The Global Forwarding Mystery Shopping Study conducted by the consulting firm Simon-Kucher & Partners reveals that forwarders have immense room for improvement in their sales processes. Mystery shoppers asked eight of the leading forwarders from nine countries a series of test questions. Results found that over half of sales activities were performed insufficiently and four of the six sales activities failed to differentiate from the competition.
In the freight forwarding industry, it is extremely hard to make core products stand apart from the competition. Because the high number of forwarders, services are interchangeable, making them a commodity product. What’s more, competitive pressure in the fragmented freight forwarding market is fierce. To overcome the pressure, many forwarders offer additional services – this in turn spreads their service palette as logistics providers very thin. “Companies must seize this opportunity to differentiate their services which in turn will boost their returns,” says Philipp Biermann, partner at Simon-Kucher.
Potential of personal customer contact untapped
All of the forwarders contacted by the mystery shoppers took down information about the shipment but varied in how this information was gathered. In most cases, the forwarders asked the mystery shopper to write down the shipment details and send the information by e-mail. The phone call, ultimately, served purely to make the initial contact and pass on the e-mail address. “The opportunity to make an active sales pitch was completely lost,” comments Frank Hälsig, head of the study and senior consultant at Simon-Kucher.
To their credit, most forwarders excelled in actively cross-selling air and ocean freight services. The mystery shoppers were able to get combined offers for both freight routes from the same sales rep. However, while several forwarders sent their air and ocean freight services in one offer, others sent them separately. In the worst case, separate documents were sent from two different people within a company.
The study also analysed how well forwarders were able to go a step further and actively ask about the mystery shopper’s specific needs. A mere one-third of sales reps did this during the phone calls, further proving that calls are not being fully utilised.
Sales reps not communicating value
How well do sales reps sell their company’s services and value? Are the advantages emphasised? Is the customer given alternative products? Are higher value products being offered? These questions revealed yet another key weakness in the sales process of forwarders. In only one-in-eight phone calls did the sales rep bring up these issues. Sales reps rarely mentioned premium products or the advantages of the forwarder, nor did they draw comparisons to the competitors. “Unfortunately, forwarders are not taking advantage of the potential these phone calls offer. This is a golden opportunity to emphasise their services and boost customer perception,” Hälsig explains.
Enhance sales processes and expertise
“Far too often, forwarders pass up the opportunity to consult their customers – all because they didn’t pursue it during that initial phone contact. In fact, they do the opposite: calls are ended as quickly as possible,” Biermann summarises. Forwarders could easily enhance this behaviour and optimise their sales processes and expertise. By emphasising the role of sales in employee training seminars and the corporate culture as well as by setting up financial incentives, the sales team would gain awareness of the effectiveness of value selling. The investment is worth it. Forwarders will have a means of setting themselves apart – and above – the competition.