More than ever, it’s important for freight forwarders to adopt technology that helps evolve and modernize their Customer Experience. While many forwarders still see this type of investment as a cost center, it should actually be viewed as the revenue generator and profit center it truly is.
As shippers/BCOs continue to demand more technology and better service from their logistics providers, early adopters in the freight forwarding world have seen huge benefits from making investments in modernizing their Customer Experience through implemented software.
These benefits can be boiled down to three key themes:
- Differentiate Yourself & Win New Business
- Increase and Justify Pricing
- Improve Operations Efficiency
But First… What is Customer Experience?
Customer experience is the compilation of all the interactions that a customer has with an organization during their relationship with that company. The software and technology available to enhance Customer Experience in freight forwarding has been growing to match the evolving needs of shippers. From online quoting and booking, shipment visibility, centralized messaging, document sharing, to business intelligence and analytics, software solutions are emerging to upgrade the overall experience.
Investing in Customer Experience software means investing in your company’s competitive advantage in the freight forwarding industry.
1. Differentiate Yourself & Win New Business
In a highly competitive industry such as freight forwarding where the end deliverable is the same (getting goods from A to B), investing in Customer Experience helps differentiate companies from competitors to win more business.
If you are in the logistics industry, you know that the key to securing business is answering the question “Why are your forwarding services different?” By truck, by boat, or by air… your services may help shippers move their orders in the exact same way as your competition. The key is differentiating yourself with how they go through this process as a result of your Customer Experience.
Customer Experience’s Impact on Differentiating as a Freight Forwarder:
A recent survey of over 100 shippers found that when evaluating a freight forwarder, shippers prioritize their “Customer Service and Individualized Attention” above all else. Paired with cutting-edge technology coming in second, investing in Customer Experience software and solutions is a no-brainer when looking for ways to compete more aggressively for new business.
Investing in offerings that give them peace of mind and quick access to metrics they need for their own decision-making will help to form customer loyalty and positive word of mouth.
How to Utilize Customer Experience Software to Achieve Differentiation and Win Customers:
Differentiating your company by investing in Customer Experience software means standing out against other traditional forwarders and competing against larger digital forwarders in the market by offering not just the basic needs of a shipper, but tools to amplify the entire process. Provide this experience, not just Customer Service, by ensuring your customers have digital offerings for shipping visibility and more.
Offering a Customer Experience solution that gives them their own access to important data, document uploading, and visibility greatens the chances that the use of your solution will be integrated into their own supply chain processes. Investing in the experience your shipper receives can help reduce the churn of customers you’ve won due to this added value of improved efficiency for their own team.
When you invest in your Customer Experience and are able to stand out against your competitors, you also open the door to having more autonomy with your pricing.
2. Justify (and Increase) Your Pricing Structures
The freight forwarding industry has low margins and Customer Experience provides justification for forwarders to have more autonomy in their pricing structures.
Traditional forwarding margins are generally quite low at around 6-10%, with only the top largest forwarding companies as outliers. But how does adding Customer Experience software aid forwarders in defending an increase in their pricing structures?
Customer Experience’s Impact on Justifying Pricing Structures:
Investing in your Customer Experience supports claims of having a client-focused and personalized business model for your shippers. Whether you add options for digital payment, document sharing, data, or instant shipment visibility for orders through a platform, you are justifying why your company is not only different, but worth more.
The previously discussed shipper survey also gathered shipper feedback on freight forwarding pricing when better technology is offered. Directly backing the claim that Customer Experience software gives more control to freight forwarders pricing, 83% of shippers surveyed said they would be willing to pay higher rates to work with a forwarder that better technology, visibility and control.
In addition to being willing to pay more for improved experiences through better technology, these same shippers also rated “Price” below “Customer Service and Individualized Attention” and cutting edge technology. So not only are they willing to pay more for better offerings, they evaluate a forwarder on those offerings as their first priority when deciding who to work with. The overlap of Customer Service and technology innovations are Customer Experience software solutions that give shippers the visibility and control they are looking for.
How to Utilize Customer Experience Software to Justify Pricing Structures:
When you find the right internal or external solutions to invest in to amplify your Customer Experience, create messaging around this for your team. Prospects, customers, and the industry should know that you now are offering software services that bring your freight forwarding experience to the next level. Be sure to educate your team in order to be knowledgeable on these offerings and how they will positively impact shippers that decide to work with you.
The next step is to look at these impacts and how they will improve your shipper’s own operations. Time, visibility, accessibility, and fewer man-hours needed to optimize their own supply chain processes can all be results of your investments in Customer Experience software. Document and share these measurable results with your shippers and prospects.
Why are shippers willing to pay more for this? Real-time data helps shippers improve management of their supply chain, greaten internal efficiencies, and better serve their end-user. These services help them make more money and improve margins, so they’re willing to pay more for these added values.
While differentiating against competitors and pricing autonomy are major benefits of investing in Customer Experience software, these investments also directly benefit your own team.
3. Improve Operations Efficiency
Investing in Customer Experience software can directly improve the efficiency of your freight forwarding operations team, providing immediate returns from customer satisfaction, employee retention, and increased productivity for the company.
Customer Experience can be a tool for not only your customers but also for the workflow of your own team. When your operations team is able to work more efficiently and utilize new technology being introduced into the industry to improve their overall processes, everyone wins.
Customer Experience’s Impact on Having an Efficient Operations Team:
Investing in Customer Experience software directly impacts your operations team by giving them more time to focus on the high-value tasks that ensure orders are making it from point A to B. This results in happier customers, happier employees, and a more efficient and cost-effective workforce for forwarding companies. Logixboard has calculated from our customers that implementing Logixboard has given an average of 854 hours back to their employees a year.
A Customer Experience optimized operations team brings a higher level of efficiency and that makes it easy to see the immediate return from investing in these upgrades. Investing in these solutions enforces the priority of the high-value tasks that ensure orders are completed as seamlessly as possible.
As your operations team is able to put more focus on what really matters, not only will this impact your retention of customers based on their access to data instantly, but also increase your retention of employees. Give your team the tools to be as efficient with their time as possible and to spend their time on work that is impactful.
Retaining great employees is important in logistics, due to the small labor pool and the depth of onboarding processes needed for each member. When your employees are trained, happy, and working at their full potential, the company is getting the most value from its team.
How to Utilize Customer Experience Software to Improve Operations Efficiency:
Evaluate your operations team’s processes and take note of how their time is taken up. The time-consuming tasks should be tasks that need to take up that much time to be done successfully. If your team is spending too much time on tasks that are of lower value to the operation and could be automated or enhanced with technology, that is where software investments should be made.
Document improvements in your Customer Experience to use when recruiting, but also for outlining to your current team to demonstrate they are valued, their work experience is a priority and it will continue to be improved with these solutions as more innovation arises. Additionally, the implementation of a more tech-enabled Customer Experience solution will provide teams the options of syncing their work in a way that can be friendly to a remote-work option.
Investing in your Customer Experience is investing in your team and setting yourself up to be up-to-date on changes in the freight forwarding industry.
Staying informed and proactive on industry changes can be easier for companies that invest in their Customer Experience software.
We’ve already discussed the increase in new business, pricing autonomy, and operational efficiencies that investing in Customer Experience software will bring to your company, but how would this impact the future of your business?
Customer Experience software will help achieve the preceding benefits while also helping you stay ahead of the competition. Building a strong Customer Experience brings more loyalty and less churn from your customers. If used properly, it can build a relationship that can be utilized as a tool. These relationships provide an inside look into how the product your shippers need is evolving and the different ways competitors are trying to answer these needs.
Keep open communications with your customers on what they want to see from you and continuously take notes. Stay up to date on the technology they are being offered in the industry, the new ideas they have in relation to easing their processes, and the concerns they may have of any of your current offerings so you can stay proactive vs. reactive. Be eager to hear new shipper Customer Experience needs from your own customers before they are popularized. Provide a place for direct submissions of ideas, wants, and needs your customers want to share to employ a strategy to analyze and prioritize these for future software upgrades.
Staying up to date with technology, protocols, communication innovation, and more can be a challenge for companies that have not built the internal technology funding needed to constantly be improving systems. That’s where external solutions like Logixboard come in.
Investing in Customer Experience is critical to the health of any freight forwarding business. Research and implement a solution that caters to your company’s processes and your shipper’s needs.
Read more about the power of Customer Experience in the full shipper report referenced above.