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MARKETING STRATEGIES OF DHL EXPRESS (INDIA) PVT. LTD.

1. INTRODUCTION

DHL as an American-founded
German Company that was founded
in United States in the year 1969 by
Adrian Dalsey, Larry Hillblom and
Robert Lynn to revolutionize the
world of logistics. DHL is
headquartered at Bonn, Germany. It is
one of the leading logistics company
that majorly deals in couriers, parcels
and express mail division globally. From the past many years DHL is making a positive
contribution towards efficient global trade along with responsible business practices, corporate
citizenship and purposeful environmental practices (DHL, n.d.).

DHL divisions offer an unparalleled portfolio of logistics services varying from domestic and
global parcel delivery, e-commerce shipping and fulfillment solutions, international express, road,
air and ocean transport to industrial supply chain management. DHL has spread its territories
internationally to 220 countries with about 3,80,000 employees adding to growth of the company.
DHL provides specialized solutions for growth of the different industries and markets including
life sciences and healthcare, automotive, retail, technology and energy and many more. DHL is
part of Deutsche Post DHL Group. The Group generated revenues of more than 61 billion euros
in 2018 (Facts Sheet DHL, 2019).

DHL Mission: “Excellence Simply Delivered – is our guiding light”

DHL Vision: “The Logistics Company for the World”

DHL Tagline: “The Power of Global Trade”


1.1. DHL DIVISIONS

DHL
Divisions

Post & Paket Global


Express Frieght Supply Chain e- Commerce
Deutschland Forwarding

1.2. DHL EXPRESS (INDIA) PVT LTD

DHL in India is founded in 1979, specializes in International couriers, International logistics,


Express logistics and e-Commerce logistics. It is headquartered in India at Mumbai, Maharashtra.
DHL has a team of about 1000-5000
employees delivering reliable services to
different industries and customers
throughout India. DHL is the largest
Express service provider in India and
bestowed as No.1 twice with prestigious
“Great Place to Work award”. DHL
Express globally encourages innovation,
social responsibility, and ethical business practices to be active and effective. (Linkedin, n.d.).

DHL Express (India) Pvt Ltd laid the mission statement, which has four main elements:

 To simplify the lives of their customers.


 To make their customers, employees and investors more successful.
 To make a positive contribution to the world.
 To always demonstrate respect when achieving their results.

As the logistics company DHL forms the backbone of global trade, ensuring that whatever needs
to be delivered, gets efficiently delivered on time. A shipment placed in DHL Express trust may
include life-saving medicines, or delivering excellent services and products, or hold a company’s
entire existence in the form of a prototype. DHL not only delivers parcel and package, but to
connect people globally. (Facebook, n.d.)
1.3. GLOBAL MARKETING OF DHL

DHL is based on the old saying “Think Globally, Act Locally” to acquire the new dimensions in
the global marketing. According to DHL, Marketing plans have to work globally to preserve the
brand consistency (focus on advertising) while coordinating with the customers locally (focus on
cost-efficiency). Global marketing in logistics enables employees to localize and customize
creative material for their specific needs, to improve the speed of the market while maintaining
compliance with brand and corporate identity. For instance, from postcards to catalogues, all the
materials related to marketing are printed keeping in mind efficiency of cost and delivered to their
destination, thus making the marketing team much more responsive to the customers and increase
company’s responsiveness to the market. To establish consistent marketing communication across
all the disciplines logistics must provide their customers with software-driven one stop solution in
a cloud-based platform, as it offers a huge opportunity to handle, adapt, produce and supply print
media globally. With Global Marketing Logistics all the parties can accumulate the information
and data for each marketing activity from a single source, eliminating the loss of important
information in the process. To make the marketing effective and efficient, the DHL follows four
main steps:

 Optimize your marketing processes as it saves time as well as cost.


 Content is the King, so must be created efficiently.
 Automate your Media Production to gain competitive advantage: Just-in-time.
 Company should attain local expertise and know their market in depth and must distribute
campaigns locally. (Global Marketing Logistics, 2013)

1.4. MARKETING STRATEGIES OF DHL

 Segmentation, Targeting and Positioning in DHL:


In Marketing Strategy, Segmentation is one of the most critical part for the company like
DHL as it deals with various types of customers. To cater the needs of different kind of
customers globally, DHL uses two segmentation strategies based on:- (a) Demography;
and (b) Geopraphy.
Targeting strategy needs to be differentiated that are used by DHL so as to understand and
frame its deliverables accordingly.
DHL uses User-benefit based positioning strategy to make it a customer-centric business
model and to depict itself as a company with global footprint. (Bhasin, 2019)

 Marketing Mix of DHL:


DHL’s marketing mix based upon 7 P’s are as follows:

Product (Service): In DHL Logistics, there are variant products that are need to be
transported using different alternatives. For this purpose, DHL uses its diverse divisions to
cater customers through various freight options such as air, ocean, rail and road; in addition
to warehousing and distribution opportunities. DHL provides supplies through road and
rail freight with FTL (Full truck load) and LTL (Lass than truck load) and various
intermodal options providing managed transport and value-added services. DHL serves
both B2B and B2C parcel shipments and leverage customers with standardized, traditional
and specially-designed freight options. The characteristics of the goods shipped, delivery
lead times and criticality of the freight to ultimate consumers are the main factors in service
type determination. For instance, the logistics processes of cars are different from
chemicals and medications, not only in terms of lead times but also the way of carriage and
warehousing (i.e. temperature-controlled freight, cold storage).

Price: DHL Logistics implements cost plus pricing strategy for standardized freight
services that covers deciding the final price by adding profit margin percentage to costs.
DHL implements competitive pricing strategy and usually set prices in comparison to its
competitors. Further, the prices of the services may vary in accordance to the distance of
the destination. Prices of customized services are relatively higher in comparison to
standardized transportation services. FHL also provides special prices to loyal customers
and companies in the market.

Promotion: DHL prefers to promote its services through television advertisements and
various mass media. In addition, DHL holds several sponsorship deals with some most
exclusive worldwide such as Rugby World Cup, Formula 1, IMG Fashion Week,
Gewandhaus Orchestra, Barclays Premiere League and Manchester United; with the aim
of reflecting values of the company. For instance, The DHL sponsor IMG Fashion Week
with the motto “Tailor Made” and fashion industry. DHL firmly believes in traditional
ways to complement public relation with the purpose of generating positive image of the
company in the market and in society. DHL also shows its presence with social
responsibility projects such as “Go Green”. With slogan “Good for The Environment &
Good for Business”, company strives to provide carbon efficiency performance guideline
and diminish the possible environmental harms created by logistics industry

Place: DHL is currently operating in more than 220 countries and territories with a fleet of
more than 250 aircrafts. DHL maintains “globally centralized points of distribution” that
increases the company’s efficiency. DHL holds 850 terminals, 2590 warehouses, 26
processing centers and 32 sales offices around the world. To select the distribution channel
members, DHL implements specific criteria such as service quality, costs and
equipments/facilities. Some customer freights may require special equipment and carriage.
For instance, when perishable goods such as chemicals or food are transported, shipping
firm which offers cold options are selected, or to ship hazardous materials, those airlines
that have authorization of hazardous material transportation are chosen.

Physical Evidence: Components of physical layout such as odors, colors, temperature,


noise level, and comfort of furnishings may influence the perceived performance of service
provider. In service industry, organizations’ operations emphasize on physical evidence
looking into service standards because customers service experience can be judged through
the ultimate quality of the service that acts as a tangible evidence. DHL uses its widely-
known logo, red DHL writing on a yellow-colored-base, and yellow color on its trucks,
packaging materials and buildings. Moreover, company attaches great importance to the
design of its website, brochures, business cards and even invoices. They all have carefully
selected designs and reflect DHL’s brand identity with yellow logo and the name of the
company written in red. DHL believes that lack of a strict dress code for the employees
increase their performance, employees working at internal operations departments are able
to dress in business casual style. However, employees who are working at sales, operations,
and human resources departments and employees who are involved in customer visits are
obliged to obey written dress code.

People: At DHL, personnel training is considered as a vital aspect. Every new employee
has to go through the New Employee Orientation Program that objects to introduce
employees to all the products f DHL and developing the effective communication skills.
All the new employees within three months, made familiar to the Code of Conduct, Policies
Information, Adaption to competition and fight against corruption. Training is provided to
employees as per their respective departments. Moreover, since the company uses SAP
based IT program, all employees get training regarding usage of Interlia system.
Processes.

Processes: DHL pays attention to the integration of computer programs for measuring
customer satisfaction and being able to inform customers about processes. Through the
medium of Soft Trans program, the company measures duration of cargo handling.
Problems regarding cargo handling are being measured via questionnaires in certain time
periods.
Complaints and customer opinions are being recorded routinely. Received complaints are
being categorized according to related subtitles and the company endeavors to develop
solutions to satisfy customers’ demands as fast as possible in order to prevent customer
losses. In a similar vein, I-sell program is being used for keeping records of customer visits
and sales reports.
DHL Logistics provides diversified customer service strategies based on the type of
customer. For instance, DHL offers 7/24/365 customer service for specific industries such
as aerospace industry in which the delivery is being done within business hours. Based on
the emergency, different delivery options can be preferred by different industries.
For recovering any encountered operational problem, DHL undertakes additional costs in
order to relief and maintain customer loyalty. Every occurred problem is being recorded
into the system and customers are being informed about the solution process. Through this
system, they can track the status of the freight or the stage of solution process. Even it’s a
customer’s fault, DHL tries to solve the problem as soon as possible with the lowest
additional cost reflected to the customer. If a problem occurs after DHL delivers its clients’
freight to the air freight service provider, company opens a claim and for any occurred
damage or loss, legal process that is stated in the back of the bill of lading is followed with
the carrier. (Oflac, Dobrucalı, Yavas, & Escobar, 2014)

 SWOT Analysis of DHL

STRENGTH WEAKNESS

•Large Network •Limited Market Share Growth


•Innovation •Requires heavy investments
•Strong Brand Equity •Dependence on External Agencies
•Growth in developing countries •Dependence on Regulatory Bodies
•Excellent Financial Position •Poor Marketing
SWOT
Analysis
OPPORTUNITIES THREATS

•Emerging Markets •Competition


•Inrganic Growth •Economic Slowdown
•E-commerce •Declination of Traditional Services
•Local Player

STRENGTHS:
1. Large Network: DHL has the competitive advantage over other global players of
being largest global freight carrier with its network in more than 220 countries. DHL
efficiently expanded its reach with the help of effective communication and excellent
in-house consultancy.
2. Innovation: DHL has developed its innovation centers through which they structurally
invest into trend research and solution development. These innovation centers provides
platform where various customers and stakeholders can engage with DHL experts.
SmartSensors and Resillience 360 are the few results of these innovation centers at
DHL.
3. Strong Brand Equity: DHL carries a strong brand valuation of $5708 millions and
was ranked 77 on the best global
brand ranking by Interbrand in
2016.
4. Growing in Developing
Countries: To set up and expand
in its services, DHL heavily
invested in developing different
countries to leave large footprints
on the emerging markets.
5. Excellent Financial Position: DHL carries a good reputation in having healthy
financial background, along with ample amount of resources backing it up. As a result,
it creates a strong goodwill for itself and is doing expansion year on year.

WEAKNESS:

1. Limited Market Share Growth: In the competitive market of logistics, considering


the various small and large competitors it becomes difficult to increase market share
growth.
2. Requires heavy investment: Huge investment is required in the logistics sector to set
up and expand in the market. Also, the return on investment is not immediate.
3. Dependence on External Agencies: As DHL consists of wide network, they need to
collaborate with various local private agencies. Thus, they require good coordination
with the external agencies because it has direct impact on the efficiency of the DHL
Services.
4. Dependence on Regulatory Bodies: Regulations in the source and in the destination,
places can vary and following different norms and laws can create hurdle. DHL has to
take care of the regulatory norms of the home country as well as the local authority of
the destination.
5. Poor Marketing: DHL does not invest much on advertising and branding activities as
compared to companies like Fedex and UPS. Due to their low expenditure on marketing
activities, it may have negative impact on brand popularity and acceptance.

OPPORTUNITIES:

1. Emerging Markets: DHL has grabbed and set itself in most of the emerging markets, but
they need to expand and utilize their potential in such emerging markets by focusing of
customer-based international supply chain.
2. Inorganic Growth: DHL, being a big name in the industry can acquire several local
players to expand its reach in the target markets.
3. E-commerce: E-commerce is considered as the future of shopping and so it becomes
important for DHL to be present in this platform as well. Thus, an Increase in electronic
shopping presents an opportunity for DHL to tap this market as well.

THREATS

1. Competition: Fedex and UPS are DHL’s prime competitors and are giving DHL a tough
fight in all the markets. Various local brands also possess a threat for DHL in its specific
territory.
2. Economic Slowdown: Logistics is one of the industries which is hit the hardest when it
comes to Economic slowdown.
3. Declination of Traditional Services: Traditional services such as letter and posts have
declined due to the advent of technology in developed as well as developing economies.
4. Local Players: A major threat to DHL is that the brand suffers against local courier players
which might be operating at lower and penetrative prices. These local players are also able
to give excellent service. (Bhasin, SWOT ANALYSIS OF DHL, 2018)

 Competitive advantage in the Marketing strategy of DHL:


Collaborative partnerships: DHL works closely with the companies in core sectors like
Life Sciences & Healthcare, Technology, Energy, Automotive and Engineering &
Manufacturing. Like in Life sciences sector only it has 4900 life sciences specialists, more
than 160 pharmacists, Clinical trial depots in 24 countries and global warehouse footprint
in 60+ countries.
Strong Parent Company: DHL is the division of Deutsche Post DHL Group which is the
leading player in the Logistics, shipping and courier services. It’s 85% of the total revenues
come from the logistics business and scoring market capitalization of $36 billion as of May
2016. As per the Forbes list, the group ranked as 228 in Global 2000 brand list of
companies.
The logistics industry is facing tough competition from local national and international
players. DHL competes in the business with companies like FedEx, UPS, Amazon express,
TNT express and many others. DHL provides end to end logistic solutions to the individual
as well as SME’s (Small and medium enterprises) and MNC’s from the varied industries.

 BCG Matrix in the Marketing strategy of DHL:


The company has different strategic business units operating in freight transportation,
supply chain solutions, warehousing and distribution services. Its DHL Express, DHL
Supply Chain, DHL Freight, DHL Parcel are starred in the BCG matrix as they are a leader
in their respective business segments.
DHL eCommerce service is still in evolving phase, emerging eCommerce markets of the
world bring in opportunities in this segment of the business. It is a question mark in the
BCG matrix.

 Distribution strategy in the Marketing strategy of DHL:


Working closely with customers for delivering customer-centric supply chain solutions
have helped the company in being competitively ahead of its competitors. Providing
customised logistics solutions & value-added services along with the different set processes
in the entire supply chain is what makes its integrated distribution channel effective &
efficient.
DHL express worldwide has more than 255 dedicated aircraft which cater to more than 3
million customers across the globe.
 Brand equity in the strategy of DHL: DHL is the renowned brand in the logistics
industry which is known for its worldwide shipping and courier delivery services. It has
been associated with & has been official logistics partner of many prominent events around
the world like Formula 1 race, Rugby world Cup 2015, Fashion week, Manchester United
and Cirque du Soleil.

 Market analysis in the Marketing strategy of DHL: Changing economic scenario,


increasing cross-border business opportunities, changing government regulations, the
opening of economies/ markets for foreign players in various sectors in the developing
nations and increasing competitions, transportations of short product life cycles/ shelf life
are some of the factors affecting the operations of the companies in this industry.