[281111.EN.SEA] Liner Marketing Strategy And How It Stacks Up With The Wider Supply Chain (part 1/2)

THE global economy is currently shrouded in a cloud of uncertainty and this is having flow on effects for the shipping industry. But even in this uncertain environment all links in the ocean transportation supply chain, bar the shipping lines, are continuing to make money.

Today in The Container Shipping Manager we will take a closer look at the various links in the global supply chain and see if we can find out why the carriers are losing money while other parts of the supply chain are seeing, at most, a reduction in profit.

Before we begin today’s analysis let’s take a look at the ocean transportation supply chain, as shown in the diagram below.

As we can see in the above illustration, there are many links in the ocean transportation supply chain from the port authorities to terminal operators to container shipping lines and international freight forwarders, and finally the beneficial cargo owners or shippers.

As noted, it is only the shipping lines that are not making money this year, with the exception of niche operators like Wan Hai and Samudera, both of which recently reported small third quarter profits. The rest of the shipping lines, however, are still trying to return to the black.

In order for us to gain a better understanding as to why the shipping lines are struggling more than other links in the supply chain we will look at the marketing strategies of the carriers in comparison to the wider ocean transportation supply chain.

To do this we will use world-renowned marketing guru, Michael Porter’s 4P marketing concept, which is now used by many maritime economists and marketing personnel.

By using this methodology we will see where the differences lie in marketing approaches to gain a better idea of why shipping lines are in the position they are in, in comparison to the other links in the chain. 

... to be continued (part 2/2)

Source : CSM, 10.11.11.