OF MARKETING VARIABLES ANALYSIS -...

CHAPTER V

PERCEPTION OF MARKETING VARIABLES - AN ANALYSIS

Perception of marketing variables by the management appears

to be one of the most important firm determinants for export

success. The perception of marketing variables may be of

varying magnitude and importance for the individual firm.

In this chapter an attempt is made to study how the

perception of marketing variables differ among group of

exporters.

Identification of Marketing Variables

Research concerning marketing variables with export

performance has shown relatively definitive findings.

Functional or technological uniqueness of the firm's

products and high product quality have been found to

facilitate a firm's involvement and subsequent performance

in exporting (e.g., Cavusgil, Bilkey and Tesar, 1979; Tookey

1964). Smoother communications and sales effort competitive

pricing and promotion (Kirpalani and Macintosh, 19801, after

sales service and company image, extension of credits to

foreign buyers, unique features of product offerings, and

motivations of foreign distributors through incentives have

all been positively correlated with export market success.

Foreign market research activity, the development of

information systems, and the assessment of foreign market

pctentials have also been found to increase in conjunction

with the firm's progress along the internationalization

path.

Using the background literature and the assistance

of people involved in the international business a tentative

listing of attributes important for the firm's export

offering have been developed. This listing was then checked

in personal interviews with executives of exporting firms

as to its completeness.

As a result, the following list of possible

problem area or information gaps of exporting firms was

obtained.

VI. Product quality

V2. Product technology

V3. Product design and style

V4. Collection of marketing information

V5. Pricing the product

V6. Advertising and sales promotion

V7. Brand image

V8. Packaging

V9. Distribution co-ordination

V10. Transportation facilities

V11. Communication facilities

V12. Customer credit facilities

V13. Establishment of overseas branch

V14. Handling documentation

These attributes can play varying roles depending

on the view point of the firm. These attributes are

investigated in terms of the following aspects:

* Their importance to the export offering of the firm.

* The problem they represent in the export offering.

* The competitive advantage in the export offering.

Classification of exporters for analysis

The objective of this chapter is to find out the level of

exporter's perception of marketing variables in terms of its

importance, problem area and competitive advantage in export

offering and how the perception of these variables differ

among the exporters. Hence the total exporters are

classified into medium and small-sized exporters. Further,

to ident2fy any difference within each group, they are

subdivided into experienced and less experienced exporters.

The criteria of size based on asset (Garnier, 1974

and Drinkwalter, 1971) and experience (Johanson and Vahlne,

1977; Bilkey and Tesar, 1977) have been previously used by

researchers for profile purposes. To test different

hypotheses based on differences between and within the group

of exporters, the non-parametric statistical tool of

Wilcoxon Matched-pair Signed-rank test is used.

PERCEIVED IMPORTANCE OF MARKETING VARIABLES

Marketing variables are important for export operation.

Firms differ in giving importance to marketing variables in

export operation due to the nature of product exported, the

size of business dealing, the type of target market and

resource commitment. In this, the extent of importance given

to marketing variables by the exporting firm is studied

using a five point scale ranging from "Not at all ( = 1)" to

"Great extent of Importance ( = 5)". Table V.l exhibits the

differences of importance of marketing variables between

med,ium and small-sized exporters. As observed from the

table, it is clear that medium exporters give "considerable

importance1' to all marketing variables whereas, the small

exporters give "some importance" to most of the marketing

variables. Particularly, medium exporters attach more

importance to establishment of overseas branch office,

customer credit facilities, packaging, brand image and

product technology whereas the small exporters attach more

importance to pricing the product than medium exporters.

Table V.l

Importance of Marketing V a r i a b l e s ~ m and Small-sized Exprters

Ho Tnere are no differences among importance of marketing variables group means of, medium and small sized exporters.

Test Used: "Wilcoxon Matched-pairs Signed-ranks Test"

Wilcoxon T 9 Sum of Positive Ranks 96 Sum of Negative Ranks 9

N = 14 Table Value of T at 5 % Level - 21

Result : Ho Rejected at 5% per cent Level.

Table V.2

Ranking of Importance of Marketing Variables

* Ranks are based on Mean Values.

A

Ranks

1

2.

3.

4.

5 .

6 .

7 .

8.

9.

10.

11,.

12.

13.

14.

Medium Exporters

Product quality

Product technology

Advertising and sales promotion

Transportation facilities

Handling documentation

Distribution coordination

Collection of marketing information

Establishment of overseas branch

Packaging

Customer credit facilities

Communication facilities

Brand image

Product design and style

Pricing the product

*

Ranks

1

2.

3.

4.

5.

6.

7 .

8.

9.

10.

11.

12.

13.

14.

Small Exporters

Productquality


Advertising and sales promotioin



Prcduct technology

Pricing the product


Commication facilities


Packaging


Brand image

Establishment of overseas Branch.

Hence there are marked differences of importance of

marketing variables between medium and small- sized

exporters. The result of Wilcoxon test rejects the null

hypothesis as the calculated T value (T9) is lower than the

Wilcoxon Table Value (at 5 per cent level - 21). Further,

the ranking of variables based on mean values (vide table

V.2) shows that both group of exporters ranked similarly or

with little variation in respect to the product quality,

advertising and sales promotion, transportation facilities,

handling documentation and distribution co-ordination.

These five variab1e.s are ranked as the most important for

both group of exporters. However, they differ in ranking of

other variables. Among these, pricing of product which is

ranked sixth by small exporters is ranked fourteenth, the

last rank, by medium exporters. On the other hand, the

establishment of overseas branch which is ranked eighth by

medium exporters is ranked fourteenth, that is, least

important by small exporters.

Further, to test whether any differences of

perception of marketing variables within medium and small

exporters based on their experience is studied and presented

in Tables' V . 3 , and V.4. Table V.3 shows that the

experienced medium exporters attach more importance to

establishment of overseas branch and brand image whereas

less experienced medium exporters attach more importance to

pricing the product and communication facilities. Overall,

the mean values of both group of exporters indicate that

they give similar level of importance to most of the

marketing variables. Hence there is no significant mean

differences observed within the medium-sized exporters of

importance of marketing variables. The Wilcoxon test also

accept the null hypothesis as the calculated T value is

( T 2 4 ) is higher than the Wilcoxon Table value at 5 per cent

(21) level.

The difference of importance of marketing

variables within small-sized exporters is studied and

presented in Table V.4. The table shows that the

experienced small exporters give more importance to

marketing variables than less experienced small exporters.

Further both group of exporters differ widely with respect

to product design and style, pricing, technology, and

customer credit facilities. As regards other variables,

moderate variation is observed. Overall, the mean values of

both group of small-sized exporters differ significantly.

The Wilcoxon test also rejects the null 'hypothesis at 5 per

cent level.

The findings on the importance of marketing

variables indicate that exporters based on size differ

significantly in perceiving the importance of marketing

variables. The difference is mainly due to the availability

of more resources and commitments for export marketing. The

Table V . 3

Importance of Marketing Variables - within Medium Exporters


Ho 121ere are no differences anlong importance of n~arkcting variables group means of experienced and 1 ess experiencecl niccliurr~ exporters.

Result : Wo Acceptd at 5 per cent level.

Test Used: --

Marketing variables

Product quality

ProducC tecl1.1-101 ogy

Procluct design ancl style


Pricing the product


Brand image

Packaging

Distribution co-ordination




Establ ishment of overseas branch



Rank with less frequent sign.

--

1

10

4

9

T = 24

"Idilcoxon ---

Experienced Medium Exporters Plean

-

4.52

4.34

3.56

3.73

3.30

4.30

3.69

3.82

4.26

4.40

3.52

3.65

3.86

4.30

Matched-pairs

Less Experienced Medium Fxporters Mean --

4.48

4.36

3.48

3.63

3.42

4.36

3.36

3.75

4 .21

4.26

3.63

3.52

3.36

4.21

Signed-ranlcs

Means Difference

d

0.04

-0.02

0.08

0.10

-0.12

-0.06

0.33

0.07

0 .05

0.14

-0.11

0.13

0.50

0.09

Test" - -- Rank of d

2

-1

6

8

-10

-4

13

5

3

12

-9

11

14

7

Table V.4

Importance of Marketing Variables - within Small Exporters

Ho Tnere are no differences among importance group means of experienced and less experienced small exporters.



Result : HoRejected at 5 per cent Level.

Test Used: 'Wilcoxon

- Marketing variables

-

Product qua1 ity

Prduc t techno1 ogy

Prwluct design a1u.i style

Col 1 ect ion of marketing information

Pricing the product

Advertising arxl sales pron~otion

Brand image

Paclcaging







Matched-pairs

Experienced Small Exporters blcan

4.51

4.05

3.59

3.70

3.52

4.27

3.08

3.32

4.27

4.29

3 - 5 1

3.18

2.97

4.18

Signed-ranks

Less Experienced Small Pkpor ters Ple an

- 4.45

3.62

3.1.3

3.51

4.00

4.18

2.91

3.07

4.15

4.22

3.38

2.84

2.87

4.17

Test"

Pleans Difference

d

0.06

0.43

0.46

0.19

-0.48

0.00

0.17

0.25

0.12

0.07

0.13

0.34

0.10

0.01

Ranlc of d

2

12

13

'3

-14

4

8

10

6

3

7

11

5

1

Ranlc with less frequent sign.

3 4

medium-sized exporters cater to the needs of the higher

segment of the market as they attach more importance to

brand image and packaging. Further, they are concerned

about the foreign customer as they emphasize on customer

credit facilities and establishment of overseas branch. On

the other hand, small-sized exporters are concerned more

about the pricing which indicates their less commitment to

other marketing variables.

With regard to differences of importance of

marketing variables within medium exporters, insignificant

differences are found as both experienced and less

experienced medium-sized exporters perceive the importance

of marketing variables similarly or with little variation.

In the case of small sized exporters, notable differences of

importance of marketing variables are found as the

experienced small exporters more often perceive the

marketing variables better than less experienced small

exporters. This might be due to the fact that in most cases

the category of less experienced exporters have less than

five years of experience which prevent them from involving

themselves directly in export marketing.

Problem Area of Marketing Variables:

Marketing variables pose great amount of problems in export

operation. Particularly Indian business firms which are

Table V . 5

Problem Area of Marketing Variables - Medium and Small-sized Exporters

tio There are no differences among problem area of variables group means of n~ecliu~n and small exlwrters .

dilcoxon T 0 Sum of Positive Ranks 0 Sum of Negative Ranks 105


Xesul t : Ho Rejected at 5 per cent Level .

Test Used :

Marketing variables

Prduct qua1 ity

Product techno1 ogy

Product design and style I

Col 1 ection of marlceting information

Pricing the product


Brand image

Packaging







"Idilcoxon

Plediurn- Exporters Mean

2.36

2.74

2.64

2.35

2.16

2.43

3.07

2.45

2.48

4.05

2.07

2.40

3 -64

3 -33

Matched-prt irs

Small Exporters Ple an

2.39

3.18

3.06

2.97

2.31

3 -08

3.41

3 -02

3.17

4.06

2.17

3.01

4.26

4.13

Signed-ranlcs

Means Difference

d

-0.03

-0.44

-0.42

-0.62

-0.15

-0.65

-0.34

-0.57

-0.69

-0.01

-0.10

-0.61

-0.62

-0.80

Test" ----

Kank of d

- 2

- 7

- 6

-10

-4

-12

-5

-8

-13

-1

-3

-9

-11

-14

Table V. 6

Ranking of Problem area of Marketing Variables

Medium Exporters -

Ranks

Establishment of versea as Branch

1

1 3. /Handling Documentation


/ 4. /Brand image . 1 4* 5 .

6.

7 .

9.


Product Technology

Product Design & Style



10.

11.

13. Pricing the product 1 1

5.

6.

7 .


Product quality

1 14. /Communication facilities

Small Exporters

Establishment of overseas Branch

Handling Document ation


Brand image

Product Techology



Product Design and style

Packaging


Collection of Marketing information

, Product quality

/Pricing the product

I Communication facilities. j:

Ranks are based on mean values.

mostly domestic market orientated are facing difficulty in

marketing of their products to overseas countries. Hence an

attempt is made to study the extent of problem faced with

respect to marketing variable. Five point scale ranging

from "No Problem Area ( = 1)" to "Great extent of Problem ( =

5 ) " is used to measure the problem of marketing variables.

Table V.5 presents the extent of differences of marketing

variables between medium and small-sized exporters.

The table shows that medium exporters perceive

problem area ranging from "little extent" to "some extent"

of problem whereas small-sized exporters perceive it ranging

from "some extent" to "considerable extent". Thus, the

small exporters perceive more problem area than medium-sized

exporters. Further the mean differences of both grcup of

exporters is high which indicates that there are significant

differences of marketing variables between medium and small-

sized exporters.The result of Wilcoxan test also rejects the

null hypothesis at five per cent level. The ranking of

variables based on mean values (vide table V.6) shows that

both group of exporters ranked similarly or with little

variation with respect to the establishment of overseas

branch, handling documentation, transportation facilities,

brand image and product technology. The above five

variables are ranked as the most problem area for both group

of exporters. With respect to other variables, they ranked

it differently.

The differences of perception of problem area of

narketing variables within the medium and small-sized

exporters are studied and presented in Tables V.7 and V.8.

Table V.7 shows that the mean differences of problem of

marketing variables of both group of medium-sized exporters

are very less except for customer credit facilities and

brand image. It indicates both experienced and less

experienced medium exporters perceive the problem area of

narketing variables similarly or with marginal variation.

Further the Wilcoxon test also accept the null hypothesis as

the T value is higher than the Wilcoxon table value at 5 per

cent level.

Table V.8 exhibits the differences of problem area

of marketing variables within the small-sized exporters.

The mean values show that the less experienced small

exporter perceive distribution co-ordination, product

teqhnology, product design and style, collection of

marketing information, packaging and customer credit

facilities as more problematic than experienced small

exporters. The mean differences of both group of exporters

also at a considerable level in respect to the above said

variables. However both group of exporters perceive problem

area of marketing variables with marginal differences with

respect to transportation facilities, pricing the product,

advertising and sales promotion and communication

Table V.7

Problem Area of Marketing Variables - within Medium Exporters

H~ There are no differences arnong problem area of marketing variables group means of experienced and less experienced nied~um exporters.


Test Used: "Wilcoxon

Marketing variables

Productquality

Product technology


Collection of nlarketing information

Pricing the product

Advertising and sales proti~otion

Brand image

Packaging


Transportation f acil ities


Customer crcdit facilities

Establ ishrnent oE overseas brarlct~

Hand1 ing documentation

N = 14 Tab1 e Value of T at 5 % Level. - 21

Result : Ho Accepted at 5 per cent Level.

Matched-pairs

Experienced Medium Exporters Mean

2.39

2.68

2.61

2.43

2.12

2.48

2.96

2.44

2.43

4.04

2.05

2.13

3.56

3.30

Signed-ranks

Less Experienced Medium Exporters Me an

2.31

2.79

2.68

2.27

2.21

2.36

3.21

2.47

2.53

4.05

2.10

2.73

3.73

3.36

Test1'

Means Difference

d

0.08

-0.11

-0.07

0.16

-0.09

0.12

-0.25

-0.03

-0.10

-0.01

-0.05

-0.60

-0.17

-0.06

Rank of d

6

-9

-5

11

- 7

1 0

-13

-2

-8

- 1

-3

-14

-12

-4

Table V.8

Problem Area of Marketing Variables - within Small Exporters

Ho 'I'here are no differences among problem area group means of experienced and less experienced small exporters.



Test Used: "Wilcoxon --

Market in& variables

Product quality

Product techno1 ogy


Collection of marketing in£ ormation

Pricing the product


Brand image

Packaging







Result : Ho Rejected at 5 per cent Level.

Flatched-pairs

Experienced Small Exporters Mean

2.35

3.03

2.89

2.83

2.29

3.05

3.35

2.92

2.95

4.05

2.14

2.92

4.22

4.08

Signed-ranks

Less Experienced Small Exporters Mean - 2.42

3.31

3.20

3.08

2.32

3.10

3.46

3.11

3.35

4.06

2.20

3.08

4.31

4.18

Test"

Means Difference

d

-0.07

-0.28

-0.31

-0.25

-0.03

-0.05

-0.11

-0.19

-0.40

-0.01

-0.06

-0.16

-0.09

-0.10

Rank of d

- 5

-12

-13

-11

- 2

- 3 - 8

-10

-14

- 1.

- 4

- 9

- 6

- 7 --

facilities. Hence it is obvious that both group of small-

sized exporzers dFffe7 in most of the 2rojlem azes of

marketing variables. The Wilcoxon test also rejects rhe

n u l l hypothesis at 5 per cent ievel.

The findings of problem area of mzrksting

variables indicate that medium and small-sized exporters

differ significz7tly. The small-sized expo;rers perceFve

the marketing variables as considerable problem area than

medium-sized exporters. It indicates that the snail-sized

exporters who are kndowed with limited resources face more

problem of marketing variables than medium-sized exporters.

Hence the size related ad-rzntages play an important role in

the problem area of marketing variables.

Regarding the medium-sized exporters, no

significant differences of problem of marketing variables

arq found within it as both experienced and less experienced

medium exporters perceive the problem area of marketing

variables with marginal variation. In the case of small-

sized exporters, considerable differences are observed

within them. The less experienced small exporters who are

below 5 years in the business perceive more problem as

regards the marketing variables due to thekr limited

resources and inadequate experience in the business.

Competitive Advantages of Marketing Variables:

All overseas market is highly competitive "buyers market"

where an exporter has to compete with different competitors

from different countries and also within the country. The

success of overseas market depends on how effectively the

exporters serve the buyers better than the competitors.

Hence an attempt is made to study the competitive advantage

of marketing variables of exporters. The extent of

competitive advantages of exporters with respect to

zarketing variables over to competitors is studied using a

three point scale, that is, (1) Not as good as competitors,

( 2 ) As good as competitors and ( 3 ) Better than competitors.

The differences of competitive advantages of marketing

variables between medium and small-sized exporters are

studied and presented in Table V.9.

It can be seen from the table that the medium

exporters perceive product design and style, marketing

information collection, distribution co-ordination and

communication facilities as having more advantage than the

competitors. However, with respect to the brand image,

transportation facilities and customer credit facilities,

they perceive less competitive advantage. The small-sized

exporters perceive all marketing variables as not as good as

competitors. Further the table shows that the mean

Table V.9

Competitive Advantage of Marketing Varkables - Medium and Small-sized Exporters

Ho There are no differences among competitive advantages of marketing variables group nieans of medium and small exporters.


Test Used : "Wflcoxon -

Marketing variables

Product quality

Product technol.ogy


Coll ection of marketing in£ ormation

Pricing the prduct


Brand image

Packaging



Communication facil ities




Matched-pairs Signed-ranks Tes tt

Medium- Exporters Mean

-

1.73

1.92

2.19

2.16

2.09

2.14

1.64

1.95

2.11

1.35

2.21

1.75

-- Smal l Exporters Mean

-- 1.50

1.61

1.72

1.96

1.95

1.76

1.20

1.46

1.52 .

1.23

1.88

1.35 -

Means Difference

d

- 0.23

0.31

0.47

0.20

0.14

0.38

0.44

0.49

0.59

0.12

0.33

0.40

Rank of d

--

4

5

10

3

2

7

9

11

12

1

6

8

differences of medium and small-sized exporters are very

high for all marketing variables studied. Hence there is

significant difference of competitive advantages found

between medium and small-sized exporters group. The result

of Wilcoxon test also reject the null hypothesis at 5 per

cent level.

The findings of differences of competitive

advantages of marketing variables within medium and small-

sized exporters are presented in Tables V.10 and V.ll.

Table V.10 shows that there are insignificant differences

found within the medium sized exporters. The experienced

medium exporters perceive marginally better competitive

advantages of most of the marketing variables than less

experienced medium exporters. The mean values of both group

of exporters indicate that they differ marginally. The

Wilcoxon test accept the null hypothesis at five per cent

level.

Table V.11 shows that the mean differences of both

group of small-sized exporters is high for all marketing

variables studied. With regard to marketing information

collection, pricing, and communication facilities variables,

the experienced small exporters perceive it as good as

competitors but the less experienced small exporters mostly

perceive marketing variables as having less competitive

advantage. Hence there are significant differences of

Table V.10

Competitive Advantage of M a r k e t i q Variables - within W u m Exporters

tio lhcrc are no d i f fe rences aiilong co r~pe t i t i ve advantage of rnarlteting variables group means' 01 experienced and l e s s experience niediurn exporters.

'rest Used : "Wil coxon Matched-pairs Signed-ranlcs Tes t t l

Wilcoxon T 15 Sum of Posi t ive Ranks 63 Sum of Negative Ranks 15

N = 14 Table Value of T a t 5 % Level. - 14

Result: : Ho Accepted a t 5 p e r c e n t Level.

Table V.ll

Competitive Advantage of Marketing Vnr iab l cs - within Small F-uporters

Ho ?here are no differences among Competitive advantages of marketing variable group means of experienced and Less experienced small exporters.


Test Used: 'Wilcoxon -

Marketing variables

-- Product quality

Prduc t technology



Pricing the product


Brand image

Packaging







Matched-pairs Signed-ranks Test"

Experienced Small Exporters Mean

1.56

1.75

1.78

2.10

2.02

1.89

1.26

1.54

1.67

1.27

1.94

1.40

Less Experienced Srnall Exporters Mean

1.44

1.49

1.67

1.84

1.88

1.64

1.13

1.39

1.40

1.20

1.82

1.31

Means Difference

d

0.12

0.26

0.11

0.26

0.14

0.25

0.13

0.15

0.27

0.07

0.12

0.09 --

Rank oE d

-- 4

11

3

10

7

9

6

8

12

1

5

2

competitive advantages of marketing variables between

experienced and less experienced small exporters. The

result of Wilcoxon test also rejects the null hypothesis at

5 per cent level.

The findings of perception of competitive

advantages of marketing variables show that the size of the

organization plays an important role and significantly

affect the competitive advantages of marketing variables as

medium and small-sized exporters differ in most of the

marketing variables. With regard to brand image,

transportation facilities and customer credit facilities the

impact of size is minimal as both group of exporters

perceive it as having less competitive advantage. The

medium-sized exporters perceive better competitive advantage

of marketing variables because of their size related

advantages, of more resource commitmenr to export marketing.

The perception of competitive advantage does not

differ significantly within the medium exporters as

experienced and less experienced medium exporters perceive

the competitive advantages of marketing variables with

little variation. In the case of small-sized exporters,

considerable differences are found between experienced and

less experienced small exporters in perception of

competitive advantage of marketing variables. The less

experienced small exporters perceive less competitive

advantage because of their limited experience and resources

for export marketing.

Conclusion:

The following are the main findings of this

chapter: The exporters based on their size differ

significantly in perceiving the importance of marketing

variables. The medium-sized exporters percieve most of the

marketing varables as having considerable importance than

small-sized exporters. Further medium exporters are

committed to export marketing as they attach more importance

to establishment of overseas branch, customer credit

facilities, packaging, brand image and product technology.

The medium exporters do not differ themselves in

perception of marketing variables. Both the experienced and

less experienced medium exporters perceive the importance of

marketing variables similarly or with little variation. In

the case of small sized exporters, significant differences

of importance of marketing variables are found within them,

as the experienced small exporters mostly perceive the

marketing variables better than the less experienced small

2xporters.

The medium and small-sized exporters differ

significantly in the problem area of marketing variables.

The small-sized exporters perceive the marketing variables

as considerable problem area than medium-sized exporters.

In the case of medium-sized exporters, no notable

differences of problem area of marketing variables are found

within them as both experienced and less experienced medium

exporters perceive marketing variables with marginal

variation. Whereas, considerable differences are found

within small-sized exporters in the problem area of

marketing variables. The less experienced exporters

perceive more problem area of narketig variables due to

their limited experience and inadequate resources.

The size of the organisation plays an important

role and significantly affect the competitive advantages of

marketing variables as medium-sized exporters perceive

better competitive advantage than small-sized exporters.

Further, with regard to brand image, transporation

facilities and customer credit facilities,. the impact of

size is minimal as both group of exporters perceive it with

less competitive advantage.

The medium-sized exporters do not differ

themselves in perceiving the competitive advantage, as

experienced and less experienced medium exporters perceive

the competitive advantage of marketing variables with little

variation. In the case of small-sized exporters

considerable differences are found within them as less

experienced small exporters perceive less competitive

advantage than experienced small exporters due to their

limited resources and experience for export marketing.

To conclude, the size of organization has

significant influence on marketing variables. Particularly,

the size-related advantage is important, as medium-sized

exporters perceive marketing variables better than small-

sized exporters. The influence of experience of the firm on

marketing variables is limited to certain stage of

exporters, that is, within small-sized exporters.

OF MARKETING VARIABLES ANALYSIS -...

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