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UK Freight Firms Losing Billions – How to Compete

Every year, UK freight businesses lose £10bn of turnover to their competition. A guide on how not to.

Every year, UK freight businesses lose £10bn of turnover to their competition. Read this guide on how not to.

The UK Transportation and Storage industry turns over £214bn per year, and the average retention rate in the transportation industry is 83%, according to Statista (Nov 2021 and July 2022). This equates to businesses losing £36bn of turnover to their competition – every year. Reducing that by 20-30% would have an enormous impact on each individual business.

The 2014 book titled “The Effortless Experience” built a compelling case that Customer Service only drives loyalty if it reduces customer effort. It correlated how removing the hassle for customers impacts customer loyalty and ultimately retention positively.

The Salesforce State of Service report confirmed that a major servicing shift had taken place by 2021. Among the market leaders, customer retention had moved to centre stage. 79% of market leaders felt that customer retention was one of their most important measures, up from 57% in 2018.

Source: Salesforce State of Service 2nd Edition

The opportunity presented by this paradigm shift is staggering and applies to those who move faster than their competitors. Digital unlocks a large part of that potential as nowadays, digital, AI and data are a critical part of any business’s success.

Imagine you could anticipate late arrivals and estimate the impact. It can be done. Nudge a colleague in a depot to call a customer proactively? No problem. Always know what’s happening to your customers’ orders and bookings. Definitely possible. What issues in operations impact our reputation and cause disruption? Some do it every day.

In a previous role, over 15 years ago I led a team that built the transport management platform for a top 3, global, freight forwarder. We saw how digital drove major benefits in operations, customer loyalty and subsequently top-and bottom-line growth.

Digital, of course, drives even more value today – at a higher pace and much lower cost.

DPDGroup in the UK for example, has built its premium reputation and strong brand on extraordinary, effortless, customer experiences. It has connected operations, digital technology and data very well and has driven the gradual improvement of its operational effectiveness over the years by removing key bottlenecks and sticking points.

Maersk reduced incoming contacts to its service centre by 20% with greater insight into customer queries and problems. The emails per customer order are down to an average of four.

Does it cost more to provide a simpler, more effective and effortless customer experience? Quite the contrary: it removes large amounts of wasted effort and we tend to see those investments break even earlier.

So, how do our most successful customers remove the hassle from their customers’ lives?

  1. Market leaders are proactive and engage in real-time and proactively.

    How? By leveraging state-of-the-art tools. For example, proactive comms about delays, texts for consumers, instructions for drivers, and more.Why? It manages expectations and reduces contacts. DPD built their premium brand on better customer servicing.

  2. Market leaders strive to be digital first.

    How? They enable their many stakeholders to do business as usual online. For example, reports, invoices, chatbots, instructions for airport drop-offs, customs, etc.Why? CitySprint customers run their own reports, and in doing so this reduces customer effort, as well as CitySprint’s own reporting efforts by 90%.

  3. Market leaders are consistent at every touch point – physically and digitally.

    How? They create a “single view of the customer” and give the full team access to it so that everyone (sales, contact centres, depots, drivers, chatbots, etc) is empowered to give consistent answers.Why? Service is more competent, first-call resolution rates are vastly improved and more.

  4. Market leaders use data to fix problems in operations.

    How? Digital turns every customer touch point into a data point. Analytics and AI highlight where the friction points, bottlenecks and blockers are.Why? It removes systemic issues from operations – for example, greater insight into problems drove around 20% of contacts at Maersk.

Digital, Data and Artificial Intelligence are driving tremendous advances across the entire Freight & Logistics ecosystem. At Salesforce, we are investing heavily into the freight market, our customers and our partners, and we love to help our customers build more loyalty with their customers, improving their retention by 20-30% on average. We are happy to set up a private benchmarking session with organisations interested in finding out how much they can save.

For any questions or to set up a conversation, please get in touch with me on LinkedIn.

Meet The Logistics Innovators With a Digital-First Mindset

We invite you to watch our recent interview with Woodland Logistics Group and DPD UK on Salesforce+ where we discuss how having a digital-first mindset is making a significant difference.

Michael Pichler

Michael works with Salesforce Travel, Transportation & Hospitality customers across the continent to uncover potential for innovation and growth. Before joining Salesforce he worked with IBM Consulting in a number of leadership roles. His clients included railways, logistics & hospitality businesses and airlines. He managed a design agency, a software development organisation, and even wrote a book about software performance.

More by Michael

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