May 23, 2016

While the past five years have delivered both increased innovation and investment in agricultural technology (agtech), the value it promises to deliver to farmers has been widely unrealized, as of yet, according to a new white paper.

Investment in agtech reached a new record high in 2015, reaching $4.6 billion and almost doubling investment from the year prior, according to AgFunder’s AgTech Investing Report, Year in Review 2015. In a new white paper entitled “Beyond the Hype: How Agricultural Technology Wins Customers and Creates Value,” Dr. Arne Duss of HighPath Consulting and Jonah Kolb of Moore & Warner explain that despite this momentum and all of the potential value that agtech offers, adoption lags.

In an interview with GAI News Kolb points out that adoption may be slower than some market players and investors might think.  He argues that most agtech offerings are not yet widely accepted nor have the technologies been widely adopted beyond the “soft” adoption rates that come with beta testing and discounted or free trials. Instead, agtech remains stuck on one side of a chasm between early adopters of disruptive technology and early majority adopters.

Economic, demographic and market factors today present agtech with several impediments to adoption, including a decrease in farm incomes and a large proportion of change-averse farm operators approaching retirement. The challenge, then, becomes understanding how agtech crosses this chasm to reach broader adoption.

Duss and Kolb detail six steps to help companies and investors address this task and speed the rate of adoption. The steps include:

Justify the value added by agtech products;

Demonstrate efficacy through independent scientific studies;

Align distribution of agtech products to the way farm inputs are marketed today;

Target a niche market to build initial market share and establish a beach head;

Emphasize ease of use and systems compatibility; and

Match business and technology goals to crop seasonality

For more on how these work, download Beyond the Hype: How Agricultural Technology Wins Customers and Creates Value.

In a recent interview with GAI News Duss and Kolb discuss why the hype around agtech exists today, how they identify agtech that offers true value, why farmers are both excited and overwhelmed by agtech, and the most critical strategy to speed adoption.

Listen to interview here:

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Sarah Day Levesque

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