Wicks holds a Bachelor of Arts (Honors) in journalism and a Master of Business Administration from the London School of Economics. Some of the downsides and hurdles to overcome when using direct marketing include: Intrusive: Many people find direct marketing annoying and intrusive. Disadvantages. They usually have long-standing customers for whom they source products on a regular basis. The ETC will then seek out a reputable manufacturer who can handle the demand at an economical price, and then arrange for the transport of the goods to the customer. Laurel Delaney is a former expert for The Balance Small Business, and is the founder and president of Global Trade Source, Ltd. She is also the author of three books on exporting. Should My Company Export Products Directly to Its Customers? ETCs are virtually identical to EMCs, but they tend to function on a more demand-driven basis, by which the demand of the market compels them to buy specific commodities. Diana Wicks is a Canadian residing in Vancouver. An EMC will carry out all aspects of the export transaction: Finding a good EMC is not that difficult. If you are using newspapers, magazines or online advertising, it can be quite expensive for your business since you have to pay a host website to display your advertisement. The intermediary might also be offering products similar to yours, including directly competitive products, to the same customers instead of providing exclusive representation. In this case, you will need to arrange for the cargo to be ready by the shipment date. Some people dislike marketing mail and consider it … Sometimes the long wait may lead to disillusionment due to lack of tangible results. A local trade association with an international focus. You can field-test your products for export potential. Start your select list of companies that export products similar to your own. When selling by this method, you are normally responsible for collecting payment from the overseas customer and for coordinating the shipping logistics. Indirect marketing involves less aggressive techniques, so, for example, you may get the attention of target customers through blogging, participating in workshops, free ebooks, performing random call-ins and driving traffic through online social media sites. You must still collect payment from the customer, but your actual involvement in the transaction is minimal. Your long-term outlook and goals for your export program can change rapidly, and if you've put your product in someone else's hands, it's hard to redirect your efforts accordingly. Since indirect marketing is crucial and at the same time difficult, it requires a … The Disadvantages of Indirect Marketing. We also offer the pros and cons of using an export sales intermediary. The Advantages and Disadvantages of Indirect Exporting, Ways You Can Export Goods Across the Global Supply Chain, Everything You Need to Know About Starting an Import/Export Business, How to Become an Import or Export Middleman. Then consult the following for more referrals to add to your list: You might also use the services of an export trading company (ETC). The easiest method of indirect exporting is to sell to an intermediary in your own country. The former will build a reputation based on word of mouth and the goodwill of his customers, while the latter may make money quickly and invest in more offices and employees. The intermediary is likely to represent several clients who can help share distribution costs. It is recommended that you choose the method that makes you most comfortable and lets you focus on your business priorities so that you won't be wasting your energy worrying that something isn't working. Generally, the EMC buys the product from a manufacturer and marks up the price to cover their profit. Management Companies. However, with indirect marketing, you are usually not working to push your products or services onto prospective clients. Under these circumstances, you will not know who your ultimate consumers are. This situation may adversely affect the product’s … For example, a lawyer who uses his honesty to win clients will develop a client base more gradually than another lawyer who advertises his skills and services on television. A big disadvantage of indirect marketing is in the high costs of applying this strategy. Challenges of direct marketing. It is called a buy-resell arrangement. You have limited liability for product marketing problems—there's always someone else to point the finger at! By adding an intermediary, you are also increasing the amount of time it takes for your product to reach the buyer. You very rarely know who your customers are, and thus lose the opportunity to tailor your offerings to their evolving needs. For example, an EMC might specialize in exporting personal computer business software to educational institutional customers in Asian-Pacific countries. Attend a few meetings and talk some shop—somebody's bound to know of an EMC or even run their own. For instance, when operating online, you need to be conversant with proper search engine optimization techniques to benefit from visits to your page. It is nearly as easy as a domestic sale. Since indirect marketing is crucial and at the same time difficult, it requires a high degree of skill to achieve positive results. They generally know who has been in the export trading business for a while. And in that time you’re building momentum, you’ll need to put in … Indirect distribution channels add layers of cost, vendors and bureaucracy. You lose control over your foreign sales. At the very least, they can point you to a good online exporting directory. One of the demerits of using indirect marketing is that when people access social media sites, they usually want to talk to friends or network with coworkers, not to buy anything. They're likely to have an inside line on which companies are reputable and doing well. She has worked as Chief Editor of Business Chronicle, an online magazine based in London. A good one will act in all respects as a global extension of your sales-and-service presence—more or less what you are attempting to do on behalf of a manufacturer. Your content marketing may not achieve its intended purpose by failing to arouse interest or attention to your product. Disadvantages of Indirect Selling Channel. After all, the name of the global game is generating your network of customer relationships. Disadvantages of indirect sales Break of personal connection between the seller and the buyer; Inability to monitor and track the goods independently; Dependence of the company's reputation on the behavior of the intermediary. For example, they might get a request from a customer to find a supplier of canned sweet peas who can provide twenty container loads a month for a given number of months. Indirect exporting can also involve selling to an intermediary in the country where you wish to transact business, who in turn sells your products directly to customers or other importing distributors (wholesalers). Owing to the unpopularity and shortcomings of some direct marketing strategies, you may want to adopt indirect marketing strategies, such as coupon mailings, trade shows and public relations.