"Farmers’ Satisfaction and Loyalty on Hybrid Maize Seeds in Nepal: Perspectives using
Value Discipline Model"
Introduction
Agriculture, the dominant sector in Nepal contributes approximately 23.95% to the nation's GDP (Nepal
Rastra Bank, 2022). Among staple crops, maize is the second most cultivated after rice, with 985,565
hectares harvested in 2022, yielding 3,106,397 metric tons (MT) at an average productivity of 3.15 MT/ha
(Ministry of Agriculture and Livestock Development, 2023). Maize occupies a vital position due to its
diverse uses in food, feed, fodder, fuel, and as a raw material for agro-based industries globally. Rising
dietary shifts, population growth, and income levels have increased the demand for maize (Nepal
Agricultural Research Council, 2021). Farmers face increasing pressure to boost production as urbanization
reduces arable land and food supply struggles to keep pace with population growth (Giller, 2020). Hybrid
maize seeds have emerged as a solution, significantly increasing yields compared to open-pollinated
varieties, provides higher annual incomes, making it a more efficient option for increasing total maize
production.
Hybrid Maize seeds help farmers to adapt to changing climatic and soil conditions, thereby playing a key
role in ensuring food security. By adopting hybrid maize seeds, farmers can strike a balance between
economic profitability and responsible environmental management, ensuring both immediate benefits and
long-term sustainability. In Nepal, hybrid maize cultivation began in the 1980s with seeds imported from
India. Farmers have been growing hybrid seeds for the last 15–20 years in terai, inner terai, valley, foot hill
and mid hill of Nepal. For farmers, the choice of hybrid maize seeds is a significant investment that directly
impacts their livelihoods. Satisfaction among farmers is essential because it determines not only the success
of the current planting season but also long-term loyalty to a particular seed brand. Also, satisfied farmers
are more likely to recommend the particular seed brand to friends and relatives, which creates lasting
relationships between farmers and seed companies. Therefore, understanding the factors that drive
satisfaction is essential for seed companies’ growth and guides in maintaining competitive advantage
through farmers loyalty.
A quantitative survey with structured questionnaire among 750 hybrid maize farmers in five
districts of Nepal is performed. Kanchanpur, Bardiya, Dang, Sarlahi and Jhapa districts are selected as
these areas are the prominent locations for maize production. The research intends to measure farmers’
satisfaction and brand loyalty among hybrid maize seed farmers using the constructs of Value Discipline
Model developed by Treacy and Wiersema (1995). For the analysis of the data, descriptive statistics and
OLS are used.
The value discipline model outlines three key strategies for market leadership: product innovation,
operational excellence, and customer intimacy. A six-point Likert scale was used to measure constructs of
the value discipline model where 1 being “Completely Disagree” and 5 being “Completely Agree”. Product
innovation measures companies’ ability to develop and implement new or improved products to meet
farmer’s needs. The product innovation is measured via three questions: highly productive maize seeds, use
of extensive research & technology, customization of the seeds based on environment & geographical
location. Similarly, operational excellence evaluates the efficiency of the company's operations. The
operational excellence is measured using three questions: seed availability, information dissemination, and
the variety of seed choices provided. Likewise, customer intimacy refers to an approach that focuses on
developing deep, meaningful relationships with farmers to understand their needs, preferences and
behaviors. Customer intimacy is assessed through factors such as advisory services, brand trust, and the
value for money offered. Farmer’s satisfaction is a degree to which farmers feel their expectations, needs,
and requirements are met. It is measured using three questions: consistent quality of seed, consistent price
and excellent customer service. Brand loyalty among hybrid maize seeds farmers is measured using Net
Promoter Score (NPS) a widely used metric ranging from 0 to 10 for gauging customer loyalty.
More than 85% of hybrid maize farmers in Nepal use imported seed brands. The dominance of the imported
seeds can be explained due to superior quality and higher yield potential compared to local varieties among
the farmers. More than 50% hybrid maize farmers own below 10 khattas of land (0.33 hectares) and 28%
owns 11-20 khattas of land (0.37 to 0.68 hectares). The low land ownership among hybrid maize farmers
indicates the constraints in maize commercial farming. 55% of the farmers have been using hybrid maize
seeds of the particular brand for more than five years. The long-term usage of the particular maize seed
brand underscores deep-rooted trust towards the particular brand, indicating the consistent performance of
the maize seed brands.
More than 50% of the farmers receive information about hybrid maize seed companies from other farmers
and/or lead farmers. Recommendations from agrovets is the major source in cultivating the hybrid maize
seed of a particular brand. 23% of the farmers prefer radio broadcasts to receive information on hybrid
maize seeds followed by television (16%), road shows (14%), Krishi mela (13%) and so on. 72% of the
farmers like the high yielding quality of the particular brand, 16% likes the good to eat quality followed by
price (5%), maturity cycle (3%) and so on.
The effect of construct on Value Discipline (Product Innovation, Operational Excellence, and Customer
Intimacy) are measure on farmers satisfaction. Operational excellence (0.782, P=0.000) and product
innovation (0.128, P=0.016) has a statically significant effect on farmer’s Satisfaction. Operational
excellence has a strong relationship indicating the brands need to focus on efficient and reliable delivery of
high-quality seeds, along with clear information delivery and seed availability enhances farmers
satisfaction. Product innovation has nominal effect on farmer’s satisfaction, brand should focus in
delivering highly productive maize seeds with extensive research and technology, customization of the
seeds based on environment and geographical location. There is no relationship between customer intimacy
(0.069,0.212) and farmers satisfaction. Farmers appreciate the development of new or improved seeds that
carter to their needs and improve productivity. However, effort to enhance customer intimacy such as
personalized services or building deeper relationships may not yield substantial returns.
Secondly, effect of farmers satisfaction on brand loyalty was measured. Brand loyalty (-0.1919, P=0.023),
has a negative relationship with farmer’s satisfaction. Although farmers may be highly satisfied with a
maize seed brand, they are often reluctant to recommend it. The close connection between agro-based
products and income makes recommendations in this sector more cautious.
In conclusion, companies need to focus on efficient distribution systems, reliable seed availability, and clear
communication of product information for brand building. Nepal’s hybrid maize seed sector and ensure
long-term farmers satisfaction, companies need to focus on delivering high-quality products through
operational excellence and continuous innovation. To strengthen hybrid maize sector and ensure long term
farmers satisfaction, seed companies should prioritize in delivering high-quality products through
continuous innovation and operational excellence.
References
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