Download 16-Compost-Marketing.. - US Composting Council

Compost
Marketing and Sales
“Pioneering Sustainability through
Organics Conversion”
Bill Camarillo – President
4,500,000 TONS CONVERTED SINCE 1993
Marketing vs. Sales
• Role of marketing – create prospects for sales
and keep the market informed about the compost
product
• Role of sales – turn prospects into cash as
efficiently as possible; stay in touch with existing
and potential customers
• Recognize geographic constraints
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Cost of shipping compost limits markets to a 75-100
mile radius from composting facility
• Recognize that many buyers do not understand
what compost is and how it should be used
Key Elements in a
Market Development Plan
Compost Markets
• Traditional Markets
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Homeowners/gardeners
Landscapers
Containerized horticulture
Turf / Topsoil Manufacturing
• Emerging Markets
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Erosion & Sediment Control
Agriculture (re-emerging market)
Wetlands Creation
Bioremediation of contaminated soils
Compost Markets
• Value vs. Volume Markets
• Retail vs. Wholesale Markets
• Value Markets
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Higher value (golf courses, nurseries, sports turf)
Quality and consistency more important than price
• Volume Markets
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Price is key defining criteria
Agriculture, erosion control, remediation, wetlands
• Retail – characteristics of both value and
volume
• Wholesale – can be extremely price-sensitive
Markets We Serve
Marketing Objectives
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Objectives:
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Selling existing products to existing customers
Developing new products for existing customers
Extending existing products to new customers
Developing new products for new customers
Quantitative, in terms of values, volumes,
market shares, profitability
Consider 3-year planning horizon
Distribution & Marketing
Options
• Distribution Options:
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Wholesale
Retail
Distributors
In-house use
• Marketing Options:
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In-house staff
Contracting with private-sector broker
Self-use
Give-away
Branding
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Symbolic embodiment of all information
connected to a provider
Serves to create expectations and
associations
Brand image – create impression that
product is unique or special
Brand experience – if positive, customers
will often choose branded over generic
items
Trademark all brand names of products
Color scheme
Logos
• Graphic element, symbol or icon of
a brand
• Effect should be instant recognition
• Components – be distinctive!
– Icon – the image
– Logotype – letter font
– Slogan – convey the message
• BMW – The Ultimate Driving Machine
The Agromin Brand
Promotion / Advertising
• Critical in establishing brand
recognition
– Must control costs, have budget
• Convey your message!
• Methods
– Newspaper
– TV
– Infomercials
– Display signage
- Billboards
- Radio
- Trailers
at projects
Promotional Advertising
Generate leads….
Marketing – Demo Projects
Marketing Strategies
• In-house program requires:
Market research
Coordination of product utilization research
Highly visible demonstration sites
Professional education and outreach
materials
– Staffing
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• Broker/blender
– Reduces risk of market failure
– Revenue and control are reduced
Preparing a Marketing Plan
• Identify Target Markets and Distribution Channels
• Develop a Product Specification
– USCC STA Compost Technical Data Sheet
• Develop a Program Budget
• Develop a Pricing Structure
• Develop Product Utilization Guidelines
• Develop a Product Identity
• Plan Research & Demonstration Projects
• Plan Public Relations & Education Strategy
Selling Your
Compost
Compost Sales
• Bulk vs. bagged sales
– Most composters sell in bulk (per cubic yard, or per “scoop”)
– Bagged product requires outlets through “big box” stores or
“mom and pop” garden centers
• Extremely difficult to ensure adequate profit margins
• Much more profitable selling to garden centers, but lower
volume potential
– Sell to public at composting facility or sell through broker
• Pricing
– Determined by competition in your 75-100 mile radius
– In CA, statewide average is $20/CY
– Larger orders will expect discount
• Tractor-trailer load volumes, multiple truckloads
– Pricing may also be influenced by feedstocks used
• Manure & food waste composts vs. biosolids & mortality
composts
Sales Staff
Necessary skills or knowledge base
• The composting
process
• Compost application &
benefits
• Product quality issues
• Government regulation
• Health, safety, &
environmental issues
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Competition
Prior research
The green industry
User needs
Basic sales and
marketing
Attributes of a Compost Supplier
• Produce compost possessing attributes /
characteristics that meet end user or application
requirements
• Supplies/produces a consistent product
• Has implemented an on-going quality
assurance or testing program
• Can supply current compost characterization
data (quantifying and qualifying their product’s
attributes)
Field Guide to Compost Use, US Composting Council, 1996
Attributes of a Compost Supplier
• Provides good overall customer service,
employs a “service minded” staff
• Can assure prompt and reliable delivery (size
of truck and mode of unloading are also
important)
• Possesses adequate storage to ensure
availability
• Can provide technical assistance regarding
end use
Field Guide to Compost Use, US Composting Council, 1996
Competition
Peat?
Topsoil?
Fertilizer?
Other
composts?
Developing A Sales
Strategy
• Set up pricing structure
• Set up Information Management System
– Record sales, price paid, buyer info
• Recruit sales staff or hire broker
• Develop promotional materials
• Get out and talk to buyers
Market research is key!
Understanding The Customer
• How does compost benefit the customer?
• Benefits identified by purchasers of compost
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Helps reduce soil compaction
Helps increase water retention
Helps hold on to nutrients
Helps reduce chemicals needed
Reduces erosion
Increases infiltration
Reduces some plant diseases
Increases porosity
• Talk the customer’s language – “what’s in it for
me?”
Different benefits
are important to
different end users
Understanding The Customer
• Anticipate the customer’s concerns:
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What is it made of?
How do I know how good it is?
Are you sure it is safe…how do I know?
If it is so good, why is it such a bargain?
Will you guarantee it if it kills my plants?
What if my kids or dog get sick?
• Consumer education – shortens the list of
questions!
Handling Objections
Sales Information Management
• Feedback – essential to strong sales
• Develop sales reports – monitor goals
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By
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Product – for product managers
Customers – for salespeople
Geographical Area – for advertising
Market – for marketing staff
• Allows understanding of total market size,
market share and “projected vs. actual”
sales data
Compost Market
Development/Sales
• Investment (2-3 years)
– Cost
– Time
– Staff
• Game plan
Any Questions?
Your marketing /
sales challenges ?
Review
• Role of marketing
– create prospects for sales
– keep the market informed
• Role of sales
– turn prospects
– stay in touch customers