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Unit 4: Export Marketing – Going Global

game in the market. Success against these forces depends upon the company’s ability to create a Notes
successful product-market fit that offers unique advantages to the customers, reduces costs of
operation below those of its competitors, erects barriers to entry into its market places, attracts
price premiums for its goods and services and above all creates a strong position in the mind of
the customers.

The initial screening of the potential markets will form the basis for target market selection. The
essential steps are a thorough analysis of each market against preset definition of the target
market. Thus, a company may be looking at South East Asia, Far East and China as its potential
markets but a thorough analysis of each of these in terms of demand for a particular product,
size and growth potential of the market, income levels of the potential buyers, geographic
serviceability, psychographic profile of the customers, nature and size of local and foreign
competition, Government regulations, political stability may point that China is the most
favoured potential market and China tops as the target market.

Effective marketing programmes require a detailed analysis of the target markets. This analysis
can only be developed through achieving adequate information about these markets. Systematic
collection on information is crucial to successful strategy development in global markets.
Information is needed to:
(a) To assess new opportunities and threats that may emerge in target markets.
(b) To better prepare in a better manner, for lack of familiarity in foreign markets and their
business environment.
(c) To monitor market demand, competition, government policies, and other environmental
factors in the target markets.

Example: A US company, which brought its tomato ketchup to Japan on the simple
assumption that ketchup was not available in Japan and that the company would be able to
derive the pioneer advantage. However, Japanese did not like the product as their tastes
traditionally favoured a Soya, based sauce. The company paid a heavy price for not conducting
proper research to arrive at a suitable product-market fit for its target market of Japan.
The research has to answer the following questions:
What are the most exportable products to be offered to target market(s): To identify
products with export potential for distribution internationally, you need to consider
products that are successfully distributed in the domestic market. The product needs to fill
a targeted need for the purchaser in export markets according to price, value to customer/
country and market demand.

What makes your product(s) unique for markets abroad: Your products must have a
unique feature(s) that will interest the foreign buyer to accept them from you compared to
anyone else from around the world. The product needs to fill a targeted need for the
purchaser in export markets according to price, value to customer/country and market
demand.

What are the best countries to market your product: Since the number of world markets
to be considered by a company is very large, it is neither possible nor advisable to research
them all. Thus, your firm’s time and money are spent most efficiently by using a sequential
screening process.

The first step in this sequential screening process for the company is to select the more
attractive countries for your product. Preliminary screening involves defining the physical,
political, economic and cultural environment. Subsequently, one could identify two or
three markets that offer the best potential.

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