Covid-19 is having a huge impact on farmers’ purchasing practices, according to new research by leading global consultancy, McKinsey and Company.
The survey of financial decision-makers at farms across Europe reveals that 95% of farms are considering adjusting purchasing behaviour to minimise physical interactions in response to the global pandemic.
Digital purchasing may provide the answer, with McKinsey uncovering a 36% point increase in both farmers’ desire to use digital channels to make product-purchase decisions (up from 51% in 2019 to 87% post-Covid-19) and their desire to use digital channels to make actual purchases (up from 33% to 69%).
Across Europe, that adds up to almost four million more farmers who say they are ready to use online channels as their main sources of ordering.
‘A long track record of innovation’
Nicolas Denis, Partner at McKinsey, says:
“The agricultural sector has a long track record of innovation in many areas, such as yield improvement, sustainability and animal welfare.
However, the sector has quite low online retail adoption, with only 22% of farmers having made an online purchase over the past 12 months as of May.
“It is worth noting, though, that this is a large and recent increase over the 13% of farmers who claimed the same last August.
“As attitudes shift in response to the Covid-19 pandemic, companies in the agriculture industry have an opportunity to accelerate their online presence, work out omnichannel strategies, and perhaps even change their business models to better meet farmers’ needs. Now is the time to capture it.”
McKinsey estimates the European online farming market to have annual revenues totalling between £136 million and £182 million. However, this could grow to more than £9 billion by 2025, out of a £126 billion agricultural input and equipment market.
