You would have looked at the logo of FedEx several times. Have a look at it again. Do you see something peculiar?
No? Try finding the arrow. Yes, that forward arrow between E and x. That is the beauty of the FedEx brand. It talks about moving forward towards the future.
Founded in 1971, the company started as a courier delivery service but it has grown into the 5th largest airline in the world. With over 656 aircrafts in air, FedEx has pioneered the art of overnight delivery.
FedEx was not always FedEx. It was called Federal Express for over 2 decades from the day of its inception. In early 1990s, the company had made such a mark on the package delivery market that its name was almost used as a verb. Customers started calling it FedEx instead of Federal Express. Hence, in 1994 the company rebranded itself. The name of the company was changed to FedEx Corporation.
FedEx is not a normal package delivery company; it is a premium courier delivery and supply chain solution provider. You will have to shed out 200 bucks instead of 40 if you wish to send a few documents weighing 100g from New Delhi to Mumbai via FedEx. Now why FedEx commands such a premium?
Firstly, FedEx guarantees timely delivery of a product, similar to the Dominoes’ Pizza. Its delivery network spread across 220 countries is so strong that it guarantees that it will return all the money paid by the customer back if the parcel is delivered 60 seconds later than the committed time.
Secondly, it ensures no wear and tear of a product. You can send things as delicate as a mirror through the FedEx channel. It has even delivered Beluga Whales and Dolphins from one place to another. They were alive and healthy after reaching the destination. A large number of luxury carmakers use the FedEx Custom Critical to transport delicate windscreens and engines from one country to another.
Thirdly, FedEx spends billions of dollars each year as marketing expenditure. FedEx also sponsors various sports that share the attribute of speed, reliability, precision, teamwork and flawless execution. It has association with NFL and NBA teams. It also has a racing competition named FedEx racing. FedEx also broadcasts television commercials all across the globe.
Now, all this marketing ensures customer delight. There are thousands of e-commerce businesses that ensure customer delight by using FedEx as a channel partner. People in USA are delighted to see a parcel arrive with FedEx (the premium package delivery service).
Over the years FedEx has developed brand architecture and naming system in such a way that it extends the FedEx brand without compromising on its integrity. FedEx Express, FedEx Ground, FedEx Freight, FedEx Custom Critical, FedEx Supply Chain Services, FedEx Office all use the same FedEx logo but with a different color. This ensures that the company can leverage its existing brand image even after creating a significant differentiation in the product offerings.
FedEx is not just a combination of logos, good colors, a few videos and event sponsorship but it is a powerhouse of great customer service. In year 1994, it became the first package delivery company to provide online support through its website. It was able to receive orders through its website and also able to assist its clients at any time they wanted.
FedEx is a player in commodity business. Package delivery has been there since ages. Its innovative methods have ensured that it continues to charge a premium for the amazing service that it has to offer the world. The constant investment is branding saves the company from getting into a price war with its competitors and hence ensuring profitability.
FedEx is a pioneer in the industry. It has always led the change in the market place and has displayed amazing results to the onlookers.
However, it might face some challenges to position itself well in the emerging markets of the world. It will be difficult to command the same level of premium from the price sensitive customers.
Also, cab aggregator services like Uber can disrupt the market with a new kind of delivery system through cabs. Ola Cabs in India has started Ola Chef, which delivers food to customers. FedEx can actually gain some cost advantage by partnering with cab aggregators for the last mile delivery.
All said and done FedEx is an awesome brand. It is a great case study for young marketing enthusiasts like us to learn and get inspired from.