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Marketing 6.1

UPS Partners with Business Customers:

What Can Brown Do for You?

Mention UPS, and most people envision one of those familiar brown trucks with a friendly driver, rumbling around their neighborhood dropping off packages. That makes sense. The company's brown-clad drivers deliver more than 4 billion packages annually, an average of 15.8 million each day. For most people, seeing a brown UPS truck evokes fond memories of past package deliveries. If you close your eyes and listen, you can probably imagine the sound of the UPS truck pulling up in front of your home.

Even the company's brown color has come to mean something special to customers. UPS has been referred to for years as "Big Brown." "People love our drivers, they love our brown trucks, they love everything we do," says one UPS executive. Thus was born UPS's current "What Can Brown Do for You?" advertising theme.

For most residential customers, the answer to the question "What can Brown do for you?" is pretty simple: "Deliver my package as quickly as possible." But most of UPS's revenues come not from the residential customers who receive the packages, but from the business customers who send them. And for these business customers, UPS does more than just get Grandma's holiday package there on time. Whereas residential consumers might look to "Brown" simply for fast, friendly, low-cost package delivery, business customers usually have much more complex needs. For these customers, UPS becomes an ally in finding solutions for a broad range of logistics issues.

For businesses, package delivery is just part of a much more complex logistics process that involves purchase orders, inventory, order status checks, invoices, payments, returned merchandise, and fleets of delivery vehicles. Beyond the physical package flow, companies must also handle the accompanying information and money flows. They need timely information about packages—what's in them, where they're currently located, to whom they are going, when they will get there, how much has been paid, and how much is owed. UPS knows that for many companies, all these work-a-day logistical concerns can be a nightmare. Moreover, most companies don't see these activities as strategic competencies that provide competitive advantage.

That's where Big Brown comes in. These are exactly the things that UPS does best. Over the years, UPS has grown to become much more than a small neighborhood package delivery service. It is now a $50 billion corporate giant providing a broad range of logistics solutions. UPS handles the logistics, allowing customers to focus on what they do best. It offers everything from ground and air package distribution, freight delivery (air, ocean, rail, and road), and mail services to inventory management, third-party logistics, international trade management, logistics management software and e-commerce solutions, and even financing. If it has to do with logistics, at home or abroad, UPS can probably do it better than anyone can.

UPS has the resources to handle the logistics needs of just about any size business. It employs 425,300 people, some 93,600 vehicles (package cars, vans, tractors, and motorcycles), 600 owned and chartered aircraft, and more than 1,000 warehouse facilities in 200 countries. UPS now moves an astounding 6 percent of the gross domestic product in the United States, links 1.8 million sellers with 6.1 million buyers every day, and processes more than 460 million electronic transactions every week. It serves 90 percent of the world population and 99 percent of businesses in the Fortune 1000. UPS invests $1 billion a year in information technology to support its highly synchronized, by-the-clock logistics services and to provide customers with information at every point in the process.

Beyond moving their packages around, UPS can also help business customers to navigate the complexities of international shipping, with some 700 international flights per day to or from 377 international destinations. For example, although most residential customers don't need next-day air service to or from China, many businesses do seek help shipping to and from the burgeoning Asian manufacturing zones. UPS helps ensure the timely flow of crucial business documents, prototypes, high-value goods (such as semiconductors), and emergency repair parts that wing their way across the Pacific every day.

UPS even offers expedited customs services, with fast inspection and clearance processes that help get goods into the country quickly. "When you're trading internationally, your entire investment could be hanging on a single clause," says one UPS ad. "We don't get you over oceans, mountains, and deserts only to be delayed by Chapter 3, Part 319, Regulation 40-2 of CFR Title 7. . . . Leave the burden of global compliance to UPS."

In addition to shipping and receiving packages, UPS provides a wide range of financial services for its business customers. For example, its UPS Capital division will handle clients' accounts receivable—UPS shippers can choose to be reimbursed immediately and have UPS collect payment from the recipient.

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For its business customers, UPS does more than just deliver packages from point A to point B. It becomes a strategic logistics partner, helping customers to solve their complex distribution problems. "What Can Brown Do for You?"

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Marketing 6.1 Continued

Other financial services Include credit cards for small businesses and programs to fund inventory, equipment leasing, and asset financing. UPS even bought a bank to underpin UPS Capital's operations.

At a deeper level, UPS can provide the advice and technical resources needed to help business customers large and small improve their own logistics operations. UPS advises companies on redesigning logistics systems to align them better with business strategies. It helps customers to synchronize the flow of goods, funds, and information up and down their supply chains. UPS Logistics Technologies supplies software that improves customers' distribution efficiency, including street-level route optimization, territory planning, mobile delivery execution, real-time wireless dispatch, and GPS tracking.

So, what can Brown do for you? As it turns out, the answer depends on who you are. For its residential consumers, UPS uses those familiar chugging brown trucks to provide simple and efficient package pickup and delivery services. But in its business-to-business markets, it develops deeper and more involved customer relationships. For their business customers, UPS employees around the world must do more than just deliver packages from point A to point B. They must roll up their sleeves and work hand in hand with customers to help solve their complex logistics problems. More than just providing shipping services, they must become strategic logistics allies.

Sources- Facts and information from various UPS Web sites, including www.ups-scs.com;www.ups.com

content/us/en/about/facts/worldwide.html; www.upslogisticstech.com; and http://capital.ups.com/contact/;

accessed September 2008. UPS®, What Can Brown Do for You-, and UPS Capital- are registered trademarks of United Parcel Service of America, Inc. Big Brown" is a trademark of United Parcel Service of Amena, Inc.

Author I Business buying decisions Comment | can range from routine to incredibly complex, involving only a few or very many decision makers and buying influences. _

reUes on about 1,800 suppliers in more than 50 countries to stock its shelves. If the giant retailer continues at its current growth rate, it will need to double its supply network by 2010 IKEA doesn't just rely on spot suppliers who might be available when needed. Instead it has systematically developed a robust network of supplier-partners that reliably provide the more than 10,000 items it stocks. IKEA's designers start with a basic customer value proposition. Then, they find and work closely with key suppliers to bring that proposition to market. And IKEA does more than just buy from suppliers; it also involves them deeply in the process of designing and making stylish but affordable products to keep IKEA's customers coming back.2

Business Buyer Behavior <PP 196-205)

At the most basic level, marketers want to know how business buyers will respond to various marketing stimuli. # Figure 6.1 shows a model of business buyer behavior. In this model marketing and other stimuli affect the buying organization and produce certain buyer responses. These stimuli enter the organization and are turned into buyer responses. In order to design good marketing strategies, the marketer must understand what happens within the organization to turn stimuli into purchase responses.

Within the organization, buying activity consists of two major parts: the buying center, made up of all the people involved in the buying decision, and the buying decision process. The model shows that the buying center and the buying decision process are influenced by internal organizational, interpersonal, and individual factors as well as by external environmental factors.

The Model of Business Buyer Behavior

In some ways, business markets are similar to consumer markets—this model looks a lot like the model ot consumer buyer behavior presented in Figure 5.1. But there are some major differences, especially in the nature of the buying unit, the types of decisions made, and the decision process.

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