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Archives of Business Research – Vol. 10, No. 11
Publication Date: November 25, 2022
DOI:10.14738/abr.1011.13540. Makbul, Y., Rochana, S. H., Nugraha, D., & Ratnaningtyas, S. (2022). Digital Marketing Adoption Between Rice Farmer and Farm
Trader. Archives of Business Research, 10(11). 276-286.
Services for Science and Education – United Kingdom
Digital Marketing Adoption Between Rice Farmer and Farm
Trader
Yogi Makbul
School of Architecture, Planning, and Policy Development
Institut Teknologi Bandung, Indonesia
Siti Herni Rochana
School of Architecture, Planning, and Policy Development
Institut Teknologi Bandung, Indonesia
Deni Nugraha
School of Architecture, Planning, and Policy Development
Institut Teknologi Bandung, Indonesia
Sudrajati Ratnaningtyas
School of Business and Management
Institut Teknologi Bandung, Indonesia
ABSTRACT
Rice marketing, largely, is still traditional, wherein farmers sell their products to
traders, who then sell them to consumers. On the other hand, the use of digital
media is fast developing in society currently. It is also growing in rice marketing.
Digital media can be utilized by farmers to shift from traditional marketing
channels to direct online marketing to consumers. The question is which category,
i.e., farmers, or traders, can better adopt digital marketing. The purpose of this
study is to compare the adoption rate of digital marketing between farmers and
traders. If this adoption is higher, then there is a possibility of direct online
marketing replacing the traditional ways of rice marketing. The research was
conducted by surveying farmers and traders in certain rice production centers in
Indonesia. The location of the research was Gantar District in Indramayu Regency,
West Java province. The location was chosen because Gantar District is the highest
rice producer in Indramayu Regency; furthermore, this Regency is the largest rice
producer in West Java. The province of West Java is the ultimate rice producer in
Indonesia. The results show that the digital media adoption of traders is higher than
that of farmers. So, the possibility of a shift to online marketing from farmers to
consumers is low possibility.
Keywords: Adoption of digital media; Online marketing; Rice Marketing; Rice Farmers
and Traders.
INTRODUCTION
Increasing access to marketing is one of the most important factors in increasing farmers'
income and reducing poverty in rural areas (Mgale & Yunxian, 2020). Marketing access is,
generally, still traditional in rice farming, wherein marketing channels are controlled by
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Makbul, Y., Rochana, S. H., Nugraha, D., & Ratnaningtyas, S. (2022). Digital Marketing Adoption Between Rice Farmer and Farm Trader. Archives of
Business Research, 10(11). 276-286.
URL: http://dx.doi.org/10.14738/abr.1011.13540
wholesalers; therefore, rice marketing is not efficient. Yaser Feizabadi's research (Feizabadi,
2011) reveals that wholesalers and middlemen play a large role in rice marketing in Iran.
Mgale's research (Mgale & Yunxian, 2020) on rice marketing in Tanzania reveals that farmers
still sell to middlemen or traders. This is because it is difficult for farmers to sell directly in the
market. Therefore, it is necessary to improve marketing information systems to enable farmers
to transact directly with end-consumers. Mukson's research (Mukson et al., 2021) on rice
marketing in Central Java reveals that farmers need to improve marketing information for them
to enhance their farming profits. Several international studies on the marketing of paddy or rice
find that, largely, it still relies on collectors and wholesalers. In this marketing channel system,
farmers are in a weak bargaining position and, therefore, usually at a disadvantage. Within this
traditional marketing system, it is difficult for farmers to increase their income.
The current era has witnessed the development of online or digital marketing whereby
producers can sell directly to buyers, without depending on traditional marketing channels.
According to Chaffey (Chaffey et al., 2006) online marketing is the application of the internet
and related digital technologies to achieve marketing goals. Thus, digital marketing is an
internet application used in marketing. According to Kaukab (Kaukab, 2021) internet use has
expanded significantly, with more than four billion people connected to the internet globally.
In Indonesia, around 132 million people are already connected to the internet. Currently, the
use of the internet has become a basic need for most people in Indonesia, whereby they can
shop, study, find information and bank online, among other things.
Online marketing is being used extensively in Indonesia; according to BPS, as many as 90.18
percent of businesses in Indonesia have used online marketing (BPS, 2021; BPS Indramayu,
2020). Marketing is conducted through various platforms, for example, through Tokopedia,
Shopee, Lazada, and so on. The following graph depicts the monthly number of visits on each
platform.
Figure 1 Access per Month on various platforms
As seen from the figure, Tokopedia is the most widely used platform in Indonesia, followed by
Shopee, Bukalapak and so on. With so many online transactions, can this situation be used by
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
140,000,000
160,000,000
Tokopedia
Shopee
Bukalapak
Lazada
Blibli
Bhinneka
Orami
Ralali
JD ID
Zalora
Access per Month 2021
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Archives of Business Research (ABR) Vol. 10, Issue 11, November-2022
Services for Science and Education – United Kingdom
farmers to market their rice online? According to Dodik Ridho (Ridho, 2018) if farmers sell rice
online, they will earn huge profits. This is because the current marketing chain from farmers to
consumers is very long. Many people and institutions that are part of this chain, make money
at various stages. This causes farmers to receive low prices for their goods, even though
consumers pay high prices for them. Online marketing of rice is expected to benefit both,
farmers and consumers, by raising prices for the former, and lowering them for the latter.
The research questions for this study are:
1. How much do rice farmers use online marketing?
2. How much do rice traders use online marketing?
3. How does online marketing adoption compare between farmers and rice traders?
If farmers' adoption of online trade is higher than that of traders, then there is the possibility of
farmers being able to transact directly with consumers, without going through traders.
If farmers' adoption of online trading is lower than that of traders, then rice marketing will
remain in its current state, wherein farmers will continue to depend on traders to market rice
more efficiently to consumers.
This research is important, because it suggests a breakthrough for improving the welfare of
farmers. As is known, rice farmers in Indonesia are currently facing many problems with
traditional rice marketing. Traditional rice marketing causes farmers to receive a low price
even when consumers are paying high prices, while high profits are obtained by middlemen
and wholesalers.
Research Objectives
The research objectives are:
1. Identifying the level of adoption of online marketing by rice farmers
2. Identifying the level of adoption of online marketing by rice traders
3. Comparing online adoption rates between farmers and traders
The remainder of this paper is structured as follows. Section 2 discusses the methodology of
the analysis, while Section 3 describes the key findings of the study. The next section constitutes
the Discussion of the results, while the last section, i.e., Section 5 concludes the study.
METHODOLOGY
Research sites
The research method used is the analysis of the results of a survey conducted on rice farmers
and traders. The research location is in Gantar District, Indramayu Regency. Gantar Subdistrict
was chosen because it has the highest rice production in Indramayu (BPS Indramayu, 2020),
while Indramayu Regency was selected because this district has the largest rice production in
West Java Province (BPS Jabar, 2020). The logic behind selecting the location with the highest
rice production is that it is expected to be representative of all rice farmers in Indonesia.