The Current Status Regarding the E-Commerce of Farmers Association in Taiwan

Transcription

1 Chen, C.-C., Liang, C., & Yueh, H.-P. (2014, September). The current status regarding the e-commerce of farmers in Taiwan. Paper presented at the 9th Conference of the Asian Federation for Information Technology in Agriculture, Perth, Australia. The Current Status Regarding the E-Commerce of Farmers Association in Taiwan Chao-Chien Chen 1 and Chaoyun Liang 2 and Hsiu-Ping Yueh 3 1. Chao-Chien Chen, Taiwan/Taipei and d @ntu.edu.tw 2. Chaoyun Liang, Taiwan/Taipei and cliang@ntu.edu.tw 3. Hsiu-Ping Yueh, Taiwan/Taipei and yueh@ntu.edu.tw Abstract Taiwan s agriculture industry consists of a small farming system comprised mostly of family farms, Farmers s (FA) are very important farmer organizations in Taiwan which aid in the promotion of the agriculture industry, the implementation of agricultural policies, production and marketing, and the development of rural areas. FA have brands, funding, technologies, channels, and policy support. Due to the rise of the internet in recent years, e-commerce has become one of the broadest and most important topics in business management. As the internet environment has surpassed the limitations of traditional marketing, the distance between businesses and consumers has been substantially decreased, lowering costs and increasing customer interactions internally while increasing competition and fulfilling customer demands externally. The application of online marketing in various industries has also flourished and become more advanced. Due to its borderless nature, online marketing allows industries to break through geographic limitations, making it the most effective method of localization around the globe and an important development trend for Taiwanese agriculture. We distributed the scale to 302 FA in Taiwan to assess the current status of e-commerce, this study reports the current status regarding the e-commerce of FA in Taiwan. Keyword: E-commerce, internet marketing, agriculture marketing, Taiwan agriculture Introduction Taiwan s agriculture industry consists of a small farming system comprised mostly of family farms, wherein the lack of free-flowing channels for product marketing has an immediate and direct impact on operating income. The establishment of diverse marketing channels for agricultural products will improve the business scope of small agriculture markets (Chen et al., 2010), and actively applying internet and e-commerce options can help in creating innovative opportunities for Taiwanese agriculture (Chen, Liang, & Yueh, 2014 July; Chen, Liang, & Yueh, 2014 August). FA are important agricultural organizations for all regions in Taiwan which help promote the agriculture industry, implement agriculture policies, and develop rural areas. The goal of FA in Taiwan are safeguard rights, enhance knowledge and skills, boost the modernization of agriculture, improve livelihood and develop rural economies (Farmers Association Act, 2008). They have the advantages of brands, capital, technology, 1

2 access, and policy support (Liao, 2011). Having FA lead online marketing promotion will aid Taiwan s agriculture industry develop online marketing. Following the emergence of the internet and electronic commerce, online marketing has recently become one of the most widely discussed and highly held topics in enterprise operations. The internet environment surpasses traditional marketing limitations, greatly shortening the distance between businesses and consumers, reducing internal costs, increasing interaction with customers, improving competitiveness, and satisfying customer needs. As such, application of online marketing in various industries has become more advanced and flourishing. The internet is boundless; introducing online marketing can help industries break free of geographic restrictions and become the most effective local business channel in the world. This is an important development trend for Taiwan s transitioning agriculture industry. There are 302 FA across Taiwan, each with unique characteristics and business models, and although they all engage in online marketing. To understand the current situation of Taiwanese FA online marking, this study applied the scale, regarding employees of the online marketing division within FA to conduct a questionnaire survey on online marketing current status. Literature review Online marketing in agriculture The focus of marketing is the process created by the supplier to satisfy consumers needs and desires that they accept the provided valued product. The internet combines product information, promotional events, customer feedback surveys, public relations, and access to provide distinct marketing environments and thought for one-on-one communication. Therefore, online marketing can include tangible products, expressing services and intangible consumer experiences, and passing on satisfied consumer experiences to potential customers (Bernstein and Federgruen, 2007). These are important trends in marketing applications. Huang (2011) also pointed out that, for the agricultural industry to make money, it must industrialize; for it to develop, it must rely on creativity to retain consumers. In other words, how operators apply their brain to get inside their pockets. Therefore, constantly introducing new ideas is the key to agricultural marketing (Liao, 2011). As the internet provides both media and access, business-to-consumer e-commerce has become an important battlefront for web portals; online marketing of agricultural products can seize opportunities and make proper use of technology (Yang, 2004). Therefore, agricultural product marketing can use both traditional channels and the internet to avoid or reduce restrictions from insufficient farm production, rural location, brand establishment, or being unknown (Wu, 2012). With global competition, cannot simply be a distribution depot for agricultural products; they must become packaging and marketing centers that develop new products, incorporate creative marketing concepts, expand marketing channels, and increase profits (Zhuang, 2008). Having FA develop online marketing will help drive further progress for agricultural online marketing in Taiwan. The internet creates a sense of community; using social media, such as chat rooms, Facebook, and Weibo, can help increase netizens loyalty (Huang and Wang, 2009). The essence of online marketing has caused marketing strategies to gradually gravitate towards the theory of 4Cs (customer, cost, communication, and convenience); therefore, online marketing emphasizes the consumer s opinion in pursuit of providing customers needs and desires, thinking from the customer s point of view, and creating a desired convenient environment, as well as stressing interaction and communication with customers to strengthen client 2

3 relationships. As a result, the key to successful online marketing lies within personnel and how website managers create an enticing online experience for customers (Chou & Liang, 2013; Gu & Liang, 2013; Hung & Liang, 2013). A successful online experience is the result of excellent service quality and the key to creating an online competitive advantage (Novak, Hoffman, & Yung, 2000). Using MagCloud, Hewlett-Packard s online magazine publication platform, as an example to evaluate the benefits of online marketing, results from statistical analysis by Google and HP show that promotional price reduction has a strong influence on consumers, yet this is limited to stimulation of purchasing decision; however, website service reputation and recommendation by netizens have a broader influence (Albuquerque, Pavlidis, Chatow, Chen, and Jamal, 2012). For online marketing, maintaining online service quality is more important than price promotion. Within the internet environment, given a desired emphasis on consumer satisfaction and enterprise success, a service development framework should be created and service innovation and customer relations should be strengthened according to five strategies: use of 1). Abstract and multiple-perspective thinking, 2). Expandable concepts, 3). Modular concepts, 4). Analogical thinking, and 5). Original design (Zeng, Proctor, and Salvendy, 2009). Research methods Study design This study create a Taiwanese FA online marketing survey. conducted a survey regarding employees outside of the online marketing division within the 302 FA across Taiwan. Twenty industrial, official, and academic experts relevant to the agricultural industry were invited to perform a pretest on the survey. A total of 16 questionnaires were returned for a return rate of 80%. Further amendments were made to the variables and wording in the survey in accordance with the pretest results and the experts suggestions to arrive at the final survey content. The subjects of this study were the employees of Taiwan s FA; therefore, surveys were sent to Taiwan s 302 FA. The chiefs of staff at each FA were asked to select two employees fill out the survey regarding the application of the internet in marketing agricultural products and improving the FA s image. A total of 604 surveys were sent. The surveys were scored using a six-point Likert scale where interviewees gave responses according to their opinion which best matched the options Strongly agree, Agree, Slightly agree, Slightly disagree, Disagree, and Strongly disagree. A score from 1-5 was given to each response; higher scores responded to higher expectations for service quality and more positive experiences. Reliability and validity analyses Reliability is the consistency and stability of the test results. This study applied Cronbach s α coefficient to test the reliability of the survey variables. The general standard for measuring reliability defines good reliability as 0.7. Higher values indicate higher correlation between the question, higher internal consistency, and a more stable measuring scale. Results showed Cronbach s α coefficient was between and 0.952, suggesting high reliability for the questions in this survey. Validity tests the accuracy of the concept the investigator wishes to measure. This study pretest was conducted after amending the questions and wording according to the characteristics of online marking, therefore, its validity is sufficient. 3

4 Data processing This study viewed Taiwan s 302 FA as one entity, control variables were the state of operations for each FA, resources allocated for online marketing, and the level of support by chiefs of staff. A total of 604 surveys were sent and 214 were returned. Four of the returned surveys were ineffective, leaving 210 effective surveys (34.77%) which included 149 FA (49.34%). As the internet is boundless, it can break free of geographic restrictions. FA are established in accordance with Taiwan s districts and townships which make them representative of their respective locations. This study divided Taiwan into four large regions: northern Taiwan, central Taiwan, southern Taiwan, and eastern Taiwan and outlying islands. Comparatively, eastern Taiwan and outlying islands is a more remote region. These remote regions (areas situated in mountains or far from city centers) were also used to investigate the relationship between geographical regions and online marketing. Taiwan has also conducted a regional survey on the digital divide; ranks 1-5 were given based on the extent of the divide from least to greatest. Although regional digital divide is not equivalent to the FA digital divide, as online marketing and the digital environment are interrelated and FA services target regional farmers, the relationship between the regional digital environment and online marketing will be investigated simultaneously. Results Analysis of Taiwan s FA current online marketing According to survey results, 70% of Taiwan s FA utilize the internet to sell agricultural products and improve the FA image, remote regions (areas situated in mountains or far from city centers) 23.13% % created online marketing websites, and 81.9% provide product descriptions online, also have 32.8% of the farmers to open FB account, but operating results are poor, only a maximum of more than five thousand fans. As such, Taiwan s FA have a definite function in developing online marketing in Taiwan s agricultural industry. However, further analysis showed only 46.19% of FA provide direct online shopping services, in other e-commerce web sites to shop ratio is more down to 22.38%. This shows that while FA understand that the internet can be used to market the FA and agricultural products and the majority has created official websites, there is an evident decline in those with online shopping services which require more information and technical support. This observation demonstrates that online marketing is mainly used for promotional purposes and not for direct sales. Most of FA have dedicated colleagues to maintenance website accounted for 75.23%, but have dedicated colleagues to internet marketing down for 47.14%, visible FA were still to set up a website-based, yet very focused on internet marketing. Instead, the remote regions (areas situated in mountains or far from city centers) relative importance internet marketing, have dedicated colleagues to internet marketing accounted 27.27%, higher than have dedicated colleagues to maintenance website(18.99%). 4

5 Correlation analysis of Taiwanese FA online marketing and geographical region To understand whether online marketing is influenced by the geographical location of the FA, this study divided Taiwan into four regions: northern Taiwan, central Taiwan, southern Taiwan, and eastern Taiwan and outlying islands. Observation of development in the geographical regions reveals that eastern Taiwan and outlying islands is a more remote region and central and southern Taiwan important agricultural production regions. One-way analysis of variance was online marketing current status set as dependent variables and FA geographical region set as factors (Table 1). Results showed no significant influence. One-way analysis of variance was repeated with remote regions were set as factors and FA online marketing current status were dependent variables (Table 1). Results found a significant influences on utilize the internet to sell agricultural products and improve the FA image, have website for internet marketing, have provide online shopping services, have cooperation dealer, cooperation dealer have e-commerce, have dedicated colleagues to internet marketing, if the FA was located in a remote geographical region. Correlation analysis of Taiwanese FA online marketing and regional digital divide Taiwan has also conducted a regional survey on the digital divide; ranks 1-5 were given based on the extent of the divide from least to greatest. Although regional digital divide is not equivalent to the FA digital divide, as online marketing and the digital environment are interrelated, FA services target regional farmers, and employees are mainly regional residents, the regional digital divide, local farmers, and FA employees are all related. Therefore, this study conducted one-way analysis of variance with online marketing current status set as dependent variables and ranks of regional digital divide were set as factors and (Table 2). 5

6 Table 1 The table correlation analysis of Taiwanese FA online marketing and geographical region s utilize the have website have products provide shops open have cooperation internet to sell for internet on the web online on other cooperation dealer have agricultural products and improve the s image? marketing? site? shopping services? e-commerce sites? dealer? e-commerce? have a Facebook account? have dedicated colleagues to maintenance website? have dedicated colleagues to internet marketing? four large regions more remote region 0.001* 0.000* * * 0.000* * p value < 0.05 significant influences 6

7 Table 2 The table Correlation analysis of Taiwanese FA online marketing and regional digital divide utilize the have website have products provide shops open have internet to sell agricultural products and improve the s image? for internet marketing? on the web site? online shopping services? on other e-commerce sites? cooperation dealer? s cooperation dealer have e-commerce? have a Facebook account? have dedicated colleagues to maintenance website? have dedicated colleagues to internet marketing? the digital 0.025* 0.039* * 0.003* * 0.027* * divide p value < 0.05 significant influences 7

8 Conclusion This study made scale according to industry characteristics to create a Taiwanese FA online marketing service quality survey. Amendments were made to the variables and wording in the survey in accordance with industrial, official, and academic experts suggestions after a pretest. 604 surveys were sent to employees at Taiwan s 302 FA. 214 surveys were returned, four of which were ineffective, leaving 210 effective surveys (34.77%) which included 149 FA (49.34%). The following conclusions were reached through statistical analysis: According to survey results, 70% of Taiwan s FA utilize the internet to sell agricultural products and improve the FA image, 68.09% created online marketing websites, and 81.9% provide product descriptions online. As such, Taiwan s FA have a definite function in developing online marketing in Taiwan s agricultural industry. However, further analysis showed only 46.19% of FA provide direct online shopping services. This shows that while FA understand that the internet can be used to market the and agricultural products and the majority has created official websites, there is an evident decline in those with online shopping services which require more information and technical support. This observation demonstrates that online marketing in Taiwan s FA is mainly used for promotional purposes and not for direct sales. Geographic regions often influence the state of physical access marketing. Using Taiwan as an example, eastern Taiwan and outlying islands are located further from regions with concentrated populations; This shows that there is no influence on online marketing current status as a result of being located in four regions in Taiwan, but have significant influences of being located in a remote region. The FA located in a remote region more active to online marketing for utilize the internet to sell agricultural products and improve the s image, provide online shopping services, looking for cooperation dealer and hope the dealer have e-commerce, and have dedicated colleagues to internet marketing. Although regional digital divide is not equivalent to the FA digital divide, as the target FA services and their employees are mainly regional residents, this study attempted correlation analysis between regional digital divide and online marketing. Results found regional digital divide had significant influences on utilize the internet to sell agricultural products and improve the FA image, have website for internet marketing, provide online shopping services, shops open on other e-commerce sites, cooperation dealer have e-commerce, have a Facebook account, have dedicated colleagues to internet marketing. References Albuquerque, P., Pavlidis, P., Chatow, U., Chen, K.Y., & Jamal, Z. (2012). Evaluating promotional activities in an online two-sided market of user-generated content. Marketing Science, 31(3), Cenfetelli, R. T., Benbasat, I., & Al-Natour, S. (2008). Addressing the what and how of online services: Positioning supporting-services functionality and service quality for business-to-consumer success. Information Systems Research, 19(2), Chen, C.-C., Liang, C., & Yueh, H.-P. (2014, July). The business policy and strategy of online marketing: A case study of the Sinyi Township farmers in Taiwan. Paper presented 8

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