Aug 07, 2000
SUMMARY: In the B-to-B Net markets universe there have been a lot of hyped launches over the past year, but very few have shown the solid, steady growth of Verida’s Agriplace and its two sibling sites GrainPlace and InputPlace. This may be partially due to the fact that Verida’s CEO Michael Hinshaw comes from a marketing background, rather than one in technology or investment banking. || |
Q: How did you launch your sites? You didn’t seem to do much online marketing at all.
Hinshaw: We really had no customer acquisition plans that were online. We’re an agricultural company that happens to be on the Internet to help farmers and other suppliers do their jobs better. We’re not an Internet company.
Q: Even through you are what people call an Internet “pure play?” How did you figure out how to reach people then?
Hinshaw: That’s right. We figured out how to speak to them in a way that they would be willing to listen to us. With farmers that’s direct marketing and outbound telemarketing. With end users, who are primarily very large companies, these are direct sales so we go and sit down with them. For brokers and dealers it’s a combination of targeted direct mail followed up by a sales call and typically meetings.
Q: How did you figure all this out in the first place? What sort of prelaunch market research did you do?
Hinshaw: We spent a lot of time figuring out what their pain points were, what’s causing them difficulty in their jobs. We did surveys and focus groups and then took those results to the field to reality check them.
We’ve found in our research that the farm community has a very hard time believing that one lone entity can be an expert on everything, hence we launched two separate services -- our GrainPlace which is run by experts in grain and our InputPlace which is also run by names the farmer knows and recognizes. It’s all about focus and hiring long-standing experts the marketplace already respects.
Q: What have been your most successful offline marketing tactics to let farmers and others know you exist?
Hinshaw: To raise general awareness in the farm community we were very active in trade shows and we’ve done a fair number of our own seminars. Our senior agronomist and chief agronomy officer go out and meet with farmers in one-on-twenty seminars. It’s fairly low budget. It’s the cost of the plane, the room and getting the farmer there through our telemarketing call centers.
Q: A lot of sites are outsourcing call centers because it’s such a demanding specialty. How are you handling it?
Hinshaw: We built our own call center and only hired people who absolutely understood the farmers’ business already. If someone’s calling to say, ‘We have a special on nitrogen this month,’ and the farmer says, ‘Actually I think I need potassium,’ they can actually converse about their needs. We have other experts on staff so if the farmer has a question about a particular product, the telemarketer can say, ‘Well I have an expert here who used to work at Monsanto, let me put him on the line.’
It’s all about winning the trust and then the business of our customers and that’s the order it has to go in. With farmers, they are particularly difficult!
We also use telemarketing to do a lot of cross-selling of products. InputPlace will know when a farmer plants a crop, when he needs to buy fertilizer, when he has to apply crop protection and preemptively call him at each stage to present him with alternatives and opportunities.
Q: So how do you transition farmers into using your Web site for all of this?
Hinshaw: We recognize you can’t get people to change overnight the way they’ve been doing business for 20 years. We call it ‘transitioning’, evolution not revolution. When we get a farmer signed up, we don’t let that farmer transact without having him walked through the process with a person the first time.
We show the farmer that the Internet is nothing but a tool and there’s real people behind it. The farmer will call up and say, “now I’m pushing this button, you got that?” and our call center rep will say, “Yep I see it Mr. Johnson” and read the order off to him. You hand-hold them for first couple of times. By hand-holding we’re increasing the volume of the system by increasing their comfort level with technology.
Q: There must be two dozen or more agricultural portals on the Web, how are you dealing with the competition?
Hinshaw: It’s a highly competitive environment. We looked at the space and made a decision to focus on what was the greatest opportunity that had been addressed the least -- and that’s Canada. Competitors there totaled zero. So we’ll initially roll out in regions with high promise that are underserved.
A lot of B-to-B and net-based companies have done a very effective job of marketing themselves to the business community and are less effective in marketing themselves to actual customers. We’re focused entirely on delivering service to our customers.
Your biggest competition in every channel is the entrenched brick and mortar channel. We’re working with existing brokers. Some of the smarter brokers are coming over to us in partnership as part of their online stategy. The forward-thinking players in every business realize that like it or not, the Internet is a significant part of the future of business. We don’t have a strategy for dis-intermediation, we’re inclusionary. Our long-term success will be very tightly tied to how we can integrate with the brick and mortar channel.
Q: What’s next?
Hinshaw: We launched Agriplace on March 31st. Our goal now is to develop as many markets as we can balanced with our growth and our ability to create real solutions and generate REAL revenue.
Editor’s Note: PetroPlace for the petroleum industry is their next planned launch.