When multi-generational farming operations make major purchases, the decision-making process often involves two different perspectives. Each farming operation is different, but similar factors shape most major purchase decisions. A new paper offers possible insights for companies or consultants doing business with farmers.

Techniques used by young and older producers to bridge the generational gap is the topic of a recently released thought paper by Paulsen Marketing, “How Multi-generational Farming Operations Make Major Purchase Decisions.”

Paulsen interviewed 14 farm families across the Midwest to understand how two generations approach farm purchases. Three main observations became clear:

  1. There is a high degree of brand assimilation in multi-generational farming operations.
  2. The generational gap related to online usage is closing.
  3. The consideration cycle leading up to a purchase can last well over a year.

If producers are loyal to a specific brand, it is generally because the brand has been assimilated into a farming operation from one generation to the next. Producers tend to rely on brand familiarity, integrated equipment, consistency of a product and relationships with sales and service providers when deciding what to purchase.

Yet all producers rely on a combination of information sources to help them make important purchase decisions and online research is a growing resource for both generations.

“Older producers are going online more often and for longer periods of time,” said Mark Smither, Paulsen Marketing Vice President, Strategic Director and co-author of the thought-paper. “More importantly, they are engaging in more advanced online activities such as following blogs, contributing to forums and participating in online auctions.”

While older generations have engaged peers in purchasing decisions for decades over coffee at a local café or elevator, younger producers are creating their own peer networks in virtual coffee shops. Younger producers are reaching out to other young producers and cultivating their own trusted networks of peers, oftentimes in online communities.

“Several younger producers mentioned they often seek and provide advice online using organized forums and ag-related social media channels,” said Heather Covrig, Paulsen Marketing Account Executive and thought paper co-author.

The need to increase production is a continuous cycle. This is why farmers seem to be in a constant state of consideration.

The most noticeable difference in purchase philosophy between older and younger producers is this: younger producers are more comfortable making a purchase decision based on maximizing return or profitability; older producers seem to be more comfortable making purchase decisions based on minimizing costs.

“Older producers bring a unique historical perspective and a lifetime of personal networking to the purchase decision, while younger producers bring a new point-of-view and sense of energy to the process,” Smither said. “Together, older and younger producers are creating their own “purchase philosophy” based on the specific needs and goals of the operation.”

To read the complete thought paper and view video clips of the producer interviews, visit www.agribranding.com/paper.