I’ve called on hundreds of companies over my 22 year marketing career and have discussed strategic concerns with just about every size, mode and geographic focus possible within transportation. Many companies say they do a dozen things well and really do 1 or 2. Others have an extremely diversified menu but customers are unaware of the breadth of service provided. Both are immediate marketing concerns.

#1. You typically have to win customers over one service at a time. Even though an integrated approach is the end goal for the diversified model, if you don’t establish the necessary rapport and trust first… the big sell is a hard sell.

# 2. By casting too wide a net with your marketing you run the risk of not catching anyone’s interest. If you can’t back up a statement with tangible evidence of expertise, your entire message can get grouped together as being unbelievable.

# 3. You don’t want customers confused about what your service offerings are and you also don’t want to hear the words “I didn’t know you did that” by failing to create the awareness of your full service offering. If you can, lead with your best service first and remember “It’s the steady rain that soaks.”

# 4. As a general rule, we find transportation providers have a core strength(s), a secondary focus and what we would typically call a value added or convenience sell. It’s important to weight these accordingly in your marketing so customers understand fully who you are as a company.

# 5. Most successful diversification is through a dedicated model, something that has been developed for a single customer with very specific needs. It won’t typically role out to your general customer demographic…so don’t market it that way.

# 6. Decide who you are. Are you better suited as a handyman that does a host of things pretty well? Or is what you do a craft, with a more select target that’s tough for others to duplicate. Both have value. You need to make sure there is alignment between your skill set and your targeted market.

# 7. Markets change. Regardless of your business model, if what used to be the volume of your activity is shrinking, maybe it’s time to bring one of those secondary services front and center. As an example, what represents 50% of our market strength today (websites and branding) was only 5-10 % of our mix 4 years ago.

# 8. From listening to recent shipper panels, they want stability, service commitments, information exchange and relationships. It won’t be just about price going forward… they know the landscape is changing and that shrinking capacity is on the horizon.

# 9. Reset your thinking soon, as no one can beat you down any further on price. The value, innovation and focus you have going forward will dramatically shape your road to recovery…proceed with caution, and confidence!

Lee’s quote for the day:
“Truckers are like elephants. They work hard and have long memories. The shippers who forced their hand too heavily during the recession may soon be viewed like a male porn star after a very cold shower…small, unimpressive and no longer carrying a big stick!”

In a conference this past week I had the pleasure to listen to panel discussions from the viewpoint of shippers, carriers, financial analysts and other industry sectors. It was enlightening to say the least. I’ve already blogged on the topic of what the large retail shipper is looking for and also how best to handle the delicate subject of rate increases.

The shippers know they’ve had a good run and won’t be surprised by rate increases and the reintroduction of accessorial charges by Canadian carriers.  Capacity will become an issue with a strengthening economy and many shippers are trying to lock in the low rates for longer terms while carriers are still struggling with lower revenue streams. The stars are not aligned for carriers to increase rates yet…but its coming.

The carrier panel at the conference was made up of 3 companies representing truckload, intermodal and regional LTL specializations. They spoke candidly to the small group assembled and highlights included the following:

• On the truckload side, optimism prevailed and extensive investments are being made to update fleets and retire old equipment to the scrap yard. As a point of interest a storage quality trailer can fetch $1500- $1750 and you get to keep the tires so scrapping it yields similar revenue as selling and it’s taken off the market.
• This brings us to the topic of Zombie truckers running the aforementioned tired equipment. These individuals are part of an underground economy running up and down the road with inferior equipment, a poor handle on costs and eroding the market on short hauls where their rigs can be nursed along to complete the job at hand.  Apparently there is nothing in it for the finance companies to repossess the tired rigs and thus the problem has gone on longer than it should of. Maybe the finance institutions should look at the macro effect their decisions are making on the industry and their paying customers?
• A particular carrier was not well thought of across the panel. It was the panel’s opinion that this carrier was riding on the backs of their owner operators and hurting the industry in no uncertain terms. No specifics were mentioned but the culprit in question may have a name that rhymes with Telasong.
• There was a lot of discussion about the aging driving force, treating drivers with respect and increasing their wages. There was a concern that owner operators laid off during the downturn may not come back. Eventually the laws of supply and demand will kick in for the drivers that keep our supply chain flowing…but it’s not here yet.
• I never really thought about how the downturn affected truckload, intermodal and LTL carriers differently. I thought truckload would be the hardest hit because it is more of a commodity. It never occurred to me that regional LTL players had to keep their equipment and driver investment pretty much the same to maintain service standards…but with much less revenue in each consolidation. I also didn’t realize that the economy made the railways a competitor to the intermodal players, forcing their large hand on full load shipments to Western markets by dealing direct with shippers.
• Short strokes-everyone got hurt and the healing process is not so much dependent on the pending economic recovery as it is on the ingenuity of carriers to run smarter, refrain from adding capacity and essentially get back to running the lean mean truckin’ machines that built their companies in the first place.

I trust you’ve found this snapshot interesting. I believe I’ve covered most of the points from the conference. Its work hard, work smart, always lay tracks for the future, keep your people and your customers happy…and keep the faith as better times are finally on the horizon. Yahoo!