For years, debate has focused on the efficacy of these programs in expanding foreign consumption as well as increasing the market share for U.S. products. Also central to the promotion debate is the role of generic v. branded advertising. Exports of high value agricultural products represent a significant potential source of market growth for U.S. agriculture. Both academic and government research shows that these programs have been effective in increasing sales of U.S. products abroad.
Research shows that export promotion is, in general, a sound public investment.
Generic and branded promotion affect demand in two different ways. Generic promotion educates the consumer on the product while the goal of branded promotion is to differentiate the product from other products on the market. By evaluating the effectiveness of promotion in terms of impact on market share and total market sales, four strategies for promotion can be identified. Figure 1 illustrates the criteria for determining which strategy is most appropriate. In this case, even if the return to U.S. growers is positive, there is an incentive to collaborate with other nations in expanding the demand for the product.