Environmental Perspectives on Marketing of freight Transports

Abstract

An obvious trend today is increased freight transports within the European Union, especially those on road while rail transports have a stable, smaller share of the transport market. This relation between transport modes mainly holds true for Sweden as well. Increased road transports have negative effects on the environment, which may obstruct a sustainable development; a goal in many political guidelines. Moving more freight off the roads and by rail instead, is desirable. At the same time, there are increased environmental demands on companies from stakeholders and therefore they pay attention to the environmental consequences of their business, including transports. A key process of influence is the freight transport buying. This task is executed by the logistics managers or equivalent, usually at the shippers of freight, and their decisions have a direct environmental impact e.g. choice of transport mode. The development of intermodal road-rail transports has been slower than expected in Sweden, even if the volumes have been increasing during the last few years. The environmental aspect is a quality that these transports may capitalize on in order to develop marketing strategies based on differentiation and to use these strategies in competition with direct transport on road. The environmental aspect may be a competitive advantage and thus an opportunity to increase the market shares in Sweden. The purpose of this thesis is to explore the potential of using environmental arguments in the marketing of intermodal road-rail freight transports. A theoretical framework is elaborated that brings together theory in marketing, logistics, purchasing and environmental management. This results in a proposed theoretical main model for the marketing of environmental advantages in freight transportation. After this, three research questions are identified that then guide the empirical data collection: (1) What impact do environmental aspects have on shippers and their customers? (2) If environmentally preferable transport services are offered, are they value-adding to the shippers? and (3) Is it effective to use environmental arguments in marketing strategies of intermodal road-rail transports? The first collected data was through an explorative interview study among shippers regarding how they work with environmental issues in connection to their freight transports. The results are summarized in a model showing the environmental considerations in the logistical decision-making process. Also, the results generated input for the second empirical study – a telephoneinitiated survey. The methodology and survey design is described quite thoroughly in order to identify the theoretical and practical problems when a survey is carried out, and the consequences for reliability and validity. The target population in the survey consisted of active companies having transport exceeding 150 km and this lower distance limit was set in order to focus on potential freight for intermodal road-rail transports. The survey data collected from shippers forms a foundation for the freight transport demand. These results provide basic data about the actual freight flows in terms of estimated total volume, destinations, lengths and transport modes. The most important practical contribution though, is the survey results reflecting the attitudes and preferences of shippers regarding environmental considerations (especially in relation to their transports) and in combination with other aspects. All results are examined in the light of the opportunities and barriers for marketing of intermodal road-rail transports. According to the proposed theoretical main model, the shippers’ transport service requirements are based on their logistical, economic and environmental needs. These demands are put on the transport sellers and brought into their marketing context. This can be used by promoters and marketers of intermodal road-rail transports based on environmental advantages. A customer segmentation of shippers is made based on company size and trade of business in the first stage, and then further by classifying them based on their environmental needs, their priority of price and their potential for intermodal road-rail transports. All these needs and preferences are weighted together in a resulting total marketing priority matrix for marketing efforts of intermodal road-rail transports based on environmental advantages. It shows that the target groups would mainly be large manufacturing companies, but also medium manufacturing companies and large wholesale companies. The model shows that customer segmentation can be used in a differentiated marketing strategy including e.g. transport service differentiation and marketing communication with different segments. The result is customer value for the shippers, which is weighted together with price (originating from the transport sellers’ service production context), which enable the shippers to make a final choice of transport seller(s). The results are discussed in terms of a marketing context among transport sellers, but they are intended to also be useful to other parties interested in developing environmentally preferable transport services e.g. to policy-makers. The results contribute to the examination of the potential of Swedish companies contributing towards achieving a sustainable transport system in a voluntary way, or as a knowledge basis for public policy decisions.

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