Let’s take a step back in our marketing series this edition. Selling replacement females or selling beef directly to consumers fits neatly into a traditional marketing paradigm. Marketing from a commercial cow-calf perspective is inherently different.

Marketing is marketing, but marketing commercial cattle has some unique characteristics. One of the most unique aspects is, for the most part, we are not representing an established brand. We are not looking for buyers. Instead, we are looking for ways to differentiate our product within what is a very narrow pool of buyers.

Typically, the marketing component of a commercial operation is centered around market timing. When do you decide to sell the cattle?

The greatest challenge by far when marketing calves is the challenge of assembling load lots of similar-weight cattle. Auction markets evolved to address this issue. Plus, they addressed the second-largest hurdle of marketing cattle — transaction costs. Not only were buyers able to assemble load lots in one place, but the “one” place to procure large numbers of cattle greatly reduced transaction costs for purchasing those cattle. Auction markets also do a lot to facilitate the transactions, everything from bonds to scales to sorting.

Marketing then becomes, in large part, about getting that information into the right buyers’ hands and in a form that truly allows those buyers to buy with increased confidence.

The commercial marketplace is steadily moving away from commodity marketing toward more differentiated marketing of cattle. This is a great development for buyers and sellers alike. The evolving marketplace is sending more accurate pricing signals and doing a better job of allocating true value.

This leads us to the primary question of how to add more value in this evolving marketplace, and how we define marketing in today’s environment.

Information is the greatest differentiator, as it allows buyers to assess value. The less information there is, the more prices will be compressed around the mean; the more information, the more accurately they can reward higher-valued cattle. Marketing then becomes, in large part, about getting that information into the right buyers’ hands and in a form that truly allows those buyers to buy with increased confidence.

Buyers need information that allows them to assess health risks, vaccination and nutrition protocols that have been implemented. They also need information on the genetic merit of those calves. Everyone understands these needs. The difficulty is in providing the information in an objective, verifiable and consistent way.

Buyers have to believe in the accuracy of the information, and it has to be provided in an objective form they can utilize. “He buys really good bulls, and they have had all their shots,” is a start, but it does not get one to the finish line.

The AngusLink^SM program is designed to provide an objective, reliable and verified way of describing the genetic merit of a pen of feeder cattle. As such it is a vital component of an effective marketing strategy.

It is not meant to replace your current marketing program. Rather, it is meant to be overlaid upon it.

One of the most unique aspects of the AngusLink program is that it is not based on scarcity; the more cattle that are enrolled, the more value there is available to each marketing group. Historically, high prices have reduced both discounts and premiums alike. However, the value of genetics has increased with higher prices.

Give us a call to discuss how AngusLink can play a role in improving your marketing program and in helping you capture the value you have created.

Editor’s note: Troy Marshall is director of commercial industry relations for the American Angus Association. For more information about AngusLink, click here. 

Angus Beef Bulletin EXTRA, Vol. 17, No. 4-B