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 Communicate 24/7 Mar 1, 2007 12:00 PM By David Hest Creative agricultural retailers have learned that the Internet, once feared to be the potential source of unwanted competition from afar, has turned out to be a good hometown communications tool that provides critical business information to customers 24/7. Others are learning that the cell phone — and, in particular, its text-messaging capability — is a highly efficient way to instantly communicate with a large number of customers. Increasingly, customers expect that you will communicate with them electronically. Whether or not these tools contribute directly to the bottom line, when they are used well, they strengthen bonds with customers and may improve internal efficiencies. Web pioneer Topflight Grain Cooperative Inc., Bement, IL, got involved in the Internet in the mid-1990s, when the World Wide Web was more of an oddity than a relied-upon information source. “We started our Web site very early,” recalls Pam Jarboe, Topflight assistant manager, who oversees the 10-location co-op's Web site. “Companies were just starting to do Web sites, so we thought we should have one.” The site (www.topflightgrain.com), designed by a local Web designer, provided a place to post grain prices and bids once a day, as well as general information about the co-op. “It was not very flashy; reaction was good,” Jarboe says. Although Topflight's Web site has evolved over the years, keeping customers informed about grain markets, including current bids, remains its primary calling. In addition, the site provides links to weather and agricultural news. The site was designed to have a hometown flavor, Jarboe says. During the growing season, the co-op posts cumulative rainfall amounts at its 10 locations. Other popular features include a monthly trivia contest, a community calendar and a customer photo page. “Mostly our Web site is a customer service,” Jarboe says. “It probably doesn't affect our profitability or the amount of business we do. If our grain bids weren't competitive, farmers wouldn't do business with us.” When the site was first set up, grain prices were posted daily. Today, working with QuickFarm, which is one of the major grain market content providers (along with DTN), markets are “live” and updated continuously throughout the day. As in the past, the co-op posts its bid prices as well. The co-op supplements its online grain market postings with twice-daily e-mails. Between 7:30 a.m. and 8 a.m., it e-mails a commentary on factors likely to affect markets that day. In the afternoon, closing bids are e-mailed to customers who have asked for the daily updates. “We don't count on the e-mails; if we need to contact someone for certain, we call their cell phone,” Jarboe says. About three years ago, Topflight Grain expanded its Web site offering when it began providing its customers with security-protected access to their grain accounts. Customers can look up current grain balances that remain to be sold, plus open offers, contracts, accounts receivable balances and grain scale tickets for the past several years. Overall, an estimated 10% of the company's customers use this service. But based on business volume, about a third of Topflight's customers access their accounts online. “More and more, farmers are using the Web site to check their accounts,” Jarboe notes. Although the co-op's Web site has been a valuable customer-service tool, Jarboe expects it to become more important in the future. Eventually, the site could offer a grain-trading tool, but not in the near term. “Currently, customers can submit offers over the Web site, and a few people use it,” Jarboe says. “At some point, we could add a mechanism to hedge grain. But farmers are like us; they still like the one-on-one contact. It is hard to see what kinds of changes they will want.” Text message success About a year ago, Terry Jones, president of Circle J Grain in Williamsburg, IA, kicked off a pilot program with six customers to test whether sending text messages of daily grain market prices to their cell phones would enhance his business. Today, through word-of-mouth demand, Jones has expanded the free pilot to 100 grain customers, plus 200 customers of related seed and feed businesses. The cost — more than $20,000 — has been more than made up with new business and time efficiencies, Jones says. “I know that I have picked up 10% new customers on the grain side of my business,” he says. “Our seed sales are up about 20%. It's not all because of the text-messaging program, but it sure isn't hurting.” Jones set up the text-messaging pilot through Commodity Update (www.commodityupdate.com), a company that sells text-messaging services to companies and individuals. Working via the Commodity Update Web site, Jones's grain customers are able to sign up for text-messaging options ranging from a single daily commodity report to several reports a day. In all cases, customers receive a two- to three-line text message after the market close each day with Circle J's bids, along with its telephone number. “I don't know how you put a value on your phone number being in front of the customer every day,” Jones says. “If a customer needs something, he is going to call. “Farmers have three things with them every day: their pickup keys, their wallet and their cell phone,” Jones continues. “With this program, our customers think of us as being cutting edge. We are offering something nobody else around here does. It differentiates us and offers valuable information that customers want.” In addition to helping build business, the text-messaging program saves time, he says. Notably, his staff fields fewer calls for general market update information. “It will probably save us an employee in the long run,” he says. Being able to contact a large number of grain customers at once also has enabled Circle J and its customers to take advantage of short-term opportunities to fill premium contracts for identity-preserved grain. “Now we send out a text message while we are on the phone line with the IP buyer,” Jones explains. “We may do two or three contracts while we are on the phone on behalf of customers who respond right away. We are getting more done.” Jones also uses text messaging on a limited basis to notify customers of upcoming meetings, seed order deadlines and other dates. “We get better communications and response from our customers from sending a two-sentence text message than sending a letter, which ends up in the circular file,” he says. “We're pretty cautious about sending out promotional material. We don't want to turn it into spam mail. I haven't had one person drop the service yet.” Although Jones is sold on the text-messaging service, he is uncertain about whether he will expand the free offering or whether he will begin charging some customers. “Right now we are using it with larger clients who do most of our business,” he says. “As it grows, we probably will want to charge for it, depending on how much business a client does with us.” |
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