“We needed to put ourselves in the customer’s shoes and at the same time balance their needs with what we could effectively deliver to the market. We are in this business for the long run and as a result our focus had to be on creating value and not only competing on price,” Louisa Loran recalls.
“Change takes time, especially after we added the Transport & Logistics scope on top of the original segmentation. However, we are creating something that could change the game of logistics, and I’m confident that this will make a big change in terms of our customer satisfaction within the next couple of years,” she adds.
Asking thousands of customers
Today, Maersk Line has 70,000 customers. In addition, Damco has several thousand customers and together, the two businesses have just shy of one million customer contacts. All of these have different needs. The essential question that employees and executives from across Maersk Line found themselves asking was whether it would be possible to identify groups of customers, i.e. segments, with similar needs? And, if the answer was “yes”, how many segments would be manageable for the organisation and still make sense to the customers?
“We carried out a very inclusive process across the business, leveraging both data and experience; asking how we could match certain customer needs and what that was worth. We also looked at a lot of data covering small and big customers, profit and volumes, contract length, different commodities, customer ownership structures, their organisational setup, the value of reliability and many other variables,” Louisa Loran explains.
“We also need to address customers that are not particularly loyal to us and don’t expect us to be loyal to them either,” says Louisa Loran. “We’ll meet them on a case-by-case basis when the product and price is right. We will focus on making ourselves available to them through the channels they use so that they can make a fast choice. And these customers are just as good and appreciated as customers from other segments. It’s the needs that are different, and this approach is just looking at it from their perspective.”
The segmentation approach as such has not been communicated to customers, who can instead expect to see a gradual change over the coming years as the specific value propositions, relevant to their segments, are developed and rolled out.
Customers can focus on growth
According to Louisa Loran, this is what makes the vision to simplify and connect the customers’ supply chains by becoming the integrator of container logistics “so powerful”. At the same time, transforming itself to win in the future is both a huge opportunity and a challenge for the Transport & Logistics division.
“We can sometimes look at ourselves and say it’s complicated, which it certainly is, but if we don’t do anything, then we are just pushing the job over to our customers. Many of them spend a lot of money on entire departments that are engaged in compensating for the inefficiency in logistics,” she says and reinforces the customer perspective:
“It is clear that our customers hope we will remove some of the inefficiencies in the industry so that they can focus on their own growth.”