Special delivery: UPS gets into the advertising business
Filed under: Company News
Last week, UPS (UPS) made a few special deliveries. In addition to the more than 15 million packages that the company normally carries every day, Big Brown's drivers in Chicago, Dallas-Fort Worth, Miami, Phoenix, and Washington DC brought selected customers special offers and samples from Sephora, West Elm, Pottery Barn, and nine other popular retailers. The pilot program, which UPS calls "Direct to Door," represents an attempt to expand the company's core business into the advertising arena.
For retailers, the most attractive aspect of Direct to Door may be its audience. While traditional advertising methods -- such as mail circulars or magazine ads -- engage a wide range of consumers, there is no guarantee that the people who see the ads will be comfortable with mail-ordering products or will actually spend their money on premium brands. By using UPS as an advertising method, the companies shortcut the mail order problems; by vetting customer deliveries, the carrier can guarantee that various offers find their way to the most promising customers -- those who regularly receive UPS packages.
In spite of the cost, however, it seems like many companies are eager to get involved with the program. Lisa Lynn, director of UPS new product development, stated that the company has conducted talks with several potential partners, noting that there is "a lot of interest" in the program. She pointed out that a voluntary survey of Direct-to-Door customers has produced an "overwhelming response," indicating that customers strongly appreciated the free samples and special promotions.
While it is unclear if Direct to Door will become a permanent part of UPS's business, it seems to be a timely option for both advertisers and delivery companies. By developing a new revenue stream, carriers like UPS, DHL, and FedEx (FDX) could potentially reduce their delivery costs, making them more competitive.
From the advertising angle, companies involved with Direct to Door-style programs could save a great deal of time and effort by narrowing their focus to the most promising customers. And, from the customer perspective, these programs hold the allure of great deals and lowered freight prices. With so much to offer, it seems likely that, even if UPS decides against continuing Direct to Door, somebody else will choose to pick it up.
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Reader Comments (Page 1 of 2)
10-06-2009 @ 8:50AM
Steve said...
This is a brilliant idea. Get flyers into the hands of individuals and family that purchase goods either online or from catalogs. I can see in the future the UPS catalog dropped off with all residentail deliveries. Imagine the opportunity, even office supplies at businesses. And if UPS goes one step further and catagorizes its business customers, industry focused advertisments could be attached to all business deliveries. Absolutely brilliant.
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10-06-2009 @ 10:29AM
John said...
OK and now that the Government is going to run a lot of our industries and do it better than we can they should have come up with this for the USPS right? Not.
10-06-2009 @ 9:20AM
Gary said...
If I am using UPS to deliver my products, can I be assured that they will not drop off one of my competitors flyers or catalog to my customer?.....if not looks like I'm switching carriers.
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10-06-2009 @ 9:34AM
t said...
How much money does this costs . It funny how the USPS UPS cry about money and layoffs yet they have the money to do this or air expensive commercails during golf tournaments NBA playoff games football games. And i currently work for the USPS. How do you like to be someone laid off reading this or seeing those commercials .
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10-06-2009 @ 11:13AM
big man said...
Let's not be fooled folks. Sure, this is a great idea for business, but don't expect any savings to be passed onto the customers. UPS, USPS, Fed Ex are all losing millions of dollars each quarter. This is a way to add revenue, not to pass savings to customers. Now we will have junk in our mailbox and at our front door. The 'tree huggers' will go insane. More cardboard boxes and paper advertisements to throw straight in the dumpster.
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10-06-2009 @ 11:17AM
mark said...
Last week ups delevered my package to the wrong house,because my wife and the other women have the same first name.Guess its not nessary for the driver to read all the information. Flemington NJ
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10-06-2009 @ 11:24AM
Paul said...
Why do you even bother to mention DHL as a competitor for UPS or FedX. That company is a shell of its former self and its share of the US domestic market is basically ZERO. I highly doubt that DHL will even exist in the US for much longer.
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10-06-2009 @ 2:15PM
Jon Bergey said...
Do you who dhl is? the German post office, now if you want to support a company do it with an American co.
10-06-2009 @ 1:11PM
Corey said...
UPS lost my computer 3 weeks ago....I am pissed about it and they havent done anything to rectify the situation. Who in the hell cares what UPS does and doesnt do.....except how much packages they lose!
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10-06-2009 @ 2:05PM
prete ryback said...
the govt can't run anything right--get the govt out of everbodys life and get rid of obama the marxist,he just like hitler, and he needs to go away fast, very bad president and has no qualifications for anythhing but picking cotton, from chicago he is corrupt and should be in jail
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10-06-2009 @ 2:11PM
Jon Bergey said...
Yoo T said it wrong ups did not cry about money or the lost there of nor does it layoff people I quess he just had to say something even if it is wrong.
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10-06-2009 @ 3:44PM
ASP said...
Since when is UPS crying about money? They go up on their rates every year. Plus, this wouldn't cost them money, they'd be making money off the retailers. I think this is a great idea. I'd love to get samples and special offers delivered with my packages.
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10-06-2009 @ 4:12PM
mark said...
extra traimg for drivers? i work there and training is a joke, just a nice word they use like safety. (ps bigman) do your homework ups had almost 900million profit last quarter
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10-06-2009 @ 6:13PM
big man said...
Atlanta-based courier giant said its profit for the second quarter of 2009 shrank to $401 million from $906 million during the same period last year - a drop of 55 percent. As the company reported a profit of just 40 cents per share - down from 87 cents a year ago, its shares slipped 6.5 percent to $51.21. Yes it's still a profit, but it's also cut that profit income by more than half. That my friend is a 'loss' of business. UPS had 900 billion in revenue only 400 in profits. The two are very different.
10-06-2009 @ 6:18PM
big man said...
I apologize, the last line was meant to be 900 million.....not 900 billion.
10-06-2009 @ 4:41PM
consumer said...
so if i'm not receiving a ups package, i won't be receiving any samples, flyers or special offers???? How is that fair??
Will UPS be required to obtain the solicitors permits that the cities make everyone else obtain and PAY for to deliver samples, flyers and special offers?
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10-06-2009 @ 5:48PM
brian said...
UPS is one of the dirtiest companies to work for they treat the part timers like shit.. ups also performs like a sweat shop !! if they get 30 new hires within two weeks they all quit. the gov't should look into their practices because they are taking part in putting the USPS out of business. its the taxpayers that are keepin the post office afloat and im sure the taxpayer WOULD NOT agree with UPS.
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10-06-2009 @ 5:59PM
Dawn said...
UPS treats their drivers like crap. At my husband's center, instead of laying people off, management isn't looking for any reason they can to harass the drivers and fire them for any reason they can. Since July, they have fired 14 other drivers we know personally for minor things that management directs them to do but then pulls the plug when a customer complains. Those poor guys are sick with stress. They are followed by management on their routes, written up constantly, yelled at. Any small complaint from a customer threatens their jobs. The drivers deserve every penny they make. Just remember before you make a complaint to the company, mostly likely the driver most likely is told by management to do something like sign for your packages as long as they get them off the truck but whom will be fired when management covers their own butts. Very stressful job. Before you make a complaint, remember a good portion of the time, it really isn't your driver's decision, he/she is being told what to do but will take the fall for your complaint as well as their families.
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10-06-2009 @ 6:54PM
Steveo said...
I agree. My drivers are pretty stressed out. Their trucks are very overloaded every morning, I can't even see through the truck, we get 40+ packages a day for our customers. The drivers bust their butts daily and get yelled at for any/all complaints. They make great money, but happiness and enjoying your job is more important to me.
10-06-2009 @ 6:02PM
Dawn said...
And pardon my typos, hope I made my point anyway
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