The need for export marketing research will arise only when a company is genuinely interested in exporting its product. There can be several reasons which may motivate it to export. These may be as follows:
- There is a surplus production capacity which can be utilized if overseas market is harnessed.
- The home market is saturated or passing through a no-growth phase. Exports can moderate the influence of fluctuations in the home market.
- There is a heavy pressure of competition in the home market. This may not be so in the overseas market.
- Overseas markets seem to be more attractive as there may be substantial business.
- Emphasis on export may help improve the quality of indigenous product as the exporter has to face the challenge from the foreign competitor.
- An exporter is entitled to preferential treatment under the import policy in our country. As such, he may have more access to imported units than a non-exporter.
- Export profits are exempted from the income tax under Secton HHC of the Income Tax Act.
- The top management of the company may be very ambitious and wants to enter the export trade so that its company may in due course become a multinational corporation.
- A company may find that its senior management is specially equipped for export marketing on account of managerial experience and competence.
- A company might have developed a new product the demand for which may be far more in the overseas market than in the domestic one.
A company interested in exporting its products must know which of the above-mentioned factors are applicable in its case. It must seriously consider the various aspects of entering into export field. It should adopt a long-term approach and should retain from entering and leaving the export field as and when it pleases.
The importance of export marketing research has been aptly emphasized by Milton L. Rusk while releasing the publication of American Management Association. Market Research in International Operations, as far back as in 1960:
“Marketing abroad is no longer simply a matter of skimming the cream from the top of rich market. Today, successful marketing abroad requires thorough market investigation and effective sales follow-through. Market investigation means market research: determining market possibilities, evaluating competitive conditions, directing local customs, tastes and preference4s. On the basis of this research, marketing and sales plans and advertising programmes are shaped, products and corporate images succeed or fail. In response to the growing need for more adequate market research abroad, international companies have increased their market research staffs, and independent research organisastions have begun to stress their international services.”
This shows that the export marketing is a highly complex operation which cannot be carried out efficiently and successfully unless it is based on sound research. However, as we shall see below, there are special problems in export marketing research.
