Market Closeout
A marketing wellness check.
To be completely candid, when I heard that the theme of this publication was “your wellness check,” my first thought was, “How does that relate to the cattle business?” So, I did what most people do today. I Googled it. I found that this theme is actually pretty important to what we are doing in the cattle business.
Cattlemen are naturally pretty good at searching for and executing a solution when a problem exists. That is like going to the emergency room when you are having trouble breathing. A wellness exam, however, is totally different. It isn’t about diagnosing or treating a known problem. Rather, it is a form of preventive care focused on stopping problems before they occur. If there is a problem emerging, you catch it in its earliest phase, so it is relatively easy to correct. Wellness exams are designed for healthy people.
In that vein, I would argue it makes sense for all producers to take a wellness exam relative to their marketing program. It guarantees you are maximizing returns in the short term, but also that you’re positioned to take advantage of market opportunities in the future. Let’s assume that you have been selling at or near the top of the market. Does that mean you are winning? Maybe more importantly, are you certain that you will still be selling at the top of the market in five or 10 years?
When conducting a wellness exam on your marketing program, you will want to take a look at the methods you are using to market your cattle. Are you missing marketing opportunities or not gaining access to supply chains that are providing a premium? Finally, you need to ask what trends are driving change and what it will take to be successful in the future.
Most insurance companies will pay for one wellness exam per year. It makes sense that once a year we sit down and evaluate our marketing strategy. Marketing is a pretty complicated task, with a lot of factors to consider. But there are some general categories to look at if you are wanting to assess the overall health of your marketing strategy.
A doctor begins by taking a physical examination and checking your vitals and body mass index. When you start your marketing exam, you start by comparing the prices you receive to other cattle in your region and determining if the premium or discount you are receiving is increasing or decreasing. Trends are great indicators if there are areas of concern. Your location is a lot like your family medical history, you can’t do anything about it, but it is good to be aware of potential problems. Your genetic program is like your exercise program. It is essential to being healthy. If you don’t utilize genetics that keep you competitive, it is similar to being a couch potato. It may take some time, but it will eventually catch up to you.
Your doctor will make sure you are up to date on your vaccinations, will make sure you are making healthy dietary decisions, and will help establish a plan for a healthy lifestyle. When conducting a wellness exam on your marketing program, you will want to take a look at the methods you are using to market your cattle. Are you missing marketing opportunities or not gaining access to supply chains that are providing a premium? Finally, you need to ask what trends are driving change and what it will take to be successful in the future.
There are a lot of niche market opportunities that warrant consideration, but from a broad perspective we know that genetics are becoming more valuable, and the marketplace will demand genetic verification. The Genetic Merit Scorecard® is designed to take advantage of this trend and to help producers document the genetic merit of their calves to get rewarded for those genetics. We know sustainability and animal welfare are growing in importance, and traceability is a priority for many of our customers.
You can’t simply make a marketing claim and expect everyone to accept that. Verification is becoming a key to gaining access to many supply chains, and that is likely to increase. We also know many of the traditional ways of marketing our cattle must be supplemented to be effective. You can’t expect those who have traditionally helped you to market your cattle to help you differentiate your product in the marketplace. The responsibility of marketing is something that can’t be entirely delegated to somebody else.
Even if your marketing program is pretty healthy, I’m guessing there are probably some things you can work on to make sure it continues to be competitive in the years to come.
Call us at 816-383-5100 to schedule your marketing wellness exam today!
Editor’s note: Troy Marshall is the director of commercial industry relations for the American Angus Association.
