INTRODUCTION

International interdependence is the base of export marketing. No country of the world is self sufficient in all respects. It has to import some goods/services from abroad. This is due to geographical factors & also due to inadequate resources, huge population, economic backwardness & inadequate technological development. Export marketing is a need of all countries- rich & poor. Global efforts are needed for the promotion of export marketing/international marketing & also for making it beneficial to all participating countries in a fair manner. WTO & other global trade organisations are making efforts for the growth of the world trade & also for making it free & fair to participating countries.

WHAT IS EXPORT MARKETING

Export marketing means management of various activities & operations since the receipt of an export order till its execution & receipt of payment for the goods exported. It is a key factor in the process of economic/industrial growth. It is DYNAMIC in character.

DEFINITION:
Export marketing includes the management of marketing activities for the products which cross the national boundaries of a country. By: RATHOR B. S.

FEATURES OF EXPORT MARKETING: LENGTHY & TIME CONSUMING:

Exporting marketing is a lengthy & time consuming activity. It involves discovery of promising foreign markets, manufacturing goods as per the requirements of foreign buyers & finally marketing of goods through suitable pricing, packaging, & sales promotion techniques. It is a complex activity as procedural complexities are involved in export market trade transactions. Export marketing involves a systematic process of discovering & developing foreign markets & distributing goods & services in such markets with profit to exporting firm & satisfaction & welfare to buyers.

LARGE-SCALE SERVICES:

OPERATIONS

IN

GOODS

&

Export marketing involves largescale marketing operations relating to goods & services. Export of services is now

becoming popular, attractive & profitable to countries like India due to availability of huge technically qualified manpower. Large scale exporting is always economical & profitable. Moreover, retail export marketing is just not possible. Export marketing involves well planned & systematic efforts to sell goods & services in overseas markets.

PRESENCE BLOCS:

OF

TRADE

BARRIERS

&

TRADE

There are various trade barriers (tariff & non-tariff) in export marketing because of the protective policies of countries. Regional trading blocs like EU, NAFTA & ASEAN encourage free trade among the member countries & impose restrictions on export marketing by non-member countries. Trade barriers are imposed by all countries. Even bilateral trade agreement restricts the growth of trade to some extent. Free & fair trade is still a dream & certainly not a reality.

SUBJECT TO FOREIGN EXCHANGE REGULATIONS: Export trade is subject to foreign exchange regulations imposed by countries. These foreign exchange regulations relate to payments & collection of export proceeds. In addition, export marketing is subject to other rules & regulations relating to health& safety, environment protection, etc. All such regulations affect free movement of goods among the countries. EXTENSIVE DOCUMENTATION:

Export marketing involves preparation of various documents for the connivance of exporters & foreign importers. Such documents include export incentive documents & so on. Normally, exporter sends documents such as certificate of origin, consular invoice, bill of lading, commercial invoice etc. to the importer for his convenience & speedy delivery of goods. The foreign buyer has to prepare certain documents for taking delivery of goods. Exporters & importers need knowledge of

such documents for conducting foreign trade transactions. SENSITIVE & FLEXIBLE CHARACTER : Export marketing is highly sensitive & flexible as it involves many countries & commodities. An exporter has to identify the specific needs of foreign buyers & adjust his products & marketing activities accordingly. He has to offer full satisfaction to foreign customers for their continuous support & loyalty.

NEED OF SUITABLE MARKETING MIX:

Marketing mix is a rational combination of 4Ps- Product, Price, Place & Promotion. Appropriate marketing mix facilitates success in export marketing. For large-scale exports, it is necessary to adjust marketing mix frequently as per marketing environment. NEED OF EXPERTS:

Export marketing involves lengthy procedures & formalities. Professionals/experts are required for dealing with various aspects of export marketing. For e.g., an exporter has to introduce right type of marketing-mix for the target market selected. Here, the services of experts are useful.

LONG TERM PLANNING REQUIRED: Export marketing requires long term planning. The marketing situation in different countries changes because of economic, political & social factors. Naturally, suitable adjustments in export marketing are necessary through careful planning. GOODWILL & REPUTATION:

Large scale export marketing creates goodwill & reputation for marketing firm. It earns huge profit along with reputation as company which is globally competitive. Such company gets promising sales in domestic as well as global market.

NEED FOR EXPORT MARKETING: a) AT THE NATIONAL LEVEL: EARNING FOREIGN EXCHANGE: An export enables a country to earn foreign exchange & strengthen the national economy. It enables countries to import basic raw materials, advanced technology & various components. Strong foreign exchange base also enables the

country to face financial difficulties. Export marketing is needed for earning foreign exchange. It is its benefit to an exporting country. SOLVING PROBLEM OF BALANCE OF PAYMENT: Large scale export solve balance of payment problems & enable countries to have favourable balance of payment position. The deficit in balance of trade & balance of payments can be removed through large scale exports. This suggests its need. PROMOTING ECONOMIC DEVELOPMENT: Exports are needed for promoting economic & industrial development. The optimum utilisation of resources may not be possible within the narrow confines of the domestic market. Business grows rapidly if it has international markets. RAISING PRODUCTION & EMPLOYMENT: Exports facilitate large-scale production of goods & services. Additional demand in the overseas markets generates new employment opportunities. HELPING HAND TO TERTIARY SECTOR:

Export marketing is needed as it indirectly facilitates the expansion of tertiary sector which includes transport, insurance, banking & so on. This sector expands its operation & also earns foreign exchange for the benefit of the country. MEETING IMPORT NEEDS: Export marketing is needed in order to meet the growing needs of imports for industrial development. Payment for imports is normally made out of the foreign exchange through exports. DEBT SERVICING: Developing countries borrow heavily from advanced countries for meeting their urgent economic needs. This leads to the problem of repayment of debts along with service charges. Repayment of debts may not be possible unless foreign exchange is earned through export promotion. RAISING STANDARD OF LIVING OF PEOPLE: Large-scale export makes the country strong, stable & rich. It earns foreign exchange which can be used for importing goods & services useful for raising living standards of people.

PARTICIPATION IN GLOBAL CO-OPERATION: Export marketing facilitates global cooperation for the benefits of all participation countries. Cordial relations developed among the nations & this helps countries in bringing world peace & economic development at the global level. INTERDEPENDENCE OF COUNTRIES: Export marketing is needed as no country is completely independent or self sufficient as regards all its requirements. Even the USA or Japan are not completely selfsufficient countries. Inter-dependence of countries is bound to continue in future also. This brings the need of imports & exports by all countries.

B) AT THE BUSINESS/ENTERPRISE LEVEL: HIGHER PROFITS: Exports enable a business enterprise to earn higher prices for goods. If the exporters offer quality products, they can

charge higher prices than those charged in the home market & thereby raise the profit margin. GOODWILL & REPUTATION: Export marketing countries earn global reputation sue to their business contacts & participation in international trade fairs & exhibitions. IMPROVEMENT IN ORGANISATIONAL EFFICIENCY: In order to survive in international competition, exporters have to adopt advanced production & marketing techniques. Export marketing firms have to function efficiently by using modern technology & tools of information technology.

OPTIMUM USE OF PRODUCTION CAPACITY: Large-scale production is necessary for meeting domestic demand & export orders. Exports are possible when surplus production is available after meeting domestic needs. This makes it essential for

a firm to utilise its production capacity fully. SPREADING OF MARKETING RISKS: A firm engaged in domestic as well as export marketing can spread its marketing risk in two parts. The loss is one part which can be compensated by the profit earned in the other part. HONOURING EXPORT OBLIGATIONS: Some export organisations are given certain concessions & facilities only when they accept certain concessions & facilities only when they accept certain export obligations. LIBERAL IMORTS POSSIBLE: Organisations exporting on a large-scale collect huge foreign exchange which can be utilised for liberal import of new technology, machinery & components. This also raises their competitive capacity.

IMPORTANCE OF EXPORT TO A DEVELOPING COUNTRY

In the present global trade, all countries developed as well as developing take special interest & initiative in export marketing or large scale exporting. Moreover, large scale exports are necessary for survival & growth of developed as well as developing countries. At present, the USA, the European countries, china, Japan, India & many other countries take special measures for export promotion. This suggests the significance of export to all country Developed, developing & even poor countries. In this connection, it is correct to say that exports are necessary not only for developed countries but also for developing nations. India is making special efforts for export promotion. The purpose is to secure various benefits through large scale exports. The benefit includes

Earning foreign exchange,

Economic growth,

Creation employment opportunities,

of

massive

Agricultural growth, & so on. It is through large scale export marketing that a country earns foreign exchange & imports goods & technology. Export is important as it offers benefits to national economy, business community & the society at large. Exports create employment opportunities, facilitates full utilisation of resources, being rapid economy growth & makes the country self supporting. In the absence of export growth, the very survival of a country may come in danger. This is applicable to developed & developing countries.

FUNCTIONS OF EXPORT MARKETING EXPORT MARKETING RESEARCH: Large-scale exports are just not possible unless foreign markets are studied & understood through research activities. Such research relates to consumers, products & features of foreign markets. In addition, social, cultural, economic & political background of foreign markets can be studied through such research. EXPORT QUALITY PRODUCTION, CONTROL & PACKAGING: QUALITY

For large-scale exports, promising products need to be selected. Quality control is a must in the case of exportable items as export marketing is possible if the product is superior in quality & also competitive. In addition, packaging of export items should be secured, attractive & agreeable to foreign buyers. All aspects relating to product, quality control & packaging come within the scope of export marketing. For this, product research & development activities need to be undertaken.

EXPORT RISKS MANAGEMENT: Export risks may be related to the cargo in transit or payment by the foreign importer. ECGC issues different policies. Export risk management is within the scope of export marketing. EXPORT PRICING: Export pricing is one important area within the scope of export marketing. It means fixing the F.O.B. pricing of goods to be exported. Pricing needs to be competitive & also attractive to foreign buyers. Export prices should be fixed on cost calculation & judgement relating to non-price factors such as market competition & substitutes available. EXPORT ORGANISATION: For large-scale exports, efficient export organisation is essential. It should work in close co-operation with other functional departments. Execution of export promotion programmes is possible only through efficient export organisation. The study of export marketing organisations is with the scope of export marketing. EXPORT FORMALITIES, DOCUMENTATION: PROCEDURES &

Export transactions are lengthy, timeconsuming & complicated. There are procedural complexities involved in export marketing. They are as a barrier in export trade. Various documents are required to be prepared while exporting goods. These aspects are included within the scope of export marketing. FINANCING, PAYMENTS: ACOUNTING & COLLECTION OF

Large funds are required for exporting goods. In addition, liberal credit facilities are required to be offered to foreign buyers. Moreover, rules & regulations regarding foreign exchange need to be followed properly. These procedural aspects come within the scope of export marketing. EXIM POLICY & EXPORT INCENTIVES: Export marketing needs detailed study of Exim policy in India & abroad. This facilitates large-scale exports. The study of Exim policy & export incentives is within the scope of export marketing. SALES PROMOTION: Sales promotion measures are necessary for capturing foreign markets & also for facing market competition effectively. These

aspects are included within the scope of export marketing.

DIFFICULTIES IN EXPORT MARKETING: PAYMENT DIFFICULTIES: Payment for imports & exports is one important difficulty in export marketing because different currency systems are used in different countries. In addition, foreign exchange regulations exist in every country including India. These factors create payment problems in export marketing. Indian exporters have to honour foreign exchange regulations while exporting. In addition, an exporter has to face some risk while converting Indian currency into foreign currencies as exchange rates are flexible. LONG DISTANCE TRANSPORTATION: & RISK IN

There is a risk of loss or damage of goods as they are exposed to uncertainties in transportation. Even political & commercial risks are involved. This makes export marketing risky. In India ECGC provides relief as regards commercial risks in exporting. However, long distances create difficulties (high risks & uncertainties) in export marketing. Such difficulty is common before exporters of all countries including India. GOVERNMENT RESTRICTIONS EXCHANGE REGULATIONS: & FOREIGN

The government restrictions compel the exporters to follow certain rules & regulations in the form of licenses, quotas, & customs formalities. Due to such restrictions, new problems developed before the exporters. Even trade restrictions in foreign countries create problems before exporters face this difficulty of foreign exchange regulations even when trade policy is now made substantially liberal. DIFFICULTIES IN COMMUNICATION:

The export marketing activities are carried on between people of different language groups, traditions, nationalities & socio-systems. Moreover, direct contact between the parties is not possible. This creates difficulties before the exporters while complicating export procedure. In addition, use of different weights & measures creates some more difficulties before Indian exporters. TIME DIFFICULTIY: There is a wide time gap in export marketing transaction. There is possible delay in receiving the delivery of goods due to complicated procedures & long distances. This creates financial problems before Indian exporters. DIFFICULTIES FACED BY INDIAN EXPORTERS Payment difficulties due to the use of multiple currencies & foreign exchange regulations. Long distance & risk & uncertainties in transportation of good abroad.

 Government restrictions, legal barriers & exchange regulations. Cultural barriers. barriers & communication

Customs formalities in India & also in foreign countries. Documentation difficulties & cost involved. Intense global competition among unequal participants. Problems created by trading blocs & trade barriers imposed practically by all countries on different grounds. Risks & uncertainties involved completion of production. till the

STRATEGY FOR EXPORT MARKETING Export strategy can be prepared on the basis of the following: 1) To select local product which are suitable for overseas buyers & to improve its

quality & design to meet requirements of foreign buyers. 2) To develop a product strategy in packaging. Packaging for export markets must be strong & protective. It must fulfil three functions protection against water & moisture, breakage & theft. 3) To consider overseas markets as heterogeneous. Each country has a different climate, commercial laws & buying patterns. It is desirable o adopt intensive marketing strategy so as to concentrate on one country at a time. 4) To take into account convenience of the buyers while designing the product. 5) To find out the established channels of distribution & to develop relationships with channels members. Wherever required, use the services of sales representatives.

6) To consider selection of the right sales promotion schemes. Participation in trade fairs, press advertising, ads on

trade journals & advertising on web sites will certainly improve export preference. 7) To give highest importance to the product quality. Indian exporters should emphasise total quality of the product. Even a slight variation in the quality is not acceptable to foreign buyers. 8) To make available regular information flows, compliance with delivery schedule & prompt after sales services. 9) To develop suitable brand name, appoint an agent to facilitate quick sales, maintain competitive price & market ecofriendly products. 10) To develop personal relations with foreign buyers. Sometimes feelings may take precedence over facts during negotiations.

PREPARATION FOR EXPORT MARKETING

 SELECTING BUSINESS:

PRODUCT

FOR

EXPORT

Here the selecting product includes the product plus packaging, branding, labelling, and warranties & after sale service offered. In general, product offered to foreign customers should be unique in terms of quality, merits, colour, brand, package, label & warranties. The following alternatives are available while offering product in the foreign markets: (a) OFFERING THE SAME PRODUCT in foreign markets as is marketed in the domestic marketing.

BAJAJ PULSAR (b) OFFERING THE SAME PRODUCT BUT AFTER MODIFYING the contents as well as packaging, etc.

MODIFIED

(c) OFFERING COMPLETELY NEW PRODUCT as per the needs & requirements of customers in specific foreign markets.

The following guidelines can be suggested while selecting product for exporting: (1) THE SELECTED PRODUCT SHOULD HAVE REGULAR & CONTINUOUS DEMAND (2) IT SHOULD BE POSSIBLE TO MANUFACTURE THE SELECTED PRODUCT AT LOWER COST. (3) THE SELECTED PRODUCT SHOULD AVAILABLE IN SUFFICIENT QUANTITY. BE

(4) GOVERNMENT REGULATIONS SHOULD BE GIVEN DUE CONSIDERATION. (5) THE PRODUCT SELECTED FOR EXPORTING SHOULD BE ADJUSTABLE AS PER MARKET REQUIREMENT. (6) THE PRODUCT SELECTED SHOULD HAVE REGULAR DEMAND.

 DESIGNING MARKETING:

PRODUCT

FOR

EXPORT

Product design is a technique to satisfy customers & have advantage over competitors. Often design is the only feature that differentiates a product. Exporters are convinced that there is considerable promotion appeal in designing products. Designing product has always been an important marketing tool right from automobiles & TV to calculators & watches. A good design improves sale by making it easier to operate, improve quality, appearance & reducing production cost. Many export firms have employed expert designers to prepare attractive & eyecatching products. Colour is often the determining factor in a customers acceptance or rejection of a product. The experiences of marketing abroad helps to acquire better understanding regarding use of different colours to suite the need & imagination of buyers.

 PRODUCT POSITIONING IN EXPORET MARKETING

PHILIP KOTLER defines product positioning as the act of designing the companys offer so that it occupies a distinct & valued place in the target customers minds. There is stiff competition in the overseas markets. It is not adequate for an exporter to select & design a product. It is perhaps more important for him to differentiate & position the product in overseas markets. In order to have effective product positioning, an exporter must answer certain basic questions: 1) How can I differentiate my product from that of competitors? 2) Which differences to highlight? 3) What should be the basis of communicating differentiations to overseas buyers?

STEPS IN PRODUCT POSITIONING (1) IDENTIFYING COMPETITIVE DIFFERENTIATION: It means to identify possible differentiations in the areas of: (A) product (B) services (C) personnel (D) image. (A) PRODUCT DIFFERENTIATION: The product can be differentiated on different bases which are as follows: I. FEATURES: An exporter can differentiate the product by enhancing & adding new features. It is necessary to find out if it is worth adding a feature & the cost involved. II. PERFORMANCE: A superior quality product giving better performance is always patronised by foreign buyers.

III. CONFORMANCE: Making the product exactly as per the specification of foreign buyers is called conformance. It indicates how far the product comes upto the expectations of foreign buyers. IV. DURABILITY: It is determined by the life enjoyed by a product. The longer the life of the product, the more durable it is supposed to be. V. RELIABLLITY: It is determined by the life enjoyed by a product. The longer the life of the product, the more durable it is supposed to be. VI. REPAIRABILITY: Products with zero defects should be manufactured. Chances of breakdown should be minimised. Quicker repairs of a malfunctioned product, to make it function quickly can be included under repairability. VII. SYTLE & DESIGN: The appearance of the product along with its pattern & design form another criteria for differentiation. B) Service differentiation: From customers point of view, availability of after sale service is an important consideration to buy a product. Such service can take the form of:

I. DELIVERY: By selecting the right mode of transportation, it is possible to make delivery at the right time. The exporter can improve his reputation through speedy and careful delivery. II. INSTALLATION: Installation refers to making the product operational at the planned location. Quick installation to the satisfaction of the buyer of the buyer is always a selling point.

III. TRAINING: The employees of the buyer can be trained to operate the equipment and to attend to minor breakdowns. IV. REPAIR: Repair is the selling point of exporter. V. GUARANTEES: Guarantees help to break sales resistance. It installs confidence on the buyer. C) Personnel differentiation: Well-trained & qualified personnel are asset to any business. A good amount of differentiation can be provided by focusing on competence & responsiveness of personnel. These personnel must remain

courteous & trustworthy to win over the buyers abroad. d) Image differentiation: Regular consumers have a certain image about the product & the exporter. Mostly repeat purchases are made by consumers because they have good opinion about the product. Image differentiation is a mental picture. The exporter can use: I. SYMBOLS: The brand logos must be designed choosing the right objects to create the right image. II. USE OF MEDIA: Distinctive image can be established through print as well as audiovisual media. Effective advertising campaign can be undertaken to boost the image of the exporter & his product.

(2) SELECTING DIFFERENCES FOR PRODUCT POSITIONING: It is important to emphasize the differences which are likely to benefit the consumers. Such differences must be distinctive & should not be found in the product of competitors. Superior & profitable differences must be selected & communicated as it is likely to build an improved image of the exporter. Correct

positioning depends on deciding how many differences & which differences to be promoted. The selected differences should be: {i} visible, {ii} profitable, {iii} affordable, & {iv} economical. (3) COMMUNICATING POSITIONING: THE COMPANYS

The product positioning should be clearly communicated to target customers. The following 6 attractive bases can help in this: I. Positioning on specific product features. II. Positioning on benefits, problem solution or needs. III. Positioning for specific usage occasions. IV. Positioning for user category. V. Positioning against another product. VI. Product class dissociation.

(4) FOLLOW UP OF POSITIONING: It is important for every exporter to obtain feedback how his product positioning has worked in the market. In case, the product positioning is not welltaken by the consumer, the exporter must reposition his product & revive its sales.

 SELECTING TARGET MARKET FOR EXPORT BUSINESS: An exporter has to identify the most promising market for exporting. Target market must be selected carefully. Global market provides ample scope for such selection. The following factors need attention while selecting target market: (a) Target market selection needs detailed study of potential overseas markets. Here, nature of demand, degree of market competition, features of consumers, government facilities, etc. need to be given due consideration. (b) For the identification of promising export market, market research/consumer survey is useful. In addition, adequate information about potential foreign markets needs to be collected. This facilities short listing of potential markets for final selection of the most suitable market.

(c) Factors such as current market potential, potential for further growth, risk involved, market competition, & demand for certain goods which are not available in the market for the present should be given due

consideration while target market.

selecting

suitable

(d) The exporter has to decide his export marketing objectives by using parameters such as: (i) Political & economic stability in export markets, (ii) The strength & stability of currency system, & (iii) Infrastructure facilities available. (iv) Tariffs & non-tariff barriers. SELECTING BUSINESS: BUYERS FOR EXPORT

The selection of buyers involves 2 steps as notes below: (a) Collecting information about prospective buyers: Exporting firm cam collect addresses & other details of promising buyers from the following sources: (1) Enquiries with EPCs, CBs, ITPO & IIFT. (2) Reference to publications of export promotion organisations. (3) Visiting in international trade fairs & exhibitions in India & abroad. (4) Making contacts with Indian trade representatives abroad. (5) Visiting consulates of foreign countries in India. (6) Visiting popular websites by using internet services.

(b) Communication with prospective buyers: Communication link can be established with overseas importers through the following methods: (1) By correspondence & by sending product literature & sales literature to prospective overseas buyers. (2) Participation in buyer-seller meets & meeting the members of foreign trade delegations invited by EPCs, etc. (3) Participation in international trade fairs, seminars, etc. (4) By undertaking trips to foreign markets & establishing direct personal contact with overseas buyers. (5) Creating websites in international arena.