Promoting Exports and Scientific Marketing

Summary

This 1970 Forum of Free Enterprise booklet collects three short addresses delivered in Bombay under the Forum’s auspices: ‘Some Steps for Export Promotion’ by industrialist S. P. Godrej, ‘A Strategy for Export Promotion’ by Y. A. Fazalbhoy (a former president of the All-India Manufacturer’s Organisation), and ‘Scientific Marketing’ by M. Mathias (a director of Hindustan Lever Limited). The volume’s argumentative center is a defence of the Private Sector as the natural engine of India’s foreign trade and a critique of the post-bank-nationalisation drift toward state control. Godrej and Fazalbhoy press the case for treating exports as a private-sector domain backed by infrastructure rather than displaced by it, while Mathias argues that the discipline of marketing must be reconceived as a science drawing on economics, statistics, psychology and sociology — a managerial counterpart to the policy programme the first two essays advance.

Essays

Some Steps for Export Promotion

By S. P. GODREJ

S. P. Godrej opens by naming the ‘political malaise’ of 1969-70 — the sudden nationalisation of fourteen banks, the talk of nationalising foreign trade — as an active drag on accelerated economic development just when exports had begun to recover from devaluation. He insists that the great export success stories (USA, Japan, West Germany, UK) belong to free-market economies in which governments supply infrastructure but do not themselves trade, and that exports must therefore remain a Private Sector domain.

The bulk of the essay is a practical checklist for business firms: shed the ‘Made in India’ inferiority complex; revive a Fashion Council to project Indian design, decoration and yoga abroad; eliminate steel-shortage bottlenecks that cause order cancellations; invest in product development, marketing research, design and packaging, multilingual sales literature, publicity, and a dedicated permanent export department staffed by people with foreign-language proficiency. Godrej praises the Indian Institute of Foreign Trade as a ‘college of exports’, urges joint ventures abroad as a way around tariff walls and freight discrimination, and closes by arguing that tourism — ‘an invisible export’ and a labour-intensive industry — should be treated as a national necessity rather than a mere convenience, with Chambers of Commerce leading the way as in Japan.

• Frames the 1969 bank nationalisations and threats to nationalise foreign trade as ideological intrusions damaging export confidence.
• Argues export success belongs to free-market economies where the state provides infrastructure but does not itself trade.
• Lists concrete firm-level reforms: product development, marketing research, design/packaging, multilingual sales literature, publicity at fairs like Expo-70 Osaka.
• Calls for a permanent export department in every firm, staffed by people with proven sales records and a second language (French, Arabic, Russian or Spanish).
• Endorses joint ventures abroad as a way around tariff walls, freight discrimination and dumping pressure, and singles out tourism as an ‘invisible export’ the Private Sector should lead.

A Strategy for Export Promotion

By Y. A. FAZALBHOY

Y. A. Fazalbhoy turns from firm-level practice to national strategy. He documents that India’s export earnings have grown at only 2.2 per cent during 1966-69 against a target rate of 7 per cent for the Draft Fourth Plan, and that India’s share of world exports has fallen from 2.1 per cent to under 1 per cent over eighteen years even as world trade more than doubled. The diagnosis: traditional exports (tea, jute, cotton textiles) will grow slowly, so India must concentrate on non-traditional items — metals and machinery, equipment, engineering goods, iron ore, chemicals — and diversify the export basket.

Fazalbhoy calls for an ‘Export Concept’ consciousness running through industry, suppliers, transport, tax authorities, labour and management. He proposes that Indian embassies and STC foreign offices run information centres and showrooms with FOB-port prices and full catalogues, that trained market research representatives be stationed abroad through industry associations, and that a special Export Promotion Wing of the Commerce Ministry grade factories by export share (A, B, C through ‘J’ for 100 per cent exporters), giving top-grade firms priority access to machinery, raw materials at international prices, higher import licence quotas and transferable import vouchers along Indonesian and Ceylonese lines.

• Quantifies the export slowdown: 2.2 per cent annual growth in 1966-69 versus a Fourth Plan target of about 7 per cent, with India’s world-trade share falling from 2.1 per cent to under 1 per cent.
• Urges diversification away from tea, jute and cotton textiles toward engineering goods, iron ore and chemicals.
• Proposes a sector-wide ‘Export Concept’ culture spanning industry, transport, tax authorities and labour.
• Calls for Indian-embassy-run information centres, FOB-port pricing showrooms abroad, and industry-association-selected market research representatives stationed in foreign countries.
• Recommends a Commerce Ministry Export Promotion Wing that grades factories by export share and rewards top exporters with priority machinery, raw-material access at international prices and transferable import-licence vouchers.

Scientific Marketing

By M. MATHIAS

M. Mathias argues that marketing has outgrown its old identification with selling and advertising and must now be reconceived as ‘the total marketing operation’ — a continuous flow from raw materials through production, distribution, advertising and pricing, organised around the consumer’s interest rather than the producer’s. The recession has, he says, already pushed both business and government to recognise that providing the wheels of industry is not enough; one must keep them moving by being consumer-oriented.

The challenge of the 1970s, in Mathias’s framing, calls for an orientation of attitude, not just an orientation of technique. He defines ‘scientific marketing’ as the use of specialists’ skills across economics, statistics, human relations, psychology, sociology and the physical sciences to refine data, segment populations, forecast demand through mathematical and econometric models, and predict consumer behaviour. He concedes that scientific skills alone cannot give the final answer — the informed judgment, intuition and confidence of the marketing manager remain essential — but insists that without the scientific approach as a basis, sound marketing decisions cannot be made.

• Distinguishes the old ‘selling and advertising’ view of marketing from the integrated marketing concept that organises every stage of business around consumer interest.
• Identifies the recession as the moment when both private enterprise and government recognised that production alone does not sustain industry.
• Defines scientific marketing as drawing on economics, statistics, human relations, psychology, sociology and physical sciences to segment populations and forecast demand.
• Notes the marketing man’s reliance on demography, sociology and human-motivation research to classify consumers into homogeneous groups by income, profession, location and psychology.
• Concludes that mathematical and econometric forecasting must be combined with the marketing manager’s informed judgment, intuition and confidence.

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