Introduction to Export Marketing
There are so many factors influencing your ability to conduct export marketing in faraway destinations. Thinking that exporting your products or services overseas, is a quick fix or cure for your domestic sales problems is going to be a very costly and painful lesson to learn. This is especially true if you don’t have a deep understanding of export marketing strategies.
That being said, there are many fantastic reasons why you should consider exporting from Australia. But before you go any further with your plans, you should ask yourself these two fundamental questions:
- How do you know that you are exporting to the most attractive geographic market?
- How do you define, select and identify the most attractive export markets?
Baker Marketing Can Provide Export Training
If you can’t answer these questions confidently, you are in luck! This post has been created by an export marketing expert, to share with you how the team at Baker Marketing can help answer these very questions.
We are in the unique and fortunate position to be industry leaders when it comes to export marketing. Due in large part, to our collective years of experience and work with businesses which export goods and services domestically and overseas.
We help our clients select the most attractive and profitable export markets. And we do this with precision because of the years we have spent honing our skills.
The secret of our export marketing success has been packaged into a smart little matrix that we have dubbed “Geographic Market Attractiveness Matrix.” The name doesn’t need to be sexy when it works this well!
This strategic planning tool helps clients, like you, with both domestic and export market planning and development. The domestic matrix was designed first, and the Geographic Market Attractiveness Matrix is based on the same design. However, due to differing export marketing strategies, there are a few added variables to support the complexity of exporting.
The Geographic Market Attractiveness Matrix is the answer to the question “How do I export my product or service?”
Both Matrices can be divided into three essential analysis areas:
- Potential for profit
- Potential to convert
- Potential for longevity
Export Marketing: The Potential for Export Profit
Analysing the potential for profit in export marketing takes into account the environmental or macro issues related to export marketing. Things related to market entry cost:
- Legal costs
- Free trade agreements
Although with the recently completed free trade agreements with Japan, Korea and China many of these tariffs will be eliminated. This elimination will bring a more competitive retail price point without negatively impacting the profit per unit you will receive.
Some of the more micro or marketing variables that will be taken into account in your marketing strategy include:
- The size of the market
- The margin related costs like distribution
- The cost of any packaging or product modifications
- The manufacturing costs
Once all of these essential analysis areas have been assessed, Baker Marketing allocates a score to compare them with other potential markets.
Export Marketing: The Potential to Convert
The next stage in the process is to analyse the potential to convert within a geographic market. Our matrix analyses the desires of the primary target market and determines how a product will be perceived.
We use market research methods such as:
- Competitor analysis
- Gap analysis
- Product differentiation
- Product appeal
- Price sensitivity
These five elements have the ability to highlight the potential to convert for your product or service in an overseas market.
There have been recent changes to company tax rates that are designed to help more Australian exporters, like you, increase their competitiveness in an international market. These tax rate changes will increase your potential to convert, so they are an essential factor in this analysis area.
Several conversion factors within any given segment have a significant impact on the potential volume, which in turn, will affect the attractiveness of a market for exporting. A score is then assigned to each market analysed for its potential to convert.
Export Marketing: The Potential for Longevity
The third and final essential analysis area, completed by our export marketing agency, is the potential for longevity and sales profitability.
The potential for longevity can be impacted by factors such as:
- Age of the target market
- Likelihood of competitive substitutes
- Other long-term trends like health, education, media, technology and income
For example, there is a growing “middle class” in developing countries like India, Russia and China and this is having an important impact on the potential for future export growth. Again, a score is given to each market analysed in terms of the potential for longevity.
Comparing Export Markets
At the completion of the Geographic Market Attractiveness Matrix for two or more markets, scores have been assigned to each of the three essential analysis areas thus making it far easier to make an objective decision.
With the help of Baker Marketing, you will be able to objectively see the relative attractiveness of the export markets we have analysed. Using the scoring system presents you with information based on fact and inherent understanding of export marketing.
At this point, resources can then be applied to those export markets that appear to represent the best opportunity for a return on investment.
Sources of information for developing your geographic attractiveness matrix are:
- Website searches for competitive and socio / demographic information
- Google Keyword Planner for keyword searches by country
- SEMRush for keywords and competitive website performance data
- Freight forwarders for freight-related information
Export Marketing Further Reading
If you still want to sink your teeth into more content about export marketing and find answers for all of your questions, we can recommend the following blogs by the Baker Marketing team:
- Export Marketing Strategy for China
- Export Marketing 101 – Your 30 Second Sales Spiel
- 5 Keys to your Export Marketing Success
- Exporting food and beverage to Malaysia: things to consider
- Choosing the right export distributors
- How to tell an Export Distributor from an Importer or a Broker?
If you are looking for more articles, case studies, or specific advice and answers about export marketing give us a call, at Baker Marketing on (08) 8352 3091. One of our export marketing consultants will be on hand and ready to chat with you!