therefore, the second line of questioning should be to figure out what types of information are important to the buyer.
Third, salespeople must be knowledgeable about how ruralpolitan buyers will use their products (this may be different than on-farm use) and have information organized so that it can be presented to customers clearly. This process takes place well before the customer comes in to a dealership. Ruralpolitans have diverse needs, and salespeople should visit ruralpolitan customers and learn first-hand how equipment is used rather than assuming they know based on past farm experience.
Timing of Purchases
The closer a ruralpolitan is to the time of their purchase, the more interested he or she will be in hearing from a salesperson who has information for them. Therefore, “new” information of which the buyer was unaware can be a valuable purpose for a follow-up call on a ruralpolitan who is nearly ready to buy. This only holds true as they near the purchase, and then only when the information is perceived as truly valuable.
Buyers, who are unsure of their knowledge, appreciate a relationship with a salesperson who can inform them.
Stories from feed industry professionals who work with ruralpolitan horse owners often talk about the customer knowing more about feed than the salesperson, and sometimes even more than the nutritionist. Consumers and hobbyists who are passionate about an item they are purchasing may invest far more in learning about equipment or other products than their more business-like commercial farm counterparts.
For passionate ruralpolitans, learning more can be fun, and they may be more willing to invest time in learning about it when they aren’t trying to manage their costs with an eye toward generating profit from the purchase. For this reason, equipment dealers who are interested in selling to ruralpolitans MUST assess the buyer’s confidence in their knowledge relating to the purchase.
In some cases, the buyer may be very confident, even appearing cocky or “stuck up” because they know so much. Sales professionals working with ruralpolitans should be careful about how they deal with this issue. Ruralpolitan buyers who are under-confident will appreciate information from salespeople; buyers who are already confident may actually be a “source” of information for salespeople and appreciate their respect.
Suggested Sales Training
The ruralpolitan segment provides a great opportunity for equipment dealers. This is particularly true for the 16% of respondents in the Purdue study who report household incomes in excess of $100,000. Also worth noting are the large home sites reported by ruralpolitans with nearly 60% indicating 40 acres or greater for the area their home is located on.
To take advantage of these opportunities, equipment dealers should consider training salespeople on how to use information most effectively in the sales process, how to identify buyers with varying levels of profit intention, and how to be sensitive to the unique needs of female buyers. The motivations and needs of buyers like Bill and Kim aren’t always served by talking about features that are important to farmers. Their needs may be for information, education and training on topics that farm business buyers are assumed to have knowledge about already.