In our last blog post we talked about sales and marketing landscape changes brought upon us by changes to the volume, breadth, and accessibility of commercially useful intelligence. 

We also talked about not being able to leave such available intelligence on the table if is already in the public domain.

We at Gilead make no statement in respect of the systemic merits (or otherwise) of surveillance.  However, we plainly hold that employing the means to access and filter material information from that social intelligence is irresistible for sales professionals.

Twitter is by no means the only source of such social media intelligence, but the tools available and the public domain information may be useful if employed effectively.  Having the tools and the available intelligence doesn’t, however, necessarily lead toward a successful sales programme.  

Software tool providers are not shrinking violets when it comes to making claims about the essentiality of their products as the following illustrates: 

http://blog.socialbro.com/2014/01/what-cia-can-teach-your-business-about.html

However, as is the case for most software systems, the makers and marketers are often the least effective in providing the lead in successfully deploying their systems in commercial enterprises.

When employing social media for sales and marketing purposes, there are two critical aspects to be weighed ahead of assessing the quality of information derived from them.  The first one concerns identity, and the second one is the question of whether the content is an honest admission, or otherwise.

In the sales & service sense, if you have a contact or candidate, and you can confirm that the social media identity you have located is a match for that contact, then you have a start.  Then you must assess whether that social media contributor chooses to volunteer genuine information, and if that information is material.  In other words there are a lot of ifs.

And there are no lesser amount of buts.  Consider a situation where SocialBro became a hit and is deployed widely in the transportation sales market, and you have deployed that system in your organisation.  Your sales person has assured you that the twitter identity and your candidate are indeed one and the same, and they are volunteering private information…

Then follows the question: it may be material, but is it useful?  And if it is - how will you use it?  Will you inform your sales call contact how you came across the information?  What do you anticipate their reaction will be?  What happens when several sales people from competing organisations all access the same intelligence, and perhaps many employ it clumsily?   It is rather obvious to many that initiating calls & campaigns based solely upon intelligence derived from surveillance is fraught with hazard.  

The most useful information gathered from social media, however, may be that which informs the parties of existing common ground and interests within the parties 3 degrees of connectedness.  For both parties, the value of existing connectedness (in social, philosophical, or commercial terms) surfacing stands on its own merits - as it always has done.  

It is obvious that the sales person will try to associate themselves with the orbit of their prospect, but it is important to recognise, that in a maturing social media derived surveillance world, that prospect is defining and leading the presentation of that orbit on a voluntary basis.  If they are a critical decision maker, they will come to carefully manage their identities and what information they release in the public domain.

On another day, we may discuss twists and turns in respect of the personal identity issue in social media.  As SocialBro itself states above, the process of commercialising marketing ideas developed by intelligence agencies is well underway.  The idea of social media identities being out there building followers based upon their advocacy of a fashionable moral crusade for the expressed purpose of later selling that identity for commercial interest should not shock or surprise a marketing professional.

Transportation carrier supply & demand reports and market prognoses are featuring prominently in the logistics and financial news wires in recent times.  
As usual, the narrative employs standard rhetoric in respect of supply and demand, and of surveyed market confidence.  

www.forbes.com/sites/robertbowman/2014/01/21/air-and-sea-freight-carriers-plagued-by-low-rates-weak-markets/

The obvious framework of neo-classical liberal economics flutters through these reports, and the surveyed voices are sometimes said to have it that simple pricing solutions at the user interface will move the market forward.

http://theloadstar.co.uk/air-freight-survey/

But can we find a new way to approach the subject of carrier and transportation economics?  And, is there an acceptable manner of public speech that doesn’t lead the market audience towards false easy-fix market prognoses?

Unfortunately, the answer at this time is likely no. 

To understand this we might compare the neo-liberal market narrative with the supply-sider controlled realities that turn out market consequences for capacity (or supply). 

In the ocean containerised trades, capacity is ruled by supply-sider ideas: ocean carriers strategic desire to maintain or expand shares in trades and alliances, corporatist government views of shipyard and hub port unit capacity as strategic assets, the market in scrap metal that both lubricates new orders when it is up - and keeps old vessels in trades when it is weak, and that all important magic dust called financial market liquidity and funding.   We start our ocean container capacity forecasting from this base and ride the effects of new building programmes downstream of a game locked in years before in another market.

Citing a reality case-in-point close to home in the air carrier market (ie: QANTAS - a combination passenger and freight carrier) why would we be surprised when there is a neo-classically inclined led attack upon QANTAS’s objective of maintaining a 65% domestic market share.  

www.afr.com/p/business/companies/gobsmacked_at_qantas_market_share_v3zODox9752ibVRfUfdM1O

And why would we be surprised when such a contention is batted back by QANTAS at financial market and media critics by means of citing earlier published reports such as the one concluding that they have lost 15.5% market share in the past decade on international routes to Australia by failing to match competitors capacity increases (…and as a consequence their international airline business is a basket case)?

www.theaustralian.com.au/business/aviation/qantas-blames-rivals-for-market-share-drop-on-routes-to-australia/story-e6frg95x-1226784446855#

So both ocean and air carriers acknowledge, by means of order book action and reaction to financial market commentators that the reality is they surrender market share at their peril.  We deal with markets that are, in part, a product of that capacity reality in a supply-sider world.  If investors have gone along for the ride they might care to look at the daylight between their narrative and world views, and market reality.

Ahead of us are the issues of the fragility of the mega-hub and spoke models of global transportation systems, the fragility of air cargo freighter and engine economics, and the limits and dangers presented by “domestic mindedness” in the global commercial trade and transportation industry. We will return to these issues on another day.

Many among the general populace have recently been distracted by a proposition raised by Amazon.  Amazon have conceived what they say they believe is a patentable system, one whereby orders are generated based upon “anticipating” customer purchases & there is an implied automatic process of shipping to the customer.  Amazon claims that they have, in turn, based that “anticipation” upon their profiling of that customer.

As far as we know at Gilead, this was first covered in the media by the Wall Street Journal:
http://blogs.wsj.com/digits/2014/01/17/amazon-wants-to-ship-your-package-before-you-buy-it/

The fragility of the story, however, is given the rub by a flowchart diagram provided in a subsequent article released by GeekWire:
www.geekwire.com/2014/anticipatory-shipping-amazon-wants-package-purchases-even-buy/

Eventually, the more astute may determine that the Amazon patent application, if correctly reflected in the diagram presented by GeekWire, relates not to the process of “anticipatory” shipping to specific customers at all, but rather is limited to an order routing process called pre-distribution. This involves the delivery of orders to regional warehouses rather than to customers; and the “anticipated” re-order weighting factor is rather a common place forecasting element of the demand management rubric.

For many seasoned logistics industry veterans, the recall of programmes run by the likes of Sears-Roebuck for many decades will be front of mind, and the shape of the Amazon programme more than familiar. 

Given such market wide familiarity with these demand planning techniques, and the related method of the offshore consolidation of orders that are shipped direct to regional warehouse locations, we would be doubtful of the chances of success of such a patent application in any credible legal jurisdiction. 

Perhaps, however, the patent application’s limited prospects are a lesser issue.  One must also consider Wall Street perceptions and the gains that have been achieved for Amazon’s brand identity.

Meanwhile, some first class wits have engaged this scenario, and we can enjoy their work despite the fragility of the proposition:

Note:  Among Gilead Logistic Service’s core competency is the design and implementation of offshore pre-distribution systems. 

In my view, to describe the Australia and New Zealand (ANZ) international transportation trades as typical of north-south markets is both apt and misleading.

In respect of the dominance of the commodity trades in export tonnage it is apt, but in respect of the lack of distinctiveness of the ANZ mercantile markets, it is misleading.

The case I provide here is that, based upon that distinctiveness, strategically it now is a good time to invest in the ANZ transportation market

The ANZ mercantile goods markets have always appealed to EU and US mercantilists seeking low risk markets for high value products; it is a market where tariff and non-tariff barriers do not significantly deter trade. 

Traditionally, other north-south trades have involved increased political and transactional risks that at various times have manifested themselves in capital controls and other barriers, or risks, to the continuity of trade.

In many ways, the Australian international maritime container and air freight trades have, in the past decade, become more sustainable.  For asset owning international carriers, in particular, the lessening of inbound vs outbound volume imbalances, and the greater availability of vessels, has made it especially so for the Asian trades.  

The lesser volume imbalances in trades has largely been brought about by the more innovative employ of unit loaded niche commodities that are moved more deeply and directly into foreign consumer markets than can be achieved by bulk transportation. 

At this point, however, to address challenges to the significance of the ANZ markets as seen through western eyes, during the past 3 decades in particular, it is necessary to engage the broader subject of freight management perspectives among global industry players that evolved during the period. 

The first perspective to engage is that of those freight companies that have come to regard themselves as more global in their orientation, and look at the world differently than they did when their performance in their home country market ranked first in their management collective’s imagination.

In earlier times, mercantilist home markets demanded mercantilist minded, and hence export centric, freight executive managements.  With the advent of the offshoring of consumer goods production, and the globalisation of such sourcing, the increased prominence of inbound and east-west trades brought about a subsequent dominance of central management’s attention directed toward those primary east-west trade lanes, and to the import-distribution oriented global customers supporting them in those trades.

Global customers, typically, have introduced global service requirements; and increasingly have sought to employ global contracting in freight bargaining that focuses on the value achieved in primary trade lanes.  The ANZ market is heavily represented among global customers, being among the most open markets for direct representation by global merchandising and consumer goods companies, so it has tended to be heavily influenced at the customer interface downstream of these events.

Given the above, there has been a corresponding local ANZ transportation industry tendency to focus on the negative downstream effects perceived as arising from lesser levels of influence; such sentiments finding expression when ANZ freight and import-distribution industry executives lament the rise of a global transportation industry attention deficit in respect of the ANZ freight trades.

It is also important to recognise the evolved perspective of the Asian theatre regional freight manager fulfilling their strategic role for contemporary global freight companies.  It is difficult for those managers operating in a highly engineered environment to move beyond the view that they should leave well enough alone in a small volume corner of the Asian theatre called ANZ, one that bears little resemblance in trading patterns and style to the far larger east-west trade Asian export markets.  Consequently, any subsequent attention deficit generated might be expressed as a natural consequence of ANZ as a market being limited to the level of priority displayed by their global customers’ voices.

This perception changes fundamentally, however, when the rise of the intra-Asian trades as a whole is contemplated.  If the freight decision and the nurture of essential customer support is regarded as emanating from within the Asian-ANZ theatre itself, where a multiplicity of trade lanes of distinct characteristics are meaningful and material to decision makers, and where a more traditional mercantilist sentiment is recognised, then the freight management support task must be upgraded and decentralised in order to support it.  

In respect of the Asia-ANZ maritime trades, this view is nothing new, and has long been recognised as the prevailing commercial environment by the most successful and longstanding shipping lines.  Among most global freight forwarders and global airlines, however, such a view generally diminished, or perhaps can be appropriately expressed as having been buried by the significance of global managers being distracted when serving the European and American consumer trade prerogative. 

Hence my contention is that the rise of the intra-Asia trade lanes generally means consequential change for the ANZ transportation industry, and more so for the freight forwarder than for the carriers that have long spread the burden of customer engagement in these trades, those that were perceived to have diminished on a global scale during the growth of the east-west trades.

For ANZ, the negative point of reference of being absent from participating in the dominant Asia-EU and Asia-NAM consumer goods trades is likely to be removed with the rise of the intra-Asia trades.  It is a good time to choose to invest in ANZ freight forwarding and domestic asset carriers.