2013 23.1 New Research on Farmers Market in Washington State

Farmers today have a range of direct marketing options – from farm stands to food hubs, CSAs to co-ops, school cafeterias to restaurants celebrating our local fare. And yet amid expanding options, farmers markets continue to provide a crucial connection between farms and shoppers. We now have over 160 unique farmers market locations in Washington State with an estimated over $50 million in annual sales, supporting more than 1,000 small and midsized farm businesses. Despite this growth, the farmers market community faces significant questions about the future: What do farmers need to succeed? What will encourage shoppers to regularly buy their groceries at the market? How to best adapt to new technology? How to sustain market operations? How do we measure and communicate the economic, community, and environmental roles markets play locally and throughout the state?

Washington State Research Project

Such questions posed by market advocates sparked a threeyear research project led by Marcy Ostrom, Washington State University’s (WSU) Small Farms Program leader and funded by United States Department of Agriculture’s (USDA) National Institute of Food and Agriculture. The research team includes an economist, sociologist, and community development specialist from WSU, and farmers market managers, farmers, and the Washington State Farmers Market Association. While some organizations, like the Neighborhood Farmers Market Association, collect excellent records and market statistics, most data on farmers markets is inconsistent and difficult to aggregate at the state level. The USDA Census of Agriculture asks just one question about direct market sales. Given the dearth of farmers market data and complex points of entry into farmers markets, our research methods are designed to be both broad and participatory: fourteen Rapid Market Assessments, a statewide Market Manager Survey, four Case Study markets, a Farm Vendor Survey, three Focus Groups, and collecting any existing records. The research project is in its final stages of data collection and we look forward to sharing results with Tilth Producers members throughout the coming year. What have we learned so far?

Rapid Market Assessments

Developed by Garry Stephenson and Larry Lev at Oregon State University, Rapid Market Assessments (RMAs) are an efficient way for farmers markets to collect a great deal of shopper information and obtain feedback from impartial peers in a single market day.1 Based on participatory research principles used internationally, RMAs were selected for their low-cost and low-tech ability to capture rich data for a given market day. The three main tools of the assessments are shopper counts, a “dot survey” with questions on flip charts that shoppers can answer with colorful round stickers, and constructive observations from a team of outside market managers and experts. We have completed fourteen RMAs through our project. Farmers markets were selected to represent a wide variety of geographic features — urban and rural, western, and eastern Washington — as well as a mix of market sizes.

Shoppers Support Local Farms

When market shoppers were asked “what their primary reason for shopping at the farmers market” was, the most commonly selected answer was “to support a local farm.” The percentage varied by market, with a high of 52% at the South Tacoma Farmers Market and low of 19% at the Yakima Farmers Market; however supporting a local farm was the top reason selected by shoppers at thirteen out of the fourteen RMAs. (Pike Place Market was the exception with “atmosphere” being the top reason reported.) The second most frequent reason for shopping listed by folks was “healthy food.”

These findings affirm that farmers markets are tapping into the interests of a highly motivated group of shoppers who care deeply about local agriculture and health. They also reiterate the importance for farm vendors to invest in building relationships with their shoppers at farmers markets. The message for farmers is that simple things can make a big difference. For instance, make sure farm banners are attractive and send a clear message about the farm identity. Be sure to have banners prominently displayed at every market. Consider wearing name tags or having market employees wear shirts with the farm logo so that shoppers can get to know the farm and recognize it at other markets and marketing venues. Shoppers want to know the farm story, how the crops are grown and how the animals are raised, and ways to use the products. Any farm brochures, photos, websites, or farm events that help shoppers feel connected to the farmers feed their desire to come to the market and support the grower. And, if possible, be sure to highlight any health benefits of the products. It’s hard to know exactly what shoppers think of when they refer to “healthy food,” so don’t limit promotions to the nutritional content. Think broadly about everything connected to health that the shoppers may aspire to share: energy, freshness, proximity to the earth, absence of toxic substances, cleanliness, and food safety. In a recent statewide poll of the general public, safety, followed by freshness, taste, and nutrition ranked highest among consumer purchasing priorities.2

As indicated in Figure 1, only 2% of respondents selected “affordable food” as their primary reason for shopping at the farmers markets. Nuancing the general perception that farmers markets are “elitist” and “expensive” places to shop is a real challenge. There is clearly a perennial need to educate shoppers about the true and relative costs of food. As experienced farm vendors know, how products are displayed and priced influence shoppers’ perception of “affordability.” In addition, be sure to highlight the value of products: staying fresher longer, yielding less food waste, having more flavor, having a unique variety, or offering food raised with humane/sustainable practices. Not to mention endlessly educating customers about how the farm business is supporting working agricultural land, a family farm, the local economy, and so on.

With the rise of “food insecurity” and awareness around the importance of access to healthy foods, farmers markets have also become increasingly engaged in serving low-income communities. Not only are farms increasingly accepting Farmers Market Nutrition Program checks for Women, Infants, and Children Program (WIC) clients and seniors, there is growing capacity for people to spend food stamp benefits at farmers markets. More and more markets can turn Electronic Benefits into tokens, although keeping up with the ever-changing technology and bookkeeping demands can be daunting. In addition, many farmers markets also partner with their local food bank and farmers donate tons of fresh food each year, adding to their positive impact in the community.

Average Sales an Important Economic Indicator

In general, economic data for direct marketing farmers is very difficult to evaluate. There aren’t any equivalent governing bodies with the capacity of commodity commissions to collect, analyze, and report crop-by-crop data. In addition, many direct market farmers have diversified operations and multiple marketing channels. So, sales at farmers markets are an important economic indicator not just for the individual farm businesses, but also for farmers markets and the direct marketing industry as a whole.

In our RMAs, we asked two questions: how much the shopper “had or would spend at the farmers market” that day and “how much they would spend at other nearby businesses or restaurants.” The latter is intended to capture some of the spillover economic activity related to the farmers market.

Taken together, the average shopper spending reported at the fourteen RMAs was $18.21 with a high of $36.03 at the U-District Farmers Market in Seattle to and low of $12.69 at the Okanogan Farmers Market. Clearly seasonality, product mix, vendor mix, the local demographics, weather, and other variables can impact sales at a farmers market on any given day.

One current strategy to increase shopper spending at farmers markets is to help vendors to accept credit and debit cards, either through token-type programs or directly via smartphones apps like the Square. This addresses the general shopper reliance on “plastic,” while raising tricky questions about how to cover the processing, bookkeeping, and administrative expenses.

As in other marketing outlets, it’s important to get a sense of the average sales at the markets of interest. Is this particular market a good fit with the products’ price point? How can more of the shoppers’ farmers market dollar be captured? This is real work. And often requires diligent record keeping and ongoing experimentation. Most farm vendors have an innate sense of sales on any given day. But do folks track and analyze enough to really indicate what’s working and what’s not? Not just for the market day, but for the season? Market managers can be great consultants. Start by asking what their average farm vendor sales per market day is. Simply the ability to answer that question indicates a strong market drive and capacity to analyze data. Don’t be shy about asking managers for their ideas on how to increase sales. They see a lot and often minor display upgrades and product promotions can make a big difference. What special events does the market organize? If there is a kids’ day on the schedule, is there anything the farm can do to educate or engage the kids (and their parents)? Is there a potential opportunity to promote product categories (e.g. cheese, apples, flowers) or maybe even individual farms? Lastly, know the market and plan display and product mix strategically. Is the market a destination for primarily for locals? Tourists? Lunch-break shoppers? Post-church shoppers?

The RMAs also provided data on what shoppers reported spending at other nearby businesses and restaurants. This spending tends to be a primary indicator of the overall economic impact of a farmer market, particularly for its host community. What our research affirms is that there is indeed spillover spending at each of the RMAs, however, the amount varies widely. The highest amount was at the San Juan Island Farmers Market at $36.71 and the lowest was in Bremerton in 2009 at $3.93. For some markets such as the Kittitas County Farmers Market in Ellensburg, the average additional spending was just about the same as market spending at around $17.00

Not surprisingly, the more we learn, the more questions we have. This project is no exception. Fortunately, we’re on the cusp of finalizing the results of our statewide market manager survey that looks at overall sales, organizational issues, and opportunities. We’re also eager to report back what we learn from the statewide farmer vendor survey and better understand farmers’ views, needs, and future marketing directions.

1 Lev, Brewer, and Stephenson, 2008 “Tools for Rapid Market Assessments”
OSU Extension, Oregon Small Farms Technical Report No. 6.
2 Ostrom M. and R. Jussaume, 2010. Statewide Telephone Poll. WSU Social and Economic
Sciences Research Center.

Tags: Food Stamps, Market Research, Market Shoppers, Rapid Market Assessments, Women Infants and Children Program