Glenn Rothwell, Lauren Wilt, Tyler Gendron, Jenn Ding, Jon Ota
Strategy and Policy, Prof. Chari
Airborne Express (A), 9/22/15
1. Describe and contrast the business strategies of Airborne Express and Federal Express in the Express Mail industry.
Airborne Express and Federal Express each had very unique and distinct business strategies. Federal Express believed that the packages do not care how far they travel as long as they arrive reliably on-time (p5, ¶3). In addition, they found out they could efficiently use a hub-and-spoke routing system. Their strategy used an all-express-mail airline that would fly all packages to a single airport where they would be sorted and distributed. Federal Express eventually refined their target market to focus on small packages that other air carriers ignored (p5, ¶3). On the other hand, Airborne Express had a target market of larger companies that shipped large volumes of urgent items. Airborne Express’s strategy involved avoiding residential deliveries and infrequent shippers. Xerox would be an example of a company that fits their target market and allows them to fulfill customer needs by doing what they do best. In terms of technology, Federal Express gave its customers Powership computer terminals (p6, ¶2) and shipping software free of charge. This allowed customers to prepare shipping paperwork, streamline billing, and track shipments. This resulted in more efficient operations and higher customer satisfaction. Airborne Express invested selectively in technology and often let their competitors be the guinea pigs for new technology. The software system they used was very similar to the one Federal Express used except customers could not schedule a pickup or create shipping paperwork on their website. Finally, each company took very different business strategies in terms of marketing. Federal Express used an aggressive marketing strategy intending to appeal to the whole market. In 1996, advertising expenditures topped...