Case Study Analysis
ROUBAOFedEx: From a portfolio of brands to a single company
FedEx was founded in 1973 as an overnight delivery company. It has since established itself as a leading company in global air transportation, securing a strong reputation for service and reliability. The company faced some stiff competition from rival UPS and service novel ventures in the express carrier market during the 1990s. In addition, FedEx acquired Caliber Systems – which included a suite of logistics and express companies – in the late 1990s. Both these developments triggered the need within the FedEx corporation to rethink its corporate brand and communication. In particular, there was the belief that rather than slowly assimilating these companies whilst keeping marketing activities separate, customers increasingly requested a ‘one-stop’ transportation interface – a single point of contact with the same company. In January 2000, FedEx responded and rolled out a single corporate brand across all its operating companies. The company name was badged on all its services and operations, with sub-brands such as FedEx Express for express services and FedEx Freight for less-than-truckload services. Whilst the structural alignment within FedEx and the choice for a monolithic brand made a lot of sense, strategically stakeholders were initially not convinced. Media journalists were skeptical of the new structure and questioned its viability, employees continued to identify with their own operational units and financial analysts felt that the new structure did not provide additional synergies over the model of having a portfolio of separate brands and companies.
Bill Margaritis, the vice president for corporate communication at the time, aimed to address these stakeholder opinions through a campaign that set out to gain recognition for the new business model and that would also help in creating acceptance and support across stakeholder groups. Before the campaign was developed, Margaritis and his team carried out extensive research on the current awareness of, and attitude towards, the new FedEx structure. They surveyed employees, journalists and financial analysts, who each expressed a lack of understanding and even skepticism about the new model. Margaritis used these research findings to develop change communication programmes internally that would create understanding of the new structure. The research also led them to intensify their efforts to convince journalists and financial analysts of the advantages of the new structure and to demonstrate to them some early successes.
Question for reflection
Reflect on the research and planning cycle and how it was used within FexEx. Could the same results have been achieved without research informing their messaging along the way?