The United States Potato Board sets new standards in information gathering and research. Every five years, the board's activities are measured at the grower level to determine the effectiveness of its promotion activities.
To calculate the return on investment, the USPB enlisted the analysis of Timothy J. Richards and Paul M. Patterson with Arizona State University's Morrison School of Management and Agribusiness. The relevant question their evaluation seeks to answer: where would the industry be without the USPB's promotion efforts?
Over time, demand can change or shift. Potential causes of this are higher prices, diet trends, demographic shifts and the effect of changing alternatives like rice or pasta.
Richards and Patterson estimated the long term return on investment from domestic marketing, foodservice and export promotions. Marketing activities increase demand.
With econometric analysis which factors demand curve elasticities for each promotional area, Richards and Patterson demonstrate that the demand curve does infact shift outward--showing that the USPB's activities are successful in creating demand for potato products.
The results of the study show that the USPB programs are highly successful. The results of the current study are statistically and economically significant. Product differentiation is the key with potatoes which shows low price elasticity and more effective marketing.