What is Crowd Funding and Does It Really Work?

One of the major challenges of starting a small business is finding financing. Banks are giving out fewer and fewer loans in this economy, so where is an entrepreneur supposed to get startup money? You may need to get creative and try alternative financing options like crowd funding.

According to Wikipedia, crowd funding is "the collective cooperation, attention and trust by people who network and pool their money and other resources together, usually via the Internet, to support efforts initiated by other people or organizations. Crowd funding occurs for any variety of purposes,from disaster relief to citizen journalism to artists seeking support from fans, to political campaigns, to funding a startup company or small business or creating free software."

In a July 2011 post, I described a Pittsburgh brewery that was using crowd funding to fund their expansion into a larger facility. Below is a video of a New Jersey woman who recently used crowd funding to open a storefront for her baking business.



Is this type of funding right for you? As I've said many times before about trying a new idea, DO YOUR RESEARCH! Every business is different and you must weigh the pros and cons to tell if this is right for you. In the near future, I'll write a post about different kinds of crowd funding websites.

If you are an ag entrepreneur and have tried crowd funding, how was your experience? What kind of promotion did you do? What kind of advice would you give others thinking about trying crowd funding?

Getting people to "see" your brand on Twitter

If you have used Twitter, you know that there is a very small amount of space for you to post (only 140 characters). To show a picture, you must include a link or use a third-party photo app like Instagram, Twitpic, or yfrog. To get people to click on your picture, you need to create a description that catches readers' attention, all in 140 characters or less. Sounds a little daunting, but it can be done!

Some tips on creating a better visual of your brand from an article posted on OpenForum.com with examples created for my fake business "DJM428 Cheesesteaks":

1. Twitter voice should be consistent and relevant. Try to keep the same person as the main Tweeter so that your Twitter account has the same style and voice. When composing tweets, they should be descriptive and relevant. Explain as much about the product (in 140 characters or less) and then add a picture.



2. Favor native images. As I mentioned above, third-party photo apps allow you to attach a picture right in your tweet. The reader just needs to click on the embedded link and the picture will show up in the feed. This is much more useful than just adding a link because it doesn't force your users to open another screen to see the picture (which might deter some readers). Research the different photo apps and how they work on mobile devices. Some work differently than others in how they display images.




3. Pageviews are paramount. As always, you want readers to visit your website. Be sure to frequently link back to your website so that readers can see all that you have going on. In doing so, don't be vague. Links with little or no description discourage readers from clicking.

What to do:



What not to do:



As an ag business owner, how do you use Twitter? How many followers do you have? How do your customers respond to your tweets? What advice would you give another ag business owner who is thinking about tweeting?

UK institutes gluten-free labeling regulations; could the US be next?

In June of last year, I wrote a post about gluten-free products and it was the most read post so far. Since this seems to be a trending topic, I thought I would continue giving our readers more info about gluten-free products.


Starting this year, the UK has developed new regulations in the labeling of gluten-free foods. The labels will include 3 categories (as reported by SupermarketGuru.com):
1. Gluten-free: applies only to food which has 20 parts per million (ppm) or less of gluten.
2. Very low gluten: applies to foods which have between 21 and 100 parts per million (ppm) of gluten.
3. No gluten-containing ingredients: this is not covered by the law and is for foods that are made with ingredients that don’t contain gluten and where cross-contamination controls are in place. These foods will have very low levels of gluten but have not been tested to the same extent as those labeled gluten-free or very low gluten unless otherwise stated on the label.

Is the US next in instituting such regulations? The FDA took steps in 2007 to develop gluten-free labeling (products with less than 20ppm of gluten could use the term "gluten-free"). There was a lull in the FDA's development of gluten-free labeling, but the case was re-opened in 2011.

As a food business owner, what do you think? Will these regulations help or hurt the gluten-free industry? Do you currently make gluten-free products? Do you have customers asking for gluten-free?

What Are Consumers Buying? - Guest Blogger, John Berry

Participating in a recent workshop on communicating with customers, I was reminded of the significance attached to meeting the needs of our customers. After all, they do have the money! Concepts around customer buying behavior are not necessarily new, but they do evolve over time. Jolene Brown was the catalyst for my latest ah-ha when she spoke of the 5 attributes people seek when shopping. She reminds us that people are not buying the goods we sell directly. What they actually seek to buy is: 1) time, 2) youth, 3) health, 4) safety, and 5) experience. It may benefit our businesses to give these concepts consideration as we finalize the 2011 work and start into planning and implementing for 2012.

Time

Convenience is another way to think of this retail shopper expectation. Many people are time stressed. Between family, community and work, there is often multiple demands on our limited available time. Getting the message to our customers on the ease with which our products can be purchased, prepared and consumed can be a challenge worthy of a solution. As an example – the average American male spends 8 minutes on shopping and 15 minutes per day on food preparation and cleanup. The average American female spends 14 and 47 minutes accomplishing these tasks. If our typical shopper is near to these averages – how do our products/services fit? Are we time worthy?

Youth

During a private conversation, a major grocery chain manager described the basics of their decision making process for locating a new store. The gist of this process is “we seek a demographic with relatively high cosmetics transactions.” Having not yet found the secret of immortality we do strive to stay vibrant and active as we age.

Health

Continuing research into our health status leads scientists to project that in a few more years, 70% of American adults will be overweight. As we consider the health needs of our customers, are we providing solutions focused on their demand or our interpretations of what they should demand?

Safety

Between food safety concerns with conventional food sources and food safety concerns with trendy food sources, it’s no wonder the safety of the food we feed ourselves and our families is a primary consideration when shopping. Also, agri-tourism opportunities are evolving as farm marketers develop a more sophisticated and fuller compliment of venues. As farmers step into these non-production roles the risk they accumulate and mitigate can be significant.

Experience

More consumers are also seeking the farm experience as a way to build family quality time and assure themselves of the safety of their food. Not only do consumers expect a delightful experience each and every time they purchase an item, more significant for us, the further removed from farm life consumers get the more they crave a real farm/food experience. The experiences we make available to our customers begin as we initiate promotions and awareness efforts and follow through final product use. It may be worth remembering – our customers’ last impression of us is the one most likely to stay in their head.

Conclusion

I am wildly optimistic when I think about agricultural opportunities. We may only be limited by our imaginations. However, challenges are also many. As we seek new farm ventures, develop and implement plans – let’s also remember to focus on what potential customers actually want. Growing and marketing great farm products is not the point. Successful farm marketers are those businesses that are growing and marketing great farm products that customers want. We may serve ourselves, our communities and our industry best when we focus on customer needs more often.

About John Berry.... Following twenty years of milking cows, raising pigs and making maple syrup  John received an MBA and has been working for Penn State Extension ever since. His adult education work with Extension centers primarily on agricultural marketing issues. Roughly half his time is devoted to commodity marketing concerns with the remainder focused on retail farm market and agri-tourism topics. An annual retail farm market bus tour, in-season farm market employee twilight workshops and a Retail Farm Market School are some examples of the educational outreach programs John is involved with that benefit direct-to-consumer farm families.