Essay on Export Management
The aim of this assignment is to demonstrate knowledge of the information and data needed to formulate an export strategy. This will be achieved by way of addressing the following:
1. What is meant by the ‘business and market environment’ of a target market? What kind of information would an exporter need to collect?
2. What is meant by the concepts ‘market segmentation’ and distribution channels’? What kind of information would an exporter need to collect?
3. What are the financial issues, export practicalities and technicalities that an exporter would need to know about to in the context of developing an export strategy?
Business and market environment of a …show more content…
Market segmentation is where companies establish ‘segments of demand’, ‘target specific segments’ and ‘develop specific marketing ‘mixes’ for each targeted market segment’ (Hunt and Arnett 2004, p7). According to McDonald and Dunbar (2010, p9) it is an ‘alternative to product differentiation’ - the ‘process of splitting customers, or potential customers, in a market into different groups, or segments’. A crucial factor in McDonald and Dunbar’s (2010) definition is the emphasis on customers, who they are argue, are no longer content to play a secondary role, but are more market savvy and experienced enough to specify exactly what they require. Part of the reason for segmentation is that it can be used to divide large markets creating sectors that cater for geographic such as climate, area and location; demographic and socioeconomic like income, education, job, age, gender; family dimensions and house occupier status; behaviour relating to brand loyalty and psychographic in terms of attitude, lifestyle choices and values. Segmenting in such a way can ensure accurate and precise product and service placing.
An important dimension of an export market strategy is to determine the segment of the market the company wishes to target. In this way a company will ascertain the potential buyers of its products in the target market, reasons for buying, situatedness of customers and any salient features.