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Are Young Producers Loyal?


In August, Steve Easterbrook, global chief brand officer at McDonald's, made headlines after commenting during an interview that millennials were “promiscuous in their brand loyalty.” The casual nature of these customers’ loyalty was creating challenges for the company. He went on to say that the millennials’ behavior “makes it harder work for all of us to earn the loyalty of the millennial generation.”

Most would agree that millennials are those born between 1980 and 2000. At their oldest, millennials are 34 years of age. From the 2012 Census of Agriculture, there are about 119,833 millennials operating farms. This means that roughly 5.7 percent of farm operators are from the millennial generation.

So what about millennials in agriculture? One of our recent research projects is the Large Commercial Producer Survey. This survey's goal is to understand the management strategies and decision-making processes of large commercial producers. And while the survey didn’t ask about millennials specifically, an interesting trend emerged with regards to producer loyalty.

Again, the survey didn’t target the millennial generation explicitly, so a proxy has to be used. The youngest group of respondents in our survey were between the ages of 18 and 39. The group isn't exclusively millennial, but a significant portion of it is.

When asked to self-report their loyalty to dealers and retailers of various inputs, the youngest group of producers had the smallest portion of respondents who reported that they were loyal. This was the case across all crop inputs evaluated. Furthermore, the trend for older producers to report being loyal was also consistent across all inputs.

The differences across age groups was most noticeable for capital equipment dealers. Only 49 percent of the youngest producers considered themselves loyal, compared to a full 75 percent of those producers 70 years of age and older.

This wasn’t the only difference we observed across age groups. The youngest producers also placed more importance on all sources of media information for purchase and management decisions. This means that millennials find all types of media, including farm publications, websites, field days and social media, more important than their older peers do.

It’s very common to segment customers to help deliver products and services that best fit different customers’ needs. And while agriculture has done this for a long time, it is more common to segment farmers by the crop or livestock they raise and the size of their operation. It might also be helpful to consider segmenting by age. 

McDonald’s has found that customers from the millennial generation are different than other customers as it pertains to their business model. The Large Commercial Producer Survey also found that the buying behavior of the youngest group of producers is different than older producers, particularly when it comes to loyalty. Agribusinesses and those working with producers will have to carefully monitor this generation’s preference and trends as they continue to become a large portion of the customer base.

This article originally appeared in Agri Marketing magazine and is reprinted with permission.


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