Using Marketing Channels to Create Value for Customers Case Study of Fedex
FedEx as a service company that mainly focuses on transportation or shipment services,
channel played an important role leading to success. FedEx need a good channel to get and
reach more customers. FedEx has a strong network structure linking all the market together.
FedEx serves more than 220 countries and territories currently. Further, these networks are
linked up by land, air and ocean transportation. FedEx’s service covered all around the globe,
making services available for customers from many countries and almost every place. FedEx has
many drops off location around the globe. Customer can choose either one drop- off location
that is nearest to them.
FedEx has great air network, having more than 320 daily international flight and 654
aircraft ready to ship the packages. FedEx has many hubs around the world working as a
midpoint of delivering the packages. There are four hubs in Asia pacific. That is Shanghai,
Osaka, Seoul and Guang Zhou. Besides, FedEx has hubs in London, Colonge, Frankfurt and Paris
which will later ship the parcel around the European area. Moreover, hubs that link the Latin
America, the Caribbean and Canada was in Memphis and Miami.
One thing that makes FedEx so special out of so many transportation or shipping company
is the collection of airplane uses by FedEx in order to ship the parcel. FedEx is the first company
who use the plane called Boeing 777. The uniqueness of the plane is the plane is fuel saver. It
shorter the transit time with larger space to put the parcel. This had made the overnight carrier
service possible.
FedEx was famous in its overnight service. Customers can receive their packages at the
same time on the next day. The strong backbone of shipping network structure by FedEx makes
this service available. An example given to explained how FedEx manage to ship the parcel
between 24 hours and reach at 10.30am. A customer decided to ship his parcel from Shang Hai
to New York City. FedEx pick up the shipment in time to make the same-day trans-oceanic
flight. FedEx picked up the package from client at the time of 4:50 pm, Tuesday. The package
was delivered to Shang Hai’s facility for sorting process.
Then, the package reaches Shang Hai Pudong International Airport at 9:30 pm. At 11:30
pm, the package leaves China and in the Boeing 777 aircraft on the way direct to Memphis,
Tenn. The flight travel east of the Pacific Ocean and passed the International Date Line. At the
time 11:30 pm, the package arrived in Memphis. In Memphis, the package was on loaded,
cleared, sorted and reloaded on to a flight from Memphis to Newark. In Newark, the shipment
ship by truck to New York City. This is how the package from Shang Hai reach client in New York
City and at the time 10:30 am Wednesday.
From the example, the package was first picked up and sends to the facility for process,
then to airport. The package then reach the hub and been process again. Finally, the package
was delivered by motorized vehicle. FedEx has more than 43,000 motorized vehicles which
make FedEx manage to reach many places in different country. Example of motorized vehicle
commonly used by FedEx was trucks, vans, containers, and also tricycles.
FedEx delivered by electrically-assisted tricycles in Paris to avoid traffic jam in order to
ship in time. The tricycle was designed to put packages back on the tricycle. It has a removable
storage container that places between the back two wheels. It is 100 per cent electrical and it
has to start manually. It is 100 per cent eco-friendly and it enable delivery work more efficient
even faster that a car or truck.
FedEx not only ship with aircraft and motorized vehicles, but also by ocean cargo. It
provides another choice for customer to choose. The ocean cargo services provided by FedEx
linking North America, Latin America, the Asia-Pacific region, Europe and the Middle East
together. Besides, FedEx has enough amount of ocean cargo to make their services, choosing
on the space of cargo available. For example, allow customer to have full-container-load (FCL)
for user that need huge space and less-than-container-load (LCL) for those customer that do
not need so much cargo space. Further, FedEx has ocean cargo with different facility like
refrigerator, on-board cranes, on the cargo ship to provide the service like ship dry or liquid
bulk shipments and handle heavy shipments to smaller ports.
Moreover, customers usually expect their package to ship in time with good condition.
FedEx understand that and come out a solution that is provided packing service. It tried to help
in avoiding damage in packages. In order to make the service available, one of the FedEx’s
subsidiary company was designed to become one of the channels in helping customers to pack
their packages. So, customers can now bring their package to any of the FedEx Office and ask
for pack up service.
Further, FedEx knows that this the era of information technology. Everyone seems to be
online often and many things can be done online. FedEx understand that there is a need to
open a web site as a channel in order to make the service available for more people, especially
for those who seldom go out and always do online shopping. The website makes the process of
shipping easier. Everyone can use the service. Now, FedEx’s customer can ship online with few
step and avoid many process of filling up the forms.
FedEx reach customers in many different ways. Beside of online, by air, by land, and by
sea, FedEx reach customers by telephone and fax. This is another channel provided by FedEx to
customer called and pick up service. In order to provide convenient to customer, understanding
some people might think lazy to go out just for dropping a small package, and also for people
who definitely very busy and lack of time, called and pick up service is a very good way to reach
them. Customer can just dial FedEx’s customer service number and ask for a pick up. FedEx will
pick up the package from you and the great thing was the time count once the package was
picked up by them. Further, Customer can fax to the company to have the service.
In another hand, mobile phone or smart phone are uses as a channel to reach more
customers. Smart phone become very popular nowadays. People tend to have one smart phone
to do many tasks on the go. FedEx makes the website of FedEx available for smart phone user,
trying to attract more customers to use their service. FedEx customer can do tracking of parcel,
schedule a pick up, and even billing by using phone. It makes the service become very
convenient especially for those who usually travel around and wish to deliver their parcel.
FedEx understand the important of customer service. So, a company called FedEx Service
is there specialized in information technology. They providing back up and information like
tracking information, customer’s detail, and customer’s history of using FedEx’s services,
estimate the duties and taxes and handle the claims and complaints. Besides, the company also
provides information about the service and company. It is to make the customer service and
online tool available at all the time whenever customer needed them. Furthermore, it is a guide
for customer because much information was provided on the web site.
One of the channels in marketing is employee. As a service provider, employee is the first
who reach the customer and make the service available. It often leads to satisfaction of
customer. In order to make the service deliver in a certain standard, employee is been train.
The employees required test in every six months to ensure their skills meet minimum
acceptable requirements. Extra training was required for those who are not met the minimum
requirement. Employees need to go through computer-based training, satellite broad-cast
training, and staff-conducted training in order to perform the service to customer.
FedEx’s channels are backed by the computer system called COSMOS. That is Customers,
Operations and Services Master Online System. It is a centralized computer system to manage
people, packages, vehicles and weather scenarios in real time. It is to make sure all the channels
are working properly.
