Premium 'Daily Maersk' service abandoned
Janet Porter | Thursday, 05 March 2015Maerk Line's Skou acknowledges that very few customers were prepared to pay premium prices for guaranteed delivery times
MAERSK Line has effectively dropped its groundbreaking Daily Maersk service that was designed to offer customers a premium product.
Maersk Line chief executive Søren Skou told Lloyd's List this week that "it had not been a roaring commercial success".
Daily Maersk was launched in September 2011 as part of an effort by the carrier to provide a differentiated product, with customers given guaranteed delivery times in return for higher freight rates. The concept did not refer to daily sailings, but daily cut-off times for export cargo delivered to certain specified ports in Asia.
In a statement this week, Maersk said it had "scaled back" on offering Daily Maersk to its customers.
"Daily Maersk is a premium product in terms of reliability and frequency — but there has not been a big demand to pay the premium it takes to run the service," the line said.
In a question and answer session during the TPM conference, Mr Skou said Maersk had found that customers were not willing to pay a higher price for better service.
This reflects the fact that the big east-west trades have become highly commoditised, with lines finding it almost impossible to offer a differentiated product on these routes.
"Our big customers talk about the paying more for better quality services, and in our case we had a major attempt with the Daily Maersk product, achieving 95% on-time delivery of cargo — our experience was that we could deliver on our promises, but the customers were not willing to pay for it," said Mr Skou.
"We had a lot of extra cost to deliver that level of reliability so we have changed our strategy."
There was always a question of how Daily Maersk would fit into the 2M alliance with Mediterranean Shipping Co, but with its huge network, Mr Skou suggested that Daily Maersk could still be offered to those who are prepared to pay, but that this was an extremely small number.
Daily Maersk was launched by Mr Skou's predecessor Eivind Kolding and was seen as a way of positioning the line well beyond the reach of competitors in terms of scale and reliability.
The daily service was built around a fleet at the time of 70 vessels operating between Ningbo, Shanghai, Yantian and Tanjung Pelepas and calling at Felixstowe, Rotterdam and Bremerhaven.
Daily cut-offs were offered, meaning that cargo could be shipped immediately after production without the need for storage, with Maersk Line promising agreed pick-up times and offering compensation, should customers’ containers not arrive on time.
Maersk Line chief executive Søren Skou told Lloyd's List this week that "it had not been a roaring commercial success".
Daily Maersk was launched in September 2011 as part of an effort by the carrier to provide a differentiated product, with customers given guaranteed delivery times in return for higher freight rates. The concept did not refer to daily sailings, but daily cut-off times for export cargo delivered to certain specified ports in Asia.
In a statement this week, Maersk said it had "scaled back" on offering Daily Maersk to its customers.
"Daily Maersk is a premium product in terms of reliability and frequency — but there has not been a big demand to pay the premium it takes to run the service," the line said.
In a question and answer session during the TPM conference, Mr Skou said Maersk had found that customers were not willing to pay a higher price for better service.
This reflects the fact that the big east-west trades have become highly commoditised, with lines finding it almost impossible to offer a differentiated product on these routes.
"Our big customers talk about the paying more for better quality services, and in our case we had a major attempt with the Daily Maersk product, achieving 95% on-time delivery of cargo — our experience was that we could deliver on our promises, but the customers were not willing to pay for it," said Mr Skou.
"We had a lot of extra cost to deliver that level of reliability so we have changed our strategy."
There was always a question of how Daily Maersk would fit into the 2M alliance with Mediterranean Shipping Co, but with its huge network, Mr Skou suggested that Daily Maersk could still be offered to those who are prepared to pay, but that this was an extremely small number.
Daily Maersk was launched by Mr Skou's predecessor Eivind Kolding and was seen as a way of positioning the line well beyond the reach of competitors in terms of scale and reliability.
The daily service was built around a fleet at the time of 70 vessels operating between Ningbo, Shanghai, Yantian and Tanjung Pelepas and calling at Felixstowe, Rotterdam and Bremerhaven.
Daily cut-offs were offered, meaning that cargo could be shipped immediately after production without the need for storage, with Maersk Line promising agreed pick-up times and offering compensation, should customers’ containers not arrive on time.
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