Crop protection market segmentation: relationship between buyer segments and the use of digital sales channels

Abstract

Digital technologies are revolutionizing agricultural trade, enabling farm input suppliers to reach customers through multiple channels. The aim of this study was to segment farmers based on their purchasing behavior for crop protection products and to examine segment-specific characteristics in the digital environment. A cluster analysis of 590 German farm managers was used to identify five distinctive buyer segments based on five characteristics: dealer, brand and service orientation, price affinity and autonomous decision making. The results demonstrate that farmers place high value on personal contacts to stationary suppliers when purchasing crop protection products. Service orientation turned out to be a strong mediator of segment membership, while price and product brand are secondary to farmer segmentation. However, traditional typologies are only suitable for the digitization topic to a limited extent, as digital search and information behavior hardly differs. Even though digital information procurement is becoming increasingly interesting for all segments, an openness to e-commerce applies only to a small group of independent buyers. Concerning e-commerce attitudes, the perception of its advantages and the lack of personal contact differentiates the clusters the most. The results contribute to the scientific understanding of farmers’ information and purchasing behavior and provide initial approaches for the development of customer-centric corporate marketing strategies.