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Advanced Marketing Management
Marketing plan for United Parcel Service
Mission Statement:
"End-to-end global supply chain provider."
Executive Summary:
The company analysis shows that UPS is actually positioned as a domestic (U.S.) ground
shipping company, instead of being the primary coordinator of the flow of goods,
information and funds throughout the entire supply chain on an international basis, as UPS
perceives themselves. UPS is the follower in the overnight (express) deliveries segment.
Therefore the marketing plan recommends gaining market share in that segment by
withdrawing market share from FedEx, which is the market leader in that segment.
Therefore, UPS should target companies (such as hospitals, finance companies etc.) and
households who are currently using FedEx for urgent freight. In addition, UPS should also
position themselves in the international shipping market. Therefore, they should target
global manufacturing companies where UPS can handle storage, tracking and shipping on
a worldwide base.
The major strength of UPS is its ubiquitous US ground network, which was built more
than 90 years ago and is six times bigger than that of FedExs. UPS can reach virtually
every address in the U.S. In addition, UPS figured out how to under-take quick
mid-distance deliveries - as far as 500 miles in one night - by truck, which is much less
expensive than by air. One should also consider that UPS has much better operating
margins in air deliveries than FedEx. Therefore, is it absolute feasible to gain market share
in the overnight (express) segment. To push this idea UPS should establish an alliance with
Wal-Mart in order to set up Drop Boxes in their stores, offer night and Saturday delivery,
corporate rates, coupon for frequent household users, and implement appropriate media
advertisement according to the target customer group.
UPS has a weak international position, since none of the US freight transpor-tation
companies has a dominant global position there is a huge potential that UPS could be the
leader. In addition, UPS has just received the rights for six direct flights to China. This is
just one of further steps UPS should undertake in order to conquer the Asian market. UPS
should build up an Asian network by setting up an Asian hub, buying air routes, and
establishing relationships to Asian governments. In addition, UPS should increase
key-account (sales force) to address global manufacturing companies in order to undertake
their global shipping and by showing presence at international trade events. As shown,
UPS can increase their international market share.
