Drivers for continued use of a direct marketing channel: evidence from Thai farmers

Abstract

PurposeThis study aims to identify the key drivers influencing the success of farmers who employ direct marketing at wholesale markets. The diversification of the distribution system in Thailand has created many challenges for farmers, with diversified farm businesses struggling to survive and to ensure profitability across channels. Direct marketing channels at wholesale markets provide farmers the opportunity to develop a new farm business division.Design/methodology/approachThe study consists of qualitative and quantitative approaches. First, in-depth interviews with farmers were conducted, and selected case studies were employed to develop a research framework and design the questionnaire. Second, the questionnaire survey was conducted. Using factor analysis and logistic regression, farmers' data were studied to define the factors of success in direct marketing.FindingsThree key drivers were examined and verified. The findings indicate that the development of direct marketing channels requires farmers to efficiently allocate family labour, possess negotiation skills and manage a farmer network. Particularly, the presence of negotiation skills coupled with digital technology can enable farmers to expand the market and build their network.Research limitations/implicationsTwo marketing channels have been explored. However, more choices in marketing channels utilizing digital resources should be addressed in future research.Originality/valueThis is the first empirical study to define the drivers leading Thai farmers to continue employing a direct marketing channel.