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About Aramex Company culture and marketing positioning
About Aramex Company culture and marketing positioning
Executive SummaryAramex is an international logistics and transportation service company specializing in a wide range of services including logistics, express, domestic distribution, and freight forwarding. It was founded in 1982 by Ghandour who became its CEO. The firm began as an international operator offering oversea delivery to American courier companies in the Middle East. This paper looks at the US companies Aramex has partnered with over the history, identifies the culture that drives it, its services, and how it has managed to develop a global network. First mover advantage and developing global network alliance are the two drivers of Aramex competition.
Contents
TOC o “1-3” h z u Executive Summary PAGEREF _Toc380779424 h 1The Global Express Business PAGEREF _Toc380779425 h 2Entry of ARAMEX PAGEREF _Toc380779426 h 3Aramex Culture PAGEREF _Toc380779427 h 6Aramex Services and Global Positioning PAGEREF _Toc380779428 h 6Conclusion PAGEREF _Toc380779429 h 8
Introduction
Aramex is an international logistics and transportation service company specializing in a wide range of services including logistics, express, domestic distribution, and freight forwarding. The company was established in 1982 by Fadi Ghandour in partnership with his father’s friend William (Bill) Kingson. Ghandour had just attained a degree in political science from the University of George Washington. As a student in the university he marveled at reliability and efficiency of U.S express business and wondered what it would feel to start a similar business in the Middle East. He met Kingson at Paris Air Show and they talked about this opportunity in the Middle East. This conversation led to a partnership to establish an express business in the MENA (Middle East and North Africa) region. They established the firm to offer delivery services for companies dealing with exports deliveries in North America like FedEx (Federal Express), Purolotor, Emery, Burlington Northern, and Airborne Express. Its main competitor at the time was DHL in this region. In 1990 it partnered with Airborne Express to establish an independent alliance for international express companies known as OEC (Overseas Express carriers). This organization formed an international delivery network for the member firms to give them an advantage over large firms. In 1997, the company became the first Middle Eastern company to list in the NASDAQ. However, it delisted from the stock exchange in 2002 to return to private ownership. In 2003, Airborne Express was acquired by DHL and it existed from its alliance with Aramex.
The Global Express BusinessAt the time Ghandour contemplated venturing into express business this industry was still at it infancy globally. Air freight industry started in US around 1970s. Airlines began to ship cargos in empty spaces underneath passengers. However, because international trade was not well developed then demand was low. As a result, airlines shifted to larger and more appealing items and abandoned smaller packages businesses to firms known as freight forwarders (Augustine, 2009)..
In the U.S the freight forwarders included Emery, Airborne, and Purolator. These companies consolidated smaller packages into large loads attractive to the commercial airlines. Later, FedEx entry into the industry transformed this as it came with its own aircraft carrier as well as logistic infrastructure. This caused ripples in the industry and other firms went on to purchase their own aircraft to generate similar profitability like FedEx (Augustine, 2009).
Over these years United States express business dominated the world. DHL was the only company operating internationally in the whole world. It was established in 1969 in California at San Francisco. The Bank of America was the company’s first customer as it needed an international express carrier to carry its credit letter and other records globally reliably and rapidly. In the 70s the company operated in Europe, Far East, Africa and Latin America. It was one of the express companies with local offices in Middle East. By 1983, the company operated in over 125 with 500 offices (Augustine, 2009).
Entry of ARAMEXAfter graduating from university, Ghandour decided to conduct a feasibility study to start an express carrier in the Middle East. In his analysis he noted that global carriers would bypass DHL if they had an option for delivering their items across the world. By partnering with Kingson they established Aramex. Ghandour spent a lot of time in the initial years travelling around the world to find entrepreneurs to develop his network. He networked with individual who accepted to deliver Aramex packages locally. They include small travel operators, and emerging domestic courier companies. Ghandour initially used commercial flights to ferry packages across the world. He also noted that though most of the courier firm used to send packages to Middle East, majority had no interest in venturing into global market. His company established processing operation in major drop points like New York City airport of John F. Kennedy and Heathrow in London. In these locations the company started to load small packages to be taken to Dubai, Amman, and Bahrain for sorting and delivery to various parts of Middle East. In time the company was able to lure U.S express operators like Emery, Burlington Northern, and Airborne to partner with it and deliver these firms’ packages to Middle East. The company was able to use the known brands to attract more business (Augustine, 2009).
The company successfully developed its brand with the small courier companies. In 1987, it attracted the U.S. largest courier company FedEx. This became the firm’s turning point as the partnership alone generated 30 percent of the total revenue for Aramex. In the late 80s express industry experienced a series of acquisitions of various courier companies that the firm served, but it continued to serve them despite the changes in ownership. However, the firm later developed its relationship with Airborne and they formed OEC alliance. This alliance enabled the two firms to compete with large firms like DHL and UPS with global presence. By 1991 this network had 90 percent connection to various countries of the world enabling Aramex to access different markets. This network enabled the firm to build trust among businesses in the Middle East for services ranging from freight forwarding to express, and distributed goods to any location a client needed.
Although this alliance formed an important source of business growth for Aramex, it still depended on other courier express company like FedEx. As a result, when FedEx decided in 1966 to drop the firm and start its own ground operation in the Middle East it created a great threat to Aramex’s revenue. Accordingly, the firm started to source for finances to develop its own systems in Middle East. The company first sourced these funds by selling 9 percent of its share to Airborne. However, these investment were inadequate to enable the company develop its technological capabilities to a competitive level in the region. The Arab world was also reluctant to invest in the firm. They did not have confidence in the firm because it did not own buildings or lands. Kingson advised Ghandour that they should list the firm in NASDAQ, an American based stock exchange. In addition to the cash acquired for this listing, it enabled the firm to build its reputation as a global player. The firm’s IPO (initial public offering) traded on January 1997 and was the first company based in Middle East to sell shares in a United States Stock Exchange (Augustine, 2009). The listing left an impression among other players such as strategic partners, banks, and client. They all started to view the firm in a different perspective.
According to Ghandour (2011) partnering with Airborne had a great impact on the firm reputation. The company used to speak about this partnership in every road show organized in America. This partnership cultivated confidence in the firm from institutional investors in US. It was also later instrumental in attracting regional investor interest in the firm. The firm was therefore, able to move from its IPO value of $7 million to $14 million in the second offer. As a result, the company was able to accelerate its growth and it started to venture into new regions beyond Middle East like India, Bangladesh, Sri Lanka, and Hong Kong. This weakened the firm’s dependence on OEC. The firm worry of losing technology capabilities provided by Airborne because of the OEC alliance compelled the CEO to start developing its own IT system. He recruited a former employee of Airborne to assist in this objective and successfully managed to do so in two years time. In 2003, Airborne was acquired by DHL and withdrew its support to Aramex. Luckily the firm had ventured into various markets and had developed its own package tracking and tracing system. The company also called a meeting of other members in the OEC alliance to convince them that despite Airline walking away from the alliance, it was in a position to maintain their alliance.
Ghandour (2011) argues that by the time Airborne moved out of the alliance and switched its system from Aramex, the latter was able to switch its new system on. This is because that moment offered Aramex an opportunity to build its global leadership position. He further argues that though the firm loss of Airborne had an impact on the firm, it was a blessing in disguise because their partnership had hindered Aramex from realizing its full potential. However, in spite of the firm being listed in NASDAQ, it was not able to get the capital it needed. Political instability in the region made investors to lose confidence with the firm. Ghandour partnered with Abraaj Capital to return the firm into private ownership. There years later the firm was listed in the Dubai Stock Exchange where it continues to source for funds to date (Williams, 2013).
Aramex CultureThe company continued to develop a unique identity as a global leader in logistic industry. It was known as a non-bureaucratic, non-hierarchical, entrepreneurial, and encouraging environment. The company values entrepreneurs and recognize the need to work with small firms in expanding its businesses. In 2003, for instance following a wave of consolidation in the industry, the firm lost a significant proportion of its US market. To address this challenge Ghandour initiated his own strategy of acquisition and alliances to equal its competitors. The company continues to acquire local operators, and has recently acquired logistic firms in Britain, Ireland, and Egypt. Ghandour believed that entrepreneurs existed everywhere where the firm needed a business partner. In addition, the company attracted a younger workforce with 45 percent of the entire workforce being under 29 (Augustine, 2009). To prospective employees it offered access to international opportunities and professional growth. In addition, the firm offers relatively high degree of local autonomy to work stations not common in most of the multinational companies. This enables the firm to provide services that other international express companies would not bother to provide. For instance, the firm in United Arab Emirates and Jordan delivered notification for courts. This created an intensive knowledge of the local market that Aramex operates.
Aramex Services and Global PositioningThe company prides itself as a global service provider. It offers a wide range of services in categories like international delivery, freight forwarding, domestic express delivery, integrated logistics, supply chain management and warehousing, information management solutions, and E-business solutions.
International express delivery involves shipping of packages and documents for clients in various sectors like banks, pharmaceutical, trading, regional distribution and manufacturing, which needs speedy delivery. The freight forwarding category encompasses all transportation via land, air, and ocean. This is mainly for large packages, which are not time sensitive. In domestic express delivery category the firm offers door-to-door delivery of packages urgently needed within a city or country. This can either be same-day or the next business day. The firm also offers warehousing and inventory management systems for clients’ products, from the time they leave business premises up to the time they reach end user. According to AUGUSTINE (2009), this category emerged from increased demand for these services by companies due to changes in global economy. These firms needed the warehousing services to enhance the logistics solutions. The firm also has information management solution services under the brand name infoFort. This provides clients in North Africa and Middle East information management solution. This encompasses information confidentiality, preservation, accessibility, business continuity and compliance issues relating to data and information.
Following recent growth in online business due to expanding internet use the firm has also developed e-business solutions. The company operates an online shopping delivery services known as Shop and Ship. This is a delivery service enabling thousands of online shoppers in various parts of the world to get goods purchased from UK, US, and China via online stores delivered to them. This service is offered in over 25 countries in Europe, Middle East, Asia, and Africa (Aramex Overview, 2011). Despite recent growth in online business, some firms in America as well as eBay traders do not ship sold items overseas. Recognizing this gap Aramex developed the Ship and Shop where it offers Middle Eastern online shoppers American Addresses where they can have their goods delivered. The firm then delivers these items to the buyers in other parts of the world (Bangkok Post, 2006).
The firm has a dedicated website where the Shop and Ship service can be accessed. This is www.aramex.com/shopandship. This website provides crucial information to the firm’s customer through mailbox accounts. Customers can also be able to truck their shipments and calculate the rate of shipment as well as convert currency. The site also links users to other popular sites. The mailbox for Shop and Ship enables users to access Mailboxes in the US, where they can get internet orders, magazine subscriptions, correspondence, and special offers that would be impossible to get under any other ordinary international addresses (Middle East Company News, 2004).
ConclusionThe lesson from this analysis is that Aramex growth has developed as a result of two major reasons. The first is because of the first mover advantage. The firm was able to develop a competitive advantage over its competitors by venturing into local markets they feared to enter or disregarded. Secondly, its ability to maintain global alliance also gives it advantage over its competitors. Its ability to build alliance in different countries gave it a cheap means to compete with its main rivals without having to engage in an investment race with them. As a result the firm has been able to grow its revenue from $125 million in 2005 to closer to $845 million by 2012 (Robert, 2013).
References
Augustine, G. (2009). Aramex: Delivering the Future (A). William Davidson Institute Case 1-428-776.
Ghandour, F. (2011). The CEO of Aramex on Turning a Failed Sale into a Huge Opportunity. Harvard Business review, 43-46.
Middle East Company News. (2004). Aramex Complements ‘Shop and Ship’ Service.
Robert, K. (2013). Case Study: Developing a Global Operation: Aramex’s New Strategies at New Stages. Financial Times.
The Bangkok Post. (2006) How Delivery Companies are Consolidating.
Williams, J. (2013). Ordering off the menu: Entrepreneurship Arab-Style. INSEAD.
Building Place Brands
Building Place Brands: There’s nothing like Australia
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Introduction
Every business person’s goal is to succeed and earn substantially from their ventures. Most large organizations spend a significant amount of money on marketing to raise awareness of their company and, hopefully, persuade potential consumers to purchase the goods or services they provide. Building place brands are one of the most effective ways to contact the target demographic and increase brand awareness (Hereźniak, 2017). When deciding on building place brands, different companies may have different objectives. Using the theories learned in the course, this paper will address building place brands in Australia “There’s Nothing like Australia” by analyzing the brand personality of Tourism Australia, challenges involved with developing a place brand, and global experience seekers.
Brand personality of Tourism Australia
The importance of branding in tourism locations cannot be overstated. Tourism Australia is a well-known brand that has been successful in establishing emotional relationships with its customers. The tourism business is based on selling products- experiences. The tourism industry has evolved in recent years, with online marketing and promotion becoming more prominent. Tourism Australia is one of the key players in this change – through innovative technology and marketing strategies. Tourism Australia has a strong brand personality that pulls together all of the country’s assets into a coherent message for potential visitors to consider when planning their trip. The brand encapsulates a dimension that travelers want. The business goal for Tourism Australia is to promote, develop and maintain a brand that represents Australia as a desirable and exciting holiday destination (McCarthy, 2016).
Tourism Australia’s strategy is aimed at creating emotional connections with the Australian people and also improving the visitor’s overall experience. The second stage of this vision involves creating messages that will establish strong emotional connections with potential visitors to make them want to return over and over again. This is an important element of building awareness. The brand personality of tourism Australia is created to present it in an authentic, non-exploitative way. The country’s diverse landscapes are portrayed accurately with honesty and without glamorizing any specific region. With this approach, the brand personality of tourism Australia is created with a sense of place and belonging for all Australians who can now experience their own country as never before.
Challenges associated with developing a place brand
It is tough to gauge the success of place branding. Place branding, like product branding, is all about identifying and expressing the aspects of an organization’s identity that appeal to specific target groups. The challenges encountered in place branding and implementing a true place of marketing strategy that is integrated stem from the concepts of contextual branding and consumerism.
The advertising methods that work with position branding are not functional marketing strategies. The same goes for place branding. The place branding strategy is an attempt to promote the brand in the context of its given location and its surroundings. It’s becoming more common to identify with one’s surroundings, and the economy of your town or city – this is never good news for marketing teams trying to sell products without consideration of who they’re targeting. People across the country consume different things. One product might be difficult to market if it doesn’t fit into that lifestyle. The nature of places themselves, with fixed physical conditions and long-term reputations, governments, and economics, as well as the lack of a single controlling authority and major marketing campaign skills in government, and the lack of a single controlling authority and major marketing campaign skills in government. Place branding is further hampered by the inability to assess its success. Places, like products, can have umbrella brands that include various things from those locations that are all marketed in the same way (Eugenio-Vela, Ginesta, & Kavaratzis, 2020).
Global experience seekers
Creating a brand personality for a place requires a thorough understanding of the target market by the marketer. Adults with an independent travel mindset who wish to learn about and experience Australia’s culture are targeted by Tourism Australia. The “global experience seekers,” as defined by Tourism Australia, are a group of people from many cultures who seek out new experiences. Long-distance travelers, who are less impacted by distance, time, and money, are known as experience seekers. Travelers seeking new experiences are better informed, more inquisitive, and more curious about potential places. Their lives revolve around travel. As travelers, experience seekers are drawn to traveling to places they have not yet seen. They define their own goals, which include experiencing something different in each destination. It’s important for marketing programs to focus on the reasons why these people choose to travel and how they define success.
Their experiences give them a sense of purpose and insight into other cultures. Their experiences are sometimes challenging, but often offer growth and personal transformation. Tourism Administration departments can develop marketing campaigns that allow customers to experience new destinations with clear goals in mind. For marketers trying to build goodwill through brand personality heuristics, every effort must be made to support this quest for new experiences by creating an authentic brand personality that provides enjoyable travel propositions. Then, once the brand personality is achieved, any communication providing travel propositions must be consistent with the authentic brand personality.
Conclusion
In conclusion, “There’s Nothing like Australia” is a global building brand personality which is an advancement of an existing successful brand personality. Building brand personality was simply to remind people that Australia is still a wonderful country to carry out with or to visit as a tourist. The new marketing campaign was adopted after the company experienced persistent bush fires which people tend to have a negative on the country. The personality was based on the existing brand personality which is There is nothing like Australia (McCarthy, 2016). This campaign was successful as it restore the image of Australia as a desirable tourist destination nationwide and internationally. The campaign was successfully adopted in many countries globally because it successfully changed people’s perceptions about Australia.
Reference
Eugenio-Vela, J. D. S., Ginesta, X., & Kavaratzis, M. (2020). The critical role of stakeholder engagement in a place branding strategy: A case study of the Empordà brand. European planning studies, 28(7), 1393-1412.
Hereźniak, M. (2017). Place branding and citizen involvement: Participatory approach to building and managing city brands. International Studies: Interdisciplinary Political and Cultural Journal (IS), 19(1), 129-142.
McCarthy, B. (2016). Building Place Brands: There’s Nothing Like Australia. SAGE Publications: SAGE Business Cases Originals.
Management Dilemma A Case Of Beer Industry Versus Health Industry
Management Dilemma: A Case Of Beer Industry Versus Health Industry
Introduction
Management dilemmas manifest in many ways. For example, it is very hard to regulate multinational companies that profit by selling alcoholic beverages in a developing nation where workers like their beer, and like it cheap, to the extent that alcohol use has become a serious public health problem. Given the core goal of multinational corporations is to gain more market share, this essay argues that there should be a compromise between who qualifies to take alcohol, when to take it, and the price of the alcohol.
The government should control alcohol consumption through legislations that stipulate the legal drinking age, official drinking hours and tax. At the same time, the government should create a friendly business environment for multinational companies to operate in. To this end, there should be a compromise between the monetary implications and the health implications of alcoholic industry since the government earns revenue but spends such revenue in providing health care to persons who suffer from alcoholic addition.
On the other hand, the head office of the multinational company expects all its subsidiaries to make more profit and expand their market. It is least concerned by the health implications of the sale of its alcoholic products to the local population. Moreover, it needs to sell its alcoholic products at a lower price to attract more customers. As such, any regulation that seeks to reduce the drinking hours or increase the prices of alcoholic beverages threaten its overall competitive advantage. Alcohol consumers in developing countries seek to maximise satisfaction all the time. They achieve this by looking for the least priced alcohol products in the market. Since there are many operators in the alcohol industry and cheap alcoholic beverages in the developing countries, consumers will tend to buy more as long as the products have been approved by the local quality standards body.
Lastly, the country manager is tasked to make profits and expand the local market share. He will therefore use all strategies including lowering of product prices so as to fit well in a market where consumers are willing to buy alcoholic products as long as their prices are low. He will also lobby the legislators to enact laws that restrict alcohol consumption or slap heavy tax on alcoholic beverages.
Overall, the government and the country manager should engage each other in coming up with a balanced regulation that discourages heavy drinking and encourages leisure drinking. This can be achieved through slapping alcoholic beverages with mild taxes, limiting drinking to evening, weekend, and holidays, and disgorging the over-excessive consumption of alcohol.