Beruflich Dokumente
Kultur Dokumente
(A SURVEY OF AGRIBUSINESS)
ADP 15/16/H/7043
STATE.
SEPTEMBER 2017
CERTIFICATION
This is to certify that this Research Project was carried out by ADAJAMES IBIASO
ORMSLEY, ADP 15/16/H/7043 in partial fulfilment of the requirements for the award of
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Master of Business Administration of Obafemi Awolowo University, Ile-Ife, Osun State,
Nigeria.
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DR. O. O. OLASANMI Date
Supervisor
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PROF. K.O. OSOTIMEHIN Date
Head of Department
Management & Accounting
DEDICATION
This work is dedicated to God almighty who gave me the life, strength, inspiration and supply to embark
on this project and to my parents Senibo Adajames Duke Banigo, Mrs. Atesipaomie Adajames, Mrs. Linah
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ACKNOWLEDGEMENT
My sincere gratitude is to God almighty for the life, supply, protection and inspiration He gave
My sincere appreciation to my supervisor DR. O.O. OLASANMI for her direction, advice and
emphasis to do the work right, I really appreciate your time and attention given to me to ensure
My sincere appreciation to DR.T.O. SIYANBOLA for her kind effort and support. I am very
I acknowledge the good works of all lecturers, especially in the Department of Management
and Accounting for the knowledge you have shared to me, the training and development.
TAIWO TOLULOPE, etc. for the friendship, exchange of ideas, and support during the
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TABLE OF CONTENT
Title Page………………………………………………………………………………………i
Certification ................................................................................................................................ i
Dedication ..................................................................................................................................ii
Acknowledgement .................................................................................................................... iv
Abstract ..................................................................................................................................... xi
v
2.1.1.2 Difference between E-commerce and E-business ..................................................... 10
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CHAPTER THREE: METHODOLOGY
DATA
4.2.1 Level of Information Technology use among farms and agribusiness ........................ 59
vii
4.2.2.1 Technological Factors influencing the Adoption of E-commerce ............................. 61
4.2.2.4 Summary of Factors Influencing the Adoption and Level of Use of E-commerce
Bibliography ........................................................................................................................... 74
APPENDIX ............................................................................................................................. 87
viii
List of Tables
Table 4.2.1: Level of ICT use in farms and Agribusiness within the study area ..................... 59
ix
List of Figures
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ABSTRACT
This study investigates the effect of e-commerce on agribusiness marketing. Its specific
objectives were to; identify the current level of information technology use by selected
marketing tool by agribusiness and examine its effect of adoption on the financial and
The study population consist of various forms of agribusiness such as service providers, food
processors, marketers, etc. from which a sample of 302 was drawn using the simple random
solicit information from respondents and analysis of data using frequency distribution, central
The study revealed low level (71.7%) of Information Technology use, as majority of farms and
agribusiness use Information technology mainly for communication rather than e-commerce
activities. The technological, organizational and environmental factors that influences adoption
was found to be very low and inactive in farms and agribusiness surveyed, on a mean scale of
5, the factors fall below average at 2.16, 2.13, and 1.97 respectively. E-commerce was found
The study concludes that the level of ICT use by farms and agribusiness influences their
commerce adoption, and that as adoption among farms and agribusiness grow, the benefits of
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CHAPTER ONE
INTRODUCTION
Information technology has continuously transformed the way businesses are conducted today
and particularly how businesses and people buy and sell goods and services that are of utmost
importance to them, not forgetting its role in government, health and other areas of life. Its
introduced the electronic business and commerce otherwise referred to as e-business and e-
commerce. There is almost no business transaction done today without the use of information
technology as well as any business successfully managed today without the use of information
telecommunication networks, also, refers to the use of internet and other telecommunication
networks and technology to conduct commerce (buying and selling of goods and services) and
consisting of the sale or purchase of goods and services between businesses, individuals,
governments and other private or public organizations in which computer mediated networks
are used to order goods and services while payments and ultimate delivery of the goods and
services may be conducted on~ or offline. Ecommerce take various forms such as business-to-
government(B2G) and vice-versa depending on the partners involved in the transaction and the
purpose.
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EFT (electronic fund transfer), EDI (electronic data interchange), fax and other related
information technology that facilitates and enhance electronic business transactions, among
these technologies the introduction of the internet and World Wide Web from early 90s have
made electronic business transactions more cheaper and easier as such the continuous growth
in ecommerce withnessed around the world. Ecommerce is today further expanded and its
adoption and use in a recorded high because of a growing rate of internet penetration and
access, it is safe to say that increased internet access leads to increased ecommerce transactions.
According to ITU (2016) the world has over 3.4 billion internet users representing 47% of the
World’s estimated total population of 7.3 billion as at 2016, of which developing world
comprising Nigeria has 40% internet users and developed world including US, UK, Russia,
etc. has 81% internet users, whereas on regional basis only 25% of the African population has
internet access, on country basis about 46.1% of Nigeria’s estimated total population have
internet access consisting over 86 million users, while in march 2017 the world has over 3.7
billion internet users i.e 49.6% of the Worlds estimated total population (Miniwatts Marketing
Group, 2017). Similarly, may 2017 telecommunication sector report released by National
Bureau of Statistics puts the number of internet users in Nigeria to over 90 million representing
about 48.8% of its estimated population, of which 59.9% subscribed through GSM, and 13.93%
through CDMA and the remaining 26.17% from other sources as at March 2017, (NBS, 2017).
The increased access to internet have also impacted on ecommerce transactions worldwide this
is shown in Asendia Global B2C E-commerce report published in october 2016 which indicates
that 26% of the world’s population shop online noting that in 2015 global ecommerce was
worth over 3.11% of global GDP, (Asendia, 2016). Similarly, Emarketer worldwide retail
ecommerce sale report indicates that retail ecommerce sale will make up 7.4% or $1.671 trillion
of total retail market worldwide in 2015 and that by 2019 that share will jump to $3.578 trillion
making up 12.8% of global retail sale (Emarketer, 2015). UNCTAD reports shows that Global
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e-commerce market is worth $22 trillion in 2015 with China and US leading the rest of the
world (UNCTAD, 2016). In Nigeria online shopping rose to ₦78 billion as at 2012 indicating
a 25% growth rate between 2010-2012 according to Philip Consulting Online Shopping report
2014 (Philips Consulting, 2014), similarly Oxford Business Group reported that Nigeria
ecommerce industry recorded $1.9b in 2016 and is expected to reach an estimated $3.9b in
Ecommerce provides several benefits such as promotion of information flow, market and price
collaboration among partners, allows for 24/7 and 365 days business operation without down
time, enable businesses operate easily by overcoming physical limitations affecting their
businesses, reach a wider target market which directly affect sales and production as identified
by (Ferentinos, Arvanitis, & Sigrimis, 2006), and (Nanehkaran, 2013). Several reports on
ecommerce across the world indicates that the extent of adoption varies according to country
and sector of application, largely contributed by the rate of internet penetration and access in
such country, Nigeria as indicated by several reports show promising internet peneration
growth as such the adoption of ecommerce is expected to grow beyond retail sales into other
industries.
agricultural products, both input and output as such the benefits of ecommerce are brought into
agricultural sector to facilitate growth in cultivation, harvesting, livestock, crop production and
sale, etc. especially in large agricultural economies such as China, USA, and India, etc. report
in these countries indicate increase in both production and sale in agriculutural sector resulting
Global Analysis reports on China indicates $1.4b online groceries sale in 2015 and a 92%
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The present government in Nigeria is putting more emphasis on agriculture as a means to
diversify the economy, reduce dependency on oil and gas, ensure steady economic growth and
create the much needed employment opportunities to reduce the high rate of unemployment in
the country, adoption of ecommerce in agriculture can facilitate the attainment of the Federal
government goal in improving agricultural growth by creating and expanding markets for
agricultural products, both input and output, although ecommerce is still at its early growth
stage but the focus is mainly on merchandise retailing and estate than in any other sector of the
economy with ecommerce platforms such as olx, konga, jumia, wakanow, jiji, etc. as major
Therefore, this study examined the impact of e-commerce on marketing of agricultural products
in nigeria, and seek to investigate the rate of ecommerce adoption by both farms, farmers and
customers alike.
Agricultural products are known to have domestic food and industrial value, and export
potential as they can provide food for the entire population, income to farmers and
sector is at the forefront in govt economic policies to diversify the economy and make it less
dependent on oil. The sector has promising potential to grow and stabilize the Nigerian
economy, create employment opportunities, reduce prices of food and ensure sustainable
economic growth as noted by policy makers and economic analyst, 2016 GDP report published
by NBS indicates that the sector contributed over 24.43% to GDP and has a 4.11% growth rate
(NBS, 2016), yet the Nigerian economy depends largely on oil for public revenue generation
and foreign exchange earnings. Olukunle (2013) noted that in spite of the efforts of several
government to revitalize agriculture to its preeminent position of providing food for human
consumption and raw materials required by industries to operate effectively, as well as provide
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foreign exchange earnings and employment to the growing population, the capacity utilization
of agro-allied industry in the country has been declining partly as a result of inadequate and
Several challenges have been identified as obstacles limiting agriculture sector from becoming
a more viable sector compared to oil, etc. Olukunle (2013) identified marketing problems such
as those that impact on getting agricultural products from farmers to target consumers and
industries alike, storage and processing problem, infrastructural inadequacies, unstable input
and output prices, agricultural labour , technical constraints, etc. as challenges facing
agricultural development in Nigeria. Similarly, Ojeka , Effiong , & Eko (2016) asserts that
while exchange rate and food export are determinants of agricultural output; food imports,
diversion of funds budgeted for agricultural products and low technology use in agriculture
are among factors limiting agricultural development in Nigeria. Oluwaseyi supporting the
views of Olukunle also identifed marketing as a key problem among others affecting
agriculuture in Nigeria (Oluwseyi, 2016). As Liu & Hao (2015) pointed out that the traditional
which involves the sale of agricultural products at the original production site (Farm, barn,
ponds, forest, etc.) and reaches individual consumers through supermarkets and local farm
markets have a number of problems associated with it, which include; poor information
exchange between farmers and consumers, inability of farmers to capture market information,
constraints in optimizing agricultural production structure, quantity and time, long circulation
cycle, reduction in quality of agricultural products caused by too many middlemen and
ultimately results in high price to consumers or low price as a result of quality reduction to
farmers. These problems are experienced by farmers worldwide including Nigeria, hence the
drive towards ecommerce as a marketing tool to resolve most of these problems, supporting
Carpio, Isengildina-Massa, Lamie, & Zapata (2013) views, that ecommerce offers an
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alternative model for marketing agricultural products with benefits of reaching larger target
markets and obtaining detailed production information at a relatively low cost compared to the
traditional model hence the need for this study to investigate the impact of ecommerce on
The purpose of the study is not to duplicate previous works done to establish the impact of
ecommerce on agri-product marketing but to contribute to the growing knowledge in this field
by conducting this study in the Nigerian agricultural sector focusing primarily on selected
agribusiness
tendency to do so.
3. To what extent has ecommerce influenced the financial and marketing performance of
agribusiness
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1.5 Justification for the Study
It is hoped that the study will be of benefit to the farmers and farm owners, managers and
products and various food processing companies. Specifically, the outcome will;
1. Assist farmers and farm owners to make better decision regarding the marketing of
2. Assist them in collecting and sharing market information more reliably as well as make
better decisions and access low cost farm input required to maintain crop production,
livestock, etc.
agriproducts to close the gap between demand and supply for such products.
source of low cost input and raw materials required to maintain production and achieve
in Nigeria.
The study is limited to the impact of ecommerce on marketing of agricultural products, though
it was intended to cover farms and farmers in Nigeria, but for time constraint, finance and other
logistical limitations, the study is narrowed down to few selected farms and farmers in Osun
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State, Nigeria; the financial constraint consists of transport cost from one city, farm and farmers
location to another, photo copying and typing multiple questionnaires to identified farms and
farmers. Time constraint consists of the time frame within which the study was conducted,
were too short to conduct such study, as it requires enough time to take a survey of farms and
To ensure that ideas are easily expressed. Clarification of some terminology will be necessary.
Terms here, are defined according to there use within the study
Impact: impact as used here, refers to influence, effects; that is the influence or effect of
E-commerce: here it refers to the use of internet and other telecommunication networks and
technology to conduct commerce (buying and selling of goods and services) and other
business transactions.
Marketing: as used here is defined as a set of institutions, and processes for creating,
communicating, delivering, and exchanging offerings that have value for customers,
Agricultural Products: as used here refers to both input and output resulting from the four
sub-activities of agriculture; crop production, livestock, forestry and fishing and their
processed form.
commerce.
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CHAPTER TWO
LITERATURE REVIEW
This chapter examines some literatures on ecommerce and marketing of agricultural products
The chapter is divided into two sections, the first deals with the review of literature on
As Drucker (2002) rightly pointed out that e-commerce would significantly impact the way
that business is done, which has become a reality today, recently there has been a growing
dominance of research on the subject matter of internet and ecommerce adoption across
different businesses and sectors largely contributed by its perceived benefits of reduction in
costs and transaction times (Baourakis, Kourgiantakis, & Migdalas, 2001). Ecommerce has
been defined differently by different scholar; Turban et al (2015) defined ecommerce as the
use of internet and intranet to purchase, sell, transport or trade data, goods or services.
Similarly, Treese & Stewart (1998) defind it as the use of the global internet for purchases and
sale of goods and services, including after sale service and support. In a broader term Ferentinos
et al (2006) defined ecommerce as business transactions conducted over the internet or more
generally through digital communications which supports other authors that have defined
technology to buy and sell goods and services as well as facilitate other business transactions.
E-commerce and E-business are terms used interchangeably but are not the same as Turban et
al (2015) have opined that e-business have a broader definition compared to e-commerce, as it
goes beyond buying and selling of goods and services over the internet to focus on the conduct
of all kinds of business online which includes servicing customers, collaborating with business
partners, delivering e-learning and other electronic transactions within an organization, they
went further to state that while others view e-business as comprising only activities that does
not include buying and selling over the internet, that e-business complements e-commerce as
e-commerce can be seen as a subset of e-business. Bartels (2000) in support of this view noted
that while e-commerce focuses on the external processes of the business that directly affects
customers, suppliers and other external partners and includes activities such as sales,
marketing, order processing and delivery, customer service and support, procurement of raw
materials and supplies with the objective of achieving growth in revenue, e-business comprises
e-commerce but focuses mainly on internal business processes such as production, inventory
management, product development, finance, HR, etc. with the goal of achieving cost savings,
improvements in efficiency and productivity. Similarly, Bachu (2015) pointed out that while
e-commerce consist of commercial transactions done using the internet, e-business is the
conduct of business processes on the internet. Just as the above authors have pointed out, in the
context of this paper, e-commerce is regarded as the subset of e-business using a narrow
definition centered on buying and selling of goods and service and other facilitating
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2.1.1.3 Historical Background
Ecommerce has been growing continuously since its inception in the 1970’s about more than
42 years ago, its history dates back to the introduction of Electronic Data Interchange (EDI)
which allows for seamless transmission of data free from human intervention which replaced
documents such as orders, invoices and other business transaction data using a predefined data
format in USA, the introduction of the Electronic Funds Transfer (EFT) used by banks for fund
transfers between 1960-1980, which subsequently led to the introduction of the teleshopping
i.e shopping through telephone by Michael Aldrich in 1979, followed by the era of Personal
Computers (PC), World Wide Web and the Internet between 1982-1990 which contributed
largely to the increased number of computer network users, the introduction of URL, HTML,
HTTP, TCP/IP, and the National Science Foundation lifting of its restrictions on commercial
use of the NET in 1991, subsequent registration of domain names, the introuction of Secure
Socket Layers (SSL) by Netscape in 1994 to safe guard data transmission on the internet, these
events and technological advancement in Information technology layed the foundation upon
which the first ecommerce platform Amazon (online Market Place) came into operation in
1991, followed by Ebay and other online retail platform in 1995, search engines and advertising
platforms such as Yahoo in 1995, and Google in 1998 and their subsequent ecommerce
platforms, also online payment services such as Paypal in 1998, and other ecommerce
facilitating services (Yan & Stewart , 2006), (Miva, 2011), (Mirescu, 2010). Today more than
26% of the earths’s total population shop online consisting over 1.5 billion people (Asendia,
2016), as at 2015 e-commerce contributed 3.11%, i.e. $22.1 trillion of the global GDP
(UNCTAD, 2016) as earlier stated in the literature and it is projected to grow at 19.42%
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impacting on ecommerce growth round the world, though the rate and extent of adoption varies
among region, countries, sector of application and nature of partners involved (Baourakis,
Kourgiantakis, & Migdalas, 2001) for example, e-commerce contributed 4.48% of Asian-
Pacific GDP, 3.12% of North America, 2.59% of Europe, 0.77% of Latin America, and 0.71%
of MENA, similarly it contributed 7.05% to China GDP compared to 3.3% to USA, with major
ecommerce platforms such as Alibaba, Ebay, Amazon, (Abraham, 2017). UNCTAD (2016)
B2C e-commerce index report 2016 shows that Nigeria is ranked 100 among other nations with
an ecommerce index value of 30.4, based on criteria such as share of individuals using internet,
credit card, secure internet servers per 1 million people and postal reliability indicating that
there is a very large vacum to be filled and strong market potential for ecommerce growth as
E-commerce is classified into types and categories depending on the nature of transactions
conducted and partners involved, to this end various types of e-commerce have emerged;
distributors, and other partners. Businesses use B2B e-commerce to achieve cost
errors and eliminate manual processes and activities. It allows suppliers to access online
inventory status, refill needed products in a timely manner, business processes such as
purchase orders, invoices, inventory, shipping logistics and business contracts are
handled directly on the network to reduce cycle time, the result is improved supply
chain management among business partners, other benefit include; lower production
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2. Business-to-Consumer (B2C): an e-commerce transaction between business and
is online marketplace and storefront such as Amazon, Konga, Ebay, Jumia, Alibaba,
products and services using electronic channels as opposed to the physical channels
offers information, goods and services as well as help desk for customer service and
directly to another consumer, using this type of e-commerce individuals sells a wide
variety of products and services on the web and online auction sites such as Ebay. It
makes it easy for consumers to sell fairly-used products, products that are no longer in
use or products bought, but, not needed anymore to other consumers that have more
governments, etc.
(B2E), mobile commerce (Mcommerce), etc. (Turban, King, Lee, Liang, & Turban, 2015),
(Yan & Stewart , 2006), (Chaffey, 2002), (Nanehkaran, 2013), (Mirescu, 2010). The
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understanding therefore is that as nature of transactions, partners, adoption of e-commerce
evolve so also will be the emergence of new types and categories or forms of e-commerce, in
this paper attention will be given more to the B2B and the B2C types of e-commerce.
1. The business organization which includes; improved supply chain management, cost
products and services, find bargains by comparing prices, real time delivery,
3. The society benefits such as close the digital divide between rural areas and urban areas,
(Baourakis, Kourgiantakis, & Migdalas, 2001), (Chaffey, 2002), (Ferentinos, Arvanitis, &
Sigrimis, 2006) also supports this view noting that adoption of e-commerce leads to direct gains
including reduction to operating costs in areas such as effective collection and evaluation of
data for management decision making, enhances the development of processes for quality
assurance and regulatory compliance, facilitates direct feedbacks from customers and
consumers, improve supply chain management, etc. also Lucking-Reiley & Spulber (2000)
noted that e-commerce enables firms to find greater number of suppliers, communicate and
engage with larger number of companies in their supply chain and unlimited access to
customers anywhere with internet access and connection. Similarly, e-commerce being a
system that facilitate the exchange of information reduces the sacrifices involved in a buying
and selling transaction as it largely depends on exhange of information between buyers and
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sellers (Mueller, 2001). Wigand (1997) identified disintermediation i.e the elimination of the
so many middlemen involved in the traditional buying and selling of goods and services, and
reintermediation i.e a creation of central meeting point such as an online marketplace where
buyers and sellers meet to transact businesses directly as a key importance of why e-commerce
matters, Khan et al (2014) identified ; availability of goods and services anywhere, enablement
of cross boundary transations, cost reduction and increased quality, ability to personalize
convenience for customers and obtaining competitive advantage (Interoute, 2015). Gupta
(2014) summarized the importance of e-commerce into three namely; transaction cost
consisting of search cost, processing cost, management and logistics cost, disintermediation
and transaparency in pricing. Increasing internet penetration further strenthen the importance
of e-commerce in businesses as online sales are growing faster than offline sales, buying
decisions are largely influenced by the web, a large number of customers conduct research on
products and prices online before making purchases as such the more reason e-commerce
matters in business today (Dhalla, 2011). The benefits of e-commerce to business, consumers
and the society at large is enormous, hence the increase in its adoption across different sectors.
E-commerce is not without limitations and disadvantages, several researchers have identified
different limitations and disadvantages attributed to e-commerce that both hinders its adoption
as well as development, a number of such limitations and disadvantages are highlited in this
issues, inability to guarantee product quality, social relationship limitation as transactions are
done on the internet void of any physical contact, and went further to point out barriers limiting
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for e-commerce and internet network, protection of consumers rights, lack of legal
infrastructures, lack of security and low internet speed and penetration in some countries,
and regions. Similarly, (Gupta, 2014) identified lack of security, reliability and effective
communication protocol, cost of information technology equipment and internet access that
Generally, the limitations of e-commerce adoption and development will differ according to
the region and stage of development of the country in focus, for example while security and
privacy issues will be the limiting factors of e-commerce in developed and emerging economic
countries such as USA, Russia, China, UK, etc. lack of enabling infrastructures and services,
low rate and quality of Internet penetration and access, lack of effective legal framework, the
widening gap of digital divide between urban and rural areas, high cost of required information
commerce and many others will be the limiting factors for developing country such as Nigeria
which is the focus of the study, similarly limitations exist among businesses depending on the
size of the business as such the limitation experienced by large corporations in adopting e-
commerce will not be the same for small and medium enterprises. In as much as these
limitations exist the benefits remains a driving force upon which these limitations are overcome
by businesses.
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2.1.2.1 Marketing Concept
Marketing remains a key challenging factor affecting agricultural sector especially in Nigeria
as authors have noted, this is true as marketing plays a vital role not just in getting the desired
input and output to the target consumers but also in the transformation of agriculture from a
household farming activity to a large industrial activity geared towards providing the needed
food for a larger population as well as the raw materials required by both agric. and non- agric.
Industries. The importance of agriculture in assuring food security rest in the equitable
distribution of its inputs and outputs as well as accessibility to all when needed, in the right
quantity and quality required as such any gap identified becomes a threat to food security,
further more; its ability to provide employment opportunity, cub poverty, and secure foreign
reserve earnings in a country like Nigeria which is the focus of the present government also
agricultural outputs and inputs is at the centre of these objectives (Olukunle, 2013), (Nwajiuba,
Marketing has been defined by several authors some of which are identified in this paper.
Marketing is a philosophy that encourages the organization to ensure that the needs and wants
of customers in selected target markets are reflected in all its actions and activities while
definition, Anderson (1982) emphasizes that the reason for a strategic marketing philosophy is
that better performing organizations recognize the basic and enduring nature of the customer
American Marketing Association have defined marketing as the process of planning and
executing the conception, pricing, promotion and distribution of ideas, goods, and services to
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create exchanges that satisfy individual customer and organizational objectives, (Bennett &
Anderson, 1988), in criticising this definition, Burnett (2003) argued that while the definition
can help us better comprehend the parameters of marketing, it does not provide a full picture
as it exclude specific transactions and relationship with other elements such as the mission
statement of the organization which is its business philosophy and functional areas.
Similarly, Kotler (1997) defined marketing as a social and managerial process by which
individuals and groups obtain what they need and want through creating, offering, and
exchaging products of value with others. Chatered Institue of Marketing UK (2015) have also
defined marketing as the management process responsible for identifying, anticipating and
satisfying customer requirements profitably, sharing similiarities with Kotler’s definition. Also
, creating, delivery of satisfiers within societal contraints profitably in exchange for something
of value in the arena of business competition, this definition also points out the managerial
proces involved in marketing as well as the influence of the environment in which the business
exist. And updated definition by the American Marketing Association which closes the gap
identified in its earlier definition, they defined marketing as a set of institutions and processes
for creating, communicating, delivering and exchanging offerings that have value for
customers, clients, partners, and society at large (AMA, 2013). This definition tends to be
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4. Consumer content; which determines the existence of an organization as it identifies
the number of people who needs the product and services offered by that organization
i.e. the target market and their needs, any changes in their need for the product and
service or ability of a competition to provide or serve that need much better impacts on
consumer’s needs at present and in the future, ability to reorganize itself to adapt to the
changes in needs, preference, taste, values and buying decisions of the consumers etc.
company project’s affect the consumer’s perception of the products and services offered
product design, product quality, price, packaging, outlet selection, advertising , press
7. Competition; the ability of the organization to identify who their competitors are, their
strengths and weaknesses and the use of such information to make intelligent marketing
decisions.
departments and funcational areas in the organization rather than allow one department
departments.
9. Community Contact; ability to interact with micro and macro environment in which
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2.1.2.1.2 Marketing Process
1. The Marketing Plan: The marketing plan begins with defining firm mission and
marketing objectives which sets direction on how other marketing activtivies will be
carried out in a manner that will be consistent with the firms overall objective.
2. The Marketing Strategy: Kazmi (2008) defined strategy as the course of action to be
seeks to serve and the needs of these customers the firm intends to satsisfy and
b. The Marketing Mix: This refers to the set of tools firm adopts to achieve its
target market objectives, areas or levels of decision marking for achieving target
market objective and are broadely categorized into four, namely; 1. Product is
consumption that might satisfy a want or need (Kotler, 2000), it is the primary
element that satisfies customers needs and wants, it create the value that
customers engage in exchange to obtain. 2. Place; this defines how product will
product and services as well as how to obtain same and at what value. 4. Price;
exchange for the product (Adetayo, 2006), (Burnett, 2003), (Bordon, 1984).
3. Marketing Budget: Having defined marketing objectives, target market and the right
blend of marketing mix to achieve such objective the firm allocates resources needed
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to implement selected marketing mix strategy using the budget, as Burnett (2003) notes,
that organizations must establish budget based on the required marketing effort to
influence consumers and that marketing budget represents a plan to allocate expenditure
the marketing plan work, or activities necessary for achieving the objectives (Adetayo,
5. Evaluation and Control: The constant review of what has been done, alignment of
(Isoraite, 2009), (Gronroos, 2006) and others express these same views.
Agricultural products and agricultural marketing takes center stage as this paper is focused on
Generally, agricultural industry is divided into four consisting of crop production, forestry,
fishing and livestock, industry players (firms) within this industry are grouped into input
producers, farmers, agro-dealers, agro-processors, trade and exports. Each divide of the
industry has its own primary and secondary products different from the other divide for
instance; crop production primary products includes; wheat, rice, maize, soybean, cassava,
yam, etc., similarly, livestock, forestry and fishing has both their primary products and
secondary products (FAO UN, 2016), (NBS, 2017), (MBA 13, 2016), (USDA, 2017).
Agricultural marketing in a broader sense refers to the marketing of farm products produced
by farmers as well as inputs required by farmers in the production of products, it comprises all
the marketing operations and institutions conducting them including the movement of farm
21
produced products, raw materials and their derivatives from farmers to consumers, agricultural
marketing focuses on both product marketing and input marketing and includes issues such as
marketing functions, channels, efficiency and cost, price spread and market integration,
producers surplus, government policy etc. (Acharya & Agarwal, 2006), some of these issues
are beyond the subject matter of this study as such will not be given adequate attention.
Several definitions have emerged to explain the concept of agricultural marketing few of those
embraces all operations and institutions involved in moving farm products from farms to
consumers and distributing supplies, feed, seed, fuel, fertilizer and machinery to farmers.
It has also been defined as the performance of all business activities involved in the flow of
goods and services from the point of initial agricultural production untill they are in the hands
of the ultimate consumer (Kohis & Downey, 1972). Similarly, Hoque (2015) building on
(Pritchard, 1969) definition that considered both the product and input marketing, defined
agricultural marketing as the study of all activities, agencies, and policies involved in the
procurement of farm inputs by the farmers and the movement of agricultural products from the
farm to the consumers, further noting that it is an effort to estimate demand for inputs and to
ensure regular support of those and to dispose farm product to a proper consumption point.
22
2.1.2.2.1 Difference in Marketing of Agricultural and Manufactured Goods
There is difference between the marketing of agricultural commodities and the marketing of
agricultural sector which differs from that of the manufactured goods sector (Acharya &
1. Perishability of the Product: Most of the farm products are perishable in nature and the
period of perishability depends on the particular product, some perish faster than others.
2. Bulkiness of Product: large number of the farm products are bulky and as such
transportation and storage becomes difficult and expensive, and impose restriction on
in quality, there is variation in the quality of agricultural product that inhibits grading
and standardization.
becomes both uncertain and irregular. It is reponsible for excess demand over supply
products.
5. Small Holding Size and Scatterd Product: Agricultural products are produced
throughout the length and breath of the country and most of the producers are small in
size as well as the producers and this makes it difficult to estimate supply and creates
problems in marketing.
they cannot be produced throughout the year, which contributes to price falls
23
withnessed during harvest season and increase during cultivation, whereas the supply
of manufactured products such as electronics are adjusted and made uniform throughout
the year to make prices remain almost the same throughout the year.
7. Processing: Most of the farm products cannot be consumed directly, they have to be
processed before consumption by the ultimate consumer, the processing function adds
These accounts for the difference in marketing approach between manufactured products and
Agricultural markeing is important not just for stimulating production and consumption but
also for accelerating the pace of economic development, its dynamic functions are of key
importance in facilitating economic development (Mamoria & Joshi, 1995). Acharya &
marketing system leads to the optimization of resource use and output management. An
efficient marketing system can also contribute to an increase in the marketable surplus
by scaling down the losses arising out of inefficient processing, storage and
transportation.
10. Increase in Farm Income: An efficient marketing system ensures higher levels of
income for the farmers by reducing the number of middlemen or by restricting the
marketing of farm products. An efficient system guarantees the farmers better prices
for farm products and induces them to invest their surpluses in the purchase of modern
24
11. Widening of Markets: A well-knit marketing system widens the market for the products
by taking them to remote corners both within and outside the country, i.e., to areas far
away from the production points. The widening of the market helps in increasing the
demand on a continuous basis, and thereby guarantees a higher income to the producer.
marketing helps in the growth of agro-based industries and stimulates the overall
13. Price Signals: agricultural marketing system helps the farmers in planning their
production in accordance with the needs of the economy and set effective pricing
strategy .
14. Adoption and Spread of New Technology: It facilitates farmers adoption of new
industry specific scientific and technical knowledge. New technology requires higher
investment and farmers would invest only if they are assured of market clearance. These
products.
importance on economic development and food security, in the case of Nigeria it is seen
as the major solution for reducing the high rate of unemployment in the country, as
government increases effort to diversify into agriculture, it is expected to result into the
16. National Income & Foreign Reserve Earner : Agricultural marketing activities add
value to the product as well as increases production and distribution activities which
contributes to the nation’s gross national product and net national product.
25
17. Better Living: Increased agricultural activties resulting from effective agricultural
marketing creates employment and provide income and source of livelihood for
18. Creation of Utility: Although agricultural Marketing adds cost to the product; but, at
the same time, it adds utilities to the product. These include, form utility through
transformation of raw materials by processing them into a usable product, place utility,
time utility through storage to make the product available at all times, and possession
utility.
process (Roy, 2006). Kohis & Uhl (1985) classified these marketing functions into: physical
exchange functions consisting of buying & selling; and facilitating function consisting of
Similarly, FAO (2006) describing it as stages of agricultural marketing, identified the stages to
include: Stage 1- Assembly, Stage 2- Transportation, Stage 3- Storage, Stage 4-Grading &
Classification, Stage 5- Processing, Stage 6-Packaging and Stage 6-Distribution and retailing.
Building on these classification among others Acharya & Agarwal (2006) identified
1. Packaging: Packing refers to the wrapping and crating of goods before they are
transported. Goods have to be packed either to preserve them or for delivery to buyers.
Packaging is a part of packing, which means placing the goods in small packages like
bags, boxes, bottles or parcels for sale to the ultimate consumers. In this context the
26
2. Transportation: The movement of from point of production or processing to the ultimate
consumer, it widens the market, narrow price difference, facilitate specialized farming
of the grades uniform among buyers and sellers over space and over time. Grading
means the sorting of the unlike lots of the produce into different lots according to the
quality specifications laid downIt is a method of dividing products into certain groups
is a sub-function of standardization.
4. Storage: The storage function adds the time utility to products. Agriculture is
characterized by relatively large and irregular seasonal and year – to – year fluctuations
in production. The consumption of most farm products, on the other hand, is relatively
stable. These conflicting behaviours of demand and supply make it necessary that large
5. Processing: The processing activity involves a change in the form of the commodity.
Processing converts the raw material and brings the products nearer to human
consumption. It is concerned with the addition of value to the product by changing its
form. Its importance is derived from the fact that most of the agricultural products are
consumed in their processed forms, for instance, Rice from grains, Flour from wheat,
6. Buying and Selling: Buying and selling is the most important activity in the marketing
process. At every stage, buyers and sellers come together, goods are transferred from
seller to buyer, and the possession utility is added to the commodities. The number of
times the selling and buying activity is performed depends on the length of the
marketing channel. The buying activity involves the purchase of the right goods at the
27
right place, at the right time, in the right quantities and at the right price. It involves the
problems of what to buy, when to buy, from where to buy, how to buy and how to settle
and other information which affect the marketing of goods and services, these
information are important are important to the farmer, producer, market middlemen,
general economic development and the government for making policy and includes;
8. Financing: The financing function of marketing involves the use of capital to meet the
business is possible nowadays without the financial support of other agencies because
capital provided by farmers, producers and market middlemen are not sufficient.
A key function missing in (Acharya & Agarwal, 2006) list of agricultural marketing function
is the assembly function which (FAO, 2006) identified as the first stage and (Pritchard, 1969)
identified as a key activity involved in agricultural marketing. The assembly function is a key
function because the various agricultural products must be collated from their various sources
(Farms or famers) before processing, packaging and other marketing functions can be
performed.
Marketing system is the complex network of economic exchanges that markes it possibke for
dispersed over time and space and integrates them to create and sustain a national economy
(Jones, 1970), Jones(1970) also notes that, within the boundaries set by technology marketing
system determines the form of economic production, and that the marketing system is an
28
allocation mechanism, it exists to accellerate the equitable allocation of resources in production
and of products among uses. It is of essence that participants in agricultural marketing system
constantly adapt to the changing circumstances of deman and supply as agricultural production
is influenced by natural conditions, depletion of resources such as soil, water, vegetation, etc.,
transporting and storing which has direct impact on demand as changes in communication,
tastes, income, population size and structure, education and social organization.
A good agricultural marketing system must have sufficient capacity to provide regular markets
for the products of farm and factory, regular supplies of foods and a variety of other consumers
goods of desired kind and quality in both rural and urban markets, and timely supply of the
prodcutive inputs needed by farmers and of the raw material inputs needed by processors and
Jones (1970) in a study conducted in five tropical regions of Africa comprising; Freetown in
Seirra Leone, Nairobi in Kenya, Kana, Ibadan and Enugu in Nigeria summarized the general
tasks that an agricultural marketing system must perform if an economy is to achieve maximum
productivity to include:
1. Merchants must be able to command the physical means to move commodities from
3. There must be places where buyers can find sellers, and sellers buyers.
4. Potential buyers and sellers must be able to learn about the magnitude of supplies and
probable requirements, both present and future, at various locations in the system.
29
5. Transport services, storage facilities, marketplaces, and market information all will be
unavailing in the absence of traders who are in a position to take advantage of the
opportunities for gain that are afforded by differentials in supply and demand over
6. The costs of marketing, like the costs of hauling, storing, and processing, should be
moderate.
These general tasks shares similar view with the stages in agricultural marketing identified by
(FAO, 2006), the agricultural marketing function by (Acharya & Agarwal, 2006) and
Bressler & King (1978) identified two attributes of am efficient marketing system, they are;
1. To provide efficient and economical services and ownership transfers in the movement
Internet Marketing is the application of the internet and related information technologies to
achieve marketing objectives (Chaffey, 2002), internet marketing, otherwise called online
marketing shares some of the characteristics of both direct and indirect marketing forms, Fraser
et al (2000) identified four sources of competitive advantage that internet marketing can
provide agribusiness;
2. Ability to decrease costs associated with purchasing by curbing the time and effort
30
4. Prospect of expanding market share and / or developing new markets by decreasing the
cost of selecting and processing information concerning the needs and the wants of
Several theories and models have emerged to predict and explain reasons for e-commerce
adoption, use and impact on organizational performance as well as arguments both in academic
However, in this paper attention is given to the 5 main theories commonly used which are;
The TRA theory developed by Ajzen & Fishbein (1980) posits that the behaviour of an
affected by attitude towards that behaviour and subjective norm (Rahayu & Day, 2015). Ajzen
(1991) argued that the TRA lacks the ability to adapt to situations in which the individual is
not under volitional control as well as its limitation when applied to situations in which
individual’s actual behavior and intentions are highly correlated, based on these limitations
Ajzen (1991) proposed TPB to accommodate the shortcomings of TRA by including a new
contruct called Perceived Behavioral Control (PBC) as such factors that influence intention to
perform certain behavior are; attitude toward that behavior, subjective norm and perceived
behavioral control. While TRA and TPB focused on the relationship between intention and
behavior to explain adoption of technology such as e-commerce , its lack of other factors such
31
as personal norms and affective evaluation of behavior which could increase its predictive
power makes it weak and unreliable theory (Rahayu & Day, 2015).
TAM Theory
Davis (1989) building on the framework of TRA and TPB prosped a new model TAM in an
attempt to predict and explain the use and acceptance of information systems and technology
by individuals. Davis identified perceived usefulness i.e. the degree to which a person believe
that using a particular system will enhance his or her job performance, and perceived ease of
use i.e. the degree to which a person believes that using a particular system would be free of
effort, as factors responsible for why people accept or reject information technology
(Surendran, 2012), just as the model have been improved upon by different researchers in
attempt to adapt it to the changing technological environment, it has also been criticised by
different researchers noting that TAM has questionable heuristic value, limited explanatory
and predictive power, triviality and lack of practical value (Chutter, 2009), similarly, Benbasat
& Barki (2007) in their criticism noted that the theory has led to a state of theoretical chaos
and confussion resulting from several researchers effort to adapt the theory to the constantly
changing technological environment, Lunceford (2009) in his critic of the theory argued that
the framework of perceived usefulness and ease of use neglected other issues such as cost and
IDT Theory
Away from the individual perspective which has been the focus of the previous theories above,
Rogers(1995) developed the Innovation Diffusion Theory (IDT) framework that focused on
process oriented perspective to predict and explain how innovation can be received and shared
among people. The theory identified critical technological innovation characteristics such as;
32
influencing the adoption or rejection of information technology, arguments againts these model
is centered on its exclusion of environmental factors that affect reception and rejection of
information technology adoption, the desire for a more holistic model that will inculcate other
factors by researchers led to the emergence of the TOE framework developed by (DePietro,
TOE Theory
The addition of the environmental factors in the TOE framework which other theories ignored
makes it a more complete model compared to others as it takes into consideration factors
beyond the individual, organization and technology which has been the focus of the other
models as Oliveira & Martins (2011) pointed out that it has a solid theoretical basis hence its
use for predicting adoption of information technology. TOE identified 3 factors that influence
productivity, the organizational context consisting of firm size, scope, complexity of struture,
quality, features and availability of firm’s technology and financial resources, and the
environmental context consisting of firm’s industry and relationship with stakeholders. These
theory is widely and strongly relied upon as several research studies have shown (Hoti, 2015),
(Rahayu & Day, 2015), (Grandon, Nasco, & Mykytyn, 2011). Although several other theories
exist to explain and predict the adoption of e-commerce as well as its perceived influence on
business, they are mostly a modified version of these 5 main theories reviewed. The TOE
framework is chosen as the theoretical basis for this study based on its comprehensiveness,
wide acceptance and use by reseachers as a valid model for assessing e-commerce adoption
33
There are emerging theoretical framework and models being developed in an attempt to predict
and measure the impact of e-commerce on firm performance which is the second objective of
this study, though firm performance is quite difficult to define and operationalize as a result of
conflicting views on what a firm performance is and should be, a variety of financial and non-
financial measures are used to determine the impact of e-commerce on firm performance as
shown by the works of Mukhopadhyay & Kekre (2002) adopting non-financial measures such
adoption, and Teo & Tan (2002) using return on investment (ROI), annual total revenue,
market shares, acquisition cost and revenue growth per customer to determine the impacts of
e-commerce adoption, these measures have been largely criticised for lack of objectivity as a
result, subjective measures have received wide adoption aming researchers for measuring
impact of e-commerce adoption on firm performance(Thi, 2006). Thi (2006) identified five
subjective measures developed by Zhuang & Lederer (2003) based on an extensive literature
review to examine the business benefits of e-commerce, namely (1) back-end efficiency, (2)
market expansion, (3) costs' reduction, (4) customer service, and (5) inventory management
and subjective measures of firm performance introduced by Khandwalla (1977) based on firm’s
managers assessment of the firm's ability compete effectively, the measures are long-term
profitability, availability of financial resources, sales growth, and image and client loyalty
among other subjective measures that have been advanced, these two measures have received
wide adoption and have been tested on several studies and proved to be effective in measuring
and prediciting the impact of e-commerce on firms performance as such will be used in this
study to achieve the second objective of assesing the impact of e-commerce on marketing of
agricultural products, these subjective measures fit’s perfectly as they contain meausres for
34
2.2.2 Theoretical Review of Agricultural Marketing
Several theories and models have been advanced to explain general concept of marketing and
provide theoretical foundation for it, but very few theories and models have emerged in recent
times to explain and provide better understanding on the concept of agricultural marketing,
partly because it is still a growing concept, to this extent, the theories of agricultural marketing
proposed by (Pritchard, 1969) will be reviewed and adopted as the theoretical foundation for
agricultural marketing systems, supply of operational research question and method as well as
to provide better understanding of agricultural marketing principles, these theories are derieved
from both general marketing theory and related economic theories, they are; market structure
analysis, relevant economic theory, theory of effective competition and economic growth
theory.
Market structure is the characteristics of the organization of the market that strategically
influences the nature of competition and pricing within the market, these strategic
characteristics include; the degree of seller (buyer) concentration as measured by numbers and
size distribution of firms, the degree of product and service differentiation among sellers and
the conditions of entry into an industry and its markets (Pritchard, 1969), Market structure
analysis is a valuable tool for a comprehensive analysis of agricultural marketing system in the
context of economic growth as most economic theory is derived from marketing, market
structure analysis postulates causal relationship from industry & market structure to the
conduct of marketing firms and there performances vice versa, market structure is valuable for
studying marketing in developing countries such as Nigeria for the following reasons; 1.
35
Agricultural Industry and market structures are changing and growing, 2. Governments are
decision making in advanced agricultural market economies such as US, China, India, Brazil,
etc. it is less likely to impact decision making in developing countries where agricultural
marketing is still growing, issues such as uniform weights, legal framework and government
policies are important structural problems compared to market structures, the limited degree
of product differentiation in a developing economy, with its limited outputs of goods and low
effective demand, may be less important than deficiencies in structure that reduce productivity.
Market conduct refers to the patterns of behavior that enterprises follow in marketing. Conduct
is what businesses do; it is their policies and strategies. Market performance is the results of
market conduct. These include prices, profits and losses, product and service volumes and
progress, and other events. In market structure analysis these performance variables are related
to observed conduct and structural variables to determine lines of causation.? The next step,
with great interest for developing countries, is estimation of potential improvements in industry
and market performance resulting from a specific change in structure, such as a new food
processing plant, an improved system ,of weights and measures, new grading standards, or land
Pritchard (1969) notes; Agricultural marketing has no distinct body of theory of its own, its
principles and analytical framework are drawn from theories of marketing and general
economics such as theories of consumer and farmer demand, production, pricing, competition,
organizational behavior, etc. the theories of consumer and demand for farm products and
inputs and marketing services are useful for explaining and predicting how and why the
36
structures of these demands changes during development, The theory of production is also
important as most marketing operations involve the production of goods and services. They
production, firm behavior, and demand, are particularly valuable for estimating the feasibility
of the new marketing facilities needed for modernization of agricultural marketing systems in
developing countries.
Pritchard (1969) assert that the theory of effective competition has several advantage for a
assumptions are more realistic than those of pure competition. As a result, they provide more
useful, although less precise, guidelines for empirical study. Unlike the theory of pure
desirable, standards of industry and market performance. In view of the high importance of
improving market performance in developing countries this realism has great value for
researchers, policy officials, and others. Furthermore, it enhances the usefulness market
structure analysis with which the theory of effective competition is highly compatible. Another
advantage of the theory is that it expressly allows for dynamic economic conditions by viewing
competition as a dynamic process rather than as a static, equilibrium seeking activity. The main
disadvantage of the theory of effective competition as a guide to empirical research is its lack
of refinement and precision. Its main principles cannot be expressed in the language of
Pritchard (1969) defined economic growth as a significant and sustained increase in real output
per capita or in total as measured in national accounting, noting it is the major goal of every
country. Growth always involves sweeping changes in technology, economic and social
37
institutions, structures of production, industries, markets and demand, and modes of life and
work. Significant increases in real output per capita are on the order of 15 percent, and more,
per decade. Sustained growth is expansion of real outputs and consumption over long time
periods, usually several decades, with allowance for short-run variations in rates. Economic
growth has many origins. The obvious sources are increases in the supply of productive
resources--labor, land, and investmentsin human and physical capital. But in most countries,
the primary source of economic growth per capita is improvements in the quality of resources)-
Quality means efficiency in terms of output per unit of input. Increases in efficiency come
mainly from technological advance in production, marketing, and business management, from
improvements in resource use through changes in industry structure, and from increases in
scale of economic units. Scientific research, education, and communication are the foundation
of technological advance. Improvements in the quality of the products of one industry often
increase efficiency in others, especially when the outputs of one are the inputs of others. In a
growing economy, consumer demand rises and its structure changes significantly. Pronounced
shifts in consumer expenditure patterns result mainly from important differences in income
Pritchard (1969) further notes, new product give consumers more consumption alternatives and
the growth becomes increasingly market oriented, these changes have high significance for
significant increases in the economy's productive capacity and by equally important changes
in the structure of production, industries, and markets. Technological advance provides more
efficient production and marketing processes and new products. These are needed to satisfy
consumer demand for greater diversity in consumption and to stimulate demand enough to
assure full use of the economy's expanding capacity to produce Emphasis on marketing
increases in growing economies. Profitable utilization of larger producing and distributing units
38
depends on high sales volumes. Accordingly, marketing firms have increasing need for
influencing consumer behavior and for control over supplies of basic products. Farmers come
under increasing pressure to improve delivery schedules and the level and uniformity of quality
of outputs. The multiple, circular flows of goods, services, and credits linking agriculture,
agricultural marketing and other sectors become stronger and more complex during growth.
Pritchard (1969) in concluding on the theory of economic growth identified the following as
the reasons why agricultural marketing is considered as a distinct field of study linked to the
1. Agriculture in nearly all the countries of the world is the largest industry and much so
for developing countries where is the leading industry, it takes more than half of the
labour force, and food expenditures are more than half of consumer expenditures,
provides raw materials for other industries as such the development of agriculture and
process.
2. Agricultural production is almost exclusively a biological process, from this fact flows
3. Most farm products are subject to much lower income and price elasticities of demand
than most nonfarm products 'and services. Accordingly, general economic growth
means that a declining share of the national income is spent for food and that the share
of the gross domestic product originating in agriculture falls. from this comes the
4. This essential outmigration of people is fraught with more complexities, hardships, and
restraints of an economic, technical, educational, social, and political nature than those
39
5. Agriculture, more than any other economic sector, is the bastion of small-scale, family
enterprise. This has much importance for methods and problems of stimulating and
In an attempt to investigate the relationship between agricultural marketing theory and general
marketing can profit most from the findings of general marketing theory.
As stated earlier agricultural marketing is not a distinct field of study as such does not have a
distinct theoretical framework for analysis distinct from those of marketing and general
economics from which its concepts are drawn and underlying principles are drawn.
As noted earlier in this literature that the adoption of e-commerce varies according to country
and sector of application, and that the nature of transaction and partners involved in the
transaction determines the category and type of e-commerce. This study focuses on the
In recent times, there has been a new form of e-commerce Agri-commerce (Agricultural E-
(2001) noted that though the internet approach seems to be a one-way path for digital products
activities in the agricultural industry, they recommended that agribusiness firms should adopt
e-commerce practices to benefit from the advantages that e-commerce offers as their study
showed increase in tendency of agribusiness and farmers to adopt e-commerce although low
40
internet penetration and lack of knowledge of the full potential of e-commerce to agriculture
In supporting this view, Ferentinos et al (2006) pointed out that in recent times e-commerce
has found its way to agriculture and finds further application among agribusiness and as such
the emergence of new types of B2B and B2C e-commerce referred to as Agribusiness -to-
poitning out the benefits of such adoption to include; promotion of information flow, market
cooperatives, and further noting that the development of e-commerce in agriculture depends
largely on the adoption of the internet by farmers, and agribusinesses and are impacted by
three factors; industry structure which specifically affect development by reducing the need to
products sold in the agricultural markets driven by demands of several customers along the
value chain of such product and lastly the interplay of personal relationships in the agribusiness
environment, they conluded that the development of agribusiness e-commerce will eventually
lead to a wider adoption of e-commerce in agriculture, (William, 2000), (Poole, 2001), (Leroux,
M., & E., 2001) and others supports this view. The drive towards e-commerce application in
agriculture is based on perceived benfits that e-commerce will provide to agribusinesses and
farmers such as reduction in intermediation cost arising from middlemen activities, reduction
in cost associated with supply chain activities, effective information and communication
among supply chain partners and the prospect of expanding existing market share and
41
Another study conducted in Taiwan in 2000 indicates that less than 5% of total agricultural
produce was marketed through e-commerce, noting the great potential that exist in adopting
e-commerce in agriculure sharing similar result with a study conducted in USA also indicating
weak percentage of e-commerce adoption among farmers but with growth potential for
advancement, the study went further to note that inability of farmers to adopt e-commerce will
keep them behind and out of competition in the nearest future, while identifying relevant laws
and regulations in addition to other challenges identified by other scholars as factors limiting
Similarly, Ehmke, Ernst, Hopkins, & Tweeten (2001) in their study noted that though several
studies has been done on adoption of e-commerce little is known about about the attitude of
managers & other personnel concerned about the economic reason for adoption , also noting
that agribusiness do not consider e-commerce as much as a product but a method for delivering
agricultural inputs. majority of agribusiness in their study indicated having a rethink of their
business structure caused by the application of e-commerce in agriculture, while others have
taken proactive actions to adopt e-commerce such as setting up a website, buying and selling
products online, and few others undecided despite their knowledge of the importance of
adopting e-commerce in agribusiness in the future. They identified changes for closer
coordination of the supply chain consisting of producers, seed, fertilizers, machinary suppliers,
food processors and retailers, the need to create new relationship between different and similar
agriculture. Supporting other researchers they identified tightening of supply chain, cutdown
of (Ferentinos, Arvanitis, & Sigrimis, 2006) they noted that the agricultural sector and
42
participants presents some challenges to the development and implementation of e-commerce
practice which include resistance to changing business practices as they are committed to
demorgraphics, lack of internet connectivity in rural areas where agribusiness is and farmers
slower adoption of internet and concluded that each of these challenges require further analysis
A study carried out by (Henderson , Akridge, & Dooley, 2004) in USA, 2004 shows that
agribusiness firms were using e-commerce more with suppliers than with customers, and
perception regarding internet and e-commerce differs according to intenisty of use, hence
divers views exist of e-commerce capabilities, farmers desire for personal relationship and
customer service remained a barrier between agribusinesses and e-commerce activity with
farmers, their study futher supports the opinion of other researchers noting that firms adopting
and market expansion more than others, have the ability to provide more product offerings
enabling easier comparison and product recommendation. They concluded that future research
is required to shed more insight into e-commerce use and its impact on agribusinesses, firms
agribusiness, a quest this study intend to pursue and fill such gap within the context of Nigeria,
Sideridis, 2009) share this same views although thier studies were conducted in a different
country but there exist similiarities between the challenges of the development of e-commerce
in agriculture as well as the perceived benefits of e-commerce to agribusinesses and the gaps
in study.
related study using the process and function view and the 5 process of supply chain;
43
adoption in agribusiness firms discovered that larger firms tend to adopt internet strategies than
small agribusiness firms and that the benfit of reduction in transaction cost influences managers
perception regarding e-commerce adoption compared to traditional cost, and that e-commerce
role in agribusiness firm’s business model are not clearly defined, noting the emergence of a
broad spectrum of e-commerce adoption (Henderson, Akridge, Dooley, & Carerre, 2005),
(Sipica, 2009).
Dan & Qihong (2014) in their study noted that there has been rapid development of China’s
agricommerce in recent years as over 260 thousand agricomerce service providers have
emerged and are expected to exceed 1million early 2014, they grouped agricommerce services
in China into; 1. Corporate website to enhance brand image and product sale using social
networking, 2. Social media post for product promotion, 3. Online ordering and physical
delivery of groceries, 4. E-commerce platforms (Marketplace) for third party sale of special
agricultural products.
Similarly, Josh & Dsouza (2014) in developing framework for agricultural e-commerce in
india stated their main intent to be the improvement of agricultural sector in india based on two
factors of increasing agricultural output by applying better farming practice and enhancing
the marketing structure to facilitate marketing of agricultural products with the aid of e-
commerce, an intent, this study aligns with as it is the core focus of both government policies
and agro-allied industries in Ngeira to improve the agricultural sector to make it more viable,
and this study advances e-commerce as a key to achieving rapid improvement in Nigeria’s
agricultural sector, just as Jamaluddin (2013) pointed out, while internet adotion by
ICT for farming by farmers. This is evidenced in the e-commerce adoption in agriculture report
from china showing that over 100 billion Yuan turn over was achieved from adopting e-
commerce in agriculture (Hu, 2016), another report shows that over $1.4 billion grocerries was
44
purchased online in 2015 (AAFC, 2016), similar report shows that over 4000 agricultural e-
commerce platforms is in operation in China as at 2015 with over 50% growth from 2014
(Dsouza, 2016), a 2005 report in USA shows that 58% of US farms have computer and about
29% have internet access whereas among the large farms 79 % have computer, and 72% have
internet access, though only 9% is reported to have used internet for e-commerce activities
such as purchasing agricultural inputs, and among the large farms about 18% using it for
purchasing input and 23% for marketing activities (NASS, 2005), this number is expected to
agriculture.
Hu (2016) have advanced new types of e-commerce arising from the adoption of e-commerce
include; social media promotion channel, group purchasing promotion channel, regional media
cooperation channel, offline channel such as consumers group. Several other authors and
researchers share similar views and opinions expressed by literatures so far reviewed and
include; (Wang, Zhu, & Zhang , 2016), (Islam, 2011), (Xiaoping, Chunxia, Dong, &
The adoption of e-commerce in agriculture in Nigeria is relatively a new practice with strong
growth potentials as our rate of internet penetration continues to grow and the e-commerce for
merchandise continue to grow, as Esset (2015) rightly puts it that ICT remains a strategic and
ambitious way of modernising the agric sector as it will create more opportunities for the
farmers and ensure food security drawing from the statement of the President of National
45
The literatures reviewed in this section has shown an increasing interest in the adoption of e-
commerce in agricultural sector, although available data show weak adoption among farmers
and agribusiness alike but they all emphasize the potential for rapid growth in the near future
as more agribusiness become aware of the benefits of e-commerce adoption in the sector,
increased internet penetration and access in the rural areas, supportive govt regulations and
Studies carried out so far in Nigeria have focused mainly on the adoption of e-commerce in
business these inlcude; (Kareem, Owomoyeta, & Oyebamiji, 2014), (Okoye & Obi, 2015),
(Chiemeke , Evwiekpaefe, Juliet, & Irhebhude, 2014) among others, there is little or nothing
written in the adoption of e-commerce by farms, farmers and other agribusinesses in Nigeria
and general adoption in the agricultural sector, hence the need for this study to contribute
towards such knowledge, similarly the literatures reviewed had repeatedly identify the need to
conduct a study that will go beyond the adoption of e-commerce to look at its impact on the
Marketing of agricultural product is a key focus of this study as such review of literatures on
previous studies carried out to investigate the concept of agricultural marketing is necessary to
further establish the need for this study and to provide empirical foundation.
Marketing is the driving engine of the agricultural industry, the effectiveness of marketing
practice determines growth and decline in this industry, as Acharya & Agarwal (2006) rightly
market reform and marketing system improvement ought to be an integral part of policy and
strategy for agricultural development, the rate of growth in farming in developing countries is
still limping behind the desired levels. This has been largely attributed to the fact that not
46
enough attention has been devoted to the facilities and services which must be available to
farmers that would support agricultural sector for its development. Marketing is one of those
FAO (2006) asserts that economic development itself provides more sophiscated and more
efficient marketing system, noting that as countries experience economic growth there rate of
urbanization tends to increase substantially, as a result the number of people in urban areas
needing to be fed by rural people doubles withing 16 years , increasing reliance on agricultural
production and the marketing system that direct that production and distribution, further notes;
these movement of popultion creates inequality in income between urban settlers and rural
people that will require effective agricultural and food marketing practice to create a balance.
Marketing of agricultural products is more than ensuring the flow of a product from the field
to the warehouse, or from a warehouse to a selling place. Marketing consists of several, diverse
operations and requires multiple skills (2Scale , 2014). Similarly, Lothore & Delmas (2009)
income and should be considered a priority action; for example, a simple improvement in the
system of measurements can improve a farmer’s income by an average of 10%. The returns
from these types of activities which improve marketing conditions are often higher than those
related to an increase in productivity or yields (more difficult to obtain). Supporting this view,
AgMRC (2007) also notes; Marketing is much more than simply knowing how to dispose of
consumer wants and needs. Producers have traditionally taken whatever price they could get
while wholesale and retail distribution networks undertook the business of marketing.
agricultural commodities as basic agricultural products that are either in there original form or
47
have undergone only primary processing such as cereals, coffee beans, sugar, palm oil, eggs,
milk, fruits, vegetables, beef, cotton, rubber etc. and are generic and undifferentiated whereas
differentiated products are those with trade mark and are branded to communicate there
marketable difference and undergone different secondary processing based on use, within the
context of this study agricultural products refers to both differentiated and undifferentiated
products.
Agbo, Rousseliere, & Salanie (2013) in their study on agricultural marketing and direct selling
concluded that farmers can benefit from selling both to cooperatives as well as selling directly
to consumers, even though the cooper-ative does not have market power, it could have an anti-
competitive effect on the direct selling market, and thus benefit farmers. Conversely, direct
selling can create a healthy emulation and incite farmers to increase production that could
Walker (2007) in a study for defining models for decision making in agricultural marketing
concludes, that though, problems confronting those concerned with agricultural marketing are
complex and divers, there are variety of analytical models at the disposal of agricultural
marketing decision makers but the choice of model to use and application must be related to
the problems to be resolved, for instance; simulation models can be used for inputs and output
analysis, linear programming for analyzing long term changes in demand and its effect, and
recursive proramming for short term analysis, statistical inference for analysis of
Agricultural marketing is not without problems and challenges, several authors have identified
48
1. Lack of finance; more finance are required for financing seasonal requirements of a
activities, and stages with several middlemen taken part at every point which takes
away the profit that would have otherwise accrued to the farmer and increases the prices
quickly bring the product to its final consumers before it deteriorates in quality, also
the effect of seasonality requires more storage facility to maintain supply of such
product.
6. Price fluctuation; the gap between demand and supply caused by harvest and non
harvest season fluctuates prices of products in the market, lower prices in harvest
7. Lack of market information; in a country like Nigeria, most of the farmers lack basic
education and resides in rural areas as such are ignorant of accurate market prices and
other market information, they depend on merchants and middlemen that will rather
Asogwa & Okwoche (2012) supporting these views, identified road infrastructure for
supporting effective transportation, storage facilities, lack of organized market, too many
49
middlemen as factors affecting the marketing of sorghum in their study conducted in Benue
state, Nigeria.
In another study conducted by (Mba, 2015) it was concluded that a significant relationship exist
between agricultural marketing and economic growth, further supporting the economic growth
In summary, agricultural marketing is notably a driving force for the growth and development
of the agricultural industry which contributes greatly to economic growth and development,
provides the needed employment opportunities and earn desired foreign reserve especially for
developing countries such as Nigeria, the challenges and problems that affects its effective
practice creates a wide gap between the benefits expected and reality. In an effort to facilitate
and improve agricultural marketing, agricultural industry players are focusing on the adoption
of technology such as the internet to limit or totally eliminate some of the problems of
information, organized market for agricultural products, reduction in price fluctuation, and
reduction in the channel of distribution, etc. hence the push towards e-marketing, ecommerce,
mobile commerce, etc. for agriculture, which have been discussed earlier, although, literatures
reviewed so far show weakness in adoption among farmers, there are evidence of increasing
adotion and expected high growth in adoption especially among farmers in chinese, india, etc.
it is still a fast growing trend, and the increasing rate of internet penetration and growth in e-
and eliminate most of the challenges faced in agricultural marketing and improve its practice
for collective growth, these notion forms the theoretical framework upon which this study is to
be conducted .
50
CHAPTER THREE
METHODOLOGY
This chapter describes the research methodology used in the study. Research methodology has
been defined as the analysis of and rationale for, the particular method or methods used in a
given study, and in that type of study in general (Jankowicz, 2005). It includes the study area,
research population, sampling technique and size, sources of data, measurement of variables,
The study area is Osun state, Nigeria. It is located in southwestern Nigeria, between latitudes
7°30′N, and longitudes 4°30′E. It covers an area of approximately 14,875 (square kilometres).
The 1996 census puts the population of state at 3.4m, the State is mainly agrarian with over
256,000 farming families and 149,478 Hectares of cultivated areas. The State is made up of 30
local government areas with over 200 towns, villages and other settlements. The state has a
considerable number of highly urbanized settlements some of which are Osogbo, Ile-Ife,
Ipetumodu, Ilesa, Ikirun, Iwo, Ede, Ila-Orangun and Ikire. Food crops grown in the area include
maize (Zea mays), yam (Dioscorea spp), cassava (Manihotesculenta), cocoyam (colocasia spp),
rice (Oryza sativa) and vegetables (Amaranthus spp). The permanent crops cultivated include
cocoa (Theobroma cacao), kolanut (Cola nitida) and oil palm (Elaeisguinensis), among other
agricultural activities, the area is selected for its agrarian based economy which bears
importance on the study, although the study is intended to cover Nigeria but for the constraint
of time, transportation and financial resources it will be limited to selected farms and
51
3.2 Sources of Data
Primary data was used for this study as it seeks to collect information on the current practice
products.
The population of the study consist of farms and agribusiness in the study area comprising of
estimated 1395 farms and agribusiness alike, the accuracy of this figure cannot be verified for
lack of accurate and reliable public data. The choice of the area is justified by its agrarian
population. The sample size for the study is 302 obtained using the sample size formula
(1.96-Z value ) confidence level, 5% margin of error (C2), and 50% of Picking a choice (p) and
the finite population correction formula to determine the new sample size
from the estimated study population 1395, where n= new sample, N=Study Population, n0=ss.
The simple random probability technique is used to enable me reach out to a good number of
This study measures the variables using nominal and ordinal scales. Questionnaires were
distributed to farms, farmers and agribusiness to a sample sufficient to form an opinion within
the study area, adoption of e-commerce is the independent variable and was measured by
52
technological, organizational and environmental factors and the impact on agribusiness
performance which is the dependent variable was measured by financial and marketing factors.
The research instrument for the study is the questionnaire, which is a set of questions designed
to elicit information. The questionnaire was structured based on the questions developed and
tested by (Thi, 2006) and (Alrousan, 2014) which allows respondent to provide answers based
tool and its impact on farm, farmers and agribusiness. Section A is designed to elicit
commerce or tendency to adopt based on the TOE framework, and Section C is designed to
elicit information from respondent about their perceived influence of E-commerce on their
using the drop-off method to both reach out to respondent and get reliable response.
The instrument is reliable as it has accurate and consistent representation of the construct being
assessed, in other words the instrument measures what it purports to measure and gives similar
accurate results consistently. The instrument measures exactly the theoretical construct of TOE
framework for e-commerce adoption as well as its impact as have been tested by several
research scholars including (Alrousan, 2014), (Thi, 2006), (Zhuang & Lederer, 2003),
(Khandwalla, 1977), (DePietro, Wiarda, & Fleischer, 1990), (Hoti, 2015), (Rahayu & Day,
53
3.7 Data Analysis Techniques
Data analysis refers to the categorization, ordering, manipulating and summarizing of data, to
obtain answers to research questions (Okwandu, 2006). In this research, the data analysis
technique used for data analysis is mainly the descriptive analytical statistical tools which
include frequency distribution, central tendency, percentages, etc. to provide answers to the
54
CHAPTER FOUR
This chapter presents data collected from the study of the impact of e-commerce on marketing
of agricultural products in Nigeria, analysed and interpret the data for the purposes of providing
answer to the research questions and attainment of research objectives, 302 questionnaires were
administered and shared to respondents in the study area, but only 273 questionnaires were
recovered and analysed. The analysis of the data is divided into socio-economic characteristics
Table 4.1.1 presents the agricultural products that respondents deals on, produces and sells to
customers. The result showed that majority of respondents transact in livestock products
(30.8%) and food processing (30.4%). while other respondents are involved in fish farming
(17.9%) and forestry such as Saw Mill industry, wood dealers representing about 11% of the
total respondents.
55
4.1.2 Respondents Types of Agribusiness
Table 4.1.2 presents the type of agribusiness respondents are engaged in, results in Table 2
reveals that majority, 31.5% of respondents are into farming comprising of livestock, fishing
farming and crop farming, and about 28.6% of respondents are agro-dealers involved in buying
and selling of farm products, intermediate between buyers and sellers, marketers etc. 18.3% of
materials into other products such as food vendors, and 10% of the respondents provides
transport services and other essential trade services that facilitates agribusiness.
Figure 4.1.1 presents the years of involvement of respondents in agribusiness. Duration aids
expertise and informs understanding of strategies to embark upon to further the growth of the
agribusiness industry, the result shows that 47% of respondents have being in agribusiness for
about 5-11years and 28% have being involved for 11-15years. The result showed that majority
56
Years of Involvement in Agribusiness
25% 28%
47%
Current position with agribusiness frim of respondents is shown in table 4.1.3. The result
reveals that majority (65.0%) of respondents are the owners/proprietor of agribusinesses while
15.0% were managers. 13.6% of respondents were senior managers and 7.0% were staffs or
The educational status of respondents is shown in figure 4.1.2. The result indicates that
majority, 41.4% of respondents have a bachelor degree, 24.2% responded that they have a
diploma/certificate level of education while 23.4% had below high school education. This
57
indicates the high level of education among respondents and enhanced respondent’s
the questions.
45.00 41.39
40.00
35.00
30.00
Percentage
23.44 24.18
25.00
20.00
15.00 10.99
10.00
5.00
-
Below high school High school Diploma/certificate Bachelor degree
Age distribution of respondents is presented in the Table 4.1.4 above. The result revealed that
majority of respondents, 43.6%, falls within the sage range 40-49 years. More so, age
distribution further showed that 37.6% falls within the age of 30-39 years and about 10.6% are
less than 30 years and 8.8% more than 50years. As shown, respondents have a good number of
years of experience of to provide vital insight into the study based on accumulated experience.
58
4.1.7 Gender distribution of Respondents
In this research, the gender distribution result revealed that male were more than the females
(71.1% vs. 28.9%). This shows that males are predominantly involved in agribusiness.
The use of information technology by agribusinesses within the study area is presented in table
4.2.1 below. The result showed that 37.0% of agribusinesses has computer in their
organization. Among the agribusiness not presently using computers, 27.9% foresees
themselves using computer within a year. 22.7% of agribusiness are connected to the internet.
23.1% of agribusiness have their employees transact business via the internet while 26.0% uses
email in communicating with their customers and suppliers. 85.7% of agribusiness did not have
a website, with 14.7% having a static website for advertising while 7.3% had an interactive
website. 7.3% of agribusiness website permits procurement while none of them enables
customers to track their order and neither can they perform full online stock availability check.
Table 4.2.1: Level of ICT use in farms and Agribusiness within the study area
1. Yes No
N % N %
Do you use computer in your agribusiness 101 37.0 172 63.0
operation
If you do not use computer, do you intend to 48 27.9 124 72.1
start using computer within 1 year
Is your business connected to the Internet 73 26.7 200 73.3
59
Do you and your employees use the internet 73 26.7 200 73.3
for business activities
Do you use email to communicate with 71 26.0 202 74.0
customers and suppliers
Do you or your business have a website 39 14.3 234 85.7
Is it a static website for presenting company's 40 14.7 233 85.3
information and advertise products
Is it an Interactive website for receiving 20 7.3 253 92.7
online orders from customers and sending
online bills /invoices to customers
Does it allow for exchange activities such as 20 7.3 253 92.7
buying and selling
Can customers perform online Stock 0 0.0 273 100.0
availability check
Can customers track their orders online 0 0.0 273 100.0
Do you perform online Procurement 20 7.3 253 92.7
Source: Author Computation (2017)
Dichotomous responses of respondents in the study area was graded as positive equals to 1 and
negative response as zero. The responses were total and percentage response score was
obtained. Respondents’ with percentage score of less than 40% were identified to have a low
level of use while scores between 40 and 60% were graded as average level of use and
percentage scores greater than 60% were graded as high. The result revealed that information
technology use among respondents involved in agribusiness is low while about 28.9% had an
60
4.2.2 Adoption of E-commerce and or tendency to adopt E-commerce as
The adoption of e-commerce and or tendency to adopt e-commerce as marketing tool by farms
and agribusiness was analysed by collecting data on TOE factors that influences the adoption
or tendency to adopt e-commerce, these data and analysis are presented below.
in the table 4.2.3 below. The result showed that about 71% of respondents disagreed that e-
commerce reduces company’s overall operating cost while about 98% disagreed that e-
commerce aids in expanding company’s market share. Result showed that 8.8% of the
respondents agreed that e-commerce helps to increase customer data base while 11.0%
supported that ecommerce creates new advertising channel and 3.7% stated that it enhances
company’s image. The result also reveals that 19.0% respondents indicated that e-commerce is
compatible with their suppliers and customers. Majority, 72% of respondents’ organization
lacks adequate computer systems to support e-commerce while only 8.5% of the respondents’
firm had opportunity of trying out e-commerce applications before making a major business
infrastructure that can access internet and run e-commerce. Furthermore, 21.7% indicated that
61
Table 4.2.3: Frequency Distribution of Technological factors
The central tendency measure used in table 4.2.4 below employs the mean and measure of
dispersion used was standard deviation. Mean scores greater than 3.5 shows a high level of
presence of technological factors that aids the adoption of information technology while mean
score while mean score less than 2.5 connote a low availability of such technological factors.
The result in the table showed a poor level of availability of technological factors that ought to
62
have aided the adoption of information technology which will boost the level of use of e-
commerce in agribusiness.
Our company had the opportunity to try a 273 1.00 5.00 1.85 0.93
number of e-commerce applications
before making a decision
There are so many computers that people 273 1.00 5.00 1.81 0.94
in our company can access to use internet
and e-commerce
The organization factors that influences the adoption of e-commerce in respondents’ firm is
presented in the table 4.2.5 below. Majority, about 64%, indicated that cost of implementing e-
63
commerce applications is too high for them while about 16.0% responded otherwise. The result
further revealed that cost of internet access is highly determinant to the adoption of e-commerce
by respondents’ firm as majority agreed that internet access is a high cost. More so, the result
in the table showed that majority of agribusiness lack adequate employees that have the
knowledge and can effectively manage e-commerce and budget allocation in majority of firms
The central tendency measure used in table 4.2.6 below employs the mean and measure of
dispersion used was standard deviation. Mean scores greater than 3.5 shows a high level of
presence of technological factors that aids the adoption of information technology while mean
score while mean score less than 2.5 connote a low availability of such technological factors.
The result in the table showed a mainly fair level of availability of organizational factors that
64
aids the adoption of information technology which boost the level of use of e-commerce in
agribusiness.
The cost for internet access is 273 1.00 5.00 2.05 1.17
expensive
Environmental factors that influences the adoption of e-commerce in respondents’ firm and the
level of use is shown in table 4.2.7 below. The result shows that 67.8 % of respondents’ firm
are not under pressure from competitors to adopt e-commerce. 30.4% of the respondents’ firm
customers are open to several existing services and products that are available online while
21.6% of suppliers and partners of respondents’ firm have adopted e-commerce. The result also
showed that 7.3% were under pressure from the industry at large and 31.9% of agribusiness is
65
legislation on e-commerce isn’t encouraging the active participation of respondents’ firm in
The central tendency measure used in table 4.2.8 below employs the mean and measure of
dispersion used was standard deviation. Mean scores greater than 3.5 shows a high level of
66
presence of technological factors that aids the adoption of information technology while mean
score while mean score less than 2.5 connote a low availability of such technological factors.
The result in the table showed a mainly poor level of availability of environmental factors that
aids the adoption of information technology which boost the level of use of e-commerce in
agribusiness.
Our customers have easy access to 273 2.00 4.00 2.75 0.89
several existing products / services in the
market available on the internet
Many of our suppliers and partners have 273 1.00 4.00 1.99 1.26
already adopted e-commerce
Our agribusiness is under pressure from 273 1.00 4.00 2.03 1.37
customers to adopt e-commerce
Government agencies offers training and 273 1.00 2.00 1.39 0.49
educational programs to our agribusiness
to adopt e-commerce
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4.2.2.4 Summary of Factors Influencing the Adoption and Level of Use of E-
The summary of the factor presented below shows the extent of contribution of the factors to
respondents’ firm adoption and use of e-commerce. The result showed that over a range of
environmental factors to the adoption of e-commerce is less than average. This result shows
that for a significant adoption of e-commerce in agribusinesses, there is a need to improve the
technological, organizational and environmental factors that will facilitate and increase
commerce is shown in table 4.2.10 below. From earlier result which shows lower adoption of
e-commerce, the impacts of e-commerce is mainly weak in all the domain of impact seen in
the table with the highest strong impact observed in sales growth followed by financial
resources while both market share and company’s image and client loyalty have the same level
of impact.
68
Table 4.2.10: Agribusiness and farm Current Performance
The perception of respondents on impact of e-commerce if well adopted, integrated and used
in agribusiness is shown in table 4.2.11 below. Majority of the respondents indicated that there
will be significant large increase in each of the domains: Sales turnover of my company,
among others.
69
operational efficiency 0(0.0) 73(26.7) 27(9.9) 52(19.0) 121(44.3)
order handling efficiency/speed 0(0.0) 36(13.2) 34(12.5) 51(18.7) 152(55.7)
marketing costs 8(2.9) 27(9.9) 30(11.0) 63(23.1) 145(53.1)
administration costs 0(0.0) 9(3.3) 50(18.3) 63(23.1) 151(55.3)
channel of distribution 0(0.0) 0(0.0) 29(10.6) 94(34.4) 150(54.9)
Source: Author Computation (2017)
The study is not without limitations, to this end, the following limitations have been identified.
1. The lack of verifiable and reliable population data exposes the study to a population
specification error.
2. Although the study is intended for farms and agribusiness in Nigeria but was restricted
to those residing within the State of Osun, hence did not cover the entire area intended.
3. Lack of quantitative data from secondary sources of data for assessing the impact of e-
from performance that may be more accurate compared to the use of primary data that
70
CHAPTER FIVE
Having presented the result of the study in the preceding chapter, this chapter contains
5.1 Summary
The study was designed to examine the impact of e-commerce on agribusiness marketing,
though for time constraint and finance it was limited to a particular study area, Osun State,
Nigeria. Discussion was centred on key e-commerce and agricultural marketing concepts as
well as review of the importance of such concepts and evidence emerging from practice of such
concepts based on empirical studies. This study is of great importance to the agricultural sector
as well as the ICT sector that provides the enabling technology and services, the government
and the citizen at large that depends on agriculture for both food security, economic
The study revealed that e-commerce adoption among farms and agribusiness is considerably
low, based on the analysis of data gathered in the study, the following are the major findings;
1. Majority of the farms and agribusiness surveyed have and use computer in their
operation that is connected to the internet but mainly used for communication than for
buying and selling activities and procurement why many more have plans to acquire
very low as the technological factors, organizational factors and environmental factors
necessary for influencing adoption is not active in the farms and agribusiness surveyed.
71
3. The low adoption of e-commerce was discovered to be responsible for the weak impact
respondents adopting e-commerce in some form, show improved sales growth and
access to financial resources while majority agree that with improved adoption and
integration of e-commerce as well as support and low cost ICT services strong
enhanced procurement among others will be achieved resulting from the benefit of
adopting e-commerce.
5.2 Conclusion
It has been established by researchers and scholars that e-commerce brings with it the benefit
of achieving wider market penetration and share, offers price freedom to customers, reduce
required by farms and agribusiness to make vital production, procurement and marketing
decisions, these benefits will in no doubt facilitate agricultural growth and development that is
most desired by both government and citizens alike as its adoption in the agricultural sector
Based on the summary of the major findings the researcher concludes that;
The level of ICT use by farms and agribusiness influences their decision to adopt e-commerce
E-commerce has strong effect on agriculture that will be experienced as its adoption among
Though its adoption is currently low, with the growing desire to improve the level of ICT use
72
5.3 Recommendations
Based on the findings of this study, some recommendations considered very important have
marketing such as too many intermediators, distance between farms and markets, lack
of required information for demand and supply decision making, etc. as such farms and
agribusiness firms should make effort to adopt such technology even at their level of
operation.
2. The government should support and accelerate adoption by ensuring that essential
enabling technology is both accessible and very cheap such as the internet made
available at the rural level where agricultural activities are carried out more.
3. The development of a Marketplace platform that will provide integrated market place
services where buyers and sellers of agricultural products and services will meet and
transact similar to Ebay, Amazon, Konga, with strong security measures in place that
4. Provision of basic ICT education to farms and agribusiness alike focusing on the benefit
5. Further studies from the findings and limitations of the study should be carried out to
will make use of both primary and secondary data and cover a wider landscape for
73
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APPENDIX
QUESTIONNAIRE
Business Administration.
The study will be of benefit to the farmers and farm owners, managers and leaders of
Thank you for giving up your valuable time to assist in the research. Your cooperation
is greatly appreciated.
Sincerely,
(Researcher)
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