Social media in logistics? Oh yes, it is coming!
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Logistics is being disrupted in many ways and from all sides at the moment and it forces all participants in the industry to refocus, reshape and rethink what they are doing today and how processes, collaboration and data exchanging are going to look like in the near future.
The logistics industry is by nature an “insider” industry. Most people in senior positions on the shipper and carrier side have grown into these positions on the basis of experience and not based on education. New entrants in the logistics industry can join without too much or none logistics knowledge but learn on the job and climb the ladder by moving up to more challenging and more difficult roles. Because in logistics, you need to “get” it. Understand the flows, the processes, the bigger picture and the demand customers have. Whether that is in the warehouse, on the road, in planning, sales, management or pricing.
The insider component of this industry is not necessarily a good thing because the old adage “this is how we always have done it” is rampant because of it. This has led to an industry which is behind in digitization, modernization and efficiency and lots of processes and work is being done manually where it could be automated. That does not mean that everything is inefficient in logistics. Looking at the core of the business: automated machines in warehouses, robots and trucks, that is where many companies are very efficient. It is more the peripheral processes that have suffered from lack of focus and investment.
The revolution we see in Freightech or LogTech to address these areas is astonishing. For the last 5 years enormous amounts of cash have been in infused into new companies that are addressing a part of the outdated tech infrastructure in the industry. Among the digital forwarders, marketplaces and freight exchanges one area is still very underrated, the vertical logistics platform. Most platforms and companies are offering transactional services which is great but they offer barely something new. There are now more, they are well funded but eventually they are feeding of a part of the business which is not really effective and optimal: the spot market. Even before the internet was born, similar platform concepts already existed.
They only serve a small portion of the market while being in an increasingly fierce battle for business among each other. But back to the vertical platform. Matchmaking and establishing contact in logistics typically happens based on an existing network. This goes back to the insider model of the industry, sales people move from 1 forwarder to the other to perform the same role but use their existing network to migrate as well to the new employer. Efficient for a few but highly inefficient for many and not compatible for the demands of todays’ corporate environment which typically surpasses borders and continents. On top of that there are or there used to be conferences to meet new contacts but here logistics has another unique challenge. There are so many potential suppliers in transportation that shippers are overwhelmed and are not really open or don’t have the time for traditional “meet and greets” which sales people in logistics do crave for. Next to that Linkedin has become a source for finding and contacting people but it is too superficial for logistics to really quickly grasp who you are dealing with.
Linkedin has proven to be a great platform for sales in many industries but a demanding digitizing environment will drive the need for new ways beyond Linkedin to match shippers with suppliers and vice versa. That is why the transportation industry needs platforms designed for logistics to facilitate matchmaking based on deep specialized profiles. Based on geographical areas, available equipment, ability to ship dangerous goods or frozen foods, company size, available certificates, qualifications, etc. For manual search but for sure also automated search and AI driven search.
The need for this is high as shippers do not have good search possibilities, Google search in that sense is like Linkedin, too generic and finding the right carriers outside of your geography may be challenging. Carriers on their part need new business and preferably not only spot but long term stable contracts with partners they can build a relationship with. Gaining access to those shippers is challenging as many carriers, especially the smaller ones, do not have the sales and marketing power to grow out of their natural geographical boundaries.
So what are some of the things that should be possible on a social logistics platform?
- Searching for new carriers or for new business
- Chatting with potential new carriers
- Creating preferred carrier lists
- Creating of a virtual carrier database
- Giving carriers ratings
- Managing tender and business opportunities for carriers
- Sharing company news and updates
- Invite carriers to tenders
There will be more and more specific platforms beyond “traditional” platforms such as Linkedin and in logistics they are only just getting started such as TendrX.