Corporate Entrepreneurship 1 of 2

Lahore School of EconomicsExport Marketing

BBA IV with Major in Marketing Minors in Media Studies Section: H

Course InstructorFaizan Khalid

E-mail: faizankhalid@hotmail.com

Core Reading ListGerald Albaum, and Edwin Duerr. 2011. International Marketing and Export Management. 7th Edition. Prentice Hall.

Alan E. Branch. 2005. Export Practice and Management. 5th Edition. Thomson Learning. Thomas A. Cook, Rennie Alston, and Kelly Raia. 2004. Import and Export Management Hardcover Edition. AMACOM. Philip Cateora, Mary Gilly, and John Graham. 2010. International Marketing. 15th Edition. McGraw-Hill/Irwin.

Final Assessment CriteriaFinal Exam 25% Mid Term 20% Project Report 20% Quizzes 10% Assignment, Class Participation 10% Case presentations 15%

Lecture SessionsMonday 8:00 AM- 9:45 AM

Saturday 10:00 AM-11:45 AM

What is Export Marketing? Export marketing means marketing of goods and services beyond the national boundaries B.S Rathor

The growing importance of international marketing 2008 recessionFirst drop in international trade and investment in 50 yearsIt demonstrated importance to:national and regional economiescompanies of all sizesworkers and consumers

Increasing importance of international markets and exporting due to:

greater opportunities for enterprises of all sizes,

most companies selling to, buying from, competing against, and/or working with companies overseas

consumers have a wider range of choices, often at lower prices and/or better quality

importance of international sales in spreading risk, increasing profits, covering R&D costs, understanding emerging challenges

increasing dependence of national and regional economic health on exports sales Path to Success in Export Marketingcustomer focus

Innovations in products and services

Increased efficiency with lower costs or improved services

Identifying and exploiting appropriate market segments

Responding to increasing opportunities and threats Failure to be proactive in exploring foreign markets leads to missed opportunities and lack of information about potential new threats Exporting is the most common market entry mode for small and medium-size companies. It is widely used by all large international companies. Exporting is no longer just an option for most companies; it is now an imperative.

Domestic CompaniesForeign MarketsDomestic MarketsForeign CompaniesInternational Marketing: A definition and unique requirements International marketing is the marketing of goods, services and information across political boundaries.

PlanningPromotingDistributingPricingSupport of goods/servicesInformation to consumersCultureConsumer TastesEconomic LevelsMarket StructuresWays of doing business Laws & RegulationsExcelling in International MarketsAnalysis of markets and potential markets Planning, development and packaging of products, services and information to best meet Selection of distribution channels that are most effective and efficient in the foreign market Promotion, including advertising and personal selling Setting of prices Technical and non-technical support given to customers, both before and after sales

Problems with International TradePiracy on high seasPiracy of goods by making unauthorized copiesContaminated Food ProductsTerrorism Wars & Threat of WarsProhibition of exports of certain products e.g. CottonEmbargos on all or certain importsDiseases leading to prohibition of importsKidnapping of people for ransom

Internationalization and the global marketer Internationalization may be viewed as: a process, an end-result or a way of thinking.It is most effective when a carefully planned process for increasing penetration has been prepared in advance.A firm should consider advantages and disadvantages of exporting, licensing, establishing sales subsidiaries, producing abroad, forming strategic alliances. The terms international, multinational and global are sometimes used interchangeably, but imply differences in approaches.

Internationalization and the global marketer Multinational marketing:It implies a strong commitment to international marketing, and may be taken to mean that the marketer develops differentiated products and marketing strategies for each of its markets. It is associated with adjusting products and practices in each country, with relatively higher attendant costs.

Global Marketing:It implies that the company tries to standardize products and marketing practices worldwide in order to achieve economies of scale and lower prices.

Think globally, Act locally Evaluate and enter markets worldwide based on individual potential and worldwide strategy. Procure capital and invest funds on a worldwide basis according to costs and opportunities. Purchase raw materials, components, equipment and supplies from sources worldwide. Staff organizations with best qualified managers and employees without regard to national origin.

International Marketing Management3 basic steps before pushing your firm in international market:whether to engage in international marketing activities; markets to be served; methods or systems to be used.

Controllable versus uncontrollable elements in determining marketing mixThe effectiveness of marketing activities used by the firm is directly affected by the uncontrollable elements in the environment, so the profitability of any marketing programme is situation specific.

Schematic model of the export marketing mixExport marketing planning and strategy Strategic issues: choice of countries, product markets, target segments; methods of operation, timing.

Tactical issues: product positioning, adaptation, advertising, pricing and distributing. Export marketing planning process

Obstacles to exporting Barriers affecting many companies, particularly smaller ones, include: Higher operational efforts required for foreign market, Lack of information, Lack of knowledge and skills, Trade barriers, Risk factor

Dimensions of export barriers

How can a company cope?Look to existing customersMake a commitment with seasoned managersSeek advice externallyUse Trade showsPick markets carefullyManage growthBe patient & focus on networkingChoose partners carefully e.g. freight forwarder

The Internet, the World Wide Web and E-business All aspects of domestic and international business operations have been impacted by the Internet, the World Wide Web and E-business. The Internet provides greatly increased speed and lowered costs in communications. Inexpensive in most countries Very wide and rapidly expanding use. Electronic data interchange systems (EDI) have been set up by some specific sets of companies for their exclusive use.

E-business the sale, purchase, or exchange of goods, services or information over the Internet or other telecommunications networks. Business-to-consumer sales (B2C) growing rapidly than overall retail salesA combination of traditional marketing and Web-based marketing appears to be most successfulMany traditional retailers find using the Internet to build an overseas presence is faster and cheaper than building stores. Some major retailers have set up distribution centres in selected countries abroad. Business-to-business (B2B) spending continues to be of great importance. B2B transactions involve many activities in addition to buying and selling, including support of supply-chain and distribution-chain management, and provision of information for overall systems coordination.

The impact of technology Resulted in new products, the creation of additional international markets and lowered costs of doing business. Information technology related trade now accounts for 16% of total world trade. Development and marketing of software to support e-business has become a major international industry. Importance of China and India in IT-related trade has been phenomenal. New products have resulted from major advances in communications technology, medical research, traditional products and manufacturing processes.

The impact of technology Improvements in shipping equipment and the applications of information technology in scheduling and control have reduced costs.

Expanding use of radio-frequency identification systems (RFID) is making supply chain management more effective and efficient.

Licensing of new and improved technology has become increasingly important for both large and small companies.

Entrepreneurial approaches to international marketing New approaches to international marketing have been made feasible by technological advances and by recognition of emerging opportunities.

E-business software allows companies to handle key functions in a coherent on-line system: supply chain and distribution chain management; ordering, billing, and inventory management; analyses of sales and trends; etc.

Specific software is available to support specialized functions such as Customer Relations Management (CRM) programs, and many other individual and integrated programs.

The virtual company Advances in communications allow formation of virtual companies based on the owners ideas/vision/knowledge/abilities to organize and coordinate.

Have little in the way of physical facilities; have few or no employees.

Often, there are contracts with outsiders to perform most business functions.

The growth of non-traditional exports: Exporting services of knowledge-industry workers

Greatly increased capabilities and lowered costs in communications have enabled cross-border export of information services

Companies in lower-wage nations employ well-educated people to provide services ranging from call centres and back-office support to advanced technical support, software development and design services.

India is a major exporter of services, with other Asian countries and Eastern European nations expanding similar activities.

Importing customers Many companies (and nations) rely to some extent on getting income from foreign visitors.

For a number of countries, tourism is a major source of income.

In addition to seeking tourists, students and people attending meetings, more are now attracting people wanting medical procedures.

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