19.03.2012 Export Selling vs. Export Marketing Exporting, Importing, and Sourcing Assist. Prof. Dr. Özge Özgen International Marketing Management Export selling does not involve tailoring the product, price, or the promotinal material to suit the requirements of global markets The only marketing mix element that differs is the PLACE It may work well For unique products with little or no international competition For companies which are new to exporting (Initial experience are gathered from export selling) Export Selling vs. Export Marketing Export marketing does not simply take the domestic product “as is” It is modified as needed to meet preferences of international target markets Export marketing requires An understanding of the target environment The use of marketing research and identification of market potential Decisions about marketing strategies It is necessary if Companies mature in the global marketplace New competitors enter the market 3. 4. 5. 6. The firm is unwilling to export The firm explores the feasibility of exporting The firm exports to one or more markets on a trial basis (Export selling) The firm is an experienced exporter to one or more markets The firm pursues country-or region focused marketing The firm evaluates global market potential Market potential estimation are conducted by economists or marketers Size and concentration of customer segments Projected consumption statistics Competitive pressures Analysis of foreign trade statistics is extremely important for identification of suitable markets for your products Personal visits Partner search Expectations of local distributors/agents Trade shows Organizational Export Activities 1. 2. Understanding The Market Potential Potential Export Problems Yazgan Wine Winery, which HüseyinYazgan had established in a rental, self storage in Karşıyaka, Izmir, in 1943 HüseyinYazgan launched into the construction of a new manufacturing plant in 1953 Production was gradually increasing and reached at 2000 tons in 1969. Today their production level is 5.5 millon litre In 2012 their plan to export 3% of their production 1 19.03.2012 Key Export Participants Foreign purchasing agents Seeking out the manufacturer whose price and quality match the specifications of their principal Export sales specialist Responsible from international sales Export broker Receives a fee for bringing together the seller and the overseas buyer Export merchants Importer who buys directly from foreign producers for re-packaging and re-selling under its own brand (with or without any additional processing). Export management company (EMC) The services of an EMC may include foreign market research, marketing strategies, foreign distribution, establishing a logistics system, managing and training a foreign sales force, shipping and export information and details, and arranging financial aid and foreign language translation services. Piggyback marketing Piggyback marketing occurs when a manufacturer distributes another firm‘s product(s). Freight forwarder A freight forwarder is a "travel agent for freight." An independent agent that aids and facilitates the shipments of exported goods, freight forwarders are familiar with the procedures and regulations for shipping products overseas. Export Sales Specialist Company / Job Description Planning and implementing sales and marketing activities in line with the company sales strategies Preparing and submitting regular sales and forecast reports Reporting periodically the export sales activities to Manager Achieving his / her sales goals Developing customer portfolio Giving sales support to customers Required Skills Degree from a reputable university Minimum 3 years of working experience in automotive sector Understanding of inventory flow and supply chain as well as Import and Export rules A strong sales planning experience in coordination with the sales team Fluency in both written and spoken English is a must, Good knowledge of MS Office programs Available for international and domestic travels Good communicational skills Direct Representation in a Market Sourcing +++ Control Outsourcing means Program development Resource allocation +++ Communication !!! Need more effort !!! In smaller markets, it is usually not feasible because low sales volume does not justify the costs Small manufacturers face with the same problem Shifting production jobs or work assignments to another company o cut costs Management vision Factor costs and conditions Customer needs Logistics Country infrastructure Political factors Foreign exchange rates 2 19.03.2012 Global Market Entry Strategies Licensing, Investment and Strategic Alliances High involvement / High Costs Exporting Licencing Contract Manufacturing Joint Venture Acquisition Low involvement / Low Costs UPS agrees to buy TNT Express for $6.8B Starbucks Türkiye Associated Press – 7 hrs ago UPS is already the world's largest international package shipper by revenue, above Shaya Group FedEx Corp. and the DHL. From 2002 Buying TNT will be UPS’s biggest purchase since the company was founded in More than 10 international brand 1907 as a bicycle-messenger service 200 stores and 1600 employees TNT Express reported revenue of €7.25 billion last year—two-thirds of it They don’t have any franchising or dealership contracts Licensing agreement between Starbucks Türkiye and Shaya Group from European business UPS and TNT combined will generate annual revenues of more than €45 billion. Around 36% of the combined company's revenues will be generated outside the U.S TNT Express is the smallest of the big four global package shippers, the merger will give UPS a market-leading position in Europe to round out its big domestic U.S. presence and expanding Asian business Market Expansion Strategies MARKET COUNTRY Concentration Diversification Concentration Narrow focus Country focus Diversification Country Diversification Global Diversification 3