I recently had the opportunity to participate in an interview for a research project the Harvard Business School is conducting on the delivery of precision farming products and the progression of dealer networks. 

During the course of the hour-long discussion, I shared some perspective on the transition many dealers are making from a product-based business to one rooted in service and support. Sharing some analysis from our 2017 Benchmark Study (see "Market Optimism Revenue Opportunities Accelerate Improved Precision Outlook"), dealers are trending toward diversified delivery of precision platforms to offer farmers a more customized and comprehensive solution.

Dealers are increasingly offering “à la carte” services, often allowing customers to select from a menu of options that best suit their precision needs. These often include fairly straightforward options including yield monitor calibration, soil sampling or GPS signal subscriptions.

But there are more complex service opportunities on the horizon and Harvard researchers were particularly interested in how the Internet of Things (IoT) is impacting agriculture. One of the questions asked during the discussion was “How are dealers helping farmers understand IoT capabilities?”

This is certainly a challenging transition dealers are being asked to make, in particular those more accustomed to an equipment-based business model. Adoption of tools including remote sensors, wireless data transfer and agricultural drones are progressing and dealers are tasked with connecting the virtual dots between these technologies. 

It’s easy to view IoT as an abstract concept, (the term itself is as ambiguous as it is progressive) but precision dealers don’t have this luxury. Understanding and then explaining the practical value of data-driven tools to customers is increasingly essential. 


“It’s easy to view IoT as an abstract concept, but precision dealers don’t have this luxury…”

A recent report published by IBM cites a forecast that by 2050, agricultural IoT will increase food production by 70% and will feed up to 9.6 billion people, aided by the rapid adoption of sensing technology on farms. 

The report goes on to project a timeline for growth of sensing technology, noting that in 2000 there were 525 million farms on record, globally, and not one was connected to the IoT.

By 2025, based on the same number of farms, there will be 600 million sensors on these farms and by 2050, the number of sensors will increase to more than 2 billion. 

These are pretty ambitious totals and talking with a precision ag manager of a multi-store dealership recently, I asked him to define what role IoT plays in their business plan. He paused for a few moments and said, “That’s not the first time I’ve been asked that question and I know it won’t be the last. I still don’t have an answer, but if we don’t figure one out soon, we’re in trouble.”

He’s certainly not alone in wrestling with the challenge of integrating IoT concepts into an evolving business precision model. Not even a quarter of the way into the 21st century, the industry has already seen some dramatic reinventions. 

Even the last 5 years revealed shifts in revenue-generating methods and service goals, highlighted by historical trends in our benchmark study. I am looking forward to what the next 5, 10 and 50 years will bring and seeing if IoT will truly be a game-changing revolution in ag. 

In the meantime, how are you defining the Internet of Things in your precision business? Share you thoughts at jzemlicka@lessitermedia.com or call me at 262-777-2441.


PFD Summer 2017 Contents