Biennial Precision Retailer Adoption Survey Sneak Peek

From: PrecisionAg

The 16th Annual CropLife/Purdue Precision Adoption Survey provides a window into overall precision use in the U.S. Purdue’s David Widmar, Dr. Bruce Erickson, and Jacqueline Holland provide this overview of some key findings from the survey, with full results due out in June.

Why do agricultual retailers invest in and use precision agricultural technologies? Is it used to distinguish a business from the competition, to generate additional revenue or because customers expect it?

Precision Ag Special Reports’ sister magazine CropLife®, in cooperation with the Center for Food and Agricultural Business and Department of Agronomy at Purdue University with financial support from Trimble, have partnered to complete the 16th Precision Agricultural Survey. Sent to 2,500 agricultural retailers across the U.S., the survey looked at the use of precision technology and services at the retail level.

This year’s survey, completed by 171 respondents, looked at the use of precision technology products and services by retailers, the use of precision technology across all agricultural production, the potential barriers to technology adoption and some of the financial implications for retailers who offer precision technology products and services.

While the majority of the survey’s results will be presented in the June 2013 issue of CropLife magazine, recently completed analysis provides insights into how the technologies are being perceived. Survey respondents (ag retailers) were asked to categorize different precision technologies by how they perceive the anticipated future of these products.

A Sampling Of Technologies
Retailers were asked their opinions about the current and future state or specific equipment and practices and the impact of each on their operations.

For instance, variable-rate seeding is viewed by 49.6% of respondents as an emerging technology, currently used by few, that has promising future. Overall, 12.6% of respondents also agreed this is an emerging technology used by few, but they perceive it as a technology with a “highly uncertain future” and are not certain the seeding technology will catch on. While this technology is new and not yet widely adopted, retailers, for the most part, are confident in its future success.

Dealers perceive chlorophyll sensors to have less certain prospects. More than 74% of respondents categorized these sensors as emerging technologies, but 41.2% of respondents said the emerging technology had a “highly uncertain future.”

Shifting to precision technologies that have been more widely adopted, GPS guidance systems with automatic control (automatic steering) for fertilizer/chemical application is the third technology presented. Half of respondents reported that the two statements categorizing automatic steering as a technology that separates one from their competition best describes automatic steering in their business. While the majority of respondents identified the technology as differentiating, a significant portion, 28.9%, of respondents said this technology would not allow them to generate additional revenue. Another 30.3% agreed that the automatic steering technology is expected by customers.

In contrast to automatic steering, GPS guidance systems with manual control (lightbars) were indicated to be obsolete, no longer used or nearly replaced by 28% of respondents. Furthermore, 45.6% said the lightbar technology is one that a customer expects from their ag retailer. Less than 13% of respondents indicated the technology was one of two categories for creating value through differentiation, or separation, from the competition and less than 14% indicated it was one of the emerging technology categories.
What Is The Meaning?
So what do precision agricultural technologies mean for your business? Survey results showed that it depends on the technology and the specific retailer. Respondents indicated that for the mature technologies, their customer simply expects them to employ it.

According to survey results, as new technologies emerge, such as the variable-rate seeding and chlorophyll sensors, the impact will be different than for more mature technologies. These technologies are new and used by few, so growers are more likely to have questions and potential concerns with applicators and retailers using them. For example, promoting nitrogen application with a chlorophyll sensor might create confusion about what the sensor is and how the technology works. Retailers will have to think critically about which technologies they decide to adopt and how they decide to promote them.

As the precision market continues to mature, many technologies will become mainstream expectations, some will become obsolete and likely new technologies will keep entering.  Grower expectations may change over time as they come to expect certain technologies are employed but actively seek — or cautiously investigate — the use of newer technologies on their farms.

As this cycle continues, it will remain critically important for ag retailers to keep in mind that the market is in constant motion and not all technologies will perform equally. So what technologies do you have working for you? And, more importantly, why? Is it to distinguish yourself, improve profitability or is it because you must fulfill customers’ expectations? Or is it something else?

For these answers, please read the full report in the June 2013 of CropLife magazine, due out shortly.

David A. Widmar is research associate for the Center for Food and Agricultural Business. Dr. Bruce Erickson is agronomic education manager,  American Society of Agronomy and Department of Agronomy. Jacqueline K. Holland is graduate research associate. All three are located at Purdue University, West Lafayette, IN.

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