United Parcel Service And Service Marketing Business Essay

Services are economic activities that create and deliver great value to the consumer. It is an act that helps consumers to get things done without having to go do it themselves, and the consumers have to pay for it. Services, which can surprise a customer on the first delivery, always win over with high reputation and excellence or pass with flying colours. This report is on the services offered by UPS, mainly focusing on their call centre.

UPS was found in 1907 by two people Jim Casey & Claude Ryan who were teenagers at the time, also known as the American Messenger Company, whose messengers delivered packages, and carried notes, baggage and trays of food from restaurants. Most of the delivery was made either on foot or, and bicycles for longer journeys. At the time, only a few automobiles were in existence and department stores of the day still used horses and wagons for merchandise delivery. The company was soon started delivering small parcels for local department stores and changed its name from American Messenger Company to Merchants Parcel Delivery. The company expanded outside Seattle (USA) in 1919 with the acquisition of Oakland (USA) based Motor Parcel Delivery and was renamed United Parcel Service in 1930. UPS began the process of expanding its services by acquiring “common carrier” rights for the entire country; this took place in the 1950’s.

Over the past century, UPS has transformed drastically, growing from a small messenger company to a leading provider of air, ocean, ground, and electronic services. In 2003, the company introduced a brand new mark and acronym UPS showing the world that its capabilities extend beyond small package delivery but rather has a broad line of services. However, the company maintains its reputation for integrity, reliability, employee ownership, and customer service. For UPS, the future holds even greater goals to be achieved and accomplished.

The UPS Culture

As a company, UPS focuses its attention on:

Safety: The company spends $38 million a year on safety training, which covers everything from proper body mechanics at work to proper nutrition and exercise at home. As a result, UPS has lowered the number of workdays lost due to injury by more than 50 percent since 1995.

Employee education: Many UPS employees at Worldport and other sorting locations are college students. UPS encourages mentors and recruiters from nearby colleges to visit and work with its employees, and it provides additional benefits and perks for college students.

Diversity: Minorities make up 35 percent of UPS’ U.S. employees and 30 percent of its executives. It’s also recognized by Fortune magazine as one of the 50 best companies for minorities

The Environment: Delivering packages all over the world and moving them between distribution centers requires an enormous amount of fuel. UPS uses several methods to reduce its fuel consumption and its environmental impact. For example, it has developed a hydraulic hybrid package car, and its drivers use route-planning software to minimize the amount of time they spend idling in traffic and making left turns. UPS pilots also fly at the most fuel-efficient speeds possible to meet their delivery deadlines and run only one engine when taxiing to conserve fuel.

Current trends in the industry

According to Miss Tanya Astley, Customer Representative Officer in the UPS there are no such trends in the company, only the way things are done keep changing, on busy days, like, on festivals and important occasions.

ENVIRONMENTAL ANALYSIS

SWOT ANALYSIS

Strengths

Global Brand,

Strong Distribution Network

Weaknesses

Perception of Ground Delivery instead of Overnight

Heavy Union presence

Opportunities

Expansion of online shopping

Emergence of international middle class

Threats

Increasing Fuel Costs

Competitive Landscape (DHL, USPS, FedEx), potentially slowing global economy.

Now to use strengths to capitalize on opportunities, I would say leverage the brand online by partnering with major shopping sites.

To addresses weaknesses to alleviate threats, I would say heavily market overnight capabilities to keep FedEx and DHL at bay.

3. Major competitors:

Fedex

DHL

Speedex

Aramex

THE SERVICE OFFERING

Determining customer requirements

There is no particular way of measuring the customer requirements in the type of service done by UPS, but they tend to attract new customer through marketing and telesales. Customer loyalty is held high in UPS.

Strategy

There are a lot of different factors to build Competitive advantage in the Air Express Industry. The different strategies of the companies based on their core product which they are better in than other companies hence makes all the difference.

When a business provides an excellent service to its customers, it gives them a positive service experience which leads to repeat purchases or usage of that specific service. As well as passing on the experience to family and friends this helps UPS build a stronger relationship with their customers. UPS believes that by achieving effective customer service they will hence achieve a competitive advantage in the market.

UPS uses a differentiation strategy; it does this by creating something about its product or service that is perceived as unique in the industry. Customers must perceive the service as a unique one compared to the competition. UPS should be aware that its customers must be relatively price insensitive as adding this additional uniqueness to its services as additional costs

Differentiation may be attained through many features that make the product or service appear unique. Possible strategies for achieving differentiation may include:

warranties

brand image

technology

features

service

quality/value

dealer network

Economies of scale, such as, lower costs and product differentiation were also prime sources of achieving a competitive advantage in this industry, which were used by UPS to its advantage. This helped UPS to gain a much larger domestic market share three times that of United States postal and twice of Fed Ex, UPS was very cost effective at the time and had a very good reputation in the market. It was only a matter of time when UPS realized that they were not doing as well as they did before and also realized that any competitor could do the same in terms of achieving economies of scale.

UPS has been the market leader in this division for a long time. UPS as sited in our essay has always been the leader in market pricing trends. Always the first to charge premiums, and the first to give discounts to the customers. UPS strategy has always been quite different from that of Fed Ex, Aramax or even DHL. UPS is very profitable, well organized, successfully run, has low debt, and a massive ground operation that can financially support a downturn in air express operations. Because of their size and financial strength UPS is in the best position to survive a price war in the industry.

The media strategy

The usage of an appropriate advertising media, such as, television, press, radio, internet and key broadcast channels, leading titles and publications and strategic outdoor sites – can be very influential in helping us to achieve our campaign objectives.

The following media imperatives have been set for the region:

Television is the key broadcast medium to drive awareness of the new UPS brand identity and offering.

Radio will be used as a lead (where budgets don’t allow for TV) or support medium, reinforcing primary messages and cultivating top-of-mind awareness.

Outdoor will be used to communicate the primary message, ensure new logo exposure and in smaller countries, as a substitute for broadcast media.

Press will be used to support the TV creative or stand alone, allowing more opportunity to explain the UPS strategy further

High reach media will be used at the launch, covering all audiences, followed by one or two lower bursts – ensuring longevity of the new brand message.

To build customer relationship, the organization could:

Keep in touch with the customer by sending emails with the offers and rates.

Get regular feedback from customer who have used the service and improve with their suggestions, to make the customer feel like the king.

DEMAND AND CAPACITY

1. Demand cannot be forecasted in this industry. The company can only take the initiative to maintain current sales and hope increase sales in the future by marketing.

2. An increase in demand will lead to more people being employed either part time or full time depending on the tasks that need to be performed. Another important thing needed is the service vehicles, with the increased demand.

3. Customers don’t have to go through the hassle of waiting in lines for their doubts to be clarified. All the customer has to do is call, which gets routed to various agents in the call centre, to answer any queries or solve any issues.

SPECULATION

1).Opportunities appear to be available in the industry – currently the margin for opportunities seems to be very narrow. But strategies could be altered according to the consumer needs. For example, some consumers emphasize on price and the others on the service time taken no matter what the price.

Recently, UPS is planning to set up a domestic postal service in China. They plan to introduce a next day delivery service and second and third day delivery products. China is a potential for UPS to grow and offer services and products internationally and this it seems China is an emerging market which could be worth billions.

2. Technological advances

In today’s day and age the air express industry has become so technologically advanced that goods can be delivered overnight. It is facing intense price competition between the competitors, which exist in this market. The ability to price, route, track and deliver parcels and mail in both domestic and international markets demands a comprehensive. A significant improvement in information technology has enabled package carriers to provide to customers the ability to track their package’s movement from origin to destination. Other advances included combining logistics, freight and financial services with traditional package delivery in order to offer customers full supply chain management solutions. Only the organizations that were able to achieve these effectively and efficiently were able to survive in this industry. This is how the existing companies could then make their profit.

In this industry the price of the service is the main source for competing. This is the only way in achieving Competitive Success. Competitive advantage can be achieved if, the price of the service provided by competitors is similar and the approach taken to provide the service. For instance, the amount of time taken for the product to reach from point A to point B.

3. Advice to other firms who plan to enter the industry

Our advice to the new firms which plan to enter this industry would be to, research the market and the industry and think about strategies that provide the new firm a big competitive advantage including low cost of service and low price charged to the customers. The relationship between the firm and the customers should be healthy. The company should be knowledgeable about everything and should see to it that they have all the information necessary.

Customer Relationship Management

Customers account for 95% of UPS’s shipping information directly. The CRM methodology is a very core part of the UPS success story. UPS grows through engineering and re-engineering of its systems. UPS’s growth was achieved slowly and methodically from the inside out. An Excellent service is what distinguishes it from other companies.

Companies can use and integrate UPS Worldship hence optimizing their business processes. They can process shipments easily, respond to your customers faster, and reduce costly errors.

UPS provides businesses with multiple ways to integrate WorldShip with their business:

Batch Import/Export: Import a file containing addresses, customer orders, or other shipment information, or export shipping history to your internal systems.

Keyed Import: Allow WorldShip to recognize a customer’s order simply by entering or scanning a unique identifier, such as a Purchase Order number.

Hands-Off Shipping: Schedule WorldShip to pull addresses from your order entry database and automatically print shipping labels at designated times.

XML Auto-Import: Automate shipment processing using XML code.

LOGISTICS

Logistics is about getting things where they need to be, at the correct time as effectively and efficiently as possible. But nowadays, logistics is also a strategic way to add value to your business, better served customers, and better long term growth.

The logistics provided by UPS can help you manoeuvre the intricacies of global trade with minimal effort. Manage your shipments and minimize their environmental impact. And win repeat and loyal customers by making it easy to return products or parts.

The new logistics is more than just getting things to the right place at the right time at the right cost. It’s about using the movement of goods as a competitive advantage. It’s a whole new way of thinking. And it’s a powerful force for growing your business.

Access to Resources through UPS

Businesses don’t need a large warehouse, distribution center, or global network to access this new logistics. UPS has built a massive integrated network of physical, technological, and human assets that lets you tap into the power and passion of logistics.

The new logistics from UPS levels playing fields. It lets you act locally or globally. It’s for the individual entrepreneur, the small business, or the large company. It’s reliable, efficient, and environmentally responsible.

Long term growth in the telecommunication

UPS needs to learn from other industry best practices to gain a competitive edge in and expand beyond their core markets. An increasing number of companies have redefined themselves and significantly outperformed the markets by growth through services. UPS Moved from traditional parcel services to total supply chain solutions.

UPS can better differentiate themselves via services by extending relationship with existing customer base leveraging.

Superior customer knowledge as key asset.

Customer proximity and delivery competence.

In addition, developing the necessary skills and scale by new service-specific processes being developed and service innovations to ensure fast scalability of process and time to market.

UPS’s evolution to Total Supply Chain Solutions started as:-

Standalone development of small service operations within the organization:

Worldwide Logistics unit

Service Parts Logistics

Worldwide dedicated Services

UPS Truck Leasing

UPS consulting

This moved on to:-

Expansion of product portfolio and consolidation of existing services resources into UPS Supply Chain Solutions.

And finally

Reorganization and major M&A effort with 16 key acquisitions to develop scale and growth.