Multi-media price information service gives competitive edge to Mongolian nomads

Author : Layton Croft
Date added : 2001-04-15

Brief Project Background

Mr. Daavadorj lives with his family in the southern, Gobi region of Bayanhongor province, some 600 kilometers from Mongolia’s capital city, Ulaanbaatar. His is a remote, nomadic existence. There are no trees and few water sources; there is only endless steppe pastureland and his family’s livestock. Like thousands of other herders across Mongolia - a country larger than the United Kingdom, Germany, France and Italy combined though sparsely populated, with fewer than 2.5 million inhabitants - Daavadorj become a private property owner of his livestock just 10 years ago. Since then, he and his family acquire necessary staple goods and cash from the cashmere, wool, meat, skins, and dairy products they trade.
For most of the past decade, herders like Daavadorj have been price takers, and not price makers, when selling their livestock products. Whether dealing at provincial markets or more commonly with traders who come to the door of his ger (easily movable round, white tent), Daavadorj never knew if he was getting a fair, competitive price for his products, especially for his cashmere, the most lucrative of all for today’s herders.
But in October 1999 this man, who lives without electricity and running water and many hours’ across jagged dirt tracks from the nearest settlement, heard a new radio program that changed his life. He began regularly listening to the ten-minute reports of price information for cashmere, skins, petrol, and exchange rates for the Chinese Yuan, an important currency in the Gobi, which borders Mongolia’s giant southern neighbor.
“When we had no such program, we had to sell livestock products at prices traders offered,” Daavadorj said. “But now that we know the real price [in the markets], we just hold back until a fair price is offered.”

project description

Indeed, herders like Daavadorj are the backbone of Mongolia’s animal husbandry industries, despite seven decades of command economy price setting and years of forced collectivization that bred a passive mentality precluding many to see themselves as businesspeople with the rights and abilities to make independent, entrepreneurial decisions. But even for those who understood the power of information in making business decisions after 1990, they lacked timely, accurate data to do so.
Enter Market Watch, a multi-media price information and analysis service produced and delivered by the Gobi Regional Economic Growth Initiative, a five-year rural development program funded by USAID that began in 1999. Market Watch tracks price information for more than 30 commodities in seven Gobi and two Ulaanbaatar markets on twice-weekly, monthly, and quarterly bases. Delivered via Gobi Business News’ national and regional radio, print, and Internet media, Market Watch is wildly popular among herders and valued as well among traders and Ulaanbaatar-based cashmere and wool processing companies, banks and other financial institutions.
A core challenge to our Market Watch project was delivering this informational tool to remote users. While Internet and email access is increasingly available in province centers, it is not yet an option for the vast majority of Mongolia’s rural population.
During socialist years Mongolia boasted a national literacy rate of more than 90 percent, and Mongolians’ post-socialist appetite for the printed word has hardly waned. But whereas the state once employed thousands of rural information agents to ensure every last nomad household received printed matter-albeit wholly state controlled content-this rural information network evaporated overnight a decade ago.
Meanwhile, the extensive radio infrastructure erected during socialist years remains operational today. Although the state-run Mongol Radio is still the only transmission reaching every last herder via its longwave (LW) signal, most herders either have a radio in their ger or a neighbor who has one.

Results

project results

Today Market Watch can be heard twice weekly via Gobi Business News Radio on Mongol Radio’s national broadcast as well as regionally on the independent broadcasts of Gobi Wave in southern Gobi and Radio Altai in western Gobi. In addition to Market Watch, Gobi Business News Radio includes Weather Watch, Policy Watch, and Animal Husbandry Management segments.
A printed Market Watch column of market analysis, forecasts, and detailed charts tracking commodity price trends over time is produced bi-monthly in Gobi Business News magazine. Fifty-five thousand copies of this free, Mongolian and English language publication are delivered to readers across the Gobi region as well as in non-Gobi provinces and in Ulaanbaatar.
Market Watch price information and analysis is available for free on the Internet at www.gbn.mn, which has had 2,170 hits to date.
Countless nomads like Daavadorj say they deem Market Watch radio and print products two of the most important tools to improve their economic situation by giving them the leverage and confidence to develop their own businesses in a free-market context.
Given the relatively fast-paced nature of Ulaanbaatar life and commerce, urban Market Watch users prefer to access the website for price information and analysis. Cashmere processing companies in Ulaanbaatar, Europe and elsewhere check the website to get recent price data as well as to compare market fluctuations over the past year and a half. Banks and financial institutions use this information to valuate potential clients’ collateral.

Lessons

lessons learned

We have learned several important lessons from producing and delivering Market Watch. The first is ensuring product quality and building trust and loyalty among users. All rural Market Watch agents are trained to realize the critical importance of consistency and accuracy in their price-gathering methods. We keep all Market Watch data in a database, which has been useful not only as an analysis tool, but as a mechanism to explain to skeptics and critics of our data and media products.
All media are powerful, and our studies indicate that Mongolians tend to foremost trust what they hear and see on television, with radio, print and the Internet following suit, respectively. Therefore, we have learned the importance of repeatedly educating Market Watch users of our radio, print, and Internet products-without boring them or insulting their intelligence-of exactly what it is that we are producing and delivering.
Some think Market Watch sets cashmere prices! Others think the price Market Watch reported last week in Ulaanbaatar is indefinitely valid! We have taken great efforts via our radio, print, and Internet media to remind users that Market Watch simply reports prices, that it is a freeze-frame snapshot of a price for a particular commodity based on exact specifications and sold at a certain market location on a certain day and at a certain time. We note that such price information is essentially ‘outdated’ a nanosecond after the rural agent collects the data from the salesperson, and clearly long before it is broadcast, printed, or posted online.

Looking ahead, we have three main objectives for improving our Market Watch project using ICTs. First, we plan to expand Market Watch’s geographical coverage, and to market and sell certain Market Watch products and services. While the Gobi Initiative will conclude in 2003, a recent market survey of current demand for Market Watch indicates that enough willing and able paying customers nationwide will sustain a vibrant Market Watch service indefinitely. Market Watch products and services will be marketed and sold by a for-profit enterprise independent of our larger Gobi Initiative project.
While we can sell Gobi Business News magazine and special printed Market Watch publications-the production frequency of which we plan to double-the same cannot be said for Market Watch’s radio and Internet counterparts. So we plan to explore selling advertising on our national and regional Market Watch radio broadcasts and on our website to domestic and foreign companies interested in reaching large numbers of Mongolia’s rural and/or business population.
We also plan to increase the number of rural radio, television, and Internet Market Watch affiliates. Using an advertising revenue sharing scheme, this approach will mutually benefit these media and the independent Market Watch enterprise, not to mention advertisers and most of all the users.

Development Impacts

devlopment aspects

Second, we plan to target urban clients with instant fax and mobile phone messaging for customers who need price information now, and with detailed, in-depth commodity analysis presentations and reports that will be delivered in person and/or via analog or streaming video, audio, and email.

Third, we plan to improve the timeliness of our Market Watch product and service delivery. This will involve blending our current Internet and radio media so that once our rural Market Watch agents report prices to our webmaster in Ulaanbaatar via phone, fax, or email, we can instantly post the data online, making it simultaneously available for immediate national or regional broadcast by Mongol Radio, Gobi Wave, Radio Altai, and other independent media across Mongolia.
So although herders like Daavadorj may never own a computer or surf the web, he and his family will continue to benefit from a national network of people and institutions using multi-media ICTs to close the gap between domestic and global markets and those nomads doing business in the farthest reaches of this expansive, rugged land.

The Gobi Regional Economic Growth Initiative is a
rural development project responsible for the activity described in this
story. Funded by the USAID, the Gobi Initiative is managed by Mercy Corps
International and implemented in partnership with Pact and Land O'Lakes.
Local partners instrumental in the activity described in this story include
Mongol Radio, Gobi Wave Information Center, and ELC company.

Project Information

Organisation : Gobi Regional Economic Growth Initiative
URL : http://www.gbn.mn

Are there any partners involved : yes

Contact Information

Layton Croft
layton@gobi.initiative.org.mn

Disclaimer: No stories on this website shall be reproduced or stored in any other retrieval system without the written permission of the infoDev/IICD. Although every precaution will be taken in the preperation and maintenance of this collection of stories, neither infoDev, IICD or the submitting parties assume any responsibilities for errors or omissions. In addition, no liability is assumed fordamages resulting from the use of the information supplied in the stories.