1
INTRODUCTION TO EXPORT
MARKETING – I
(Meaning and importance of Exports)
Unit Structure
1.0 Objectives
1.1 Introduction
1.2 Definitions of Export Marketing
1.3 Features of Export Marketing
1.4 Importance of Export Marketing
1.5 Distinguish between Domestic Marketing and Export
Marketing.
1.6 Motivations for Export Marketing
1.7 Present Problems / Difficulties faced by Indian Exporters.
1.8 Summary
1.9 Questions for Self-Assessment
1.0 OBJECTIVES
The main purpose of this chapter is –
To provide you with an overview of export marketing.
To understand the meaning of export marketing
To explain the features of export marketing
To know the importance of export marketing at national level
and firm level.
To distinguish between domestic marketing and export
marketing.
To elaborate the motivations for export marketing.
To find out the present problems / Difficulties faced by Indian
exporters.
1.1 INTRODUCTION
Export marketing means exporting goods to other countries
of the world. It involves lengthy procedure and formalities. In export
marketing, goods are sent abroad as per the procedures framed by
the exporting country as well as by the importing country. Export
, 2
marketing is more complicated to domestic marketing due to
international restrictions, global competition, lengthy procedures
and formalities and so on. Moreover, when a business crossed the
borders of a nation, it becomes infinitely more complex. Along with
this, export marketing offers ample opportunities for earning huge
profits and valuable foreign exchange.
Export marketing has wider economic significance as it
offers various advantages to the national economy. It promotes
economic / business / industrial development, to earn foreign
exchange and ensures optimum utilization of available resources.
Every country takes various policy initiatives for promoting exports
and for meaningful participation in global marketing. Global
business is a reality and every country has to participate in it for
mutual benefits. Every country has to open up its markets to other
countries and also try to enter in the markets of other countries in
the best possible manner. This is a normal rule which every country
has to follow under the present global marketing environment. In
the absence of such participation in global marketing, the process
of economic development of the country comes in danger.
1.2 DEFINITIONS OF EXPORT MARKETING
1) According to B. S. Rathor
“Export marketing includes the management of marketing
activities for products which cross the national boundaries of a
country”.
2) “Export marketing means marketing of goods and services
beyond the national boundaries”.
1.3 FEATURES OF EXPORT MARKETING
The main important features of export marketing are as
follows.
1) Systematic Process –
Export marketing is a systematic process of developing and
distributing goods and services in overseas markets. The export
marketing manager needs to undertake various marketing
activities, such as marketing research, product design, branding,
packaging, pricing, promotion etc. To undertake the various
marketing activities, the export marketing manager should collect
the right information from the right source; analyze it properly and
then take systematic export marketing decisions.
, 3
2) Large Scale Operations –
Normally, export marketing is undertaken on a large scale.
Emphasis is placed on large orders in order to obtain economies in
large sole production and distribution of goods. The economies of
large scale help the exporter to quote competitive prices in the
overseas markets. Exporting goods in small quantities is costly due
to heavy transport cost and other formalities.
3) Dominance of Multinational Corporations –
Export marketing is dominated by MNCs, from USA, Europe
and Japan. They are in a position to develop world wide contacts
through their network and conduct business operations efficiently
and economically. They produce quality goods at low cost and also
on massive scale.
4) Customer Focus –
The focus of export marketing is on the customer. The
exporter needs to identify customers‟ needs and wants and
accordingly design and develop products to generate and enhance
customer satisfaction. The focus on customer will not only bring in
higher sales in the overseas markets, but it will also improve and
enhance goodwill of the firm.
5) Trade barriers –
Export marketing is not free like internal marketing. There
are various trade barriers because of the protective policies of
different countries. Tariff and non-tariff barriers are used by
countries for restricting import. The export marketing manager must
have a good knowledge of trade barriers imposed by importing
countries.
6) Trading Blocs –
Export trade is also affected by trading blocs, certain nations
form trading bloc for their mutual benefit and economic
development. The non-members face problems in trading with the
members of a trading bloc due to common external barriers. Indian
exporters should have a good knowledge of important trading blocs
such as NAFTA, European Union and ASEAN.
7) Three – faced competition –
In export markets, exporters have to face three-faced
competition, i.e., competition from the three angles – from the other
suppliers of the exporter‟s country, from the local producers of
importing country and from the exporters of competing nations.
8) Documentation –
Export marketing is subject to various documentation
formalities. Exporters require various documents to submit them to
, 4
various authorities such as customs, port trust etc. The documents
include – Shipping Bill, Consular Invoice, Certificate of Origin etc.
9) Foreign exchange regulations –
Export trade is subject to foreign exchange regulations
imposed by different countries. These regulations relate to
payments and collection of export proceeds. Such restrictions affect
free movement of goods among the countries of the world.
10) Marketing – mix
Export marketing requires the right marketing mix for the
target markets, i.e. exporting the right product, at the right price, at
the right place and with the right promotion. The exporter can adopt
different marketing – mixes for different export markets, so as to
maximize exports and earn higher returns.
11) International marketing Research –
Export marketing requires the support of marketing research
in the form of market survey, product survey, product research and
development as it is highly competitive. Various challenges,
identification of needs and wants of foreign buyer in export
marketing can be dealt with through international marketing
research.
12) Spreading of Risks –
Export marketing helps to spread risks of business. Normally
export firms sell in a number of overseas markets. If they are
affected by risks (losses) in one market, they may be able to spread
business risks due to good return from some other markets.
13) Reputation –
Export marketing brings name and goodwill to the export
firm. Also, the country of its origin the gets reputation. The
reputation enables the export firm to command good sales in the
domestic market as well as export market.
1.4 IMPORTANCE OF EXPORT MARKETING
Exports are important for all countries whether developed or
underdeveloped. The need / importance / advantages of export
marketing can be explained from the viewpoint of a country and
that of business organization.
1.4.1 Need / Importance / Advantages of Export Marketing at
the National Level:
1) Earning foreign exchange –
Exports bring valuable foreign exchange to the exporting
country, which is mainly required to pay for import of capital goods,
INTRODUCTION TO EXPORT
MARKETING – I
(Meaning and importance of Exports)
Unit Structure
1.0 Objectives
1.1 Introduction
1.2 Definitions of Export Marketing
1.3 Features of Export Marketing
1.4 Importance of Export Marketing
1.5 Distinguish between Domestic Marketing and Export
Marketing.
1.6 Motivations for Export Marketing
1.7 Present Problems / Difficulties faced by Indian Exporters.
1.8 Summary
1.9 Questions for Self-Assessment
1.0 OBJECTIVES
The main purpose of this chapter is –
To provide you with an overview of export marketing.
To understand the meaning of export marketing
To explain the features of export marketing
To know the importance of export marketing at national level
and firm level.
To distinguish between domestic marketing and export
marketing.
To elaborate the motivations for export marketing.
To find out the present problems / Difficulties faced by Indian
exporters.
1.1 INTRODUCTION
Export marketing means exporting goods to other countries
of the world. It involves lengthy procedure and formalities. In export
marketing, goods are sent abroad as per the procedures framed by
the exporting country as well as by the importing country. Export
, 2
marketing is more complicated to domestic marketing due to
international restrictions, global competition, lengthy procedures
and formalities and so on. Moreover, when a business crossed the
borders of a nation, it becomes infinitely more complex. Along with
this, export marketing offers ample opportunities for earning huge
profits and valuable foreign exchange.
Export marketing has wider economic significance as it
offers various advantages to the national economy. It promotes
economic / business / industrial development, to earn foreign
exchange and ensures optimum utilization of available resources.
Every country takes various policy initiatives for promoting exports
and for meaningful participation in global marketing. Global
business is a reality and every country has to participate in it for
mutual benefits. Every country has to open up its markets to other
countries and also try to enter in the markets of other countries in
the best possible manner. This is a normal rule which every country
has to follow under the present global marketing environment. In
the absence of such participation in global marketing, the process
of economic development of the country comes in danger.
1.2 DEFINITIONS OF EXPORT MARKETING
1) According to B. S. Rathor
“Export marketing includes the management of marketing
activities for products which cross the national boundaries of a
country”.
2) “Export marketing means marketing of goods and services
beyond the national boundaries”.
1.3 FEATURES OF EXPORT MARKETING
The main important features of export marketing are as
follows.
1) Systematic Process –
Export marketing is a systematic process of developing and
distributing goods and services in overseas markets. The export
marketing manager needs to undertake various marketing
activities, such as marketing research, product design, branding,
packaging, pricing, promotion etc. To undertake the various
marketing activities, the export marketing manager should collect
the right information from the right source; analyze it properly and
then take systematic export marketing decisions.
, 3
2) Large Scale Operations –
Normally, export marketing is undertaken on a large scale.
Emphasis is placed on large orders in order to obtain economies in
large sole production and distribution of goods. The economies of
large scale help the exporter to quote competitive prices in the
overseas markets. Exporting goods in small quantities is costly due
to heavy transport cost and other formalities.
3) Dominance of Multinational Corporations –
Export marketing is dominated by MNCs, from USA, Europe
and Japan. They are in a position to develop world wide contacts
through their network and conduct business operations efficiently
and economically. They produce quality goods at low cost and also
on massive scale.
4) Customer Focus –
The focus of export marketing is on the customer. The
exporter needs to identify customers‟ needs and wants and
accordingly design and develop products to generate and enhance
customer satisfaction. The focus on customer will not only bring in
higher sales in the overseas markets, but it will also improve and
enhance goodwill of the firm.
5) Trade barriers –
Export marketing is not free like internal marketing. There
are various trade barriers because of the protective policies of
different countries. Tariff and non-tariff barriers are used by
countries for restricting import. The export marketing manager must
have a good knowledge of trade barriers imposed by importing
countries.
6) Trading Blocs –
Export trade is also affected by trading blocs, certain nations
form trading bloc for their mutual benefit and economic
development. The non-members face problems in trading with the
members of a trading bloc due to common external barriers. Indian
exporters should have a good knowledge of important trading blocs
such as NAFTA, European Union and ASEAN.
7) Three – faced competition –
In export markets, exporters have to face three-faced
competition, i.e., competition from the three angles – from the other
suppliers of the exporter‟s country, from the local producers of
importing country and from the exporters of competing nations.
8) Documentation –
Export marketing is subject to various documentation
formalities. Exporters require various documents to submit them to
, 4
various authorities such as customs, port trust etc. The documents
include – Shipping Bill, Consular Invoice, Certificate of Origin etc.
9) Foreign exchange regulations –
Export trade is subject to foreign exchange regulations
imposed by different countries. These regulations relate to
payments and collection of export proceeds. Such restrictions affect
free movement of goods among the countries of the world.
10) Marketing – mix
Export marketing requires the right marketing mix for the
target markets, i.e. exporting the right product, at the right price, at
the right place and with the right promotion. The exporter can adopt
different marketing – mixes for different export markets, so as to
maximize exports and earn higher returns.
11) International marketing Research –
Export marketing requires the support of marketing research
in the form of market survey, product survey, product research and
development as it is highly competitive. Various challenges,
identification of needs and wants of foreign buyer in export
marketing can be dealt with through international marketing
research.
12) Spreading of Risks –
Export marketing helps to spread risks of business. Normally
export firms sell in a number of overseas markets. If they are
affected by risks (losses) in one market, they may be able to spread
business risks due to good return from some other markets.
13) Reputation –
Export marketing brings name and goodwill to the export
firm. Also, the country of its origin the gets reputation. The
reputation enables the export firm to command good sales in the
domestic market as well as export market.
1.4 IMPORTANCE OF EXPORT MARKETING
Exports are important for all countries whether developed or
underdeveloped. The need / importance / advantages of export
marketing can be explained from the viewpoint of a country and
that of business organization.
1.4.1 Need / Importance / Advantages of Export Marketing at
the National Level:
1) Earning foreign exchange –
Exports bring valuable foreign exchange to the exporting
country, which is mainly required to pay for import of capital goods,
