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The ‘Net’ Effect on Agriculture Nathan Watermeier Program Leader, Technology Nathan Watermeier Program Leader, Technology E-COMMERCE: Impacting the Way.

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Presentation on theme: "The ‘Net’ Effect on Agriculture Nathan Watermeier Program Leader, Technology Nathan Watermeier Program Leader, Technology E-COMMERCE: Impacting the Way."— Presentation transcript:

1 The ‘Net’ Effect on Agriculture Nathan Watermeier Program Leader, Technology Nathan Watermeier Program Leader, Technology E-COMMERCE: Impacting the Way We Do Business! Nashville, Tennessee October 1-2, 2001

2 Topics Agriculture IT AdoptionAgriculture IT Adoption Technology Strategies in AgricultureTechnology Strategies in Agriculture Future OutlookFuture Outlook Suggestions for Extension ProfessionalsSuggestions for Extension Professionals

3 Agriculture IT Adoption What’s happening out there?

4 Farms with Computer Access USDA/NASS, U.S. Average - 55% of Farms have Access to Computers

5 Farms that Own/Lease Computers USDA/NASS, U.S. Average - 50% of Farms Own/Lease Computers

6 Computers for Farm Business USDA/NASS, U.S. Average - 29% Farms use Computers for Business

7 Farms with Internet Access USDA/NASS, U.S. Average - 43% Farms have Internet Access

8 Farm Economic Class with Internet Access USDA/NASS, 2001

9 Internet Activities USDA/NASS, 2001

10 Producer’s Online Internet Activity 78% Check 78% Check 72% Access Local Weather72% Access Local Weather 75% Check Commodity Prices75% Check Commodity Prices 62% Find Ag Information62% Find Ag Information (eAgriCounsel.org) Buying Online 48% Buy from Vendors48% Buy from Vendors 83% Want a Trusted Local Vendor83% Want a Trusted Local Vendor 24% Won’t buy online - Unfamiliar24% Won’t buy online - Unfamiliar 17% Shop for Price17% Shop for Price 67% Shop for Product 67% Shop for Product

11 The Web: Million Surfers Strong in U.S., 2001 Almost 60% population in U.S. has Internet Access. (Nielsen Net Ratings, 2001)Almost 60% population in U.S. has Internet Access. (Nielsen Net Ratings, 2001) Only 27% Availability for high speed access. Only ¼ of U.S. is wired for high speed. (The Industry Standard, 2000)Only 27% Availability for high speed access. Only ¼ of U.S. is wired for high speed. (The Industry Standard, 2000)

12 What Gets Customers to Buy? 77% lower prices77% lower prices 65% more security65% more security 35% items easier to find35% items easier to find 30% comparative data30% comparative data 15% easier ordering15% easier ordering 14% faster delivery14% faster delivery 12% better presentation12% better presentation Jupiter/NFO, 1999

13 On-line Shopper “Come Backs” 85% best prices85% best prices 74% high security74% high security 57% confirmation of order57% confirmation of order 55% frequent buyer and users discount55% frequent buyer and users discount 54% ability to track status of purchase online54% ability to track status of purchase online 28% alerts28% alerts Horning & Associates, 1999

14 Customer Problems Using the Web 81% speed81% speed 34% organizing information34% organizing information 32% finding information32% finding information 13% returning to a page13% returning to a page 9% cost9% cost 5% not knowing where I am5% not knowing where I am 11% other11% other Horning & Associates, 2000

15 E-Business Issues Knowledge gap between technology, products and implementationKnowledge gap between technology, products and implementation Laws, SecurityLaws, Security Data and Information Ownership and ErrorsData and Information Ownership and Errors PrivacyPrivacy WarrantiesWarranties Development of new, constantly changing communications modelsDevelopment of new, constantly changing communications models of Business of Business

16 Today, 63% of Ohio’s population has access to broadband Cable Modem Service Cable Modem Rollout DSL Ohio’s Broadband Connectivity Interstate Highway

17 Why is Broadband Important? Community Economic DevelopmentCommunity Economic Development – Strengthen existing and attract new business – Provide localized IT services and support – Help sustain the rural community Foundation for value-added IT technologies and services in the futureFoundation for value-added IT technologies and services in the future

18 Technology Strategies in Agriculture GeoSpatial Technologies Decision Support Systems Internet and E-Business Food Quality Technologies

19 Agriculture Is In a New Age Information Age

20 Courtesy of Potash & Phosphate Institute

21 Future of Crop Production? Remotely sensed dataRemotely sensed data –Will we have yield monitors in the future? Electrical, Chemical, and Mechanical SensorsElectrical, Chemical, and Mechanical Sensors –Protein sensors –Soil nutrient sensors Variable rate application maps eliminatedVariable rate application maps eliminated –Automated sensors

22 Data will drive decisions High quality data layersHigh quality data layers Statistical and mathematical proceduresStatistical and mathematical procedures Prediction modelsPrediction models –2 month advance predictions for marketing products Bank loans, crop insurance, gov’t payments, environmental complianceBank loans, crop insurance, gov’t payments, environmental compliance SSURGO – assessing soil properties for taxesSSURGO – assessing soil properties for taxes

23 GPS and Documentation

24 Remote Sensing and Sensors Monitor crop growth during the seasonMonitor crop growth during the season Optimize field operation logisticsOptimize field operation logistics Supervise employeesSupervise employees Manage production riskManage production risk Market niche productsMarket niche products “Traceback” for food safety“Traceback” for food safety Document environmental complianceDocument environmental compliance

25 Geographic Information Systems (GIS) Stacked Set of Map LayersStacked Set of Map Layers Spatial and Attribute DataSpatial and Attribute Data Various Strategies Crop Production Crop Production Marketing Products and Services Marketing Products and Services Land Use Planning Land Use Planning Disease Control Disease Control Locating Large Scale Livestock Units Locating Large Scale Livestock Units Watershed Management Watershed Management

26 Management Zones

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28 Precision Farming is Dead… A European Perspective 1) Classic Precision Ag is dead.1) Classic Precision Ag is dead. 2) GPS will be equal to navigation2) GPS will be equal to navigation 3) The biggest and most important discussion point was traceback, documentation, etc.3) The biggest and most important discussion point was traceback, documentation, etc. Summary: Documentation and navigation will be the real practical precision farming in the future.Summary: Documentation and navigation will be the real practical precision farming in the future. (July 3, Georg Durrstein,

29 Precision Ag Services and Enhanced Seed Dealership Survey (Farm Chemical Magazine and Center for Ag Business, Purdue Univ., 2000)

30 Precision Ag Services and Enhanced Seed Dealership Survey (Farm Chemical Magazine and Center for Ag Business, Purdue Univ., 2000)

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32 Weather and Other Information

33 Predicted Dryland Results

34 What is the Internet Doing for Farms and Agri-Business? Information SharingInformation Sharing Distance EducationDistance Education Buying/Selling Products and ServicesBuying/Selling Products and Services Marketing CommoditiesMarketing Commodities Data Storage and Decision MakingData Storage and Decision Making

35 Information Sharing communication communication Electronic Business CardElectronic Business Card Sell yourself, commodities, products and managementSell yourself, commodities, products and management Provide information and data to all levels of food chainProvide information and data to all levels of food chain Educate general public (i.e., environmental stewardship, community involvement)Educate general public (i.e., environmental stewardship, community involvement)

36 Distance Education Online undergraduate and graduate coursesOnline undergraduate and graduate courses Online Training (free to fee-based)Online Training (free to fee-based) CertificationCertification

37 E-Business Models Business-to-Consumer (B2C)Business-to-Consumer (B2C) Business-to-Business (B2B)Business-to-Business (B2B) Business-to-Government (B2G)Business-to-Government (B2G) Consumer-to-Consumer (C2C)Consumer-to-Consumer (C2C) Relationships Manufacturer Input Supplier Producer Product Handler Processor Consumer

38 Defining E-Business E-business is not E-commerce.E-business is not E-commerce. E-business is the conduct of business on the Internet.E-business is the conduct of business on the Internet. –This includes buying and selling, online marketing, servicing customers, providing and collecting information, and collaborating with business partners. E-Commerce is a component of E-Business. It is the mechanism for purchasing and selling online.E-Commerce is a component of E-Business. It is the mechanism for purchasing and selling online.

39 Computer Science Marketing Logistics Biz Admin Consumer Behavior P.R. Graphic Design Quality Control Engineer Research Sales ?? ??? Law E-Business B to B B to C

40 Types of E-Biz Model Formats MarketplacesMarketplaces Mall PortalsMall Portals Auction SitesAuction Sites Customized Web SiteCustomized Web Site Informational / TourismInformational / Tourism

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42 E-Business Stores and Malls Basic templates providedBasic templates provided Will get you up and going quicklyWill get you up and going quickly Easy to doEasy to do One-stop shop for everythingOne-stop shop for everything –Shopping Carts –Credit Card Transactions –Transportation –Security –Advertising and evaluation

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56 DOT.COM Fallout Was it too much too fast?

57 Self-Examination Period, 2001 Certain Dot.Coms see the need to spend more time educating about technology and expectations so customers know how to access their products and services online. (indicators: comprehensive help section, additional methods for customer support, warranties/liabilities)Certain Dot.Coms see the need to spend more time educating about technology and expectations so customers know how to access their products and services online. (indicators: comprehensive help section, additional methods for customer support, warranties/liabilities) Businesses are refining and enhancing existing methodologies. (indicators: advertising costs down, developing knowledge base systems)Businesses are refining and enhancing existing methodologies. (indicators: advertising costs down, developing knowledge base systems) Trying to make sense of customer data already acquired. (indicators: strongest investments in IT industry are in data storage, database management, broadband and security. InternetWeek, September 2001)Trying to make sense of customer data already acquired. (indicators: strongest investments in IT industry are in data storage, database management, broadband and security. InternetWeek, September 2001)

58 Communicating Quality Signals Clear crisp imageryClear crisp imagery Audio / VideoAudio / Video Allow comparisonsAllow comparisons Allow samplesAllow samples Tracking informationTracking information Customer Service/SupportCustomer Service/Support TestimonialsTestimonials Brand RecognitionBrand Recognition

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61 OSU E-Business Audience Observations and Evaluations Internet Business Plans are not on paper Many have “informational” web sites more are starting to get into full e-procurement web sites this year Difficult to keep up with maintenance and online marketing strategies throughout the growing season Low web site traffic (Watermeier, N, 2001) (Small Business Audience)

62 E-Biz Topics Being Asked How to Get Noticed on Search EnginesHow to Get Noticed on Search Engines Managing the whole transaction process from data collection, e-procurement, to follow-up with customers.Managing the whole transaction process from data collection, e-procurement, to follow-up with customers. Web development “how to’s”Web development “how to’s” Selecting a web hosting companySelecting a web hosting company Measuring ROIMeasuring ROI and mailing lists for customer interaction and orders and mailing lists for customer interaction and orders (Watermeier, N, 2001)

63 Suggestions for E-Business E-Business is more than a web site. It is about adding IT into other portions of the business, e- marketing, and e-commerce.E-Business is more than a web site. It is about adding IT into other portions of the business, e- marketing, and e-commerce. Plan for timing and expenses for e-business. Learn and investigate mechanics of the technology. Rely on experts to make it happen.Plan for timing and expenses for e-business. Learn and investigate mechanics of the technology. Rely on experts to make it happen. Establish a good working relationship with your web design/hosting consultants. Meet customer expectations by delivering timely products and information.Establish a good working relationship with your web design/hosting consultants. Meet customer expectations by delivering timely products and information.

64 Suggestions for E-Business Visibility is important to get noticed. Watch your competitors. Build Search engine compatible web sites.Visibility is important to get noticed. Watch your competitors. Build Search engine compatible web sites. Consider professional design, content and navigation structure. Usability and download time are key elements. Evaluate, adjust and repeat.Consider professional design, content and navigation structure. Usability and download time are key elements. Evaluate, adjust and repeat. Understand legal issues on the Internet. Own your own virtual property. All offline laws apply online. Use common sense and business practices.Understand legal issues on the Internet. Own your own virtual property. All offline laws apply online. Use common sense and business practices.

65 Thoughts on Online Trading Grain sales are still new and limited (i.e., few local buyers onboard)Grain sales are still new and limited (i.e., few local buyers onboard) Price comparisonsPrice comparisons Independence and “neutral” (i.e., Cybercrop, Rooster, E-markets)Independence and “neutral” (i.e., Cybercrop, Rooster, E-markets) Online Decision Tools ( i.e., E-markets – Decision Rules for Contracts (DRC))Online Decision Tools ( i.e., E-markets – Decision Rules for Contracts (DRC)) Customer service?Customer service?

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67 Data and Information Warehouses Local and regional data sets on a variety of informationLocal and regional data sets on a variety of information Cropping and livestock information (i.e., varieties, soil types, yields, diseases, insects)Cropping and livestock information (i.e., varieties, soil types, yields, diseases, insects) Organize, manage, consultOrganize, manage, consult Aggregate and mine data for decision making and marketingAggregate and mine data for decision making and marketing

68 Data and Information Warehouses

69 E-Business will not save Agriculture Next generation of E-Agribusiness will generate off of value in the information and services that it currently provides.Next generation of E-Agribusiness will generate off of value in the information and services that it currently provides. Agriculture is becoming more vertical with production and distributionAgriculture is becoming more vertical with production and distribution Requires new learning opportunities and willingness to share data between the different levels of the food chain.Requires new learning opportunities and willingness to share data between the different levels of the food chain.

70 Next Generation E-Agribusiness Traceback and Identity Preservation through “suite” of data collection and interpretation technologies.Traceback and Identity Preservation through “suite” of data collection and interpretation technologies. This will be provided through documentation (text, graphics, and voice), GPS, GIS, remote sensing, other sensors, data warehousing/mining, decision support systems, and knowledge base systems.This will be provided through documentation (text, graphics, and voice), GPS, GIS, remote sensing, other sensors, data warehousing/mining, decision support systems, and knowledge base systems.

71 Electronic Identification (EID) Management Tool Tracking Information Quality Food Safety Ohio Beef Network – Ohio Cattlemen’s Association & OSU Extension

72 IdentityPreserved.com Tracking and identification tools for capturing value for food and agricultureTracking and identification tools for capturing value for food and agriculture Includes services to keep track of information and help make decisionsIncludes services to keep track of information and help make decisions Postmark® Signpost CropTouch TM TraitCheck TM GMOCheck TM

73 Future Outlook

74 Refinement of Technologies Mining multiple data setsMining multiple data sets Data WarehousingData Warehousing Increased Bandwidth - Internet 2, wireless, cable, DSL, and satelliteIncreased Bandwidth - Internet 2, wireless, cable, DSL, and satellite Speech to text, text to speechSpeech to text, text to speech

75 The Future of E-Business Growth will continue, will be more rational, cautiousGrowth will continue, will be more rational, cautious Integration with strengths of businessIntegration with strengths of business Sharing of databases and knowledgeSharing of databases and knowledge CRM (Customer Relationship Management)CRM (Customer Relationship Management) XML and other standards/platformsXML and other standards/platforms

76 The Future of E-Business Business to business e-com will continue to growBusiness to business e-com will continue to grow Consumers will expect brick and mortar businesses to have a dot.com presenceConsumers will expect brick and mortar businesses to have a dot.com presence Successful models will be “clicks and mortar” and “pure plays”Successful models will be “clicks and mortar” and “pure plays” Meanwhile the Web will be omnipresentMeanwhile the Web will be omnipresent

77 “X” Internet Defined by Forrester Research as ‘executable’ and ‘extendable’ InternetDefined by Forrester Research as ‘executable’ and ‘extendable’ Internet –Cell phones –Radios/TVs/Appliances –Tractors and combines Wireless and Chip technology with Internet connectivityWireless and Chip technology with Internet connectivity

78 Future Technologies 3G Wireless (Third Generation Wireless)3G Wireless (Third Generation Wireless) –Japan’s DoCoMo, I-Mode –80% Wireless Users in World are in Asia (NTIA, 2001) WAP (Wireless Application Protocol)WAP (Wireless Application Protocol) ( DoCoMo, 2001

79 Virtual Reality Pesticide TrainingPesticide Training Virtual ConferencesVirtual Conferences Crop ConsultingCrop Consulting

80 Smell Technology Computers equipped with chemical spray devices. Built on molecular ionization processes.

81 Suggestions for Extension Professionals

82 Basic Starting Point - Learn about the Technology Use Internet tools in everyday education programmingUse Internet tools in everyday education programming You don’t have to be the expert on everything. Explore the web and new technologies and identify ways it can assist you.You don’t have to be the expert on everything. Explore the web and new technologies and identify ways it can assist you. Don’t let the technology intimidate you or drive your education programsDon’t let the technology intimidate you or drive your education programs Evaluate what is most effective for the audienceEvaluate what is most effective for the audience

83 Where do we need to be... Increase Organization Skill Sets - Training (Internet, GIS, E-Business Planning)Increase Organization Skill Sets - Training (Internet, GIS, E-Business Planning) Invest in Organization’s Technology Future ($$$ and staff)Invest in Organization’s Technology Future ($$$ and staff) Promote Online education courses “DOT.EDU”Promote Online education courses “DOT.EDU” Practice what you preachPractice what you preach - How ‘Useable’ is your web? - 5 years?, 10 years? - Begin building database driven web sites

84 Extension Programming Implement specialized IT teams across University: (i.e., GIS, E-business, precision agriculture)Implement specialized IT teams across University: (i.e., GIS, E-business, precision agriculture) Non-biased position: implement research studies to evaluate applications of technology in real-world conditionsNon-biased position: implement research studies to evaluate applications of technology in real-world conditions Start building the technical capacity and partnerships within local communities. Create a county Information Technology Steering Committee.Start building the technical capacity and partnerships within local communities. Create a county Information Technology Steering Committee. Train community leaders to assess the potential for E- Business.Train community leaders to assess the potential for E- Business. Develop training opportunities to educate operators of small- and medium-sized businesses how to plan, establish, and expand business presence using the Internet.Develop training opportunities to educate operators of small- and medium-sized businesses how to plan, establish, and expand business presence using the Internet.

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