apply marketing in real life shipping

1. Marketing in Shipping
6/4/2020
1
Prof. Lalith Edirisinghe, PhD Chartered Marketer
Doctor of Engineering in Transport planning and Logistics management

2. Marketing Management
The Logistics and Transport Perspective
2
6/4/2020

3. The complications
Various concepts that cause
potential impact on
decision making in liner
shipping.
3
6/4/2020

4. 4
 What are the elements of the marketing mix of a
service organization ?
• Taking a shipping line as a service organization give
 example to each element.
Class room question
6/4/2020

5. 5
 What are the elements of the marketing mix of a
service organization.
ANSWER
Product,
Price,
Place,
Promotion
People,
Process,
Physical Evidence
Colombo to Europe container service
Freight Rate
Agents offices
Advertising, sales visits
marketing ,operation Staff,
Release order ,BLS
Containers, ships, OBL
• Taking a shipping line as a service organization give
example to each element.
6/4/2020

6. 6 CIM's Definition of Marketing
 "Marketing is the management process responsible for
identifying, anticipating and satisfying customer
requirements profitably
6/4/2020

7. Business to Business
Marketing
is all over in the Shipping
7
6/4/2020

8. 8
Marketing of goods and
services that businesses
and organizations buy for
purposes other than
personal consumption
Definition to B 2 B marketing
6/4/2020

9. 9
 Generally, the same principles are true for business and consumer
customers
However,
 There are characteristics that make B2B buying more complex
 Multiple buyers
 Number of customers
 Size of purchases
 Geographic concentration
6/4/2020

10. 10 Good marketing
 Therefore good marketing must be able to create a
"proposition" or set of benefits for the end customer
that delivers value through products or services.
6/4/2020

11. 11
Ladder of loyalty and Relationships
Powerful
partnership
Grow with DMI partner
Relationship
reliable
Recommend
actively
advocate
Recommend
passively
supporter
Transaction
satisfaction
Repeat business client
One shot Once consumes customer
Agree but not
consumes
prospect
Stranger to
company
Suspect
6/4/2020

12. 12 Marketing communications
 There are distinct stages in converting strangers to
customers that govern the communication medium
that should be used.
6/4/2020

13. 13 The elements of the
marketing
communications mix
6/4/2020

14. 14
 Reaches large, geographically
dispersed audiences,
 often with high frequency;
 Low cost per exposure, though overall
costs are high;
 Consumers perceive advertised goods
as more legitimate;
 Dramatizes company/brand;
 Builds brand image;
 May stimulate short-term sales;
 Impersonal, one-way communication;
6/4/2020

15. 15 Some advertisements of
famous brands
 Toyota
6/4/2020

16. 16
Some old advertisements from Sri Lanka
6/4/2020

17. 65%
15%
10%
5%
5%
Percentage Share of Shipping
Communication Mix
Personal selling
Direct marketing
PR
Sales Promotion
Advertising
17
6/4/2020

18. Factors that significantly influence on the
brand choice of a shipping line (1)
 Customer Friendly staff
 Type of containers used by the customer and its
compatibility with carrier
 Market image and mapping as a reliable carrier in reality
 Availability of clean containers that are acceptable to
shippers commodity requirements
 Ability to maintain competitive freight rates despite the
complexity of shipping supply and demand which is a
derived demand and not a direct demand.
 Shipping is ever changing business and customer needs
are frequently changing ,the prompt attention received
by the customer make a big difference in the brand
choice.
18
6/4/2020

19.  Type of commodities shipped by the customers is vital in the
brand choice because the customer expectation may differ
accordingly.
 The contract of carriage- the legal document between the
customer and shipping line is a negotiable document unlike a
mere receipt to the cargo. The flexibility in documentation is
a decisive factor therefore to the customer which is clearly
evident in the research.
 Other factors such as offering fast transit times, maintaining
fixed vessel schedules and weekly Frequency, perceptual
mapping as a prestigious carrier does not make much sense
for the customer.
Factors that significantly influence on the
brand choice of a shipping line (2)
19
6/4/2020

20. 20 Some advertisements of
famous brands
 7 up
6/4/2020

21. SHIPPING SERVICE QUALITY MODEL21
6/4/2020

22. What customers really
need?
 75% Consistency of Vessels
 80% Arrival dates (fixed)
 80% Transit Time
 60% Freight Quotation
 50% Vessel Details
 50% Vessel cutoff Date
 20% COD request
 30% Documentation
Reliability
Responsiveness
22
6/4/2020

23. 90% Freight rate validity
50% Special Rates
85% Credit Terms
50% Time Constraints
60% Good Containers
40% New Ships
90% Fast
What customers really
need?
Assurance
Empathy
Service
Tangibles
23
6/4/2020

24. Results overview
0
10
20
30
40
50
60
70
80
90
Assurance Reliability Service Tangibles Empathy Responsiveness
Importance of variables as a Percentage
Percentage
24
6/4/2020

25. Shipping Lines’ service includes
following basic features,
 Make available information about vessel dates ,freight rates
transit times etc
 Accept bookings
 Reserve space in the ship,
 Make available empty sea containers for stuffing of cargo
 Update vessel arrival dates and cut off times at port
 Attend documentation work with discharge port
 Send debit notes and follow up collection etc
 Issue Bills of Lading as a receipt to the cargo
 Follow up at discharge port for smooth delivery of cargo
25
6/4/2020

26. 8 Ps, Does it make sense ?
 Container service- (Colombo to Hamburg -AEC
5)
 Freight Rate (from Colombo to direct ports of
discharge)
 Agents offices in Colombo and Hamburg.
Online
 Advertising on CASA magazine, sales visits to
export firms
 Sales staff ,operation Staff, Accounts staff
 Release order for empty containers ,Bills of
Lading
 Containers, ships
Product,
Price,
Place,
Promotion
People,
Process,
Physical
Evidence
Productivity
and Quality
26
6/4/2020