Influence of product bundling on farmers’ preferences to buy soyabean inputs: A conjoint study in Ethiopia

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In my previous year PhD update, I qualitatively explored and highlighted the influence of smallholder farmers’ perceptions of legume seeds, inoculant, fertilizer and improved practices on their adoption intentions. As farmers perceive high relative product advantage with the legume inputs, they also perceive low compatibility with prices and packaging of the inputs. Particularly, farmers perceived high uncertainty with market and spray services. Perceived complexity is mainly observed with inoculant application.

Farmer perceptions of product attributes is an indication of the need for the provision of not just legume seeds, inoculant and fertilizer alone but the provision of a combination of legume inputs together with service components so as to enhance adoption or sales. I used a conjoint method and designed options of soyabean input products combining levels of soyabean input attributes identified in my previous study. The soyabean input products were printed on separate cards (see Figure 1 below for sample cards) and given to the farmers to make their preference ratings on 7-point measurement scale ranging from “I would be extremely unsatisfied” to “I would be extremely satisfied”. 


sample soyabean input

Figure 1: A sample of soyabean input products offered for farmers for rating

A total of 252 smallholder farmers who participated on previous N2Africa ( dissemination activity were participated on the interviews. This is because for farmers to give sensible ratings on the soyabean input product offering, prior awareness of the products is important. The importance values from the conjoint analysis results show that product attributes “Market”, “Bundle” and “Brand” have mostly influenced the overall preference ratings with values of 38%, 20% and 11% , as compared to the other attributes (Table 1).


Importance value table

For the market service attribute, it means that, about 37% difference in preference between soyabean input products is due to the presence or absence of soyabean grain market contract service. Similarly, 22% of the overall difference in preference is due to whether the offering is just for soyabean seed alone or whether it is a bundle combining of soyabean seed with inoculant or whether it is a combination of soyabean seed along with inoculant and fertilizer. High and positive utility estimates are observed for the product levels that indicate the inclusion of the product attributes in the input offerings. 

Large effect size (0.16) for the attribute market service, indicating about 1.6% variance in soyabean input product preferences by farmers and followed by the attribute “Bundle”.

Figure 2. Farmers on soyabean input product preference rating task at Bako district. Bako preference rating Bako Pref rating

The study results imply that input providers can enhance farmers’ input purchases through offering a combination of input products and services together. In this respect, we recommend that the private and public actors in the legume sector need to take a different perspective and as such to improve their input products sales performances, they need to bundle it with other necessary inputs or services from other suppliers through, for example, Public-Private Partnerships(PPPs). 

In my next study, I will build on the findings of this study and design a field experiment in which representative soyabean input products will be offered to test farmers input purchase behavior. 

Tamiru Amanu, International Livestock Research Institute, Ethiopia and Wageningen University & Research, the Netherlands