A wide global network, global partnerships, speedy deliveries and trust — these are just some of reasons behind the success of DHL Express. Chandrashekhar Pitre, Senior Director - Marketing, South Asia, DHL Express, reveals the brand’s marketing agenda and how it plans to conquer current obstacles in the Indian market.
Q] The logistics business in India is very competitive. What are the initiatives taken to increase customer share and awareness about brand DHL?
DHL operates in the international space, while Blue Dart, which we acquired, works in the domestic space. While there is competition on the international front, we are market leaders because we do more with our brand than the other players. We have more than 520 retail outlets — which is almost three times more than our competition — and more vans too. Our infrastructure investment too, is larger than anybody else’s.
We have global partnerships with Formula One, Manchester United, Volvo Ocean Race and local partnerships with Lakme Fashion Week, marathons in three cities: Mumbai, Delhi and Bangalore. All our sponsorships and partnerships are on the themes of passion, speed and team work. They are all leaders in their own field, have a lot of passionate followers and therefore, gets our brand right up there, above everybody else.
Q] Can you explain the synergies you share with these partnerships and how DHL leverages them?
Fashion, textile and apparel are important verticals for DHL, for which we have a dedicated sales team. The Lakme Fashion Week provides us a platform to engage with all stakeholders and if anybody thinks of delivering fashion, they should think of DHL. Being here also helps us understand the market and offers us an avenue in customer engagement. We are associated with 19 Fashion Weeks across the globe.
There is a Formula One race happening every two weeks and our job is to transport the entire setup. Formula One is about speed and time and that is the core of our business, anything that is time critical, has speed, team work and involves a lot of passion is something that we are involved in.
Q] As a marketer, what takes precedence on your agenda?
Besides marketing communications, pricing, products, research and data analytics make the role of marketing more business-oriented. So my priorities are to achieve and improve profitability, grow the volume and revenue and also achieve brand salience.
Q] What are the fundamental principles of your marketing strategy?
Our marketing strategy is very simple — to go where our customers are. Business is no longer in the metros but in the smaller markets. We look to develop value proposition for our customers and for this you need to invest in research, productize your offering so that it sells, and package and communicate it well, so the entire gamut of marketing sub-functions are a part of this proposition that we need to make to our customer.
Q] Even though DHL is primarily a B2B brand, what activities does it undertake to engage with the B2C clientele?
More than 90% of our business is B2B, but B2C is certainly the most interesting partof our business where we can experiment, as most customers are new. This allows us to try out some innovative ideas like Rakhi Express, Express Easy Student and Express Easy Mango where mangoes can be sent from India to anywhere in the world. We engage with the student community via our Facebook Page. We also have an online portal for those looking to trade online.
We spend a lot on TV as our advertising, gets us top-of-mind recall that, in turn, drives our business. It is important for us to advertise, because even a B2B business has individuals who see these ads and get drawn towards them.
Q] How do you then convince these customers to pay a premium to use DHL?
By creating a feeling of trust that when you know it is important, you can trust only DHL. The job is to build bells and whistles around the core proposition that is attractive to consumers; that is not expensive but offers the most value. For example, a student applying to any university abroad should be able to track his shipment till it is delivered. We are not just in the business of moving things from one place to another; we are also in the business of giving customers peace of mind. They are happy to pay that little premium because they are getting the service and value that they really want.
Q] How is DHL using the digital platform?
We have Facebook pages for all our global sponsorships which we track. Our corporate social responsibility is also on social media. Digital, today, makes up a large part of our business as a lot of customers get orders online and execute it through DHL. Since customers are demanding it, you will see a lot more digital and social media coming from DHL.
Q] DHL was also caught up in the entire Goa Adfest brouhaha recently. Do you have any comments?
It was said that the ads were copied and done for someone else, which I wasn’t aware of. When I approve something, it’s because it’s a good concept. There was controversy, but it’s in no way related to DHL. I can only tell you that that work was good, it was appreciated and approved by us.
Q] What is your current market share? Looking at the logistics sector, where do you see yourself and the industry, five years from now?
We cover close to 800 cities and because of Blue Dart we are present in nearly 30,000 locations from where an international shipment can be sent. We have the largest network and our market share is close to 50%. I think the logistics industry is slated to grow. Many companies, who currently don’t outsource its logistics, will probably to do to a company that is best positioned to cater to its need — which is a big opportunity. The cost of logistics in India is 13%, whereas it is 8-9% internationally. This differential will improve as the infrastructure improves. We can only be trade facilitators on the back of a strong infrastructure.
Q] What are your challenges in the current Indian market?
The depreciating Indian rupee is a big challenge. We bill customers in rupees, so if we were billing them Rs 50,000, that was previously $1,000 dollars, today its $800. Logistics is economy dependant. As we are a fixed asset business, the additional shipment can be accommodated at no extra cost but with growth slowing, shipments are affected.
Logistics is also not recognized as an industry by the Indian Government. We should be seen as trade facilitators, and have our own voice in policy making. We have the expertise from 220 countries and the knowledge base that can benefit customers. The recognition as an industry will show how much value we add.
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