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Logistics for Marketing
Can repositioning logistics as a sales and marketing driver convince companies to invest in digital transformation?
Getting people to buy things is sexier than getting things to people.
At least it used to be.
Events like the stuck container ship in the Suez Canal and the coronavirus have taken logistics mainstream. Now, people care as much about what they buy as when they will get it — yet the challenge of convincing budget holders that logistics is as important as sales and marketing remains.
Unlike marketing-driven projects like ecommerce sites that everyone sees and promotional campaigns that everyone looks forward to, logistics goes mostly unnoticed. This is changing as logistics is incorporated into ecommerce sites to power omnichannel fulfillment (check out the Target example here), but we still have a long way to go.
I remember coming across one study in 2017 that identified supply chain digitization as a major influence on profits but only two percent of companies were focused on it. Meanwhile, 49% of companies were focused on digital marketing.
I was part of the 49% back then…
From 2013 to 2018 I was the director of digital product management and strategy at Staples where I enabled sales with ecommerce products that facilitated self-service purchasing. Supply chain and logistics wasn’t ignored but it was harder to get budget for.
Around this time, we had invested in moving our website from a legacy ecommerce platform to microservices and APIs. This made our ecommerce site one of the fastest in the industry — and the results were obvious. Anyone could go on the Staples website and feel the difference. The website was faster and it’s well-documented that site speed has a direct impact on sales. There are also dozens of free tools that can measure site speed and a website's impact on revenue.
But we don’t have free, flashy tools like this in logistics, which makes it harder to rally support for digital transformation.
In 2022, the investment in digital transformation for logistics was $15 billion worldwide while the investment in marketing technology surpassed $20 billion in the United States alone. This is far from a clear-cut comparison but I found it interesting.
For professionals that try to defy this ignorance, implementing new tech can be so overwhelming that pouring more money into warehouse space, shipping contracts, and headcount starts to look appealing. But it’s important to hold out and rally teammates and budget holders to see the opportunity of embracing digital transformation together. Remind them that logistics can be a company’s biggest driver of sales and loyalty, and it can lead to better marketing.
If the infamous Amazon case study is not relevant for your company, it may help to position investments in digitizing logistics from a sales, marketing, and customer experience standpoint:
Better customer experiences - Digitizing logistics enables real-time tracking of shipments and inventory. Customers can see an accurate representation of what’s available on a website, where it’s available to purchase, and when they will receive it. For retailers, this enables an omnichannel experience that enhances customer experiences and drives loyalty.
Better marketing - When data from logistics operations is visible to the entire company, you can use it to inform sales and marketing strategies. For example, you can base targeted advertising campaigns and personalized offers on inventory availability and shipping efficiencies in specific areas (i.e. run those promotional campaigns for a big profit).
Better pricing and sales - By automating and optimizing logistics processes, you can reduce transportation costs, labor costs, inventory carrying costs, and returns due to damaged goods that were stored too long or shipped without digitized inspection. Cost savings from these efficiencies can lead to more competitive pricing that boosts sales.
If you position investments in logistics technology as an activity to drive better experiences, better marketing, and more sales, you might get people to hop aboard the digital transformation train to logistics. Not just digital officers who oversee the budget, but also your friends in sales and marketing.