1.6 Marketing in the maritime industry
Ports are perceived as national assets for the trade and security advantages they bring to their countries. They are not often perceived as business enterprises in their own right, although this is beginning to change. For this reason, many ports once depended on their tradition of maritime service and see little need for having a marketing orientation. Hence, they were, and in some cases are, at risk of being unaware of, and unresponsive to, changes in the global market place for terminal services.
Ports vary in their commitment to marketing, in part due to the nature of their ownership. However, whether a port is state-owned, privately-owned or jointly owned, it has to be concerned with having sufficient business to remain economically viable. In an age of competition for aircraft, trains and trucks, and in the context of more advanced ships and ship-handling facilities, no port can afford to be complacent about its future.
The marketing of ports is a complex matter, especially as ports become increasingly privatised. Port authorities often do not control warehousing, coldstores or even certain docks. As ports hand over terminals on long-term leases of about thirty years, they have less control over their maintenance and technology. Thus, the port may carry out marketing activities such as promotion, but is not able to modify the product or take an order.
It is important to realise that marketing is really a frame of mind that must permeate an organisation and all of its employees. It must become the dominant part of the organisational philosophy or corporate culture of ports and terminals, superseding the public service ethos and production orientation of their organisation's history.
The next reading, written by yours truly, focuses on the development of port marketing by linking three of the four orientations discussed earlier with the three generations of ports espoused by UNCTAD. Also covered is a review of research that has been conducted on port marketing, which should highlight the paucity of research in port marketing and how this is an evolving area of research. While reading the PhD thesis excerpt article, think about what it will take to make a maritime or logistics organisation that you are familiar with more marketing oriented.
Reading 1.4
Cahoon, S. C. 2004, Seaport Marketing: A Census of Australian Seaports , unpublished PhD thesis, University of Tasmania , Australia , pp. 74-89.
Activity 1.6
Write a few points that highlight the difference between being marketing oriented and market oriented.
Another difficulty in relation to marketing ports is that services based around the port such as shipping lines, freight-forwarders, coldstores, rail lines and truckers have different priorities, and from their point of view their interests are best served when their own services are marketed individually rather than just the port.
Many commercial services in this position prefer the port authority to be a dormant landlord and shipping 'traffic police officer'. They do not see the value of port marketing and resist participation in any joint marketing effort that works to the benefit of their competitors at the same port as well. One interesting way of thinking about the port authority is to use the analogy of a shopping mall that contains many individual retail stores. The shopping mall (or port authority) is in charge of marketing efforts and attracting customers for the benefit of all individual retail stores (or shipping lines, freight-forwarders, coldstores, rail lines and truckers and so on). All retail stores thus contribute to the marketing of the shopping mall.
Consider this
What then, do you think is the marketing role of a port authority? Who should their target audience be? How might ports and terminal services cooperate in marketing?
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