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Running Head: MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Marketing Management Group Project (MMGP) - Shippo
Charles Harris
Dawn June
Joshua Rees
Iva White
Liberty University
BUSI 520 Strategic Marketing Management
Mr. Jeffrey Kennedy
December 14, 2018
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Abstract
A comprehensive marketing management report was performed as a group effort for Shippo to
help enhance their current operations, help plan for future endeavors, and help determine
whether an investment opportunity exists. To begin, research was performed with information
accumulated into a comprehensive report including topics such as internal and external
marketing variables; consumer analysis, market segmentation, and market coverage; positioning,
competition, and branding; services, pricing, and distribution; and finally, promotion and social
responsibility. As a group effort our purpose was to deliver informative and descriptive
discussions about the variables within each topic mentioned above. Great sources of information
for each topic are found in Kotler and Keller (2016) along with useful information found on the
internet. Altogether, the collected data once analyzed should help provide some insight for
Shippo to include within their strategic marketing plan to enrich their current operations and
possibly gain better positioning power now and in their future.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Shippo - Internal and External Marketing Variables
Provide a description of the product/service and a brief history of the firm.
Shippo is company that utilizes API technology that allows e-commerce firms to find the
best shipping service to use for delivering their products (Geron 2016). The company small force
of employees works with their business customers to find the lowest cost shipping rates with
some of the US most advancing shipping companies, including DHL, FedEx, UPS, as well as,
the United States Postal Service (Newswire 2017). Shippo designed their integrative approach to
make the shipping experience much easier for e-commerce businesses.
Shippo provides a web app and multi-carrier API to help e-commerce merchants and
other retail partners get real-time rates, print labels, automate international paperwork, track
packages and facilitate returns (Pilon 2017). Shippo provides the platform to help businesses
succeed through shipping. Shippo's investors include Bessemer Venture Partners, Union Square
Ventures, Uncork Capital, 500 Startups, and Funders Club (Newswire, 2018).
According to Kotler & Keller (2016), the traditional marketing mix, (e.g., product, price,
place, promotion) has been upgraded to align with the modern marketing environment to reflect
the “holistic marketing concept” (p.25-26). The additional classifications includes: (a) People,
who must be viewed more broadly, moving beyond the label of shopper; (b) processes, which
involved the firms creates long-term relationships with their targeted market; (c) programs,
which includes the original 4 P’s of the marketing mix and integrated with the additional
classifications to bring greater value to the firm; and (d) performance, which provides the metrics
to gauge the marketing activities and their relationship in impacting the profitability of the firm
(Kotler & Keller, 2016).
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Shippo’s products and services include an integrated shipping platform that allows
businesses to deliver their products globally at lower prices, with the support of their cloud-based
Web & API software dashboard (Shippo 2018). The company has established various pricing
plans to accommodate their diverse customer base (Shippo 2018). The pricing plan includes a
pay-as-you-go plan; a professional plan and a premier plan. Each plan provides different services
and features but are designed to allow the business customer to choose and customized their
shipping needs (Shippo 2018).
Describe and discuss the original 4 P’s of marketing (product, place, promotion, and price),
and the new 4 Ps (people, processes, programs, and performance) relating to the product.
The original 4p's of marketing (product, place, promotion, and price). The original for
approach product as physical product or service. This model is also based off of a physical
storefront, advertising and price of the product determine the success of the product or services.
The evolution of the 4p's to people, processes, programs, and performance is base on the use of
the different technologies and the ability of the company to meet the need of the customer. The
changes in technology have forced marketers and companies to make changes to reach customers
that would be missed without the use of internet and other technologies that allows them
expanding their reach in the market. The 4Ps of marketing is that Shippo uses to help customer
advertising are as the following:
Product
When designing and iterating on your products, do regular check-ins with the
buyer personas you've built and imagine how they would react at each stage. Many
factors should be considered during these brainstorming sessions, such as simplicity of
use, size, and even variants.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Pricing
When pricing your item, again consider whom you are targeting. Don't take the
flat approach of "it costs $X to make and ship, if I raise the price by $10 per item, I will
make $X more profit per year.” Consider the purchasing power of your potential
audience!
If you lower the price by a few dollars, can you sell two per person instead of just
one? Is your audience mostly teenagers with a limited amount of money to spend per
month or the parents of newborns who are willing to spend more for higher quality
goods?
Branding
Your logo and brand identity should appeal to your customer base before they
even see your products.
Customer Success
How you interact with your customers goes much beyond the tone used in your
emails and copy.
Loyalty
All of the above are brought together to determine how loyal your customers are,
not only to your product but also to your brand as a whole. If you price everything
properly and make sure they feel the love when engaging with you, they will keep
coming back. Loyalty is the holy grail -what ties everything together. And you must first
understand whom you are selling to before you can understand what makes them loyal.
Remember, your audience is more than just statistics on a page. Potential
customers have depth beyond just their age and gender. (Lian, 2014, p1)
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Shippo uses the 4p's as an approach to gathering potential customer attention. The
primary target of Shippo advertising is small businesses, without a lot of assets that are
competing against larger companies, or they are in a niche marketing with limited assets.
Explain the organization’s mission. Provide its mission statement or create one if necessary.
Shippo mission statement is simple and concise: “Helping business succeed through
shipping” (Shippo 2018). Their mission is to help small companies to find to the fastest, most
reliable, and lowest-cost shipping outcomes that many other larger company’s enjoy (Shippo
2018).
Conduct a brief SWOT (strengths, weaknesses, opportunities, threats) analysis for the
organization.
Research was performed as Keller (2016) suggested through use of the internet searching
for chat rooms and blogs, industry news and trends (Kotler & Keller, 2016, p. 101). An article
written by API Economy discusses an interview with Laura Wu, the CEO and founder of Shippo,
telling the world how she and her partner began their journey. They started a shipping business
using Shopify but learned the complexity of maneuvering through the shipping process, so they
soon realized the potential for providing an easier way to automate shipping services and in turn
their customers have more time to devote their resources elsewhere. When asked about
challenges, Wu replied that her customers need access to development resources in order to
integrate an application programming interface (API) plus maintain it which becomes
challenging for non-technical businesses. Also, Shippo relies on various APIs to run their
application software and sometimes the system goes down for maintenance, this causes a brief
disrupt to service which irritates their customers (Singh, 2017). From an external perspective,
Finances Online says Shippo is considered among the top 50 e-commerce software providers and
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
scores 96% for user satisfaction (Finances Online, 2018). Shippo is leveling the playing field
with Amazon by closing the logistical gap for e-commerce (Inc., 2018). Logistics Management
describes challenges that the shipping industry currently faces such as a need for greater
technology to streamline the business process, a need for development of new or innovative
ways to efficiently and cost effectively ship products, and a need to assist with compliance issues
bogging down shippers and carriers such as rising fuel costs (Logistics Management, 2018).
New government regulations such as mandated logging devices used by transporters are causing
many hiccups within the transportation industry according to Forbes. Challenges among the non-
technical businesses consist of trying to incorporate application interfaces just to compete with
Amazon (Forbes, 2018). Industry Today tells us how increases to technology are becoming
evident and provide more efficient ways to ship and track items such as with Amazon and their
new, innovative one-day shipping option (Industry Today, 2018).
SWOT Analysis
Kotler and Keller (2016) indicate that every business should carefully examine their
competitor’s strengths, drives and behaviors to ensure that their situational positioning within the
industry is carefully planned. They also tell us that e-commerce is expected to reach $30 trillion
by the year 2025 contributing to 70% of global growth domestic product (GDP). This business
forecast also means more competition. Performing a SWOT (strengths, weaknesses,
opportunities, threats) analysis will assist Shippo’s organization to identify strengths or
weaknesses, as well as, opportunities or threats as they will be faced with much more
competition in the near future (Kotler & Keller, 2016, pp. 14, 35, 43, 56, 277-278). The
following data was collected and analyzed and many attributes and downfalls became evident as
indicated below. The following information is listed from most important to least.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Strengths. Shippo provides their customers with the needed program to efficiently find
carriers at pre-negotiated prices, along with ease of labeling and live tracking. This allows their
customers more time to produce more product. Shippo’s use of interface platforms is on the
leading edge of innovative technology.
Weaknesses. Shippo’s greatest competition is Amazon dominating the shipping industry.
Shippo’s interface relies on APIs which sometimes requires maintenance and causes disrupts,
when this happens customers may seek alternatives. Technology requires much time to update
and monitor costing time and money.
Opportunities. Economists are predicting upward trends within the economy, as well as,
growth in GDP and e-commerce. Economists also predict growth will be promising within the
shipping industry.
Threats. Fuel prices are fluctuating and sometimes rising too high affecting carriers.
Trucks are waiting for full loads causing delays in shipment. Also, inflation is rising as are costs
to ship. Federal, state, and local law changes are making it difficult to comply with industry
standards and environmental laws (such as with fuel) causing delays and costs. The rate of
technology’s growth may surpass current applications and users.
Describe and discuss demographic trends that affect the sale of the product/service.
I believe that Shippo would be classified as a trend. A trend “is more predictable and
durable than a fad; trends reveal the shape of the future and can provide strategic direction”
(Kotler and Keller, 73). This is because, as a product, Shippo will not disrupt the market. Shippo
has consolidated competition in a way that saves the user time and money. However, this idea
has been used in many different areas and is a product of the present. It is easy and convenient
but it has not revolutionized the way shipping, as a whole, has been conducted. As the Co-
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Founder and CEO, Laura Behrens Wu stated, “With Amazon’s shadow looming over online
retail…Shippo works to level the playing field, at least partially, giving businesses not in the Jeff
Bezos empire more Amazon-style efficiency on their commerce logistics” (Konrad, 2017).
This product does not actually facilitate the shipping of the product, it merely presents a
company with the cheapest means to conduct shipping. Therefore, this product is tailored to
small companies and independent retailers. The major box stores will not be using this service
because they have the means to ship their own product and regulate their own shipping costs.
Therefore, this product relies solely on how successful the small business market is at the time.
Describe and discuss current economic trends that affect the sale of the product/service for
Shippo.
Providing a SWOT analysis also helps to identify opportunities and threats that may
come to light when sorting through economic news and forecasts. This information will be
helpful for Shippo to stay on top of current industry and economic trends and hence improve
their current and future delivery of products to the end users (Kotler & Keller, 2016, pp. 14, 35,
43, 56). According to recent data from the U.S. Department of Commerce, gross domestic
product (GDP) is up 3.5% and personal income is up .2% (Bureau of Economic Analysis, 2018).
According to News and Trends, reports from the International Monetary Fund (IMF) show global
growth for 2018 trending upward with an expected GDP of 2.3% by the end of 2018 and 2.2%
by 2019. According to the World Trade Organization (WTO), growth in products globally have
increased by leaps and bounds showing increases of 3.6% for 2017 and 3.2% for 2018. These
upward trends for our economy will greatly benefit the shipping industry once materialized
(News and Trends, 2018). As for Shippo, these reports altogether indicate greater opportunities
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
for the shipping industry, plus, as GDP increases so does the transportation of those products.
Full speed ahead for Shippo.
Describe and discuss technological changes that have affected the sale of the
product/service.
“Our current forms of commerce are very much a function of yesterday’s communication
techniques” [Ste99]. This could very well be an article written in 2018, but it was written in
1999. Each year, technology seems to grow at an exponential speed. In 2018, companies interact
with customers, suppliers, shipping carriers, and customers at the click of a button…instantly.
Instant gratification, on most accounts, is possible. People want what they want, and they want it
right now. Some experts call it this the Amazon effect. [Lin]. Customers expect a technological
experience when shopping online or even in a brick and mortar store.
Ecommerce businesses are not strangers to the idea of how fast technology changes. It
hasn’t been that long ago that Etsy became a common vocabulary word, but there are now 1.93
sellers who have shops on this eCommerce site. Choosing which carrier to carry your purchase
or merchandise can still be daunting, though. There are multiple shipping carriers in the Unites
States. Some of these include DHL, United Parcel Service (UPS), Federal Express (FedEx), and
United States Postal Service (USPS). Shippo removes the need to go on each website to check
options and prices of shipping to choose the right carrier for the customer’s needs.
Today, people have unlimited information available to them at touch of a button. While
this can be comforting, it is sometimes overwhelming. “Science and technology are the driving
forces increasing the global standards of living” [Wil16]. As technology has grown over the
years, so too has the amount of multitasking that a person or company has to do. Technology is
definitely driving force behind companies like Priceline, Hotels.com and Shippo. Technology
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
that provides a customer or business owner the ability to do all of the comparisons on one
website is in high demand. Add to that the ability to print labels, packing slips and track
packages all from one interface, and that is technology that is sure to be a success with small
businesses that have trouble shipping out a large number of parcels, each day.
Describe and discuss consumer tastes and preferences that affect the sale of the
product/service.
Online, the customers expect to have a seamless buying experience. They expect
shipping, delivery, returns to be easy and able to be done entirely online. Customers also want
the cheapest shipping option that will get to them in a hurry. Shipping speed has been listed as
one of the most important buying factors by patrons. They also want to be able to track their
purchase from the time it leaves the store until it reaches their door. Shipping insurance can be a
valuable asset for retailers and customers. Shippo offers shipping insurance that includes a
paperless claims process and a choice of compensation options.
Shippo simplifies everything that is included in shipping for the retailer and the customer.
They are able to see the tracking from the moment the label is created. Retailers and customers
receive discounted shipping rates from some carriers. They also have an easy return process by
including return labels inside your shipment. Free return shipment is another important buying
factor when customers are choosing an online retailer. The good news for the retailer, in this
option, is that they are only charged if the return label is used[Shi18]. Small, online businesses
rely on the technology that Shippo provides. They are able to provide their customers with an
exact shipping cost and allow them to view real-time tracking, including delivery estimate, and
offer easy return shipping.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Outline a marketing research process to be used to gather information on present or
potential customers.
The marketing research process can be used to gather information on present or potential
customers for defining the objective and problem. The marketing research process is a
systematic methodology for informing the business decision. This process can consist or serval
steps. "Defining the problem and research objectives.” (Kotler &Keller, 2016, p 103) Shippo
problem or opportunity is to find a potential customer that is trying to find the cheapest shipping
option. They must also find a way to reach that customer base and which multimedia mediums
that would be the company's best advertising options. The must also “develop the research plan.”
(Kotler & Keller, 2016, p 103) This is a way of companies to gather information and determine
the cost that helps with the pricing of the product. The company must also:
Collect the information
Analyze the information
Present the findings
Make the decision (Kolter & Keller, 2016, p 103)
The ability to gather information and to use it in an efficient manner can help determine
the success and failure of a product. All data collected is not always and companies must know
how to sort this data and determine the useful information. The inability to determine useful
information can be detrimental to organization product sales.
Which forms of marketing research would be best in gathering consumer information
relating to the product/service?
The observational research method would be the most beneficial option for Shippo.
Using this method, “Researchers can gather fresh data by observing unobtrusively as customers
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
shop or consume products” (Kotler and Keller, 104). Shippo relies on its customer’s success, it is
essential that Shippo understand when and where it needs to allocate it’s time and resources..
Also, Shippo will benefit from utilizing Behavioral research methods. This method
occurs when, “Customers leave traces of their purchasing behavior in store scanning data,
catalog purchases, and customer databases” (Kolter and Keller, 106). Shippo can use this data to
market itself to smaller companies who may not be able to keep up with bigger companies.
“Many customers do not want to pay for shipping and seek to pay as little as possible in shipping
costs, but they may not be aware of the real price of shipping. Shipping costs have started to
change the way businesses operate…” (Return Customer, 2018). Smaller companies may be
offering flat-rate shipping or 2-day shipping on their products to just be able to compete with
companies like Amazon and Wal-Mart. Shipping is where a lot of companies actually lose
money. A study by Marketing Charts shows that, “Among respondents that had abandoned their
shopping cart, one of the top reasons for doing so was that shipping costs made their total
purchase cost more than expected, with 55% saying this led them to abandon their purchase”
(Marketing Charts, 2012). However, with Shippo, these smaller businesses may be able to offer
competitive shipping by letting market competition bring down shipping costs.
Consumer Analysis, Market Segmentation, and Market Coverage
Describe and discuss the cultural factors that influence the purchase of the product/service.
Culture factors, (e.g., culture, subculture & social class) are very significant influences
that can impact consumer behaviors in the purchase decisions of obtaining products and
services (Kotler 2016). Also, culture is determined by a person’s upbringing, their values, and
the societal experiences of living in a specific country (Kotler 2016). For example, a culture will
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
have a large impact on a buyer’s needs, wants, as well as, their behavior (Kotler 2016).
Oyerman, (2017), provides a simpler definition of culture as follows:
The part of the environment made by humans. It is the set of meanings that a
group in a time and place come to adopt or develop, and these meanings facilitate
smooth social coordination, clarify group boundaries, and provide a space for
innovation (p. 476).
Therefore, brands such as Shippo, which is classified as a global firm, must have a clear
understanding of the various cultural values involving the consumers who are purchasing their
products and services. This is also true for the “subcultures” (Kotler 2016) of which consumers
may identify with. Each culture is further divided into various subcultures based on age,
geographical location, the group’s religious affiliation, nationality, gender (male/female), and
racial community, etc. (Kotler 2016).
For example, in western societies such as the US, cultural individualism is the factor to
consider (Choi 2004). In an individualist society, personal goals, freedom, and independence
have more sway on the decision-making process than the opinion of others (Choi 2004).
However, in countries such as China, Japan, and Korea, where most of the population follows the
teachings of a Confucian philosophy; the consumers’ in these communities will show higher
levels of “collectivism” (Choi 2004). In a collectivist society, family and other in-group members
have a greater influence on the groups purchasing decisions (Choi 2004).
Another cultural element that influences the buying decisions of consumers is their
membership in a certain “social stratification . . . [ referred to as] social classes” (Kotler 2016).
Social classes are the reflections of income as well as occupation, education and other similar
factors and behaviors (Culture 2018). Kotler & Keller (2016), indicates that in the United States
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
there are “seven ascending levels . . . [ranging from] lower lowers . . . to upper uppers” (p.159),
with each level having their own preference for both evaluating and/or choosing a brand’s
product (Kotler 2016).
Describe and discuss the social factors that influence the purchase of the product/service
The most influential social factor for Shippo will be roles and status. According to Kotler
and Keller, “People choose products that reflect and communicate their role and their actual or
desired status in society” (161). This plays a major factor in the way consumers interact with
Shippo. Consumers are coming to Shippo so that they can achieve the same roles that a company
like Amazon may have. Consumers are looking for a way to push their product as efficiently as
Amazon. However, smaller companies cannot always afford two-day shipping like Amazon
Prime. Thus, consumers are more inclined to use Shippo’s services to appear as effective as
Amazon. Thus, status plays a significant role in the consumers life. This will also dictate who
purchases or uses Shippo’s services.
Describe and discuss the personal factors that influence the purchase of the
product/service.
The personal factors that influence the purchase of a product/service are value and
appeal; income and customer spending, social networks, environmental challenges, and family
roles. Other personal factors that may affect the of a product or service are age, lifecycle,
occupation, and personality. Age can play a major role in the decision-making process to
purchase and/or service the ability. The teenager, young adults, and mature adult all make a
decision on product and services differently[Her12]. The experience that comes with a person's
age can greatly determine how they make a decision. There are different models and hypothesis
that can try and explain how these decisions are made. A few of these that explain the decision-
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
making process for young adults versus older adults is based on rewards. These decisions can
independent and dependent on rewards.
The choice independent task involved learning and exploiting the options that gave the
highest rewards. The choice-dependent task involved learning how each choice
influenced the rewards available for both options on future trials and making the best
decisions based on that knowledge. Younger adults performed better when rewards were
choice-independent, while older adults performed better when rewards were choice-
dependent[Wor11].
The way in which a person lives can determine which product or service they use. The is
based on the need or want that the product can he satisfy. “Lifestyle is a basic concept for
understanding consumer behavior and demonstrating the characteristics that are more
modernized than personality and more comprehensive than personal values. Lifestyle has a
significant positive influence on the purchase decision.”[Ani16] Value and appeal also play role
in the decision-making process to purchase a product or service. The value can be derived from
many sources, the need for the product, the social group the customer belonging, age group,
economic status, religion, culture, morals, and more can play a role in the perceived value of a
product. “Marketing stimulation and personal value also have a positive significant impact on the
influence of purchase decision and brand selection.”[Ani16] The status and role within the
customer base can determine the type of products that they use.
Based on these factors Shippo should try and attract startup companies and small
companies with budgets retrains that tend to limit the way in which the spend the money. They
can attract but marketing to their affordability and ability to reach the customer based around the
world[Fle09]. They should market the tool that enables them to be a product or service that is
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
useful to the customer based and allows them to grow of a company because of Shippo ability to
customize the service to help enrich the product and make it customer friendly.
Describe and discuss the psychological factors that influence the purchase of the
product/service.
Psychological factors that can influence the purchase of a product service are,
“motivation, perception, learning, and memory.”[Placeholder1] Another psychological factor that
can affect a customer willing to buy or purchase a product is the attitude and beliefs. “Motivation
has both directions- we select one goal over another- and intensity- we pursue the goal with more
or less vigor." [Placeholder1]. In order for there to a need for the product or service, it has to be a
need or reason for the customer to purchase the product. In the case of Shippo, it is cost-
effective shipping needs that is affordable, quality, and efficient shipping with the ability to reach
the customer base around the world. There is also the perception which is “the process by which
we select, organize, and interpret information inputs to create a meaningful picture of the world.”
[Placeholder1] Shippo has a product that allows the businesses and another customer to ship
products in a manner that is less expensive and can be tracked in order to ensure that product
reaches its destination[LaM18]. The ability to adapt the product to the need and adjust the
product to the needs of the customer can help Shippo to retain the customers.
Explain how potential global markets will be evaluated for potential entry by Shippo
Weighing out how to enter the international market may be a difficult decision for Shippo
and may come with resistance. If they succeed, they will benefit from healthier profits, expand
their customer base, and maintain a secure positioning within the market for their industry. First,
Shippo must determine what products or services will succeed in the global marketplace, then
they must determine the best approach for entering the marketplace.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Shippo can consider a gradual trickle effect (waterfall), or perhaps entering all markets at
the same time (sprinkler). In Shippo’s case, their product and services use innovative application
programming interfaces (API) to expedite shipping for e-commerce so they will likely enter the
global market place from the start, also known “born global” (Keller, 2016, p. 220). To boot,
Keller (2016) tells us that the service industry is among the fastest growing sector of the global
economy. This should serve as reassurance that Shippo will likely succeed in the global
environment.
Much research and careful planning must be considered when planning to enter into
various countries’ marketplace. A few potentials are mentioned in Kotler and Keller (2016)
consisting of Brazil, Russia, India, China, South Africa, and Indonesia. Brazil may be a good
prospect to target because research shows they stand among the fifth largest of digital users and
have become savvy with social media. With this in mind, Shippo may encounter some resistance
within Brazil’s shipping industry due to their escalated labor laws. As a result, Shippo should
also enter into the underground economy known to produce 40% of Brazil’s GDP. Russia’s
recent recession affecting their economy, in addition to, ongoing corruption may be too risky for
Shippo. India, however, seems to be a good prospect with a sizable population of Indians
averaging 25 years old. This generation is the wave of the future embracing technology and
already contributing to India’s strong economy. Plans to enter China may result in much
resistance, most particularly because they lack laws for protecting intellectual property and this
can be devastating for Shippo if their product were pirated. South Africa’s economy is up and
coming and getting stronger but they lack appropriate infrastructure, so perhaps Shippo may
consider this country in the future but currently place this on the back burner. Indonesia may also
be a good prospect for market entry even though they too lack appropriate infrastructure, with
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retail giants like IKEA and L’Oréal positioning their product while waiving their risks only
means more potential clients for Shippo (Kotler & Keller, 2016, pp. 217-225). The Manzella
Report (1997) may seem a little outdated but it provides great tips for businesses like Shippo
upon selecting the right markets. Manzella (1997) suggests looking at the macro-economics and
trends for targeted countries including per capita income, demand for the product or service,
determining any trade barriers that may exist such as tariffs, or learn more about specific
packaging and labeling laws that may be quite different. The Report (1997) also suggests staying
on top of political instability for the targeted country. Lastly but most importantly, Manzella
(1997) suggests high tech software companies must keep an eye out to ensure potential markets
have skilled technical users on the other end (human infrastructure) as required for APIs. Saige
Driver with Business News Daily also agrees, she emphasizes the need to determine a strong
customer base when seeking global expansion. Driver says a product or service that might work
well in the U.S. might not work as well within foreign markets. Other challenges that must be
considered when strategizing and targeting a foreign market are language barriers or cultural
differences, a differing tax criterion, packaging standards may be stricter, and technology within
the foreign market may not be up to speed. Shippo may need to dumb down their API to meet the
countries’ current tech knowledge (Business News Daily, September 7, 2017).
Discuss the most likely mode or modes of global market entry for Shippo
There are many types of entry modes such as direct or indirect exporting of a product or
service, then there’s licensing by providing a foreign company with certain rights to use the
product or patent, etc., but this option comes with risks as the home country will no longer have
total control so if the licensee fails to deliver or becomes competition, this could be devastating
for Shippo considering their application software product is on the leading edge for technology.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Joint ventures are yet another mode of entry to consider where two companies share ownership
and control, this mode seems to be most popular in China and India. Shippo may strongly
consider this mode because at least they would remain in control of their product and daily
business operations, meanwhile, their foreign partner will be mingling in the market community
that they are most familiar with but even this mode comes with risks such as when corporate
leaders don’t see eye to eye. Lastly, there’s direct investment requiring the foreign company to
buy the product or service in its entirety or in part, or there’s acquisition which is when the home
business would simply acquire the foreign business or product (Kotler & Keller, 2016, pp226-
227). Shippo falls under the entry mode category of an export-management company by
providing, for a fee, their high tech application interface software to e-commerce for easier
shipping and tracking of packages. Shippo may consider a joint venture to maintain control of
their product, or maybe even licensing and provide their interface program along with expertise
to the foreign market, but as mentioned earlier this mode comes with even more risks than
venturing jointly. Manzella (1997) provides a great tip to close with, when Shippo or any
business decides to go global they need to determine the right markets, ones that will exceed
profit expectations, because when the wrong markets are chosen it could end in financial ruin.
There is a lot of competition out there across the border so it is imperative to identify, analyze,
and choose the right foreign market when considering globalization because whether you decide
to pursue or pass on an opportunity the results can be extreme in either direction. (Manzella,
1997).
Describe the variables (demographic, psychographic, or behavioral) used to segment the
firm’s target markets
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Shippo has already addressed many of the variables used to target markets. In Marketing
Management, Kotler and Keller describe demographic segmentation as “One reason
demographic variables such as age, family size, family life cycle, gender, income, occupation,
education, religion, generation, nationality, and social class are so popular with marketers is that
they’re often associated with consumer needs and wants” (249). With this, Shippo confronts
demographic segmentation by offering its product in three formats. According to Shippo.com,
they offer some of their services for free with pay as you go.
Shippo also caters to psychographic segmentation. According to Marketing Management,
Kotler and Keller stated that “ Psychographics is the science of using psychology and
demographics to better understand consumers…Consumers are inspired by one of three primary
motivations: ideals, achievements, and self-expressions” (258). Shippo offers the consumer a
completely pliable product that is designed to meet the individual needs of the consumer. In
Marketing Management, Kotler and Keller describe behavioral segmentation by saying that “Not
everyone who buys a product has the same needs or wants the same benefits from it” (259).
Explain how the firm evaluates the attractiveness of each identified market segment
With Shippo’s resources, the company will need to focus its attention on single-segment
concentration. In Marketing Management, Kotler and Keller stated that “With single-segment
concentration, the firm markets to only one particular segment” (266). With single-segment
concentration, “the firm gains deep knowledge of the segment’s needs and achieves a strong
market presence” (Kotler and Keller, 266). With this, Shippo will be able to tap into markets
where multiple segment specialization companies, like Amazon, are not successful. In an article
from Business Insider, Daniel Keyes reports that “Amazon has struggled to gain traction in
China, as its Prime subscription offerings and mobile app don’t appeal to consumers, and it faces
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
fierce competition from incumbent titans” (Keyes, 2017). In the same article, Daniel Keyes
reports that “Alibaba and JD.com control 47% and 20% of China’s online retail market share,
respectively, dwarfing Amazon’s current position…(1.3%)” (Keyes, 2017). This is because
Amazon moved into a market as an online store amongst many other online shopping giants.
However, Shippo would be able to move into a market such as China by focusing solely on
shipping needs. Wish has become very popular over the past few years. The website is a landing
page for many Chinese manufacturers to sell their merchandise directly to the consumer. One
angry customer stated that the “First item took almost 2 months to arrive” (Complaint Board,
2017). With Shippo’s services, Chinese manufacturers may be able to ship their product in a
more efficient manner. This would allow Shippo to directly bypass online retail giants, like
Amazon and Alibaba, and consult directly with the manufacturers.
Should the firm pursue full market coverage, market specialization, product specialization,
selective specialization, or single-segment concentration?
Shippo’s mission is aimed at helping small business’s to ship merchandise quickly and
cheaply.. “Through concentrated marketing, the firm gains deep knowledge of the segment’s
needs and achieves a strong market presence” [Kot16]. In order to choose a method of
marketing, a company must know who they want to sell to. The process that the company goes
through to decide and find a target market, and then value proposition to reach the customers is
called segmentation-targeting-proposition [gae14]. The company must carefully consider which
segment is most likely to use their service or buy their product. Among the top ten criteria for
choosing a target market are customer satisfaction sales volume, competitive advantage and
opportunities in the industry [Art14]. The criteria proposed by Kotler, et al in their 2012 book, to
target market selection, are measurability, sustainability, accessibility, differentiability and
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
actionability. The creators of Shippo have done the research and found that the segment that they
want to market to is the small ecommerce shops that conduct most of their business (including
shipping) online. Keeping this in mind, single-segment concentration would be the best
marketing strategy for the company
There have been studies based of the success of different marketing strategies. In one
study, it was found that single-segment concentration was almost always successful, due to
personalization. With single-segment concentration the firm knows the needs and wants of the
target market. Focusing on the needs of the one industry segment allows a company to reach a
high level of expertise focused on that segment..
Explain the needs that are met for each of the firm’s target markets.
The firm has made the decision to put all of their energy into concentrating on one target
market: small eCommerce businesses. The needs and benefits that are met for the customers of
this service are many.
1. Shippo has partnered with Hubspot. This company that can provide help to
companies looking for better marketing strategies and sales goals. Choosing
Shippo gives small eCommerce businesses access to another company that will
aid in growing their company and increasing their profits.
2. Shippo offers one online interface that shows shipping and tracking information.
This ability streamlines the shipping process for small businesses.
3. Efficient and cost-effective shipping for small businesses. This allows customers
the ability to choose the shipping method that they can afford and builds customer
loyalty for Shippo.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
4. Shippo will take care of more than just scheduling shipping. You can print
shipping labels, return labels and packing slips from one portal.
All the shipping needs of a small eCommerce business will be provided with Shippo. The
shipping platform makes shipping easy and affordable for the small businesses that are the target
market of Shippo.
Positioning, Competition, and Branding
Create a positioning statement for the product/service and explain its rationale
Marketers need to develop innovative ways to describe a product and sometimes this
requires thinking outside the box by telling a story so the consumer will remember the item. Use
of metaphors, associations, or some other type of connection may be needed, and even though
this can be challenging especially for smaller firms, they too can develop creative thinking and
the use of social media or in-store activities to help cast in those customers (Kotler & Keller,
2016, pp 291-292). Marketing Schools.org (2012) talks about brand marketing and how the
brand name or positioning of the product must be explanatory enough that it demonstrates who
the company is and what they do (MarketingSchools.org, 2012). Cornell 360 (2018) also
provides great tips about developing a positioning statement for a company launching a new or
revised product/service, first of all, provide a clear description of the target market by painting a
picture. Next, keep the statement simple so it sticks with the consumer and is easy to understand.
Make sure the statement delivers a promise and elaborates on the differentiation between the
item apart from the competitions. Lastly, make sure the positioning statement has room to grow
(Stayman, 2018). Shippo’s home page states “Ship Faster and Smarter with Shippo” (Shippo,
2018) which provides an easy to remember and understandable positioning statement. Plus, the
promise that Shippo provides in their statement does seem trustworthy enough that assurance is
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
met using their software product to save money and time while shipping products faster and
safer, and that says a lot, but developing a new positioning statement to stand out more and
elaborate some may be necessary. A statement that may impact the consumer and stick may be
something like, “Ship faster and easier while saving time and money with Shippo”. As a business
selling a lot of product and shipping all over the world looking for alternative ship methods, this
statement may be more inclusive at first glance. After all, saving time and money can both be
useful elsewhere in the operation.
Explain how the product service is positioned in the market
Once a company identifies what consumers need or want, they need to narrow down
certain aspects with their products that meets those needs or wants (target), then design a product
offer and image so it impacts the consumer’s mindset and sticks. A good leg to stand on with
positioning would be to consider the present and the future. Some firms might consider doing a
brand substitution test, or to make sure the brand positioning of the product is so certain that it
cannot be replaced even by the competition (Kotler & Keller, 2016, pp. 275-276). Economic
Times (2018) recommends that positioning efforts must ensure products/services will stand out
above all others in the same segment and make an impression upon the consumer. Good
positioning is when you’ve accomplished these tasks and even begin to increase the price while
keeping the competition at bay (Economic Times, 2018). According to Glassdoor (2018), Shippo
provides the building blocks for shipping (Glassdoor, 2008-2018). They (Shippo) are positioned
in the marketplace using software application programs so e-commerce companies can
customize their shipping options using reputable and pre-negotiated logistic providers while
reducing the barriers to make shipping around the world easier. Many carriers are connected
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
through their application program interface (API) dashboard that enables easy labeling and
tracking as well (Shippo, 2018).
Discuss techniques of building brand equity.
Creating brand equity is a very important task for firms in order to stay
connected in a positive way to their consumers’ expectations, while thereby,
avoiding the risk of losing customer’s loyalty to the brand (Kotler 2016).
Brand equity, according to Kotler & Keller (2016), provides the “added value
endowed to products and services with consumers” (p. 302). In other words,
brand equity becomes the reflection of how consumers may feel, act, know,
or even think about the brand promise (Kotler 2016). A consumer’s
perception about a brand can be negative or positive, mainly based upon the
experience with the firm’s products and/or services (Kotler 2016). A
customer’s awareness about the brand promise is especially important,
because it impacts the consumer purchasing decision; and it is usually
based-upon whither the brand is meeting the needs of the customer, in areas
such as, reliability and performance (Kotler 2016).
The Shippo brand has a very positive consumer perspective, because
the company delivers on the expectations that their customers are
anticipating. Through the use of the firms API technology which allows e-
commerce firms to find the best shipping service to use for delivering their
products (Geron 2016); the Shippo brand demonstrates that it can provide a
very good and reliable service. This reliability in performance and brand
promise was not only seen by the e-commerce businesses that were utilizing
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
the Shippo shipping services, but also, by very influential investors (Geron
2016).
For example, in 2016 the Shippo brand was able to amassed well-over
$7 million dollars in investor financing, to continue to further its goal of
becoming a premier shipping brand, with the lowest cost in shipping rates,
as compared to their market competitors, (e.g., DHL, FedX, UPS, etc.) (Geron
2016). In succeeding in this objective, the Shippo firm demonstrated another
important aspect of building brand equity; these investors provided the
assurance to the marketplace that the brand has the capacity for continued
growth, especially in the areas of increasing the brand’s “added value”
(Kotler & Keller, 2016, p. 302) with their consumers, but also, the potential
for persistent revenue expansion and other commercial opportunities.
As indicated above, it is these types of techniques that a brand must
employ to help define how consumers feel or act toward the firm’s
performance and service reputation. Brand equity is all about having the
ability to show a favorable difference in “brand associations with [the]
consumer” (Kotler 2016) that makes their product or service stand out from
the brand’s many competitors (Kotler 2016).
Shippo’s favorable difference is offered by the design of their
integrative approach to make the shipping experience much easier for e-
commerce business merchants. Through its web app and multi-carrier API
shipping platform, the firm has helped their more than 25,000 customers,
“get real-time shipping rates, print labels, automate international paperwork,
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
track packages and facilitate returns” (Meldner 2018). And, most recently,
the company has added the ability for merchants to customize their tracking
notifications of packages that are being shipped worldwide (Meldner 2018).
The launch of “tracking pages” (Meldner 2018)is designed to provide a
smooth and continuous user experience for the global e-commerce
merchants that are utilizing Shippo’s unique services (Meldner 2018).
Which brand elements would be most useful in differentiating the product/service from
competitors?
Shippo competes with other companies that also offer a shipping API platform. The top
three competitors, other than Shippo, in this service industry are ship cloud, stamps.com and
Pitney Bowes (Shippo, 2018, p. para 2). Differentiating a product or service from its competitors
is important for the success of the business. This can take on many means. Companies can
choose to differentiate their products by “form, feature, performance quality, conformance
quality, durability, reliability, repairability and style” (Kotler & Keller, 2016, p. 371). Some
elements that Shippo could use to differentiate their service is features, reliability and
performance quality.
Shippo offers different features that can be added to a basic pay as you go subscription
that other companies may not offer. These features give them a leg up on the competition. Some
of the features that Shippo offers (that others do not) include:
Over 60 shipping carriers, worldwide
Access to added discounts for certain carriers
Complete integration that allows you to sync tracking information across sites
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Hassle free packing slips, shipping and return labels (Everything Your Team Needs to
Ship like Experts, 2018).
With the comparison tool, “Which Shippo plan is right for me”, customers of Shippo can
choose which features their business needs and they only pay for those features.
Shippo also utilizes reliability and performance quality as a differentiation of their
competitors. Customers receive shipping by the shipping carriers that they know and trust
without having to put in the work to find the most reliable and cheapest shipping option. They
guarantee that their customers will receive problem free, quick, and reliable service. Customer
service calls are answered by real people with real solutions. Shippo knows that their customers
are not in the business of shipping, so they take all of those worries away. They want their
customers to only have to worry about what they do best.
Explain the brand promise of the product/service
In Marketing Management, Kotler and Keller define a “brand” as “’a name, term, sign,
symbol, or design, or a combination of them, intended to identify the goods or services of one
seller or group of sellers and to differentiate them from those of competitors’” (Kotler and Keller,
300). Shippo claims to “Save time and money with the #1 cloud-based shipping software.
(Shippo.com, 2018). With this statement, Shippo promises to offer timely and efficient shipping
methods to its consumers. Shippo offers all of its services in a simple and concise location. In an
article from Hinge Marketing, Dr. Lee Frederiksen defines a brand promise as “an extension of a
company’s positioning. If you think of positioning as the fertile ground that allows a brand to
germinate, grow and thrive, the brand promise is a brand’s fruit—it’s tangible benefit that makes
a product or service desirable” (Frederiksen, 2018). With this example, Amazon would be the
fertile ground in which Shippo has been allowed to germinate and grow. Amazon’s empire
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
completely excludes a lot of small businesses. These small businesses must adapt if they wish to
continue. To do so, small businesses must keep up with the shipping demands that Amazon has
normalized in our society. Small businesses have a choice, use Shippo’s services or conduct their
own research and shipping needs. Dr. Lee Frederiksen explains that there are “3 Ways to make
(and keep) your promise…a brand promise must achieve the following three goals: It must
convey a compelling benefit; It must be authentic and credible; it must be kept, every time”
(Frederiksen, 2018).
Which firm is the industry’s market leader? Explain its strengths and weaknesses.
Shippo services a market that caters to shipping and offers its services to retailers and
producers. Within this market, Amazon is a giant. However, Amazon had to claim its own stake
in the retail market. Before Amazon, brick and mortar stores could offer retail products
immediately. In an article from ABC News, Alyssa Newcomb stated that “Shipping costs can be
a deciding factor between a person buying something in a brick and mortar store or purchasing
online.” (Newcomb, 2015). Amazon’s decision to offer fast and convenient shipping
revolutionized the retail industry. Since then, Amazon and Wal-Mart have been trying to match
each other. Within this rivalry lies the strength and weakness of Amazon. As Amazon battles
Wal-Mart, both companies are pushed to offer more and more. Thus, the market greatly benefits
from this competition. A free market thrives when companies are left to compete and the market
decides the outcome. However, as Amazon battles Wal-Mart, they tend to forget the smaller
companies. That is where the weaknesses lie. As Amazon battles Wal-Mart for superiority,
Amazon neglects smaller companies that may be outside of their empire. Shippo allows these
companies to rival Amazon’s shipping process with a fast and affordable alternative. Therefore,
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companies should not strive to become all-encompassing. If they do not, they may lose all that
they have worked towards.
Explain Shippo’s market classification (leader, challenger, follower, or nicher)
To succeed in the global marketplace, firms must research and identify the right
classification that provides the best fit for products or services, and sometimes the fit finds them.
Some firms might find themselves in a lead position such as Microsoft or Best Buy when they
produced and introduced their new products into the marketplace, but many firms find
themselves fighting for positions to gain the upper hand pushing lead firms out like Toyota did
with General Motors. Firms may not want to “rock the boat” or position themselves in the lime
light, they may instead be more comfortable following others to establish a customer base even
though profit margins may be minimal. Or, as in the case for Shippo, a firm can take advantage
of being in a niche, or segment of the marketplace, offering a specialized product or service. This
is idealistically where firms want to be positioned, even large corporations attempt this niche
market with products or services such as when the automotive industry introduced hybrid models
(Markiting-schools.org, 2012) targeting environmental seekers. Either way, profit margins have
much greater potential within the niche segment (Kotler & Keller, 2016, pp 337-346). A niche
market is one that is focused and targetable, one that satisfies a need for a product or service that
is not normally found within the marketing mainstream except through specific knowledge based
or high-tech firms like Shippo. Economic Times pegs the definition of niche marketing as a
strategic move to target a specialized audience (The Economic Times, 2018) and Shippo does
just that. They are considered “born global” (Keller, 2016, p. 220) and equipped with an
innovative, interface program allowing them to gain a toe hold within a niche market. In fact,
Shippo prefers to focus on smaller markets instead of the larger giants like Amazon, but they
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soon felt their doors busted in by larger firms demanding their services such as with eBay
Canada (Konrad, 2017), Dsco Partners (Market Wired, 2017), and other investment firms
seeking their expertise.
Explain where Shippo’s services lie within the current life cycle stage (introduction, growth,
maturity or decline) for businesses
The introduction stage is the beginning and very critical stage for firms introducing new
products. This stage requires a large budget for advertising so the firm can convince their
audience to use their products or services rather than their competition. This stage also consists
of tweaking products/services and re-advertising, all of which costs money hence reducing profit
margins. If firms make it past this stage, they enter the growth stage as their products/services
gain recognition and sales begin to climb. This stage is usually the “make it or break it” stage as
firms are faced with much competition and costs just to stay afloat. If sales begin to rise or at
least remain stable, firms may start to reap benefits and profits enough to remain in this stage for
a while. If their products/services start to become a commodity however, then firms face the
maturity stage where sales become more stagnant as well as profits. If sales for products/services
begin to fall, then firms unfortunately find themselves in the decline stage where too much
competition or challenges are overwhelming causing them to reduce production or services by
cutting out the weakest links. At this point, some firms may harvest their products/services by
shaving off some overhead to recapture profits but many times they’re hanging on by a thread.
Other firms may choose to divest their efforts by selling off some or all of their
products/services, or perhaps liquidate their operations altogether (Kotler & Keller, 2016, pp.
351-357). As mentioned earlier, Shippo was “born global” (Keller, 2016, p. 220) and quickly
soured through the introduction stage and into the growth stage where sales continue to escalate,
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
and their services continue to gain competitive advantage. Shippo is among those success stories
you hear about like Mark Zuckerberg when he started an online connection for fellow students
within Harvard not realizing that it would explode across the globe becoming Facebook
(Marketing-Schools.org, 2012). As Kotler and Keller (2016) tells us, even though niche firms
prefer to target the smaller portions of markets, sometimes companies reach such great strides
that they find themselves in more sizable markets (Kotler & Keller, 2016, p. 346) and with
Shippo, larger corporations are knocking their doors down such as Ipsy, Scheels, Tuft & Needle
and Martha Stewart’s brand Marley Spoon. Shippo has been in the growth stage almost from the
get-go and will likely be there for a good long while. They recently received $7 million from
Union Square Ventures and other investment firms to continue developing and improving their
application programming interfaces (API) so international and domestic shipping companies can
better optimize shipping (Nalawade, 2016). They also joined forces with Dsco Partners to
provide thousands more retailers the opportunity to expand their shipping efforts (Market Wired,
2017). Shippo received recognition by Forbes “under 30” list for 2017 with so many firms
utilizing their API programs as they broke the monopoly after an 18-year exclusivity with the
United States Postal Service’s ePostage program allowing access to over 10,000 firms shipping
around the world (Konrad, 2017). Indicators as of last year show a volume increase averaging
over 70% for Shippo’s API users and they are in the midst of developing artificial intelligence
(AI) tools to optimize even more shipping options and close more sales (Wu, 2017).
Discuss how your firm uses packaging and labeling to support its marketing effort.
Research indicates that one of the first encounters a consumer has with a particular brand
comes by way of the brand’s packaging strategy(Kotler 2016). Whether its
the brands products and/or services, package design has three main
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
functions: (1) Reflect the business positioning (e.g., differentiates the brand
from the competition); (2) communicate graphic identity; (3) and, reflect
target market values (Bizfillings 2018).
Some firms use packaging to differentiate themselves by bundling
areas of expertise together or by what's called "graphic identity" (Bizfillings
2018). For example, a firms unique logo design and specific color-scheme do
become the recognized symbol for consumer awareness for a particular
brand (Bizfillings 2018). Also, the logo design and colors do convey the way a
brand attempts to communicate its uniqueness in the marketplace (Kotler
2016).
A service business, like Shippo, its logo which is colored in green and
white, according to “the color wheel of branding and packaging” (Kotler
2016)do communicate a message that has meaning. On the color wheel,
green represents “the color of nature, connotes health, growth, freshness,
and renewal” (Kotler 2016). And, the color white for marketing purpose
represents “purity, innocence, and cleanliness” (Kotler 2016).
From a marketing perspective, packaging becomes the reason for the
brands survival. It is through the design of packaging and labels that a firm
can promote its brand identity, get the attention of consumers, as well as,
position the product within the marketplace (Gómez 2015).
In conclusion, Shippo appears to have accomplished most of the main
objectives of packaging, by drawing the customer close to the brand, making
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
it easy to use, thereby, impressing upon the e-commerce marketplace, to
make the Shippo model a part of the their purchase decision (Kotler 2016).
Is the product classified as a convenience, shopping, specialty, or unsought good? Select one
and omit the others.
Consumer goods classification was actually proposed by a man named Melvyn T.
Copeland in 1923 (Mason, 2005, p. 309). The classifications have survived to modern times,
although there has been a little modification to the labels used, multiple times. Over the past
couple decades, the practice of assigning a classification to a product has faded and marketing
firms are taking different avenues when developing a marketing strategy. Shippo shipping
platform would be classified as an unsought good. “Unsought goods are those that the customer
does not know about or normally think about buying, such as smoke detectors” (Kotler & Keller,
2016, p. 369). As a rule, companies don’t think about finding a shipping platform that will give
you the best price for the fastest shipping. Most companies are pretty loyal to the carrier that they
chose when they first started shipping merchandise. If they do decide to change carriers, they
switch to a competitor. A shipping platform, such as Shippo takes advantage of the best deals,
best routes, and fastest delivery.
Services, Pricing, and Distribution
Describe the support services needed by buyers of the product/service.
Customers of shipping platforms, such as Shippo and Stamps.com need multiple
customer support. Packages get lost, computers crash while you are printing your shipping label,
or you don’t know how to return merchandise. Exceptional support services are needed to retain
customers. There are more customer complaints, today than ever before. Customers feel that they
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
are not heard and their needs are not being met by companies that only care about the bottom
dollar. The support services of any service company is the key to satisfied customers.
Researchers have actually identified 5 of the most important service qualities that a
service company can provide. They are:
Reliability- The company must provide the service that is advertised exactly. The service
provided must be accurate and customers must be able to depend on this accuracy.
Responsiveness- Customers must be helped when they need it. Waiting on support
services can alienate a customer.
Assurance- Customers must know that they can trust the personnel that is attempting to
help them. Support employees must be knowledgeable about the company and services
that they provide.
Empathy- Each customer must feel like they were treated like a valued customer.
Employees should strive to make the customer feel as if their problems are important to
the company.
Tangibles- The physicality of the company, facilities and tools used in providing the
service (Kotler & Keller, 2016, p. 420).
Customers are willing to accept less than perfection, but they must feel satisfied that
their issues are handled by an employee who is willing to do whatever it takes to straighten a
situation out.
Describe the support services offered by the firm’s main competitor. How are they different
from the firm’s product/service?
Stamps.com is the leading competitor of Shippo. Stamps.com offers email support that
responds within 1-2 business days, telephone support with limited hours of service and a general
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
FAQ. The general FAQ offers answers to the most popular questions that are asked by the
customers of the site. The site states that “Online support is the fastest and easiest way to fid
answers to your questions” (Stamps.com Contact Information, 2018). The support page offers
topics that include stamps, packages, billing, and ecommerce. Stamps.com also offers additional
resources such as videos. Blog, and webinars.
Shippo offers customer support personally through email, Aim and phone. All emails and
Aim messages are replied to on the same business day. Shippo has a comprehensive help center
that covers far more topics than Stamps.com. on the Contact Support page you will even find
tutorials on how to do everything from choosing a carrier to filing a claim for insurance. There
are also guides to set up a Shippo account. The topics included in the Contact Support page
includes:
International
Tracking and Insurance
Creating and Printing Labels
Account settings (Contact Support, 2018)
One downside to the support offered by Shippo is their limited telephone support. This is
something that can be a problem for merchants that need to answer to customers or get a package
out. They even state on the website that they cannot guarantee a response to a request for a
telephone call.
After looking at the support service offered by both companies, they seem pretty
comparable. Shippo does sneak ahead with all of the comprehensive tutorials and help center
guides. It lags behind Stamps.com in the live customer service with its lack of live customer
service agents.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Describe the post-sale service arrangements the firm does or should provide
In Marketing Management, Kotler and Keller describe “postsale service strategy” as the
quality of customer service that is provided. Furthermore, they state “The quality of customer
service departments varies greatly. At one extreme are those that simply transfer customer calls
to the appropriate person for action with little follow-up” (Kotler and Keller, 423). This kind of
customer service can be very fast and efficient. Companies may employer fewer members since
all of their efforts are focused on fixing the immediate issue. This kind of customer service is
impersonal and consumers may feel as if they are just another individual who has bought a
particular product offered by the company.
Kotler and Keller continue on to describe another style of postsale service strategy. “At
the other extreme are departments eager to receive customer requests, suggestions, and even
complaints and handle them expeditiously.” (Kotler and Keller, 423). With this style of service,
companies seem more actively involved with their consumers. This kind of service is very
personable and can help catch issues before they spread.
Shippo would benefit greatly from being proactive with their product. However, Shippo
does offer many resources to its consumers— contact sales, contact support, and the help center
(Shippo, 2018).
Explain how the firm’s repair/service efforts impact consumer satisfaction
In business, it is very important to provide the consumer with exactly what was promised.
However, sometimes, things may go wrong. This why repair/service is vital to any product. Any
and all products will encounter some kind of issue. It is up the company to rectify these issues as
soon and efficiently as possible. After reviewing multiple sites as a reference. As a whole, Shippo
received nothing less than a 4.5/5. Capterra rated Shippo 5/5 overall, giving the company 4.5/5
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
for ease of use and 5/5 for customer service. Another sites, G2 Crowd awarded Shippo with a
4.8/5 rating with high praise from all of its contributors. Therefore, Shippo appears to be
delivering on its promises and consumers are very satisfied with the product.
Managing the development of new ideas for products and/or services is
an important task in the firm’s process of creating value, as well as, meeting
the needs of a demanding consumer market (Kotler & Keller, 2016). Ideas for
new products can come from many sources, such as, the company
employees, brainstorming forums, studying the competitor, or through
surveys with outside consumer groups (Kotler & Keller, 2016).
For example, Shippo partnered with a foreign company, called Mercari .
The company was established as “community-based mobile shopping app”
firm that was based in Japan. With a proven model in their home country,
Mercari began a search for a e-commerce partner that could help simplify
their shipping process, with their planned expansion into the United States
(Shippo 2018). Through Mercari’s partnership with the Shippo brand, Mercari
was able to find the right solutions for their needs (Shippo 2018). By using
Shippo’s integrated API platform for shipping reports, Mercari was able to
develop “benchmark [reports] on how their shipments compare with industry
standards” (Shippo 2018).
Discuss possible sources of new product ideas.
Managing the development of new ideas for products and/or services also requires
that a firm must utilize “idea screening” (Kotler 2016)to avoid adopting poor
products or solutions that are not success driven in creating value, or
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
effective in meeting the needs of a demanding consumer market (Kotler &
Keller, 2016). For example, in the screening process a firm must avoid a type
of error, referred to as the “DROP-error” (Kotler & Keller, 2016). This type of
product error occurs when profitable ideas gets rejected (e.g., dropped) by a
firm, that may have been based upon faulty research or uninspired
management influencers’ (Kotler & Keller, 2016).
The Shippo company ideas are screened by their customer reviews and
concept tested by the ecommerce merchants that utilize their services. The
company has seen tremendous in the shipping marketplace, and are now
serving over 3 million e-commerce members through their API platforms
(Shippo 2018). For example, Shippo’s customer review from the Mercari’s
case study; the client indicated the following:
With the architecture of the shipping workflow already in mind, it
only took us one week to fully integrate with Shippo and start
shipping. And with the detailed API docs, the entire process was
very easy (Shippo 2018).
As a result of Shippo’s API platform, frequent trips to mail packages
through the US post office by ecommerce merchants are now non-existent.
Now, the firms who utilize Shippo’s services can by-pass the frequent
delivery trips to the postal services, by engaging the low cost solutions
provided by the brand, to get their products out to the customer with little or
no problems (Rapier 2017).
Discuss the firm’s pricing method or methods.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
In a demanding shipping market cost and prices for either product or services
do become a consumer’s measurement in their evaluation of a company’s
worth (Kotler & Keller, 2016). The objective for success in any marketplace
against the competitor is to demonstrate it is a “value priced” (Kotler &
Keller, 2016, p.474) company. According to Kotler & Keller (2016), this
position shows that the company value pricing strategy does not
compromise the firms product quality design or specifications. Instead the
brand strategy is to offer a “low price and high quality” (Kotler & Keller,
2016, p.474).
Shippo is a “value player” (Kotler & Keller, 2016, p.474) competitor in
the shipping ecommerce industry, with shipping plans that begins with the
pay as you-go to professional to premier (Shippo 2018). These shipping plans
allows companies to scale-up their delivery needs, as their company grow in
the marketplace (Shippo 2018). For example, for companies that ship less
than 200 packages will benefit from Shippo’s pay as you go plan, because
the company only charges a small shipping fee, however, the quality of
shipping services are not diminished by the firm (Hull 2018).
Explain the price adaptations (discounts, promotions, etc.) the firm should use.
Kotler & Keller (2016), states that companies should adapt their pricing plans
to reflect the “variations in geographical demands and costs, market-
segment requirements, purchasing timing, order levels, [etc.,]” (p.482). For
example, pricing adaptations may include the company’s use of price
discounts, or allowances, or promotional pricing plans, as well as,
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
differentiated costing approaches, in order to accommodate the differences
among the consumers (Kotler 2016).
As indicated, the Shippo company has various shipping plans that are
based upon the size of the business. Each plan has differing discounted
features that serve to meet their individual customer needs. For example,
the professional plan offered to merchants who ship over 200 orders, will
receive a 10% discount on shipping rates, if they also apply for the annual
subscription program offered by Shippo (Hull 2018).
In summary, the research shows that the Shippo brand has applied
both value and promotional pricing strategies to their advantage, in order to
meet their varying customer demands in a very competitive marketplace
(Kotler 2016). Finally, based upon the research the Shippo brand is bound for
continued success in the ecommerce shipping industry.
Discuss Shippo’s distribution strategy
Designing a distribution channel system for a product/service requires
much preparation and analyzing to first determine what the end user needs
or wants, then to figure out how to get the product to them in a cost-effective and
efficient manner. A distribution strategy is necessary for companies like Shippo to develop and
ensure their products/services reach their destination across land, sea, air, or electronically and
sometimes intermediaries or sales teams are needed to assist with the channel flow. For Shippo,
they have the power of channel reverent because of their high-tech programs come highly
recommended within the shipping industry (Kotler & Keller, 2016, pp. 237-238, 494, 503, 509),
but even so, they must figure out the best means to get their product from point A to point B. One
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
strategy Shippo uses is through networking with other software developers such as hosting a
conference to help identify various channels and means for maneuvering through those channels.
The developers at the conference all found some things in common, mostly, they do not have
marketing experience so they tend to use experienced, technical sales teams on staff to search for
buyers and negotiate deals. Networking with other software companies facing the same issues
allowed the conference participants to learn more about who makes buying decisions to help
strategize their plan. Altogether, participants during the conference agree that content marketing
plays the most important role in identifying the right distribution channels since most software
developers are looking for answers to their problems through news articles or blogs (Lian, 2017).
The head of marketing for Shippo summarizes their strategy used to target distribution channels,
Mikhail Ledvich indicates that finding market segments to target developers are challenging
because they ask why the product supersedes others and want to know if they can simply build a
software program themselves that will work just as well. Ledvich also says it is imperative to
determine the right product-market fit and recommends five important strategies to help
determine that fit; (1) don’t lump all developers into the same bracket because they vary greatly,
(2) make sure the product contains details about specific benefits, (3) provide documentation
such written tutorials or sample projects because developers look to compare their problems with
others, (4) be transparent within the developer community, and (5) design and price the software
program so developers can experiment with the product before committing to a higher level or
tier of services. Ledvich closes with this important key factor, finding distribution channels are
just the beginning of the plan, but the strategies to build developer relationships such as through
networking or developer forums are the necessary tools to a successful operation (AWS Startups
Blog, 2016).
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Explain the channels used by Shippo to distribute their product/service
There are three types of marketing channels used to reach target markets and deliver
products/services; (1) through communication channels which send and receive messages like
mail, phone, newspapers, or radio, (2) through distribution channels that help deliver
products/services using direct mail, internet sales, or indirect handlers like distributors or
wholesalers, and (3) through service channels like warehouses or transportation companies
(Kotler & Keller, 2016, pp. 10, 501, 510, 514, 603). The distribution channels that cater to
Shippo’s product/service are through digital means using zero-level channels, or direct sales, to
shipping organizations or e-commerce which are cost effective plus provides better control and
management over their high-tech software program. As mentioned earlier, Shippo uses
experienced, in-house sales teams to search for buyers and negotiate deals, they network with
other software companies, and they use content marketing such as posting blogs and projects
onto forums to get other developers to provide feedback and interest in their product.
Promotion and Social Responsibility
Integrated Marketing Communication (IMC)
Designing and managing the brand’s “integrated marketing communications” (Kotler &
Keller, 2016), component in a holistic way can pay deep dividends in building customer
loyalty (Kotler & Keller, 2016). When marketers apply the holistic approach, they are employing
various forms of promotional techniques to “inform, persuade, and remind consumers—directly
or indirectly—about the product or brands they sell” (Kotler & Keller, 2016). This is what
marketing communications should represent to the firm, because when correctly done, the
brand’s marketing communications program will become the “voice of the company . . . a means
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
by which the firm can establish dialogue and build relationships” (Kotler & Keller, 2016), with
their targeted consumer market.
Shippo’s application and use of the “integrated marketing communication” (Kotler
& Keller, 2016), approach, has proven to be not only very effective, but also well-planned and
well-communicated to appeal to the needs of their consumers. A great example of how this firm
utilizes the holistic approach in their messaging process, is their Web site, and their e-commerce
blog page (Shippo 2018). On these two sites the company provides information that designed to
help their e-commerce clients learn “how and why, by whom, where and when” (Kotler & Keller,
2016), to use their shipping services, as well as, testimonies from satisfied customers who have
used Shippo’s products (Shippo 2018). These media platforms are being utilized as the “voice of
the company” (Kotler & Keller, 2016), by sharing information to consumers to generate dialogue
and promote brand knowledge (Kotler & Keller, 2016).
The Marketing Communications Mix
According to Kotler & Keller (2016), “the marketing communications mix” (p.559),
has eight major approaches to communicate a brand’s message to the consumer. These eight
techniques include the following: Advertising; sales promotion; company events or activities;
social media promotions; mobile marketing; direct marketing; and, personal selling(Kotler &
Keller, 2016). And, through the use of these multi-platforms for marketing, the firm must
develop creative tactics to convey an appealing message that moves buyers first toward brand
awareness, knowledge, preference, and conviction; then finally toward the purchase
decision (Kotler & Keller, 2016).
Shippo’s multi-media platforms include an online Web site, Twitter, LinkedIn, and a
Facebook business page (Shippo, 2018). For example, on the company’s Facebook page, Shippo
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
provides customers with different information and topics, such as, tips on holiday gifts
buying (Facebook 2018). Of course, on Shippo’s Twitter page, again the company promotes the
brand awareness, by advertising company events and activities to consumers iPhones and tablets,
share news-worthy articles that helps to shape their consumers’ viewpoints about the brand.
Each of the aforementioned strategies appears to employ mostly the “informational
appeal” (Kotler & Keller, 2016), to creative marketing. For example, the theme on their website
says: “Powerful shipping made simple,” which advertises the brand’s services as a “problem-
solution” (Kotler 2016)benefit to the consumer. As indicated by Kotler & Keller (2016), in the
informational approach to marketing “logic and reason rule” (p.566) in the communications
process.
Discuss the firm’s advertising objective.
There are some objectives that are universal through products and services. The first
objective, of course is to introduce a product or brand. The firm needs to let the public know that
they have something that could benefit them. The second objective is making people aware that
the product/service is available and what it can do for them. The firm must then differentiate
their product from others. They must let the public know what they have that others do not and
position the product/service in the consumers mind. This positioning is what makes a consumer
purchase one product over another. The last universal objective is increasing sales and profits.
These objectives are a given as the whole purpose of advertising is to make more people buy the
product/service; therefore increasing sales.
“Product advertising should focus on solving the needs of your customers; consequently,
your advertising should stress the product’s benefits” (Determining Your Advertising Objectives,
2007, p. para 10). This is why it is important to decide what the company’s objectives are
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
concerning advertising. A company must set itself apart from the competition and give
consumers a reason to try their product/service. A company must be sure that advertising will
give them the outcome they desire. To do this, advertising must be customized to a particular
product or service. The universal objectives remain, but more specific objectives should also be
set. “For effective goal-setting, marketers should set quantified, measurable criteria”
(Kokemuller, 2018, p. para 5).
One of the advertising objectives of Shippo should be to gain the business of consumers
(e-commerce businesses) that have, up until now, used one single shipping service such as USPS
or UPS. Getting the word out to all of the e-commerce businesses that you can use any shipping
provider through Shippo will make loyal customers of other services give Shippo a chance. The
ultimate objective of Shippo is “to become the universal shipping rate provider across all
shipping carriers around the world with a dynamic shipping rate engine, providing e-commerce
stores and marketplaces the best, most optimal shipping rates” (Amazon-Level Shipping &
Logistics, 2018, p. para 1).
The ultimate advertising objective of Shippo will be achieved by using persuasive,
comparative advertising. Shippo must let potential customers know that they can do a better job
for the customer than they have been receiving. To do this, they must compare the benefits they
offer with those of other shipping platforms.
How could Shippo use event sponsorships as a part of its promotional efforts?
Many times, marketers encourage companies to sponsor specific events as part of a
promotional effort to get their product/service visible within the marketplace. This type of
exposure allows the target audience to engage with the product/service and respond more with
the company. Sponsoring events also helps the company to socialize with the audience which
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
ultimately helps to reinforce brand salience and associations. Choosing the specific type of event
in order to promote the right image and greatest awareness of the product/service is the key
weighing factor, but also, developing a budget to sponsor the event can be difficult and
burdensome but can achieve the greatest, most desirable and measurable results (Kotler & Keller,
2016, pp. 604-606). Shippo is ahead of the game and regularly seeks opportunities to host
conferences such as recently when they hosted a “Shippo Summit”. This was a sponsored event
that occurred last year, and participants included were e-commerce companies like the Gap and
Wish, as well as, other software developers and special guest speakers. Shippo’s goal was a two-
fold effort, for one they intended to brainstorm and learn from others facing similar obstacles and
challenges within the shipping industry as well as learn about any technology shifts, and number
two Shippo intended to meet and greet other software developers who may potentially become
staff members, partners, or even big clients in the future. Shippo and others walked away from
the conference with much knowledge and tools that they later integrated into their existing
operations and software platform and re-entered the marketplace with new strategies to target
audiences (Shippo, 2017).
Discuss the Internet marketing possibilities for the product/service.
The Internet marketing possibilities for Shippo are endless. Advertising spots can be
purchased in all of the marketplaces and e-commerce sites in the form of banner ads or display
ads. Potential customers are already online doing business on these sites, so there is a good
chance they will encounter one of the company’s ads. Shippo could also gain customers by paid
search ads. In doing this they can choose to pay a flat rate or pay-per-click rate. A company can
enter a list of terms related to their business and each time a person does a search the relates to
the list of terms, the company’s ad will show up on the side bar. As stated, a company can pay a
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
flat rate or only pay for the potential customers that click on their ad. Pay-per-click enables the
company to monitor and evaluate how successful the advertising is.
Companies can also choose to purchase interstitial ads (pop-ups) or advertise on social
media websites. With social media, ads can be bought in the form of banner ads or the company
can advertise on their own “fan-page”. Shippo would benefit greatly from internet marketing.
The customers that Shippo seeks to recruit do most of their business online.
Discuss the use of social media in the marketing of the product/service.
The three types of social media platforms that are used by companies for marketing are
online communities and forums, blogs and social networks. Online communities and forums are
a place where consumers go to get advice from their peers. Consumers can ask for
recommendations about what product or service would be the best in their particular situation.
Other consumers will weigh in with their experience with a certain product/service and tell
others if the product/service was worth the time, money and energy they had to put into it. This is
a useful tool for marketers to use, especially for improving the product/service. Blogs are used
by many companies to keep consumers updated about new products, product improvements and
current events pertaining to the company. They are also used by consumers that seek to inform
other consumers about a product or service.
“Social networks have become an important force in both business-to-consumer and
business-to-business marketing” (Kotler & Keller, 2016, p. 622). Using networks like Facebook,
Twitter and LinkedIn can also benefit companies that are looking to market their business. There
are guides to marketing your business on Facebook in every business magazine. According to an
article in Forbes, “…41%of US small businesses now use Facebook as part of their online
marketing strategy” (DeMers, 2015, p. para 1).
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Shippo currently participates in all of the major networks with Facebook having the most
followers at 3,472 followed by Twitter, with 2,607 followers (Shippo, 2018) (Shippo, 2018).
Shippo’s Facebook page offers webinars for small businesses. These webinars offer the potential
customer tips on a wide range of subjects. Some of the subjects covered are lessons learned,
increasing sales and International e-commerce. Because Shippo offers a service that is an
unsought good, getting the word out to potential customers can be a more daunting task, but they
are taking advantage of all avenues offered to them.
What are the promotional efforts being used to promote Shippo’s product/service?
Kotler and Keller (2016) indicate that salespeople serve as a vital key between the
company’s product/service and the customer or client. Sales reps, most particularly within the
software development industry, require up front experience plus they must be properly trained
and well versed with a company’s product/service enough so they can help solve customer’s
problems, offer recommendations, provide follow-up services, and maintenance. Another
important tool to use for an in-house sales team is the company’s web page that tells a story
across the world about the product/service’s features, advantages, benefits, and value (FABV)
approach (Kotler & Keller, 2016, pp. 644-645, 648, 651-652). Shippo’s product/service is so
specialized with complex software that their operation requires technical people to serve as a
leveraged sales force. These in-house sales force teams work directly for Shippo and provide
direct sales from the office or out in the field while assisting new or existing clients with
software downloads, updates, and training. Shippo also sponsors and hosts events on a regular
basis to gather developers and potential clients all in the same place to network and hash out any
challenges within the shipping industry or learn about new technological advances that may
affect all participants. During each conference, many developers including Shippo noticed they
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
all rely on in-house sales people to search for buyers and negotiate deals, but also, most of their
marketing efforts and greatest results were found through content marketing such as information
sharing and researching via blogs and forums. This way other developers are searching or
posting questions and looking for answers to similar software issues (Lian, 2017). An article
found online discusses how Shippo acquired $7 million in funding from Union Square Ventures
back in 2016 and the first thing the co-founder, Laura Wu, said was that they were going hire
teams of people with the right skills and experience so that the company can all grow and mature
together (Wu, 2017). Shippo is a smart company providing an experience for their target
audience, but also, their employees who they treat like family.
Explain the role of personal selling in the marketing of the product/service
In Marketing Management, Kotler and Keller define personal selling as “an ancient art.
Effective salespeople today have more than instinct, however. Companies now spend hundreds
of millions of dollars each year to train them in methods of analysis and customer management”
(Kotler and Keller, 651). Within marketing, agents must be able to understand consumer
behaviors in order to provide consumers with what they need when they need it, in an effective
manner. Kotler and Keller also define the “SPIN” method with an acronym—situation questions,
problem questions, implication questions, and need-payoff questions (Kotler and Keller, 651
Explain how sales representatives are selected, trained and evaluated
In Marketing Management, Kotler and Keller had this to say about recruiting and
selecting representatives, “ At the heart of any successful sales force are appropriately selected
representatives” (Kotler and Keller, 647). A company is only as good as its weakest link and if
that weak link is the marketing team, the company cannot push its product effectively. A
company’s marketing department must continuously learn and adapt to trends within the
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
environment in which it competes. Therefore, a company must hire and retain competent staff if
it wishes to be successful. On Glassdoor Shippo has 4.2 stars out of 5. The site says that “83%
would recommend to a friend” and “86% approve of the CEO, Laura Behrens Wu” (glassdoor,
2018). Therefore, the company seems to be hiring and retaining effective employees who truly
care about the company and are happy with its management.
Explain how the firm could be more socially responsible
Kotler and Keller define social responsibility, “Effective internal marketing must be
matched by a strong sense of ethics, values, and social responsibility. Taking a more active,
strategic role in corporate social responsibility is thought to benefit not just customers,
employees, community, and the environment but also shareholders” (Marketing Management,
663). Shippo has a page dedicated to its “shippocares” initiative. Helen Phung states “The old
adage ‘it’s better to give than to receive’ came alive at Shippo this year. We believe that giving
literally puts a bigger smile on our face than receiving” (Shippo, 2018). Shippo also “joined
more than 3000 companies in 80 countries to Pledge 1%. Pledge 1% is a global movement to
create a new normal in which giving back is integrated into the DNA of companies of all sizes.”
(Phung, 2018). Through this initiative, Shippo has partnered with many different companies to
offer assistance wherever it is needed. Shippo has partnered with—Dress for Success, the San
Francisco-Marin Food Bank, and the Urban Forest (Phung, 2018). Therefore, Shippo utilizes
many of its resources to help others and improve their social responsibility.
Conclusions and Recommendations
As economists predict future growth will be promising within the shipping industry,
Shippo already has a leading-edge interface program and power of channel reverent allowing
them to gain a toe hold within a niche market. Currently, their API users are in the midst of
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
developing artificial intelligence (AI) tools to optimize even more shipping options and close
more sales. On the downside, Shippo is also faced with challenges in the shipping and
technology industries such as reliance on APIs that require maintenance, or the rate of
technology growth that may surpass current applications and users, and rising fuel prices or
changes in regulations for shipping that may affect their carriers and negotiated prices.
Altogether, Shippo may be on the leading edge in a niche segment with a promising future
growth, but they must work hard to maintain that level by keeping abreast of the economy and
monitoring any changes to shipping laws or new technology. This requires much time and
money. They may want to expand their operations across the border through a franchise by
licensing their interface program but this comes with risks of not enough control, so a joint
venture may be more appropriate in order to maintain control over their software program.
Shippo offers a plethora of support options on it’s website, but is lacking in live support.
The options of email and AIM support is not enough for most customers who want and need
immediate support services. This could be a big turn-off for potential customers who expect
immediate options that other companies provide. Shippo should definitely look into offering
more immediate services, such as live chat and phone support. A guaranteed return phone call
might be the answer to this problem. The company would have to employee less staff, but the
customers would reap the benefit of more immediate support. This would cost the company in
the short-term, but has the potential to grow a large and loyal customer base in the long run.
Shippo will need confront this issue before it results in serious issues. Consumers expect
immediate support when they face issues with a product or service they have purchase. So, this is
a major flaw that the company will have to confront. This has become apparent on their
Facebook page. Since Shippo relies on email communication, their customers have taken to
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
Facebook as a way to communicate with the company. Customers, frequently, comment on the
companies posts with inquiries into their own questions. Also, consumers comment with their
displeasure in the lack of timely communication.
Also, Shippo will need to utilize more digital marketing techniques. For example,
Facebook ads would greatly increase traffic to their site. As it stands, Shippo is not investing
much money in this kind of technology. Their company Facebook page only has 3,474 likes as of
December 12, 2018. Shippo also has poor social media management. Their Facebook page is
very inconsistent when it comes to posts and engagement. A company the size of Shippo should
be posting content more than once every three to four days. Their engagement is very poor, most
of their posts lack any kind of likes or comments. As stated above, most of their engagement is a
direct result in their lack of timely and consisted customer service.
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MARKETING MANAGEMENT GROUP PROJECT (MMGP): SHIPPO
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