MASTER'S THESIS

Rice Farmers Buying BehaviorPurchase of Rice Machines; Transplanters and Harvesters

Mohammad Heidari AdvaryNeda Sayadi Ghazan

2015

Luleå University of TechnologyDepartment of Business Administration, Technology and Social Sciences

1

Lulea University of Technology

Master's Degree Thesis

Rice Farmers Buying Behavior

Purchase of Rice Machines; Transplanters &

Harvesters

Neda Sayadi Ghazan

Mohammad Heidari Advary

Advisor Professor: Dr.Mana Farshid

2

Abstract

This Thesis is aimed to study a buying behavior in

agricultural industry. Rice is one of the major crops

produced in agriculture farms, and hereby, we would focus

on how and by what means a farmer decides to buy

Transplanter and Harvester machines to mechanize his

business.

Rice is having a large contribution to human life since long

time ago and being considered as one of the major staple

food of several parts of the world, especially Asia. Therefore

the economy of production of rice is of huge importance.

This economy, like any other agriculture related businesses,

is heavily influenced by new technologies and conveniences

and this study tries to analyze the behavioral effects of

mechanizing of rice transplantation and harvesting on

farmers in general.

3

Table of Contents

Chapter1 – Introduction…………………………………………..5

1.1. Research Background ………………………………………………………………….……….6

1.2. Problem Discussion……………………………………………………………………….………6

1.3. Purpose of Thesis…………………………………………………………………………….…….7

1.4. Key Terms……………………………………………………………………………………………..8

Chapter2 - Literature Review

2.1. Marketing Segmentation………………………………………………………………….….10

2.2. Buying Behavior Definition……………………………………………………………….….13

2.3. Consumer as Decision Maker…………………………………………………………….…17

2.4. Learning as a part of purchase decision………………………………………………..19

2.5. Post Purchase behavior………………………………………………………………………..20

2.6. The buyer decision process for a new product……………………………………...21

2.7. The marketing mix……………………………………………………………….……………….23

2.8. Organizational Decision making……………………………………………………………24

Chapter3 - Methodology

3.1. Research Methodology…………………………………………………………………………27

3.2. Qualitative Method………………………………………………………………………………28

3.3. Population and Sample size…………………………………………………………………..29

3.4. Data collection Method…………………………………………………………………………30

3.5. Data Analysis Method……………………………………………………………………………30

4

3.6. Assessing credibility (Reliability and Consistency)…………………………………31

3.7. Pre-testing the questions and interview……………………………………………….31

3.8. Limitation of interviews……………………………………………………………………..32

Chapter4 - data presentation and analysis

4.1. Data collection……………………………………………………………………………..……..33

4.2. Questionnaire: Analytical and Structured Questions……………………………34

4.3. Data Reduction & Display ……………………………………………………………………35

4.4. Data Analysis……………………………………………………………………………………….41

4.5. Farmers’ adoption and post-purchase situation…………………………………..44

Chapter5 - Conclusion and Briefing

5.1. Qualitative Research Approach ………………………………………………………….46

5.2. Decision Making Process …………………………………………………………………….46

5.3. Briefing ………………………………………………………………………………………………48

References

5

CHAPTER 1 - INTRODUCTION

Rice Industry is having a very old history in human life and has played a major

role in human growth in number throughout centuries. In the recent decades,

when the mechanized agriculture is the only key for expansion all over the

world the Rice planting and harvesting is no exception. In less developed

nations the rate of using machines instead of man-power is low and therefore

the yield of the farms is lower.(Bridging the Rice gap in Asia Pacific region, FAO)

According to Agriculture Mechanization Organization of Iran the importance of

using advance machines for daily agriculture related activities is so obvious

that without applying them the whole business looks ending up with loss

rather than profit. In many Asian countries, because of the rapid economic

growth along with industrialization, the income gap between urban and rural

areas is expanding rapidly. The severe shortage of agriculture labor power in

rural area resulting from draining labors to cities, it becomes important issue

to save labor in the agricultural sector. The population boom in Asian countries

also demands farming sectors to increase agricultural productions at low cost.

Farming sectors in Asia have to increase crop yield, especially rice, the main

food of Asian people.(Rice Mechanization in Asia, by Joji Arihara, 2013, Tohoku

University)

The selection and buying the machines to plant and harvest the rice rapidly

grew during last two decades in the world wherever there was rice industry

and therefore the farmers have been following to select and buy the right

machine for their better convenience and profit (Mechanization of rice

production and challenges in China, by Zho Defeng).

The major producer of these machines were giant Japanese firms

(Mechanization of rice production and challenges in China, Zho Defeng),

however the Chinese companies are nowadays offering an acceptable level of

6

performance with cheaper prices. The selection, and buying machines in rice

producing countries by buyers, who are usually ordinary farmers seems a

matter of various factors, which consist the behavior of them as buyers.

1.1. RESEARCH BACKGROUND

The buying behavior of farmers as individual buyers has several aspects. The

farmers could act as people who do certain straight or modified re-buy for

certain items, however when it comes to purchase a heavy duty machine,

rather expensive and hefty, the behavior needs more assessment. The

characteristics of buying behavior of farmers are subtle, pervasive and difficult

to identify. (Buying behavior of farmers, Maarten Kool, 1994).

Focusing specifically on rice transplantation and rice harvesting machines,

being the industry rather new, we do not find much of studies carried out to

check how a farmer is convinced to buy these machines and what could be the

factors which make the major influences to do so. On the other hand

considering the farmers as individual buyers we might think of a B2C buying

behavior, however looking at the application of the machines involved we

might need to re-consider our stance. (Buying behavior of farmers, Marrten

Kool, 1994)

Farmers do buy for various reasons, it could be technology, consistency and

assurance of continuation of the farm activities such as planting and harvesting

(harvestpublicmeida.org) and the reasons and motives to do so would build up

their behavior.

1.2. PROBLEM DISCUSSION

Traditionally the farmers use the manpower to perform the whole cycle of the

cultivation of the Rice. In the traditional Chinese way for instance, the family

members would help hand-in-hand to do whatever necessary in the fields.

They water the Rice fields, do the earth preparation, and do the transplanting

and taking care of the plants till they are arriving to final stage ready to be

harvested. This has had a poor yield and the government decided to set up

agriculture cooperatives from 1956 to boost the yield of farms by various

means including mechanization of the production cycle.(Bridging the Rice yield

gap in Asia pacific, FAO).

7

Looking into the matter rationally one would go use machine to speed up the

process. We are not here seeking the advantages only, there are several other

reasons which force the farm owners to pick the new technologies; these

reasons could be shortlisted as below (Mechanization of rice production and

challenges in China, Zho Defeng):

Labor Shortage

Higher Labor cost

Larger Scale rice farms

Lower Labor productivity

The decision to make a choice between manpower and machine, specifically in

Transplant and Harvest activities, is the main concern and problem in this

study. The study will assess the factors to persuade him buying machines for

Transplant and Harvest of the rice.

1.3. Purpose of Thesis

This study mainly concentrates on farmers’ buying behavior decisions in

purchase of the Rice Transplant and Harvest machines. Given the facts of the

necessity of usage of the machines in above introduction, there are enough

grounds for the farmers to make a shift and it needs a decision. Therefore the

Thesis tries to focus on the various parameters affecting the process of buying

the Transplanter and Harvester machines by farmers. In other words the study

tries to identify the buying behavior of the farmers in a specific area of

production.

The decision has various aspects, economically, culturally and psychologically

and study of the purchase decision would give a better picture of this cultural

shift. From the decision making process the study tries to understand the

buying behavior of the farmers for the important Rice machines, namely

Harvester and Transplanter.

The expectation of the outcome of this study would provide a basis of

understanding the promotion of mechanization of the Rice industry, which

8

essentially should occur to make this important line of industry active and

sustainable.

The Iran territory is been chosen as the area of research and to be able to

cover the study we have chosen one of the major provinces in Iran with

highest rice cultivation, i.e. center of Mazandaran province.

In this thesis we are trying to find answers to following research questions:

What are the motives for a rice farmer in center of Mazandaran province

in Iran to buy expensive rice machinery, i.e. rice Transplanter and rice

combine harvester?

How and by what means a farmer makes the ultimate decision to finalize

his purchase and pick among several options available in the market?

1.4. KEY TERMS

During this Thesis there are several words which we encounter repeatedly. We

try to give a brief definition for these terms.

Rice: Seed of a monocotyledons (monocot: Flowering) plant, which is a staple

food for large part of the world’s population, especially Asia. (WIKIPEDIA)

Farmer: A farmer whose job is to plant, grow and harvest the rice and whose

income is from this industry.

Transplant: To put the rice seedling into the paddy field, in order to grow to

produce rice seeds.

Harvest: To gather mature crops (here rice) from the field using tools and or

machines.

Mechanization: To transplant and harvest the rice using newly developed

machineries.

Transplant Machine (Transplanter): A special machine used to do the

transplant of the rice seedling into the paddy field.

9

Harvest Machine (Combine Harvester, or Combine): A machine used to

harvest the rice in the field.

10

Chapter 2 – Literature Review

2.1. Marketing Segmentation

Market segmentation is targeting a part of the market which is potential to

select the product that the supplier offers. This population has got different

level of education, social life, income level which determines the routine that

result in purchase decision.

Knowledge of consumer plays an extremely important role in many marketing

applications, such as defining the market for a product or deciding on

appropriate techniques to employ when a company targets a certain targets

group of consumers. (Michael R Solomon, Consumer Behavior)

Here we use market segmentation strategy to target the group of consumers

who are busy with rice farms and specially dealing with old fashion mechanism

to harvest and transplant rice.

Another aspect marketers should take into account is psychographics.

Psychographics is the study of personality, values, opinions, attitudes,

interests, and lifestyles. (http://en.wikipedia.org/wiki/Psychographic)

Psychographics is beyond simple demographic to help marketers understand

and reach different consumer segmentation. (Michael R Solomon, Consumer

Behavior) So when marketing a rice equipment we need to pay attention to

issues such as value it provides for buyers, income of the buyers within the

segment we are marketing the equipment and attitude of the consumer of the

desired segment. We will discuss attitude toward equipment more, later in this

research.

According to VALS2 (The Value and Lifestyle System) that SBI International

developed, there are eight types of consumers as follow;

- Innovators

11

Innovators are successful people with high self-esteem who are receptive to

new ideas and technologies. They are very active consumers and image is very

important to them to express taste, independence and character.

- Thinkers

Thinkers are motivated by ideals and value knowledge and responsibility. They

are practical consumers who seek durability, functionality and value in the

products that they tend to buy.

- Achievers

Achievers are highly goal oriented and are motivated by achievements that get

their satisfaction from their jobs and families. Although they are active

consumers, they are interested in products that established prestige and

success to their peers.

- Experiencers

Experiencers are basically youth who are enthusiastic and impulsive

consumers. They are open to new possibilities and prefer those which are time

saving and quick.

- Believers

Believers like thinkers are conservative and motivated by ideals. They tend to

buy familiar products and well established brands and are generally loyal

customers.

- Strivers

Strivers like achievers are concerned about the opinions and approval of others

but with less economic. They are active consumers and as impulsive as their

financial circumstances will allow.

- Makers

Makers like experiencers are motivated by self-expression with constructive

skills and value self-sufficiency. They appreciate practical and functional

products. They are not interested in new ideas and large institutions. They are

12

unimpressed by material possessions as they prefer value to luxury so they buy

basic products.

- Survivors

Survivors do not show a strong motivation and they are comfortable with the

familiar brands especially if they can purchase them at a discount. They are

cautious consumers as they have few resources. They are the oldest of all

segments with a median age 60.

13

2.2. Buying Behavior Definition

Here we need to expand the meaning of buying decision process which is the

decision making processes undertaken by consumers in regard to a potential

market transaction before, during, and after the purchase of a product or

service. (By Wikimedia – the free encyclopedia)

Consumer behavior is a process in which the exchange is a transaction

between two or more people or organization giving and receiving something of

a value. (Michael R Solomon, Consumer Behavior)

In our case the marketer is organization selling agriculture machinery to a

farmer or a farming company. In the later one, the decision may be taken by a

group of people and there are several influencers including the managing

director, engineers, accountants, etc.

As we are discussing buying behavior of machinery we need to focus on that

segment of the market which is related to buying machinery so we look into

what makes consumer feels the need of a new tool to replace manual system

in order to make a buying decision and us as a marketer to sell products that

are safe and perform as are promised to tell the truth about what we sell.

(Michael R Solomon, Consumer Behavior)

Consumer decision making is the basic part of the consumer behavior which

consists of several processes. A consumer purchase is an answer to a problem.

So the very first level is recognizing the problem. Then the consumer searches

the related information and may find some alternatives. As a result he / she

should compare the alternatives to reach to a decision. Marketers should ask

themselves how they can affect the consumer in above stages. How can

marketers recognize the problem or need for a product and make the unaware

consumer aware of that? How can they search for information and provide the

related information for searching consumers? How can they put their product

at a priority for selection among several alternatives for consumers? So

marketing managers need to study each stage carefully to obtain sufficient

knowledge about how consumer finds out about a product, seek information

14

and make a purchase decision. They should tailor promotional strategies to

meet consumer requirements.

Buying has got three major steps as follow;

- Awareness

The very first stage of buying process for many companies happens when the

buyer starts to think about a different solution for an existing problem. In this

stage there is no intention for purchase so they need to rethink about status

quo and shift to a new or different solution.

- Evaluation

The next stage in B2B buying process is searching for possible solutions to

accomplish their goal which is change the current situation. So the buyer

focuses on practical and committed experts to achieve the solving problem

project. He tries to understand advantages and disadvantages that each option

might bring.

- Decision

The last stage of buying process occurs when the buying team selects the

vendor who has established engagement and connection to the buyer during

earlier stages. In this stage, the buyer considers the minimum any perceived

risk of purchase. This stage comes to an end when the buyer does the

purchase.

http://www.inboundsales.net/blog/bid/49600/A-Guide-to-Understanding-the-B2B-Buying-Process

As mentioned above buying is a process and it starts with recognizing a

problem. In buying the machinery for planting and harvesting Rice the problem

which exist in old manual system need to be recognized by potential

consumers which is the very first step. This problem recognition can happen

internally or externally. Internal problem recognition can happen when a

15

farmer finds failure in old manual systems or a co-farmer aware him of a new

product. External problem recognition starts by salesperson who participates

the need for a new product. Advertisement can also be a part of external

problem recognition. (Business Marketing Management by Micheal Hutt &

Thomas Speh)

Once the problem is recognized, the buying decision process starts. There are

several factors that should be considered while studying buying behavior of

farmers including amount of finance they need to invest, other competitors,

benefits they get from new tools that we discuss more, later.

Having recognized the need and the problem, the potential consumer enters

the information search phase. In this phase he starts to gather as much

information about the product as possible in order to find the best choice.

There are different ways of searching information again internally and

externally and the seller should influence the market in this phase as well as

problem recognition.

They may refer to some experts or friends for advice (word of mouth) or they

may rely on advertisement and trail given by sellers. Buying harvesting and

transplanting machinery and replacing manual method to plant and harvest

rice, is a big change in a farmer's life in economic and life style context. The

more extended the change is, the more extensive the search for information

needs. So the consumer involves more in searching the information about the

rice harvesting and transplanting mechanization system.

Motivation is also important for marketers to be ignited in potential

consumers. It is worth mentioning that marketers should recognize that the

equipment can fulfill a range of consumer needs. In other words marketing is

satisfying consumers' needs. (Michael R Solomon, Consumer Behavior)

Motivation occurs when a need rises and drives the consumer wishes to satisfy

it. The desired end state is the consumer's goal. This goal can have positive or

negative value. We control and direct our behavior toward positive goals and

seek the products to avoid negative ones. (Michael R Solomon, Consumer

Behavior)

16

Making the potential consumer motivated, marketers involve the consumer

with the products so that they are aware of the product and a specific brand

and finally choose one.

Sometimes, this motivation happens when a farmer's peer has already bought

the machinery. A Finnish study demonstrated that what our neighbors buy

affects our own buying decision making. The researchers discovered that when

one of a person's 10 nearest neighbors bought a car, the odds that the person

would buy a car of the same make during the next week and a half jumped 86

percent. . (Michael R Solomon, Consumer Behavior)

Involvement is a person's perceived relevance of the object based on their

inherent needs, values and interests. (Michael R Solomon, Consumer Behavior)

Our motivation to achieve a desired goal depends on to what extent we are

involved with the product and finds it clearly to satisfy our needs.

Having sufficient information about the product, it is the time for evaluation.

Several criteria have effect on evaluating the product and final selection. These

could be price, brand name, country of origin, efficiency in comparison to

other similar ones. These factors are called "salience" (Engel, Blackwell,

Miniyard, 1991), could have different dimension impact due to the kind of the

product. (Sean Henry Lee, 1990). There are several competitors in the market

beside old fashion manual method of planting and harvesting rice.

Suppliers also need to search and evaluate information about potential

consumers. If the supplier is the influencer on need recognition of the

consumer, he has a lot to say. (Business Marketing Management by Micheal

Hutt & Thomas Speh). This phase is also a requirement for arranging the

contract as supplier need to fulfill the consumer need and satisfaction as well

as its profit. They need to understand that how consumers decide among

alternatives. In our case there is surprisingly small numbers of alternatives.

Farmers have just a few brands in their consideration, although this amount is

also important and they have a market share. Consumers gather information

about all available alternatives (other products) and evaluate the relevant

options and finally choose one.

Evaluation criteria are the dimensions we use to judge the merits of competing

options. Another important point is that criteria on which products differ from

17

one another carry more weight in the decision process than do those where

the alternatives are similar. (Michael R Solomon, Consumer Behavior)

Finally the consumers make the purchase decision based on several criteria.

These factors could be quality, level of service, warranty, time of delivery,

price, payment schedule and lots of details (Business Marketing Management

by Micheal Hutt & Thomas Speh) to select a proper supplier.

Heuristics also plays an important role in decision making process. Michael R

Solomon refers to heuristics as mental rules-of-thumb which acts as shortcuts

for purchase decision making. People believe that some products are better

when the country of origin is a specific country. For example, everyone prefers

Italian shoes, Japanese cars and Swiss watches

2.3. Consumer as decision maker

As we see individual farmers as decision makers to purchase harvesting and

transplanting equipment, we need to pay attention to farmers' attitude

towards purchasing the equipment and the equipment as well.

An attitude in marketing terms is defined as a general evaluation of a product

or service formed over time (Solomon, 2008). An attitude satisfies a personal

motive and at the same time, affects the shopping and buying habits of

consumers. Dr. Lars Perner (2010) defines consumer attitude simply as a

composite of a consumer’s beliefs, feelings, and behavioral intentions toward

some object within the context of marketing. A consumer can hold negative or

positive beliefs or feelings toward a product or service. A behavioral intention

is defined by the consumer’s belief or feeling with respect to the product or

service.

Social pressure also has a great impact on consumer attitude. Other peers can

influence the behavior of the consumer in spite of a positive or negative

attitude of the buyer. The question is that if the marketers can change

consumers' attitude and how? One way is persuasion.

18

Persuasion involves an active attempt to change attitudes. This is the first job

for many marketing communications. (Michael R Solomon, Consumer

Behavior) There are six psychological principles that influence people to

change their minds;

- Reciprocity

People are more likely to do a purchase after receiving approval verbally or

written. They strive for consistency in their commitments as well as following

pre-existing attitudes and values. (Dr. Robert Cialdini and six principles of

persuasion by Tom Polanski in eBrand Media)

As people receive, they are more likely to give. In response rate to a survey

questionnaire, there was 65 percent increase when money is included in a

mail.

- Scarcity

People are more attracted to items with limited edition. So items with less

availability are more attractive for consumers.

- Authority

When there is an authoritative source about an item, it is likely to be accepted

two percent more than those without.

- Consistency

People are more likely to get pre-existing and approval before a purchase.

- Liking

Normally we agree with those we admire. As a result good-looking fund raisers

get more as other volunteers who are not as attractive.

- Consensus

People are more likely to do what other does before. We consider what others

purchased before we decide to buy.

19

2.4. Learning as a part of purchase decision

It is important to understand how consumers learn about agriculture

equipment as they need to know about the need of the service that the

equipment provides them.

What is learning? According to Michael R. Solomon in Consumer Behavior,

learning is a relatively permanent change in behavior caused by experience.

The learner need not have the experience directly, we can also learn by

observing.

There are several learning theories. Among them we look into two theories;

Behavioral learning theory, Cognitive learning theory.

Behavioral Learning Theory:

It is the paradigm relates to "behavior modification". When a transaction

occurs in which purchase behavior initiates and as a response, a products is

received by the consumer, need fulfillment will increase the probability of

repeat behavior. Pleasing can be manipulated by marketers through

appropriate price, distribution, service and promotional variables. (Micheal

L.Rothschild & William C. Gaidis, Journal of Marketing, Spring 1981)

Cognitive Learning Theory

Educators who believe in cognitive theory say that learning is a change in

learner rather than environment and it related to complexity of human minds.

The learner's ability to learn depends on to what extend he learns and

understands and the acquisition of knowledge need to be tailored individually.

(Wikipedia)

It is important for marketers to understand these theories as well because

basic learning principles are at the heart of many consumer purchase decision.

(Michael R Solomon, Consumer Behavior)

20

Buying decision process model

Buyer's

response

Buyer's black box Environmental factors

Product

choice

Decision

Process

Buyer

Characteristics

Environmental

Stimuli

Marketing

Stimuli

Brand

choice

Dealer

choice

Purchase

timing

Purchase

amount

Problem

recognition

Information

search

Alternative

evaluation

Purchase

decision

Post-purchase

behavior

Attitude

Motivation

Perception

Personality

Lifestyle

Knowledge

Economic

Technological

Political

Cultural

Demographic

Natural

Product

Price

Place

Promotion

Richard L. Sandhusen, Marketing, 2000

2.5. Post purchase behavior

Actually there two aspects of post purchase behavior; positive and negative.

Positive post-purchase behavior happens when the consumer is happy and

satisfied with the product quality and performance, so spreads a positive word

of mouth and feedback and recommend fellow to buy the same product. In

negative post purchase behavior, the consumer is not fulfilled with the

commitment made by the seller, so he spreads a negative word of mouth and

may result in canceling or refund. Organizations should avoid this situation.

Sale doesn't end at the time of purchase especially when it comes to buying

machinery as it involves after sale services, guarantee and so on. The

21

satisfaction process is also important to savvy marketers who realize that the

key to success is consumer satisfaction and to be successful at post purchase

phase. They should be concerned about a consumer's evaluation of the

product after purchase as well as before purchase.

Overall feeling about a product after it has been bought is called consumer

satisfaction / dissatisfaction (CS / CD). Companies that score high in consumer

satisfaction often have a big competitive advantage. Good marketers

constantly look for reasons why their customers might be dissatisfied so that

they can try to improve. (Michael R Solomon, Consumer Behavior)

2.6. The Buyer Decision Process for a New Product

A new task involves extensive problem solving. As the consumer / company

have not purchased a similar product already, there is lack of information

about its performance or there might be risky for the consumer. So the

consumer needs to evaluate the purchase and gather a lot of information

before they come to a decision. (Michael R Solomon, Consumer Behavior)

In buying decision for a new product, buyers need a lot more information

because they are posed to a totally new experience which is unfamiliar for

them. They can get information from suppliers, on the web, people who had

used and applied the product. So buyers might be more uncertain about

purchase as there is little information or experience to support purchase

decision. To solve this, they seek to analyze the key aspect of the purchase

decision process. There are questions such as; what kind of product or

equipment we should buy? Who are the suppliers? Will they provide the

service we need? (Business Marketing Management by Michael Hutt & Thomas

Speh)

When the potential customer learns about the new service or product and is

interested in buying, he / she also need to adapt to the new service or product.

The adoption process is defined as the mental process through which an

22

individual passes from first learning about an innovation to final adoption, and

adoption as the decision by an individual to become a regular user of the

product. (Armstrong & Kotler, 2003)

There are 5 stages in adoption process;

1. Awareness. The buyer simply aware that the product or service exists.

2. Interest. The buyer needs more information and wonders if the solution will assist to achieve the goal.

3. Evaluation. The buyer merely evaluates the possibilities on the short list and examines even if mentally to check if the solutions will impact and improve the solving situation.

4. Trial. The buyer will set the innovation into practice to see if it helps and if it meets the desired requirements.

5. Adoption. The buyer is satisfied with the practice and accepts the innovation.

Beal and Bohlen also suggest that in the first two stages, Media plays a great role. On the other hand, for the last three stages peers and friends have great impact and are source of information. (The diffusion process, Goerge M. Beal & Joe M. Bohlen, 1975)

23

2.7. The Marketing Mix

The marketing mix is often referred to as the '4 Ps', i.e. product, price, place and promotion. To meet customers' needs a business must develop products to satisfy them, charge the right price, get the goods to the right place, and it must make the existence of the product known through promotion. (http://businesscasestudies.co.uk/business-theory/marketing/the-marketing-

mix.html#ixzz36nVoPnSW)

Marketing mix decisions must be made to influence final consumers. The four P's should represent the seller's view of available marketing tools to influence buyers. From buyer's point of view, each marketing tool is designed to deliver a customer benefit. (Kotler & Keller, 2006)

The Product: We should exactly define the product / equipment / service that we are going to sell to the market and clarify to our customers how it will help them to achieve their goals or benefit them or improve their life in a way.

A product can be a tangible good or intangible service that satisfies a consumer need. Each product has a life cycle and marketers should consider the product mix to position the product properly in the market. The marketers must also pay attention to product development strategies. (http://en.wikipedia.org/wiki/Marketing_mix)

Price: We as the marketer need to charge our product or service according to a basis. We need to consider discount for specialties as well. In this price, it is considered our costs and benefits and the margin to compete with other competitors in the market.

Price is the amount a customer pays for a product or a service. Adjusting the price has a profound impact on the marketing strategy and demand and sales volume. So the marketer souls set a price that complements other elements of the marketing mix. When setting the price, the marketer should be aware of the customer perceived value for the product. Prices of other competing products and the value the customer gets in comparison to similar products should be taken into account. (http://en.wikipedia.org/wiki/Marketing_mix)

24

It is important to note that the price of a product is not the same as the cost of the product to the customer. Reducing the non-price cost of owning, causes increasing revenues to the marketer. (Hawkins et al., 2001)

Place: Location is one of the determining issues that seller should consider. Where is he going to sell the product? There are several issues which are related to the location such as culture, economy level, life style, etc. Distribution is considered one the aspects of place in marketing mix.

In our research, we focus on farmers located in center of Mazandaran province. So we need to localize the product to the province nature as well as challenging the place obstacles.

Promotion: Promotion includes advertising, salespeople, packaging and sales methods. Considering the product at a specific price at a site, the marketer decides on the sale strategy.

All the methods of communication that marketer may use to provide information about the product to the consumer; such as brochures, sponsorship, exhibitions; are considered as promotion. (http://en.wikipedia.org/wiki/Marketing_mix)

Apparently, WOM (Word Of Mouth) is an informal way of communication about the product by individuals. Satisfied consumers spread positive word of mouth while unhappy consumers may be a defeat for the marketer.

2.8. Organizational Decision Making

As in our thesis we are studying buying behavior of farmers about rice harvest

and transplant equipment, we consider it as a B2B case rather than B2C.

In B2B situation there should be considered organizational buying behavior

and as a result organizational decision making process. In an organization,

there might be a group of people to decide about purchasing a product. Theses

members include;

- Initiator

25

The very first person in decision making unit (DMU) who recognizes the

problem and seek for a solution.

- Gatekeeper

This is the person who controls the information flow into DMU and he

determines possible vendors and products for the rest of the group to

consider.

- Influencer

Influencers try to sway and exert the influence on the purchasing process. They

give preconditions and possess different level of powers to get involved in

purchase process.

- Buyer

The buyer does the actual purchase and gets involved in negotiation with the

supplier and discusses the contract terms. He may not use the product himself

but have a great impact on purchase process.

- User

The actual consumer of the product or service is considered as user and he

exert influence on product or service specifications.

(Michael R Solomon, Consumer Behavior)

According to Kotler & Armstrong the decision making unit is called buying

center and is consist of all people involved in the decision making and buying

process. These people represent different roles which are the actual users of

the products or service, decision makers, influencers, gatekeepers, and the

people who carry out the actual buying. It is consists of several people or in

some cases one person represents all buying centers roles. (Kotler &

Armstrong, 2008)

In our case, some of above or all of above people might be one farmer but play

different roles at different time of purchase process.

Organizational buyers evaluate potential suppliers based on the quality,

reliability, price and company image. Usually price is the most important

26

selection criteria but if the product is unique other criteria dominate and a

supplier has the possibility to develop strategic relationship with the customer.

(Business Marketing Management by Micheal Hutt & Thomas Speh, 2010)

27

Chapter 3 – Methodology

An insight into rice farmers' decision making process on buying agriculture

machinery

Here we discuss rice farmers' decision making process of buying new planting

and harvesting equipment rather than manual method. This purchase is a big

change in farmers' economic life. Due to several interviews we did with some

farmers and based on previous buyers of the equipment, we found out that

the main motivation to invest on buying this machinery is to increase profit

and margin.

The purpose of the current research is to find out rice farmers attitudes

towards purchasing harvest and transplant equipment in center of

Mazandaran province and to better understand its farmers' decision making

patterns from cultural and demographical perspectives. It is hoped that the

answers obtained from this research would help national and international

marketers to understand and predict center of Mazandaran rice farmers

purchase decision process about rice equipment.

3.1. Research Methodology

Methodology is the systematic, theoretical analysis of the methods applied to

a field of study. It comprises the theoretical analysis of the body of methods

and principles associated with a branch of knowledge. Typically, it

encompasses concepts such as paradigm, theoretical model, phases and

quantitative or qualitative techniques.

(http://en.wikipedia.org/wiki/Methodology)

The main objective of our research is to understand farmers purchase decision

of rice harvest and transplant equipment. We will also make use of the

research analysis to test our hypotheses stated former in first chapter.

28

3.2. Qualitative method

Qualitative research is about exploring issues, understanding phenomena, and

answering questions by analyzing and making sense of unstructured data.

(http://www.qsrinternational.com)

Qualitative data represents description of things made without assigning

numbers directly. Qualitative data is generally collected using some types of

unstructured interviews or observations. Focus groups and in-depth interviews

are frequently applied qualitative research approaches. (Business research

methods, Joseph F. Hair Jr., Mary Wolfinbarger Celsi, Arthur H. Money, Phillip

Samouel, Michael J. Page, 2011)

A depth interview can be defined as a set of probing questions posed one by

one to a subject by an interviewer so as to gain an idea of what the subject

thinks about something or why he / she behaves in a certain way. Depth

interview can offer great insights into consumer behavior (Burns & Bush, 2000)

Qualitative interviewing gives us an opportunity to collect rich data and

detailed information about how farmers understand, experience and explain

rice harvesting and transplanting in their lives.

Here we have chosen qualitative research method rather than quantitative as

one of the fields that qualitative method is applied is for new and less known

areas of research. A qualitative research approach is the most appropriate and

indeed the only way to achieve some research objectives. When little is known

about the research problem or opportunity, qualitative research is likely to be

the preferred method.

Actually qualitative research is the most appropriate and indeed the only way

to achieve some research objectives in situations include;

1) When little is known about a research problem or opportunity

2) When previous research only partially or incompletely explains the research

questions

29

3) When current knowledge involves subconscious, psychological, or cultural

material that is not accessible using survey and experiments

4) If primary purpose of the research is to propose new ideas and hypotheses

that can eventually quantitative research

(Business research methods, Joseph F. Hair Jr., Mary Wolfinbarger Celsi,

Arthur H. Money, Phillip Samouel, Michael J. Page, 2011)

Considering above, we decided to choose qualitative research to cover our

thesis hypotheses which is discussed in first chapter.

Among several qualitative approaches, we selected grounded hermeneutics

approach. As all qualitative research is grounded, because it is based on the

evidence gathered about the topic being studied. Hermeneutics approach

applies when it is about studying human behavior based on people's

experiences and stories they narrate around and about the top of discussion.

According to Michael D. Mayers (Qualitative research in Business and

Management, 2008), hermeneutics helps the qualitative researchers in

business and management to understand what people say and so and why.

3.3. Population and Sample size

The target group of the study is farmers who have been using manual or old

fashioned harvesting and transplanting for rice in center of Mazandaran

province and the co-operative companies in this business.

In order to obtain the information necessary to analyze the research questions,

an interview was conducted with 45 rice farmers in center of Mazandaran

living locally. The interview was developed based on the literature review.

The interview is consisted of 10 open ended questions and 10 structured

questions and the reason for each question will be discussed later in chapter 4.

30

3.4. Data Collecting Method

There are two broad approaches to qualitative data collection – observation

and interviews. (Business research methods, Joseph F. Hair Jr., Mary

Wolfinbarger Celsi, Arthur H. Money, Phillip Samouel, Michael J. Page, 2011)

As we need to understand farmers purchase decision process, then we will

need to interview farmers. Interviews were helpful for us as we could manage

it at a peaceful atmosphere for the interviewee and conduct it as a face to face

session and get a feedback at the same time. This interviews were both

structured as we had already had defined questions to be asked and also

unstructured one as we could have asked some open ended questions.

The aim of researchers is to explain the phenomena in the business. To fulfill

this, they need to collect data. Data is collected by means of interview,

observation, questionnaire, and more. Data credibility and reliability is very

important as it is the basis of making decision for analysis. There are several

methods to collect data depending on the nature of the study and the

objectives.

As said above to collect data for qualitative research there exists two

approaches; observation and interviews. Observation is preferred where the

objective of the research is to study the behavior of the people or events and

interviews are more appropriate where the researcher is looking for why

something happens.

(Business research methods, Joseph F. Hair Jr., Mary Wolfinbarger Celsi, Arthur

H. Money, Phillip Samouel, Michael J. Page, 2011)

3.5. Data Analysis Method

The objective of qualitative data analysis is to identify, examine, compare, and

interpret patterns and themes. (Business research methods, Joseph F. Hair Jr.,

Mary Wolfinbarger Celsi, Arthur H. Money, Phillip Samouel, Michael J. Page,

2011)

31

Miles and Huberman (1994) suggest that to analyze the collected data, we

should consider three stages;

- Data reduction: In this stage, qualitative data is analyzed, abstracted,

simplified, focused, and transformed. The purpose is to organize the data in

order to draw and verify the conclusion.

- Data display: To be able to have and easy conclusion drawing, the reduced

data should be displayed in an organized and compressed way.

- Conclusion drawing: In this stage the researcher decides the meaning of the

occurrences, noting regularities, patterns, explanations, possible figurations,

casual flows, and propositions.

3.6. Assessing credibility (Reliability and Consistency)

An important requirement in qualitative research is that the method used

produce reliable and valid findings. In qualitative research, reliability is the

degree of consistency in data to the same pattern by different researchers.

The Reliability means also the degree of Consistency for the similar

observations and interpretations.

This could be achieved by examining the soundness of the procedures and

conclusions by others.

(Business research methods, Joseph F. Hair Jr., Mary Wolfinbarger Celsi, Arthur

H. Money, Phillip Samouel, Michael J. Page, 2011)

3.7. Pre-testing the questions and interview

We asked some colleagues to have pilot sessions in order to pre-test the

questions in the interview. The aim of the pre-testing was to improve and

check the questions. During and after these pilot interviews, we improved

some questions and timing. We also consulted with colleagues to get their

32

feedback and some small problems about the questions were eliminated.

Finally, we have adjusted proper wording of the questions.

3.8. Limitation of interviews

These are featured as the general limitation in interview and data collection:

1) Sample size limitation

2) Time limitation

3) Geographical limitation

4) Leading the interviewee

5) Distractions during interviews

6) Respondent fatigue

7) Budget limitation

33

CHAPTER 4 – Data Presentation and Analysis

In this chapter we focus on analyzing the real data gathered from a group of

farmers who have dealt directly with the said machines.

The following diagram helps better understanding the process:

(Diagram adopted from : Business Research Methods, J.F. Hair…)

The Data Collection and Display will be the subject of this chapter. We will

discuss the Conclusion in the final chapter, i.e. Chapter 5.

4.1. Data Collection

In order to have a meaningful classification of the required information to

guide us to an analysis for the behavioral aspects of our study we picked up

farmers based on the recommendation of two major centers: The Department

of Jihad Keshavarzi (Agriculture Center) , and one of the leading consulting

firms in the region.

Data Collection

Conclusion

Data Display &

Reduction

34

The following questionnaire were distributed with the assistance of the said

centers among a group of 45 farmers, the questions were checked both with

the advisor professor and re-validated with the peers in the above-mentioned

centers.

The questions were arranged in a way to cover the reliability of the case. In

one hand the farmers were given the open-ended questions to come up with

personal ideas and beliefs and in the next phase the structured questions were

brought up to check and examine the level of comprehension of the

respondent to open-ended questions, which were chosen by advice of the

experienced field people.

4.2. QUESTIONNAIRE

Analytical Questions

1. How did you become familiar with Rice Transplanter and Rice Harvester?

2. How do you evaluate the difference between transplanting and

harvesting the rice by hand and by machine?

3. What are the minimum criteria to choose a rice transplanter?

4. What are the minimum criteria to choose a rice harvester?

5. How do you evaluate your current situation with regard to use of rice

transpalter and rice harvester?

6. What could be the main reasons of expansion of usage of rice

transplanter and rice harvester in your area?

7. Describe in detail how you select a supplier of rice transplanter and

harvester.

8. In what way they have influenced your selections?

35

Structured Questions

Are you happy with the performance of the Rice Transplanter and Rice Harvester in your area?

1 2 3 4 5 6 7 8 9 10

Does the speed of work get accelerated using Rice Transplanter and Rice Harvester?

1 2 3 4 5 6 7 8 9 10

Do the functional problems increase using Rice Transplanter and Rice Harvester?

1 2 3 4 5 6 7 8 9 10

Does the final product quality increase using Rice Transplanter and Rice Harvester?

1 2 3 4 5 6 7 8 9 10

Does the final product quantity increase using Rice Transplanter and Rice Harvester?

1 2 3 4 5 6 7 8 9 10

Do you consider the judgment of current users of Rice Transplanter and Rice Harvester as the basis of your decision to choose a certain model?

1 2 3 4 5 6 7 8 9 10

Do you consider the advices of the experts of Rice Transplanter and Rice Harvester as the basis of your decision to choose a certain model?

1 2 3 4 5 6 7 8 9 10

Do promotional packages such as low rate loans and seasonal discounts encourage you to purchase a certain model?

1 2 3 4 5 6 7 8 9 10

Do you consider the After Sales Service policy and records as one major motivation to choose a certain model

1 2 3 4 5 6 7 8 9 10

Do you recommend to other colleagues to use Rice Transplanter and Rice Harvester in their fields?

1 2 3 4 5 6 7 8 9 10

4.3. Data Display & Reduction

Data Coding and Data scaling: Coding is the process of assigning meaningful

numerical values or names that reduce data from a large amount of

undifferentiated text to a smaller number of relevant and representative

chunks (Business research methods, Joseph F. Hair Jr., Mary Wolfinbarger

Celsi, Arthur H. Money, Phillip Samouel, Michael J. Page, 2011)

We could get back the answer sheets to 42 of the questionnaires and based on

the category of the questions we could code and finally tabulate the answers

into following tables. We have worked out the percentage to check the ratio of

each important element, and in each table we have normalized the

percentages to 100% scale, i.e. assumed the highest ratio in each table 100%

36

and scaled the other figures in proportion with this, in order to have the

understanding of the position of each element based on 100% scaling.

Q1: How did you know about transplanter & harvester machines?

Codded Answer Number Answered

Ratio (%)

100% Scaling

I learnt about it from other local farmers in my area

17 40% 89%

I learnt about it from local Jihad expert 19 45% 100%

I have education in related field 5 12% 27% I learnt from local distribution shops 4 10% 22%

I had personal interest in this field 1 2% 4% I learnt about it from Media 5 12% 27%

I got to know about them through exhibitions 3 7% 16%

Table 4.1

Q2: Difference between traditional (manual) system and mechanized one?

Coded Answer Number Answered

Ratio 100% Scaling

It makes the whole operation quite faster 22 52% 81%

It takes much less labor to do the same job 26 62% 97%

Production is more, losses are much less 27 64% 100% The whole process is more convenient 4 10% 16%

The field is technically more harmonized 6 14% 22%

Table 4.2

37

Q3 & Q4: Selection criteria?

Coded Answer Number Answered

Ratio 100% Scaling

I select based on performance Yield 21 50% 100%

I select based on speed of work 3 7% 14% I select based on the quality of work 15 36% 72%

Price is my important criteria 12 29% 58% I select if the spare parts are available 9 21% 42%

I select if proper service comes with the machine

11 26% 52%

I select if the machine is user friendly 1 2% 4% I select if the seller or the agent are reputable enough

1 2% 4%

I select if the user guide is available 1 2% 4%

I select if the machine is customized for me 1 2% 4%

I select depending on the country of origin 1 2% 4%

Table 4.3

Q5: Self-evaluation of Current situation of the consumers (farmers) with

regard to these machines?

Coded Answer Number Answered

Ratio 100% Scaling

I do not have adequate info about the machines 1 2% 2% I am a satisfied user of the machines 35 83% 100%

I am a dissatisfied user of the machines 3 7% 8%

I would like to have the machines 3 7% 8%

Table 4.4

38

Q6: How to increase machinery usage rate? (Farmers suggestions)

Coded Answer Number Answered

Ratio 100% Scaling

There should be post purchase satisfaction 23

55% 100%

Farmers must be given further data and details 10 24% 43%

Sellers must advertise more 8 19% 35% Farmers rely on peers’ recommendations 4 10% 18%

Price plays an important role 8 19% 35% Payment conditions are important 6 14% 26%

Table 4.5

Q7: If user, how did they know about the machinery?

Coded Answer Numbers Answered

Ratio 100% Scaling

I was recommended by local Jihad expert 17 40% 100%

I was recommended by other locals 14 33% 83%

I had Self-study // Self research 7 17% 43% I was recommended by sellers’ agent 6 14% 35%

I purchased by chance 1 2% 5% I purchased in an exhibition 2 5% 13%

Table 4.6

39

Q8: Who influenced your purchase and how?

Coded Answer Number Answered

Ratio 100% Scaling

I relied on my own knowledge 9 21% 44%

I relied on WOM 20 48% 100% I relied on Jihad experts 20 48% 100%

I relied on well reputed companies 3 7% 15% I was impressed by after sales service 1 2% 4%

I could manage to get bank loan facility 1 2% 4% I relied on close friends’ advice 5 12% 25%

I was influenced by sellers’ marketing approaches

3 7% 15%

Table 4.7

Part II (Structured questions)

Category 10 9 8 7 6 5 4 3 2 1

Happy with Performance

13 10 5 5 3 4 1 1

Believing it is faster

22 11 7 1 1

Believing it is accurate

6 10 5 1 1 4 1 6 8

Higher quality of production

19 6 6 5 1 2 3

More quantity of production

15 9 9 5 1 2 1

WOM 21 11 5 1 1 2 1 Believing in what Experts say

19 6 12 3 2

Loans & Discounts

24 7 4 1 1 2 2 1

Proper After sale service

22 9 6 2 2 1

Recommend to others

26 8 4 2 1 1

40

Now that we have been able to reduce the gathered data we adopt the

Descriptive Analysis Method as our findings will judge the behavioral aspects

of the usage of machines.

We review the table 4.1 to 4.7 and also the answers to the structured

questionnaire. We pick up the parameters which have got the prominent

Standard Normal value in each table, and list them below, and categorize them

into following chart:

Here is a summary of the produced codes, further to our data reduction:

Table 4.1

Subject: Basic Knowledge

Jihad Experts

WOM

Local Farmers

Table 4.2

Subject: Old Method vs. New technology

Faster Operation

Less Labor

More Production

Table 4.3

Subject: Farmer Selection Criteria

Performance of Machine

Quality of Work

Price

Availability of spare parts

Proper service

Table 4.4

Subject: Current Status of Farmers with regard to Machines

Satisfied user

41

Table 4.5

Subject: Farmers’ suggestion to use Machines more

Post Purchase satisfaction

More information to Farmers

Sellers’ advertisement

Reasonable Pricing

Table 4.6

Subject: Knowledge about Machines

Jihad Experts

Local Farmers

Own knowledge

Sellers’ Agents

Table 4.7

Subject: Who were the influencers?

Jihad Experts

WOM

Own knowledge

4.4. Data Analysis

Based on our Literature Study we know the following steps consist the overall

behavior of a consumer with regard to certain purchase:

In the first step, i.e. Awareness we use the data gathered in table 4.6. which

are summarized in below chart:

42

CHART 1

The above chart suggests that the Jihad Experts’ advice and recommendations

play a significant role in AWARENESS of the Farmers. Also other local farmers

can bring about the basic information to the new comer and therefore they

play an important role as well.

In the next step we encounter the INTEREST and EVALUATION processes.

Going back to our reduced data we believe we could use the Table No 4.3 in

which we have reference to the Selection Criteria of the Farmers. We have

shown this table in below chart for a better comprehension:

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Jihad EXPERTS Local Farmers Farmer OwnKnowledge

Sellers' Agent Exhibitions By Chance

43

CHART 2

It appears that the Performance of the Machine and the Quality of the

delivered job are the most prominent facts which deal with INTEREST and

EVALUATION of the farmers.

The next step for a new comer is to try one of these Machines, as now he has

enough INTEREST and has done adequate EVALUATION on what could be the

right way to go. In the TRIAL step the farmer relies on the Influencers besides

what he had in mind as the options. Based upon our findings in above tables,

we refer to table 4.7 to see what would be the farmers’ most reliable

influencer as summarized in below chart:

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Performance Quality Price Service speed

44

CHART 3

Here we see, based on above chart, Jihad expert and other people who have

used the Machines are the ones with highest INFLUENCE on the farmers’

decision to go for a Trial of the Machine. There exist factors such as Own

Knowledge of farmer as well as other people advice, however they are not

considered very prominent as INFLUENCERS as the experts of Jihad and the

ones already using the Machines.

4.5. Farmers’ adoption and post-purchase situation

Based on our findings from farmers, i.e. table 4.4, we come to this important

point that a very high percentage of the farmers are quite satisfied using the

Machines. The satisfaction is production of several aspects noticeable to

famers’ method of work and feeling. Our findings in table 4.5 assist us to

analyze the mentioned ideas and summarized in below chart:

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Jihad Expert WOM Own Knowledge Friends' Advice Sellers' Reputation

45

CHART 4

The services and spare parts provided to farmers shall have the most

important role in the farmers post purchase satisfaction. The other important

matter which the farmer naturally expects to receive once he owns the

Machine is the Information, as to how to maintain the Machine and operate it

in the best way possible. And of course the Pricing policy and Advertisements

by the sellers constitute the next important parameters needed to keep the

famers happy with using the Machine in long term.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Post Purchasesatisfaction

Information tofarmers

Better Pricing Moreadvertisement

Payment Terms

46

Chapter 5 – Conclusion and Briefing

5.1. Qualitative Research Approach

In this chapter we shall analyze the information and the coded ideas obtained

from our chapter 4. Based on a Descriptive approach we try to understand the

Phenomena through meanings assigned to them, and we call this approach as

Phenomenology. (Business research methods, Joseph F. Hair Jr., Mary

Wolfinbarger Celsi, Arthur H. Money, Phillip Samouel, Michael J. Page, 2011)

The arranged questionnaire was designed to examine the social thoughts,

perceptions, desires and experiences of the individual farmers as to how they

would process the selection of a certain Rice Machine for their daily job.

5.2. Decision Making Process

Based on Literature we shall try to analyze the decision making process

elements based on the findings in coded and reduced data of this study:

1. Attitude & Intention

As what could be figured out in Table 4.4, the general evaluation of

farmers turns out to be satisfactory with a high rate in the sample

population. The facts such as speed and quality of the work gives the

famers the positive attitude towards purchasing a Machine. These facts

are basic motives for the famer to think of picking up these machines

and therefore constitutes their mind basis to go further in next purchase

phases.

2. Social Pressure & Persuasion

Our findings show how farmers could be motivated by seeing other

fellow farmers and they are listening to other users’ ideas and

comments, regarded as WOM. In chart No.3 we clearly see the

importance of this phenomenon, in comparison with other sources of

influence.

47

There is another pressure from society and that is the increasing labor

cost, and the process of rice is requiring quite a large number of people

in traditional ways. By utilizing Machines the labor costs shall be reduced

in a long run.

The farmers are receiving abundant information from Jihad experts as

peers and regard their advice and consultation as highly important for

them to make a decision or enter to an evaluation phase for a certain

product. This is very important of the marketers in this field to be aware

of the local peers’ community, location and procedures and to have

planning to give enough technical data of their products, knowing that it

will finally flow down to each and every individual buyer and user.

3. Buying decision process model

A. The Product , Price , Place and Promotion elements

As a famer who would like to start using Machines for his job the

selection of the product of choice is very important. Getting

information from experts or other fellow farmers play important role

in obtaining necessary basic information. The sensitivity to price is

always an important issue like every other purchase, however as we

clearly see in Charts 2 and 4 it is not the strongest decision making

element.

B. The Environmental Stimuli

Out of all environmental stimuli the Technology looks prominent in

our study, as we clearly see the importance of the quality and

performance in Chart no 2. The farmer picks up a Machine which has

the acceptable technical features. These features are coming mostly

from experts and other local farmers who have used them, partly

from his own study and knowledge.

C. Characteristics of the Buyer

The farmer buys the Machine to use it for production; therefore this

purchase is regarded as B2B purchase. Like any other industrial

purchase the farmer relies on technical advices, makes necessary

comparisons and checks out the price. The level of importance of

each of these elements are shown in charts 2 and 4, where we see

the technicality of the Machine (Performance & Work Quality) are of

48

great importance. Based on our findings famer, as an industrial buyer

gets influenced by experts of Jihad and other users on top of all

others.

5.3. Briefing

Back to our research questions:

What are the motives for a rice farmer in center of Mazandaran province

in Iran to buy expensive rice machinery, i.e. rice Transplanter and rice

combine harvester?

How and by what means a farmer makes the ultimate decision to finalize

his purchase and pick among several options available in the market?

Overall Review of farmers buying behavior regards to Mechanized Machinery

Post Purchase

Satisfaction After sale service Operation

Purchase

Influencers Own Knowledge Financial facilities

Selection

Performance yield Quality of operation Price

Knowledge

More production & Less loss Less labor Faster operation

information

Jihad WOM Education & Self study

49

We now try to illustrate our interpretation: As we saw throughout the whole

study we are facing with 3 major parameters: The Jihad Experts, The other

users (WOM), and Service concept. It clearly appears that though some of our

Rice farmers might have some knowledge about the new technologies and the

Machines, they are heavily dependent on the recommendations from Experts

and the other users. This basically constitutes the core part of the BEHAVIOUR

of any farmer as a consumer or user of the Machines or new technologies.

Once they use the Machines then they will expect a great deal of care and

attention by the seller, which is the after sale service and spare parts supply.

Farmers are amongst the very special group of consumers who could abandon

a certain brand in blink of an eye if they are not happy with post purchase

facts.

The rice season for Transplanting and Harvesting, which respectively involves

the Transplanter and Harvester Machines is just a few days in a year and the

rest of the year’s survival depends all in utilizing the said few days in the most

professional manner. A shift from traditional methods and starting to use the

Machines need the motives which could be provided if the seller side has

clearly understood the farmers’ needs and wants. So the ultimate decision will

be made further to a complete consultation with the experts, and having heard

enough of the available options in the market, i.e. WOM.

The farmer will remain a loyal user of the brands once they are satisfied with

the after sales service. So the weight of the BEHAVOURAL manner of the

farmer in the pre steps and post steps of a certain purchase look evenly

distributed.

The level of satisfaction of the farmers in our interviewed group based on

structured answer sheet, scored 26 out of 42 (62%) which shows an average to

good figure in satisfaction.

As per our findings in the overall questionnaire we could relate the unsatisfied

percentage of the farmers to following concepts:

1. Poor After Sales Service

2. Poor Information Provision to farmers

50

3. Lack of necessary spare parts on the right time

4. High price of the Machines and / or the Services and Spares

As seen in above findings, brand and brand loyalty was not mentioned by the

farmers as a major or at least important element for them to choose a certain

Machine for their purchase, or a concept for their selection preferences. They

rely on peers, they rely on other local farmers and by repeated use of a certain

Machine or certain brand they can judge if they can rely on it or not.

The above 4 dissatisfaction factors are regarded as the most important

problems which could lead a farmer, or group of farmers walk away from

certain product.

51

References:

1. Bridging the rice gap in Asia Pacific region, FAO

2. Agriculture Mechanization Organization of Iran

3. Rice Mechanization in Asia, Joji Arihana

4. Mechanization of rice production and challenges in China, Zho Defeng

5. Buying Behavior of farmers, Maarten Kool,1994

6. Harvestpublicmedia.org

7. Wikipedia

8. Micheal R Solomon, Consumer Behavior

9. Wikipedia.org/wiki/psychographic

10. The Value and Lifestyle System by SBI International

11. www.strategicbusinessinsights.com/vals, 2014

12. Wikimedia

13. www.inboundsales.net/ A guide to understanding the B2B buying process

14. Business Marketing Management by Micheal Hutt & Thomas Speh,2012

15. Engel, Blackwell & Miniyard Model,1991, Florida

16. An application of five stage Consumer Behavior Decision Making Model; An

exploratory study of Chinese Purchase of imported Health food by Sean Henry Lee,

Shanghai University of Finance and Economics,1990

17. Richard L. Sandhusen, Marketing,2000

18. The Diffusion Process, George M. Beal & Joe M. Bohlen, 1975

19. www.businesscasesstudies.co.uk/marketing mix

20. Marketing Management (12th edition), Kotler & Keller, 2006

21. Hawkins et al, 2001

22. Principles of Marketing, Philip Kotler & Gary Armstrong, 2008

23. www.qsrinternational.com

24. Business Research Methods, Joseph F. Hair Jr., Mary wolfinbarge Celsi, Arthur H.

Money, Philip Samouel, Micheal J. Page, 2011

25. Burn & Bush, 2000

26. Qualitative Research in Business and Management,2008

27. Agriculture Center in Jihad Keshavarzi Iran, 2015

28. Green Economy monthly magazine, all editions in 2014 and the JANUARY 2015

29. Dr. Lars Perner (2010), Consumer Behavior; The psychology of marketing, Usc

Marshall University of Southern California

30. Miles & Huberman (1994), Qualitative Data Analysis (2nd edition), page270-280

31. Dr. Robert Cialdini and six principles of persuasion by Tom Polanski in eBrand Media

32. Micheal L.Rothschild & William C. Gaidis, Journal of Marketing, Spring 1981