Redefining the DHL Brand

By: Joshua R. Beyerlein To : Avinash Malshe, Ph.D. and Brand Management Class Date: 5/6/2009

Preview

DHL Background

Situational Analysis

Repositioning of the DHL Express Brand

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The Situation
2008 - DHL Express Worldwide had around a $3 billion profit worldwide

DHL Express USA was losing $5 million a day

Operational costs were two times its competitors

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Restructure
DHL Express moves from 40,000 employees in the United States to 4,000 employees

Company moves back to an international only carrier

Over $10 billion in sunk cost after the merger of Airborne Express

Promised customers and employees you would not exit the United States domestic business

Brand loyalty and employee moral is at an all time low

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SWAT Analysis

DHLs Internal Strengths

Worlds largest transportation carrier Ship to more countries than our competition Customs agents in 140 countries Industry leading service levels Strength of the DHL Brand World Wide Outsourced operations (driving down cost) Relationships with Lufthansa and Polar Air Presence World Wide Lean organization

DHLs Internal Weaknesses

Integration of EGAP system (new internal processing application) Moral of employees Contractor model at some stations Lack of flexibility in the United States Relationship with the USPS for rural deliveries which can take an additional 2-3 days in transit

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SWAT Analysis Continued

DHLs External Opportunities

We only own around 9% of the U.S. market share World is becoming flatter increasing opportunities in countries we already operate in

DHLs External Threats

A worsening of the economic environment causing DHL to pull out of the United States Terrorist act causing them to bring down the airline Strong competitors in both FedEx and UPS Currency fluctuation Competition becoming stronger around the world

Growth of world GDP

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Situational Analysis (Porters Five Forces)

1.) Risk of entry by potential competitors High barrier to entry cost

2.) Intensity of rivalry among established companies

Two strong U.S. competitors FedEx and UPS 3.) Bargaining power of suppliers Controllable even the largest cost fuel 4.) Bargaining power of buyers Strong, but controllable as DHL has been able to add surcharges and annual rate increases

5.) Closeness of substitutes

Air vs. Ocean carriage (2-4 days vs. 6 weeks) JIT environment with very little inventory

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Recreating the DHL Brand

Product The Company, its employees and the DHL culture Kept 4,000 of the best employees

Everyone needs to sell

Incentives around revenue growth Proactive responsive company culture Empowerment of front line employees Proactive transit time guarantee Seamless and easy to use Company drivers versus independent contractors Our text states, The FedEx brand has identified that the delivery person who comes to pick up the sealed envelopes or delivers them is the key personality in the FedEx experience for companies.

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Recreating the DHL Brand

Promotion Advancing the brand awareness of DHL Express Small Marketing budget

Trade show concept

Team up with US Commercial Trade Organization or International Compliance Association Cost around $25,000 could hit 100 markets at a minimal cost of $250,000

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Rebranding the DHL Brand

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Rebranding the DHL Brand

Still in America Still #1 in the World

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Recreating the DHL Brand

Price What can we charge for our service? Reduced cost structure enough that we can discount heavily and make money

In todays economy need to offer an economic savings

We currently can not charge a premium

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Control Measures
Operations Service guarantee comes out of local operations budget

Customer Service
Customer service held accountable for resolution of issues Promotion

Measure revenue growth in markets that have had DHL Road Show
Also measure brand awareness and customer satisfaction with small focus groups

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Conclusion
DHL Express will not leave the United States Largest economy in the world and over 55% of all transportation decisions are made I n the U.S.

DHL is a strong brand everywhere else in the world United Kingdoms leading business brands 2009

Culture change needed to give customers a true transportation experience

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Conclusion

DHL Background

Situational analysis

Repositioning of the DHL Express brand

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