How the Pandemic Changed the Landscape of the Farmer

For long, smallholder farmers in Indonesia are accustomed to offline practices for getting information, accessing markets, and buying agri-inputs, amongst other things. During the pandemic, these offline practices were no longer as easily done and it pushed farmers to find other ways of doing things.

At the start of the pandemic when all restaurants and shops suddenly closed, farmers lost their offline market access and the prices of vegetables fell dramatically in a matter of days. Although the demand was still there, since consumers don’t stop eating, the usual buyers and offline market chain was broken. When farmers looked for an alternative access to markets, the SMARTseeds project helped them by providing a digital marketplace platform.

The SIPINDO powered by SMARTseeds (1) mobile app allowed them to advertise their vegetables and get in contact with a wider network of buyers online. When the lockdown began, we in SMARTseeds doubled our resources to enable more farmers to use our online buying and selling feature and a month after starting the initiative, we saw doubled traction in the usage of the feature. Other players in the market which focus on a “farm-to-fork” business model, such as TaniHub and SayurBox, also did the same thing and took the opportunity to introduce even more farmers to online market access services. In a short period of time, many farmers were suddenly exposed to online ways of working which they may have previously ignored.

Online Services vs Offline Services?

Before the pandemic, the main challenge the SMARTseeds team faced in increasing user adoption to our digital services was the reluctance of farmers to try the new online service. This is understandable as to access online services farmers need to make a greater effort in learning the process, understanding how it works, and ensuring that they have the necessary online infrastructure to use it, such as smartphones and internet access. In many cases, this extra effort made farmers decide to stick to what they already know and were comfortable in doing. However, during the pandemic that situation suddenly changed. COVID-19 conditions have accelerated the digital adoption process for many farmers and it has allowed them to get a taste of how online services can help them solve their problems. From what we observed in the field over the past few months, we learned that while online services cannot fully replace the offline service experience, it offers its own advantages which complement the current offline services.

Although online services such as SMARTseeds do have some disadvantages, it also has unique advantages such as access to a wider pool of potential buyers, a wider pool of knowledge and information, and a wider pool of access to experts. Plus, it is a good alternative for when a sudden disruption happens, like what we experienced with the pandemic. We learned the important lesson that both offline and online services for farmers are not meant to compete with each other but are meant to complement each other. We believe that both types of services will be used interchangeably by farmers in the future depending on the need and situation. It is similar to the trend in the e-commerce sector, in which customers use online e-commerce platforms interchangeably with going to the physical store depending on their needs and type of product they want to buy.

A Shifting Mindset and Moving Forward

While COVID-19 has brought difficulties for all of us, it has also increased our conviction that with SMARTseeds we are building something future-proof. We expect that there will be a shifting mindset from the farmer’s point of view about offline and online services. We believe that in the near future even more farmers will feel the urge to embrace online services to make them more resilient. In this “new normal”, digital solutions such as SIPINDO powered by SMARTseeds and many others out there are in a good position to help farmers being more resilient and adaptive to changes.

Photo: One of the Farmers using SIPINDO (Credit: East West Seed Indonesia)

Moving forward, with the increased adoption of online services for farmers, the next challenges for online service providers like SMARTseeds is to be able to move from being a “vitamin” to being a “painkiller”. While it is promising, most of the online services for farmers today, including those in SMARTseeds, are still perceived by many farmers as a “vitamin” rather than “painkiller”. Essentially, they still perceive digital ag-tech solutions as a “nice-to-have solution” rather than a “must-have”, and we assume it’s for this underlying reason that a sustainable business model for digital ag-tech innovation is still a major challenge. However, we believe that business model exploration for digital ag-tech innovation is still at its early stages and a lot of exploration and experimentation is still needed to ‘crack’ the formula to reach product-market fit. One of the main challenges is how to balance the customer acquisition cost and customer lifetime value. We expect that any digital ag-tech initiative that can find a nice balance between those two factors will be in a good position to sustainably serve smallholder farmers with digital services and forever change the landscape of smallholder agriculture in Indonesia.

(1) SIPINDO is a mobile application, powered by SMARTseeds. ICCO has been part of SMARTseeds as a consortium lead from its start in 2016. It is a public private partnership, funded by the Netherlands Space Office, that supports 100,000 vegetable (chilli, tomato and cucumber) farmers to increase their production, income, food security and efficient use of inputs through the use of information services based on geodata and remote sensing technology.