OCTOBER 12, 2018

New Research Looks at Agricultural Promotion Groups’ Success

The Paper and Packaging Board is one of 38 Agricultural Promotion Groups (APGs) designed to stimulate the use of commodity products. You already know some of these groups or checkoff programs by their recognizable tag lines such as “Got Milk,” “Cotton, The Fabric of Our Lives,” and “The Incredible Edible Egg.” Those highly successful checkoff programs are authorized by the Department of Agriculture and paid for by a majority of farmers or producers from the milk, cotton and egg industries.

APGs have been created over the past 50 years by a variety of mostly farm-based industries, to expand demand for particular commodities and to educate consumers about the benefits of their products. Their slogans have become pop culture icons, but until recently, it’s been hard to say collectively how successful they’ve been at drumming up business.

At the request of APGs, a 2017 study* concluded that every dollar spent promoting an Agricultural Promotion Group results in between $2 and $15 of increased revenue for the participating industries’ companies, depending on the particular program.

The study found that in 2015 – the year the study focused on – that the success of APGs in supporting and growing their respective sectors of agriculture spills over into the economy by creating jobs, generating income and spurring economic growth. The national employment return in 2015 was close to 827 jobs per million dollars of advertising and promotion.

Our first full econometric report to USDA will come out in 2019.

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*Gary W. Williams, Oral Capps Jr. & Daniel Hanselka (2017): U.S. National Economic Contribution of Generic Food and Agricultural Product Advertising, Journal of International Food & Agribusiness Marketing (https://doi.org/10.1080/08974438.2017.1402729)