What are farmers doing online?

In markets like Kenya agricultural buying and selling patterns are rapidly moving towards social platforms like Facebook.

Facebook is the most popular online forum for buying and selling produce in Kenya and far outstrips the level of activity on existing agriculture marketplace platforms. There are a number of reasons for Facebook's success in this space with the primary reasons being that it is free to post, people are familiar with how to use it and many already have an account. Importantly large farming Facebook Groups of up to 40,000 members have emerged which provide a ready audience for buying and selling posts.

Number of monthly buying/selling posts in Kenya

This hive of activity stored in public Facebook groups creates new opportunities to see digital patterns of behaviour in the agricultural sector. In Kenya for example, we can compare digital patterns of online trading with country level data sources. There is a strong skew towards fruit and veg when it comes to digital selling patterns. This is likely because fruit and veg is high value, perishable produce that is sold through a very unstructured value chain.

Share of agricultural goods sold in Kenya, total vs. online

Diving deeper into the online data can give us splits of the fruit and veg sold by item. Traditionally good data on these sorts of patterns is hard to capture, interestingly the rise of social media and digitally active farmers is changing this.

Kenyan fruit and veg sold online (by item, % share of total)

This data is just the beginning, as more of the agricultural sector comes online in countries like Kenya there will be a step change in what is visible and possible with online digital data feeds.

What else is going digital?

While new digital market patterns will prove incredibly useful, digital data is starting to shed light on other aspects of the agricultural system. Agricultural value chains have typically been hard to make sense of in emerging markets, yet they underpin a substantial share of economic activity. Using data from existing value chain reports, Google Maps, business directories and agricultural websites, the dairy value chain below was created for Kenya.

Sankey diagram of dairy value chain in Kenya

A Google search for “Kenya dairy industry” threw up multiple different reports written over a decade. While these reports are written every year the data they contain is hard to find and make use of. By contrast we were able to create a comprehensive, interactive map of the dairy value chain in the space of just a few hours, using data from a combination of online sources. The data is available in an interactive map, hit the button below to access the map.

This map is another great example of how agriculture in emerging markets is becoming digitised. Mapping and analysing location based data will create a range of exciting new opportunities for producers and buyers to find new ways to connect, as well as understand the value chains they are involved in.

What will happen next?

A new wave of digital agritultcure data is rapidly emerging in countries like Kenya (if you know where to look). At the centre of this shift are active digital producers and buyers. These individuals also provide the key to understanding future digital trends. In particular, we should look at where there is discontent with current digital processes, and existing desire for new paths to interacting online.

In combination with these qualitative user insights, quantitative data indicates where systems are falling short. The chart below shows the number of responses onion seller posts receive on a leading agricultural Facebook group, and how this varies over time. Although Facebook is the leading agricultural trading platform in Kenya, the fluctuation in number of responses and the proportion that go unanswered demonstrate the inefficiency of this digital market system.

Number of responses to onion seller posts on Facebook in Kenya

Building on these insights, the affinity analysis below represents hundreds of posts scraped and highlighted from Kenyan Facebook groups based on the topic of agriculture. By organising these insights into themes we see a few key design ideas emerge under the heading of 'marketplaces'.

• Mine and organise what exists digitally: the rapidly growing world of agricultural data (on buyers and seller intentions) should be better organised and searchable
• Proactively matchup the market: there is a missed opportunity to connect up buyers and sellers (who are digitally visible but disconnected)
• Rate interactions: intentions turn into interactions between buyers and sellers, there is a chance to capture more information about interactions via digital channels to improve the system

These insights (and more) can be found in our online affinity analysis, explore it by hitting the button below.

So what do these insights point to? One exciting prospect is imagining the growing mass of digital buyers and sellers in agriculture as the foundation for a functioning 'intention economy', i.e. an economy where the buyers' intent to buy drives the production of goods to meet their specific needs. In this case, goods go beyond mere produce, and instead cover more granular intentions, e.g. "I need 10kg of avocados delivered every other week to my location". In other words:

In future, digital intentions to buy and sell will be used to proactively match up a massive agricultural market

Digital technologies have shaped agricultural market places for over a decade. The advent of basic mobile telephony meant buyers and sellers could interact peer to peer, over long distances. With the rise of web access more were able to post content online along the lines of a classified ads model. In our current state, developments in technology and digital behaviours in these markets (as detailed above) should allow us to efficiently match up supply and demand without the need for sellers to 'advertise' in the traditional sense. Intention to purchase can be proactively matched with supply in way that could dramatically increase efficiencies and leap frog agricultural marketplaces in emerging markets to truly "buyer oriented" economies.

A theory of agricultural marketplace evolution

Want to find out more?

We're fascinated with digital agriculture in emerging markets, and leave bits of our thinking in blog format at www.acresofdata.com. We also put our latest insights on this topic (in a format like this) together every quarter. If you'd like our next insights piece just sign up below.

Investing in solutions

This piece is mainly about insights on the digital agriculture landscape, but we are actively working on a new product in this space. We are interested in talking to early stage investors who might support this work, please get in touch if you have interest in finding out more.