1. CHAPTER 3
EXPORT MARKET
EXPANSION/SELECTION:
DEFINITION AND
STRATEGIES

2. AIM OF THIS CHAPTER:
 Describe the alternatives of
international, especially export, market
strategy decisions and the base of export
competition.
 Deals with specifically with the company’s
selection of international markets, number
and types of countries and market
segments.

3. MARKET DEFINITION &
SEGMENTATION
 Market definition: identify the consumer market
Specific answers to some strategic questions
 What geographic area will we operate in?
 What timeframe do we have in mind?
 Who are our prospects?
Specific answers to some strategic questions
 What will we offer?
 In what broad range of price?
 To whom will we offer it?
 How will we let them know about our offering?
 How/where will we engage in exchange with them?
 Whom will we compete with

4. MARKET DEFINITION
STRATEGIC QUESTIONS MARKET DEFINITION
What geographic area will we Eg: domestic US
operate in?
What timeframe have we in mind Eg: 2013, May
What will we offer? Some version of product category
X
To whom will we offer it? Define prospects
Eg: people who buy/use product
category X or engage in
corresponding activity Y
What price will we charge? State price (discount, premium)
How will we let them know about State tentative ideas for media
our offering? type
How/where will we engage in State tentative ideas for exchange
exchange with them? venue type
Whom will we compete with? State the competitors

5. MARKET SEGMENTATION
 The process of defining and subdividing a
large homogenous market into clearly
identifiable segments having similar needs,
wants or demand characteristics.

6. EXPORT MARKET SEGMENTATION:
It is important to note that any decision to
segment on a particular basis should be evaluated
in terms of following:
1) Measurability : segments can be identified.
2) Accessibility : segments can be actively
reached and served - should be accessible
through channels of communication and
distribution (internet, transportation etc)
3) Profitability : make sure the size of segments
are large/profitable enough
4) Actionability : effective programs can be
formulated for attracting and serving the
segments (marketing programs)

7. BASES OF SEGMENTATION
GEOGRAPHIC DEMOGRAPHIC
PSYCHOGRAPHIC BEHAVIORAL

8. MARKET
EXPANSION/SELECTION
PROCESS, PROCEDURE AND
STRATEGY a key strategic
The choice of a market expansion policy is
option in export marketing and provides the foundation for
decisions about the elements of the export marketing mix.
Expansion strategies deal with issues on how company
identifies and analyzes the selection of export markets over
time, determining the number of markets in which to operate
and the desired characteristics of these markets. An
expansion policy can be seen in several dimensions including
the nature of market research activities in choosing export
markets, the procedures of screening export markets and the
ways of allocating efforts and resources among different
export markets. The purpose of this section is to present a
framework for analysis of alternative market expansion
strategies.

9. MARKET SELECTION
PROCESS: REACTIVE VS
PROACTIVE APPROACHES
REACTIVE (secondary)
 Exporter acts passively in choosing markets by
filling unsolicited order or awaits initiatives on the
part of foreign buyers, foreign representatives or
other export agents who individually select the
market for company.
 Selection process is informal, unsystematic and
purchase oriented.

10. PROACTIVE (primary)
 Exporter acts actively in initiating the selection of
foreign markets.
 Selection process is systematic and formalized