Pricing & Digital Marketing-Related Challenges in the Shipping Industry
Abstract
This case study is based upon the problem occurring in one of the prestigious logistics company
Lasco shipping pvt. ltd. & its head office is situated in Delhi. This case provides valuable insights
into the challenges and inefficiencies faced by a renowned shipping company in its pricing
department and digital marketing efforts. The case underscores the critical role of efficient pricing
strategies and effective digital marketing presence in maintaining market competitiveness and
revenue growth. By examining the company's struggles with delayed price quotations, missed
consignment opportunities, and prolonged response times, this case offers an opportunity to
explore the intricacies of pricing dynamics and customer engagement in the shipping industry.
Keywords
Digital Marketing, Pricing, Shipping Industry, Lasco.
Introduction
The shipping industry has a rich history dating back centuries when seafaring vessels were used
for trade and exploration. Over time, it evolved into a global network of interconnected routes
and ports that facilitate the movement of goods and commodities worldwide. The industry has
witnessed significant developments in ship design, navigation systems, and logistics, making it
an essential driver of international trade. As of 2023, the shipping industry remains a critical
component of the global economy. It is responsible for transporting approximately 90% of the
world's goods and commodities, making it the backbone of international trade. The sector
comprises a vast fleet of cargo vessels, ranging from container ships to bulk carriers and tankers.
The shipping industry faces various regulatory challenges related to international trade, customs,
and tariffs. Compliance with international regulations, such as those imposed by the International
Maritime Organisation (IMO), can be complex and costly for shipping companies. The COVID-19
pandemic, which began in 2019, had significant repercussions on the shipping industry. At the
height of the pandemic, lockdowns and restrictions led to disruptions in global supply chains,
port closures, and crewing challenges. The industry had to adapt quickly to changing conditions to
ensure the continuity of essential trade. The shipping industry has embraced various technological
advancements to improve efficiency and reduce costs. One prominent trend is the adoption of
digitalization and automation in logistics and operations. Smart containers, block chain technology
for supply chain transparency, and autonomous vessels are some of the technological innovations
making waves in the industry
Problems faced by the company
Lasco Shipping Co. Pvt. Ltd., a renowned shipping company, faced challenges in its pricing
department, resulting in delayed price quotations to customers and the loss of potential
consignments. Additionally, the company lacked a digital marketing presence, leading to missed
opportunities in brand promotion and customer engagement. To address these issues, the
company hired interns pursuing PGDM in international marketing for the summer internship
program and permanent employees for specialised export and import pricing roles. Among
those potential clients many used to have a consignment query which the interns sent to the
export pricing executive. However, even after hiring new personnel, the pricing process remained inefficient. Interns were responsible for lead generation and often encountered consignment
queries from potential clients. These queries were passed to the Export Pricing Executive, who
then contacted shipping lines or referred the matter to the General Manager. This cumbersome
process led to prolonged response times. The pricing department experienced significant delays
in obtaining prices from shipping lines and providing timely quotes to customers. Previously, the
General Manager, who also served as the marketing head, handled these tasks, but the process
remained inefficient even with new hires. The extended response times in providing price
quotations resulted in the loss of potential consignments. The company's inability to promptly
address customer inquiries affected its revenue and market competitiveness. Lasco Shipping lacked
a digital marketing representative and did not have any active social media accounts. The company's
online presence was limited to its website, which required improvement and better management
to capitalize on digital marketing opportunities. The challenges faced by Lasco Shipping Co. Pvt.
Ltd. in its pricing department and digital marketing efforts have implications for other companies
in the shipping industry as well. The case serves as a cautionary tale and offers insights into the
potential consequences of inefficient pricing strategies and a lack of digital marketing presence.
Firstly, other shipping companies may recognize the importance of streamlined pricing processes
to ensure timely and accurate quotations to customers. The prolonged response times and loss
of potential consignments experienced by Lasco Shipping could resonate with competitors,
prompting them to evaluate their own pricing workflows and identify areas for improvement. This
awareness might lead to industry-wide efforts to enhance pricing efficiency. Secondly, the case
underscores the significance of embracing digital marketing in today's business landscape. Other
companies within the industry could learn from Lasco Shipping's missed opportunities in brand
promotion and customer engagement. Recognizing the value of active social media accounts, a
well-managed website, and digital marketing representatives, competitors may invest more in
their online presence to strengthen their market positioning and customer relationships. Overall,
this could influence other shipping companies to proactively address pricing inefficiencies and
digital marketing gaps in order to stay competitive and maintain revenue growth. By learning
from Lasco Shipping's challenges and strategic initiatives, the industry could collectively work
towards improved pricing strategies, enhanced customer engagement, and stronger online brand
visibility, ultimately benefitting both individual companies and the sector as a whole
Experiencing delays in price quotation can have serious implications for a shipping business.
Customers in the shipping industry often require timely and accurate price quotes to make
informed decisions and plan their logistics. If the business consistently struggles with delays in
providing quotes, it can result in several negative consequences: Loss of business opportunities,
damaged reputation, and reduced customer trust. If there are delays in receiving price quotations
from shipping lines, it can have a cascading effect on the entire quotation process to customers.
Solutions for the pricing delay
Improve communication with shipping lines: Establish better communication channels with
shipping lines to ensure prompt responses to price quotation requests.
Set service level agreements (SLAs): Establish clear SLAs with shipping lines regarding the
expected time frame for providing price quotations. This can help hold them accountable for
meeting deadlines.
Automate quotation processes: Implement automation tools and systems to streamline the
quotation process, reducing the reliance on manual intervention and potential human errors.
Offer alternative shipping options: In cases where a shipping line is consistently slow in providing
quotations, consider exploring other shipping options or partnerships to ensure timely responses to customer inquiries.
Provide proactive updates to customers: If there are delays in obtaining price quotes,
communicate transparently with customers about the situation and provide regular updates on
the progress.
Prioritise key customers: If resources are limited, prioritise providing quotations to key and
high-value customers to maintain their loyalty and satisfaction.
Conduct regular performance evaluations: Continuously monitor and assess the performance
of shipping lines in delivering price quotations. Make data-driven decisions about ongoing
partnerships based on their responsiveness
Filing the rate contracts with the shipping lines on yearly basis or on the long term basis of a
longer validity.
Maintaining the MRG (Minimum Rate Guidelines) in which rates are defined of different
sectors on a monthly basis to resolve the customer queries immediately.
MIR- Market Intelligence Report is the collection of data through sales team with direct or
indirect communication from the exporters or importers or the logistics managers. The data
includes last freight rate, expected freight rate, order rate customer is willing to pay.
Solutions to create digital presence of the company
Hiring digital marketing personnel to work on the digital marketing strategies of the company
Build a professional website: Develop a user-friendly and visually appealing website that
showcases the shipping company's services, expertise, and unique selling points. Ensure that the
website is mobile-responsive to cater to users accessing it from various devices. Include essential
information such as contact details, service offerings, customer testimonials, and any industry
certifications.
Search Engine Optimization (SEO): Optimize the website content for relevant keywords related
to shipping services to improve organic search rankings. Create high-quality and engaging content
that provides value to visitors and establishes the company as an industry authority. Incorporate
local SEO strategies if the shipping company operates in specific regions.
Social Media Presence: Establish a presence on major social media platforms like LinkedIn,
Facebook, Twitter, and Instagram, depending on the target audience. Share informative and
engaging content regularly, including industry news, updates, and company highlights. Use social
media for customer engagement, responding to inquiries, and addressing customer feedback
promptly
Content Marketing: Invest in content marketing to create and distribute valuable content, such
as blog posts, info graphics, and videos related to the shipping industry. Share this content across
various digital channels, including the website, social media, and industry forums.
Email Marketing: Build an email list of potential customers and existing clients interested in the
shipping company's services. Send regular newsletters, updates, and promotional offers to keep
customers informed and engaged
Online Advertising: Utilize online advertising platforms like Google Ads or social media
advertising to reach a broader audience. Create targeted ads based on demographics, interests,
and search behaviour to maximise the ad's impact
Customer Reviews and Testimonials: Encourage satisfied customers to leave reviews and
testimonials on the website or review platforms. Positive reviews can significantly influence
potential customers and build trust in the shipping company's services.
Implement Live Chat and Contact Forms: Integrate live chat functionality on the website to
provide real-time support to website visitors. Use contact forms to make it easy for potential
customers to inquire about shipping services.
Track and Analyse Performance: Set up website analytics and track key performance indicators
(KPIs) such as website traffic, conversion rates, and customer engagement.
Analyse the data regularly to identify areas for improvement and optimize the digital presence
accordingly
Stay Updated and Engage: Keep up with industry trends, technology advancements, and
customer preferences to adapt the digital strategy accordingly. Engage with the audience through
webinars, online events, and interactive content to foster a sense of community.
Conclusion
The challenges faced by Lasco Shipping Pvt Ltd in providing timely price quotations to its customers
are indicative of operational inefficiencies within the pricing department. By optimising the
workforce, automating processes, and establishing better communication channels with shipping
lines, the company can overcome these obstacles and regain its competitive edge in the market.
Addressing these issues and continuously seeking improvement will position Lasco Shipping as a
more reliable and efficient player in the shipping industry. To address pricing delays, the company
needs to improve communication with shipping lines, set clear service level agreements (SLAs),
automate quotation processes, offer alternative shipping options, provide proactive updates to
customers, prioritise key clients, and conduct regular performance evaluations of shipping lines.
To establish a digital marketing presence, Lasco Shipping should hire digital marketing personnel
and build a professional website that showcases its services and expertise. Implementing SEO
strategies, maintaining a strong social media presence, content marketing, email marketing, online
advertising, and customer reviews will further enhance the company's digital reach. Tracking and
analysing performance, staying updated with industry trends, and engaging with the audience
will ensure the success of the digital marketing strategy. By implementing these solutions, Lasco
Shipping can streamline its pricing process, boost customer engagement, and establish a strong
online presence, ultimately improving revenue and maintaining a competitive edge in the market.