Empowering FPOs to Sell Directly to Retail Customers to Improve Farmers’ Earnings

While mobilization of farmer groups in India is a promising and accelerating trend, sales and marketing remain key challenges for these groups.

Supply-side Story

India has an estimated 300 million farmers and farm laborers who struggle to earn a living through the market channels available to them today. Farmers are increasingly coming together to form producer groups through which they can realize economies of scale, reduce input costs, strengthen their bargaining power, and access finance for working capital and purchasing catalytic infrastructure. There are ~6,000 active producer groups in India today and the government aims to mobilize a further 10,000 in coming years. While still nascent, ~30% of these groups are well organized and have reached maturity to take on primary value addition activities like aggregation, grading and sorting, arranging transport logistics and managing customer support. They are universally seeking innovative sales and marketing tools and services.

Demand on an upswing

At the same time, households want convenient access to healthy, safe products. There are 166 million middle and high-income households in India today and that is expected to double by 2030. Healthy and organic purchases of food consumed at home is estimated to drive USD 1.4 trillion in incremental spend for this growing cohort. These consumers want to know where and how their food is produced with growing concern about pesticide use. Such preferences are not limited to elite urban consumers anymore. Food and grocery retail in India is a USD 300 billion market today and less than 0.5% is online. COVID-19 has accelerated exposure to and interest in purchasing food products online and now is an opportune time for producer groups to directly cater to this growing demand.

Challenging Status-quo

Digital Green is piloting a digital platform, Loop, that Farmer Producer Organizations (FPOs) can use to easily publish a product catalog, receive orders, collect payments and communicate with their customers through chat and automated notifications. The FPOs are responsible for grading and sorting, packing and delivering products to their customers.

Loop digitizes sales transactions and generates a rich dataset of hyper-local prices and customer preferences, which are translated to market insights that enable farmers to increase their earnings. Unlike traditional traders and digital aggregators, Loop empowers farmers’ position in the market to communicate their distinctive stories and build direct relationships with consumers.

Loop collects a small transaction fee on sales transactions completed through the platform which funds development and maintenance of the platform.

Adding a Cutting Edge

WhatsApp is the most widely used communication platform in India and is increasingly being leveraged by small businesses for commerce. Loop leverages AI-enabled WhatsApp chatbots to help producer groups efficiently manage basic customer service queries and integrates voice-based features to drive business activities like tracking orders and updating product availability, which will increase the inclusivity of the platform, especially for non-literate farmers, especially women.

An additional innovation of Loop is the team buy model. Producer groups set a minimum purchase volume and a pre-set delivery date; consumers form virtual teams and pool their purchases to reach that minimum volume. Each team assigns a lead who receives physical delivery of the goods on behalf of the other team members and they arrange last-mile distribution among themselves.

Digital Green’s research on household consumption patterns and preferences suggests this model is differentiated and compelling for consumers. It delivers on a desire for value (bulk purchase = lower price), responds to consumer interest in knowing where their food is coming from and how it’s grown, while retaining the convenience of online ordering and home delivery, tapping into the inherently social nature of food shopping. Team-buy also makes direct to consumer sales and delivery economically viable for producers as it increases the average order size, introduces “virality” which reduces customer acquisition costs, reduces the number of delivery points, reduces wastage since producers have confirmed purchases rather than guessing demand which enables them to optimize farm operations around batch orders.

 

Loop is an initiative of Digital Green, a global development organization that empowers smallholder farmers to lift themselves out of poverty by harnessing the collective power of technology and grassroots-level partnerships. This present iteration of Loop builds on Digital Green’s experience operating a shared transport service which helped 23,000 farmers move 123,000 tons of produce worth about USD 17 million to local markets and realize price increase and cost savings. Loop is operational on a pilot basis in Andhra Pradesh, India today. Through Loop, we envision a just, resilient and human food system. Just – with increased earnings for farmers; Resilient – emphasizing local supply chains, sustainable practices and indigenous foods;
Human – where producers and consumers build personal connections.

Effective Monitoring & Evaluation of Health & Nutrition Program Performance

Digital Green collects information related to program performance from the community level, to monitor the performance of its agriculture and livelihood programs, which is uploaded on its web-based monitoring system called Connect Online Connect Offline (COCO). Major indicators regarding the effectiveness of program implementation are publicly accessible with the help of a web-based analytics dashboard. However, learning from initial pilots of health and nutrition projects (since 2012) highlighted that although there is an increase in knowledge and adoption of behaviors these are not physically verifiable nor as tangible as they are in agriculture and livelihood programs.

Thus, when we started the implementation of project Samvad in 2015, we knew it would be difficult to collect and monitor the information through COCO. Hence, in order to regularly track the increase in knowledge, practices, and behavior change outcomes of Samvad we developed an innovative design of periodic lean surveys in partnership with the London School of Hygiene and Tropical Medicine (LSHTM). LSHTM provided technical support to our Monitoring, Learning & Evaluation (MLE) team to execute the lean survey.

The lean survey monitors and evaluates the implementation of the Samvad project and seeks to understand and improve the outcomes and impact and are carried out in five states where the project is active, namely Bihar, Jharkhand, Odisha, Chhattisgarh, and Uttarakhand.

In Bihar and Jharkhand where the program implementation started earlier and is in a more advanced stage of implementation, the surveys are carried out every quarter and in others, biannually.

Statistical Process Control

To monitor the outcomes and processes of the Samvad project, we used an innovative method of lean survey which uses Statistical Process Control (SPC) method. SPC ensures regular monitoring of improvement in the implementation system, processes, and outcomes, and has its basis in the theory of variation. This helps us understand common and special causes of occurrence of an incidence (outcome or process) and its consistency and variability longitudinally throughout the period of program implementation.

With SPC, the outcomes of the intervention can be depicted chronologically through graphical representation. These graphs, called ‘control charts’ show program outcomes with upper and lower control limits based on the variability. These charts have a central line depicting the average of an outcome and two dotted lines representing upper and lower control limits. The control limits usually depict plus/minus 3 standard deviations from the mean. The control charts indicate a change in outcome when it exceeds the control limits. With the help of these control charts, one can easily identify consistency or variation within an outcome throughout the implementation process.

Since this method clearly shows the changes that occur on a continuous basis, it is useful for the purpose of monitoring and course correction, where needed. Moreover, SPC harnesses the power of classical significance tests and it is equally useful to understand the impact of a program and its exposure among the targeted populations. Surveys conducted using SPC help inform the program strategies and course correct. Information on SPC in further detail may be accessed here.

 

The control charts above show that the proportion of women who have been exposed to Samavd intervention. It showed that:

  • The exposure of married women (aged 15-34 or women with a child under two years) to Samvad intervention has increased in all states except in Bihar from the initial round (Sep 2018 in Jharkhand and December 2018 in Odisha, Chhattisgarh, and Uttarakhand to December 2019).
  • In Bihar, the exposure level has been within the control limits except in round 3 and 5.
  • In Jharkhand, in the first round, the exposure was below the control lines and in round 2 to 6, it has been within the control limits.
  • In the other three states, the exposure level has exceeded the control limits indicating a definite increase in the exposure level.

One of the major reasons for different levels of exposure to Samvad intervention in different states is the way the implementation partners in different states disseminate the videos. In Bihar, the videos are disseminated by frontline workers of the livelihood mission to the members of self-help groups. These self-help groups include members of all age groups but women of the target age group are relatively lower in number. This may be one of the reasons that the percentage of women exposed to Samvad videos is relatively lower than those of the other states. In Odisha, the videos are disseminated by an NGO which has greater control over their video disseminators and this along with their rigorous capacity building may have resulted in a higher level of women’s exposure. In Uttarakhand, the video disseminations started late and thus the exposure of women to the Samvad intervention is low.

These surveys have helped us in tracking the Samvad intervention exposure, knowledge and behaviors of communities, and also the availability of supplies. Tracking of program performance over the period has helped timely course correction of the strategies for improved health and nutrition outcomes.

Tracking the availability of commodities

Through the lean survey, we also track the availability of maternal, child nutrition, and family planning commodities at the village level with health and nutrition functionaries. For example, in the 6th round of the survey, in December 2019, we found that iron and folic acid (IFA) tablets which are important for preventing anemia among pregnant women, were not available in 25% of the villages surveyed in Bihar, 19% in Jharkhand, 33% in Chhattisgarh, 3% in Odisha and Uttarakhand each. Such a gap in the supply hampers the demand and adoption of practices promoted by the program.

Conclusion

Lean surveys have the unique strength of serving the purpose of program surveillance to understand the current performance and also to assess the impact of any intervention. The statistical process control method used in these surveys brings the rigor of classical statistical methods with time-sensitivity to programmatic improvement and makes them more useful than the traditional survey methods. The lean survey method can be used for other similar programs where tracking of outcomes is not feasible through ongoing program reporting.

If you’d like to like to learn more about this check out this webinar recording.

Building a Healthy Online Community on WhatsApp with Farmers

As countries across the world went into lockdown to break the chain of the Coronavirus pandemic, we found novel ways of keeping in touch, exchange information, spread awareness. One of the most interesting things I noticed in the initial days was the ‘virality’ of videos that explained how the COVID-19 virus spreads, as I received the same videos from multiple contacts on the various social media applications. Another feature was the increased use of the internet-based messaging application WhatsApp by local communities that shared hyper-local information that could be at such times indeed lifesaving!

Working with Digital Green I have seen the power of videos in translating complex information into clear and easily understood messages; interacting with the farming communities I have also understood the value of community networks.

At Digital Green, I have been working with various teams to think beyond our popular video-based extension approach which has helped farmers reduce input costs and improve their yield; but we want to do more, we want to help increase their incomes. For this reason, we’ve been watching closely how the rural farming communities have been adopting smartphones and going online in the last few years. The views and subscriptions of our YouTube channel started exploding just as we saw many farmers becoming YouTube sensations and influencers.

This had us fast-forwarding our own plans. Late last year we created a multidisciplinary task force that spent weeks carrying out desk research, holding ideation sessions at work, followed by farmer interactions on the field to find that one eureka moment. The apple didn’t drop. But we were besieged by a number of ideas. We decided to go ninja on each such spark, take quick small steps to tackle them all.

 

Early Insights

We found that our audience (in this pilot project rural Bengaluru, Dodaballapur) was most active on WhatsApp. And that while they were active on the platform it was confined to personal interactions, leisure, and entertainment; rarely for information or building new networks/connections. We also found that the village community was quite fragmented, they were unaware of fellow farmers in their own village and therefore unable to leverage useful information through this new medium of communication. Our experience over the last decade or more has taught us that agricultural practices, problems, and needs are quite hyperlocal in nature, which we find are best tackled by strengthening the community networks.

Thus, we decided to build a hyperlocal farmer’s community on WhatsApp giving them a space to share their farming stories, problems, queries, and successes which could be heard, appreciated, and addressed by experts as well as peers. And once the ground was fertile we wanted to layer it up with more value-added services for the community which could help them fulfill their latent aspirations, increase their income, and bring convenience to them.

We decided to take an iterative human-centered design approach. We started by creating a WhatsApp group by adding a few farmers we had built a rapport with and waited to see how the groups would grow and evolve organically. For the first few weeks, there was no moderation, we encouraged farmers to add other farmers to the group, to post content which they wished to share with their peers. We saw a lot of posts coming through ranging from politics to religion to family pictures (yes, a lot of good morning messages with photos of flowers too) to even some farming related posts. The group which started with 6 farmers had grown to more than 100 farmers in just a month and mostly all organically. The group was not silent for even a single day since it started which was very encouraging. While all of this gave us good learnings but it was not exactly what we were working towards – building a healthy online farming community where farmers exchanged information around agriculture and allied activities.

A group member even shared a collage of the kind of posts which were being exchanged in the group

A group member even shared a collage of the kind of posts which were being exchanged in the group

Our How-to List

That’s how we learned that to build an online community, we had to grow and nurture it. We chalked out and executed many small experiments to run on our group, such as video chat with an Ag-expert, polls, and competitions, etc. We set clear success indicators for each experiment which would guide us in making ‘go’ or ‘no-go’ decisions. Since the reaction to experiments run on WhatsApp were almost immediate we made it a point to synthesis our learnings as a team at the end of each day – this was really helpful in keeping us on track, we were conscious of each decision taken and ensured we would never go back to ‘reinventing the wheel’.

 

We deliberated on our messaging strategy and we even came up with 3 metrics that our content had to fulfill – it must be Relevant, Engaging, and Inspiring. Our posts now focused on:

  • Addressing problems faced by farmers by offering seasonal and timely advice on crops through experts. We held fortnightly conference calls between experts and farmers which was much appreciated by the community
  • Co-creating content with the group members. This was achieved through prompts such as polls posted from time-to-time.
  • Offering information such as daily market rates of major crops of the season that were posted on the group at the same time every day.
  • Farmers were encouraged to share inspiring pictures of their fields which elicited recognition from peers through comments and emojis. This was found to be motivating for the one who shared the pictures as well as for others to practice and share further.

    A collage of the kind of posts which were being exchanged now in the group
    A collage of the kind of posts which were being exchanged now in the group
  • Organizing offline farmer events – this helped set the tone of what farmers could expect online
  • Providing a platform to discover and encourage experts from within the community who could answer questions that arise from peers.

 

Social Listening is Key

This change in the quality of interactions was heartening for us as well as the farmers, who have come to take great pride in being associated with these groups. The members also take tremendous ownership in maintaining the quality of discussions. They value the time spent on this group and if someone toes the line by sending in irrelevant content – another member is quick to share the community guidelines that were developed over the course of the groups’ lifetime.

This experience of careful observation of how the community was engaging on the platform, synthesizing, and iterating helped us grow the groups into effective channels of communication for a network that was fruitful for all. It gave us great confidence to create and engage online communities which we are now applying in other use cases – both agriculture as well as health and nutrition interventions.

Our Journey: Staying farmer focused and learning from evidence

Digital Green started its journey in 2006 as a project of Microsoft research, with a mission to empower smallholder farmers to lift themselves out of poverty by harnessing the collective power of technology and grassroots-level partnerships. We join forces with governments, private agencies, and rural communities to promote good practices in agriculture, nutrition, and health, using videos that are of the community, by the community, and for the community. 

We recently brought to a close two flagship investments supported by the Bill and Melinda Gates Foundation (BMGF) with: (1) A partnership with the National Rural Livelihoods Mission in India; and (2) the Ministry of Agriculture, the Regional Bureaus of Agriculture, and the Agricultural Transformation Agency in Ethiopia through which we have reached 2.3M farmers (70% women), created over 6000 videos and trained over 50,000 frontline extension workers.

With COVID-19 and continued risks posed by climate change, we are continuing to innovate.  As we look towards new innovations with the use of multiple digital channels of communication & solutions to support access to markets, we want to take stock of what we have learned in the past. 

We have learned that a farmer-focused approach is key to promote adoption of new practices. That is why we share locally produced videos on agronomic practices that feature farmers who are role models in their communities, building on social networks through facilitated group discussions to enable collective learning. 

Deep partnerships with governments contribute to systems change at scale. State and national governments have institutionalized the community video approach through committing financial and human resources and embedding the approach in extension strategies. The governments of India and Ethiopia have invested $21.6M in the approach, and 75% of districts we partner with in India have built capacity to independently sustain the approach.

And finally, farmer feedback and data enables constant iteration and high returns on investment. Feedback mechanisms must collect actionable data to enable realignment to individual and community needs. Digital Green’s ‘Connect online Connect Offline’ (COCO) platform tracks gender-disaggregated data and farmer feedback, which informs the next iteration of videos and helps curate content that results in increased impact. 

As a learning organization, we recognize that we have a long way to go – from ensuring that we continue to support our partners address the differences in quality across regions; that data is not just collected but used to make decisions; that content is truly targeted & tailored to the needs of farmers; and that farmers have the agency to choose the extension services they want by controlling and sharing their data on their own terms.  

Starting today, and over the next few weeks, we will share some of our main evidence & learnings in the form of short videos by prominent researchers who have evaluated our collective impact.

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Independent Digital Development Consultant, Martine Koopman, who supported USAID, DFID, BMGF and IFAD funded research by Landell Mills shares here findings on the use of integrated communication channels (video, radio, and IVR advisories) in disseminating agronomic practices in Ethiopia.

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Beyond agriculture, Digital Green has also tested its approach to support health and nutrition messaging among rural farming families. Suneetha Kadiyala, Senior Lecturer (Associate Professor) at London School of Hygiene and Tropical Medicine (LSHTM) and the team will share preliminary findings from a 4-arm cluster RCT, in Odisha, India to test participatory videos to promote nutritionally sensitive agriculture (NSA) & use of participatory learning and action meetings.

 

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Katya Vasilaky, Assistant Professor at California Polytechnic State University-San Luis Obispo talks about the impact of the community video approach when tested at scale in Bihar with the State livelihood mission called JEEViKA. This randomized controlled trial spanning two seasons studies one crop (rice) with a focus on the System of Rice Intensification and also studies different types of messages delivered to farmers.

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David Speilman, Senior Research Fellow at International Food Policy Research Institute (IFPRI) shares the main outcomes from a study evaluating the impact of the community video approach in Ethiopia (on reach, knowledge, adoption, yield & cost-effectiveness). This study was done in the context of three crops (teff, wheat, maize) & practices already being promoted by the Ministry of Agriculture (e.g., row planting, precise seeding rate & urea dressing), and also varied with the gender of the recipient; This RCT was part of a larger research collaboration between IFPRI and Digital Green in Ethiopia, of which many outputs are discussed in this video.