DHL GOES AFTER FEDEX AND UPS WITH A FREIGHT TRAIN

$150 Million Ad Campaign Confronts Competitors Head-on

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NEW YORK (AdAge.com) -- In its largest U.S. advertising effort in 20 years, DHL Worldwide Network is spending $150 million to go after FedEx Corp. and United Parcel Service head-on.
DHL's first ad features a freight train full of yellow DHL trucks stretching to the horizon.

Although a strong global brand in the express- and ground-shipping business, DHL is less well known in the U.S., where FedEx and UPS dominate up to 80% of the market. DHL, a subsidiary of Germany's Deutsche Post, began its rebranding initiative in August 2003 after buying U.S. rival Airborne.

Humorous train spot
It is fielding a humorous TV spot that that literally aims a freight train at its two largest rivals for U.S. market share. In the commercial, a UPS and a FedEx truck driver stop across from each other at a prairie train crossing. Roaring down the tracks between them is an endless line of freight train flat cars, each carrying a yellow DHL truck. The cars stretch out to the horizon like the endless supply convoy of a conquering army. The dumbfounded UPS driver breathlessly says, "We didn't see that coming."

The tagline is "Competition. Bad for them. Great for you." The ads are designed to alert small and midsize businesses that they have another shipping choice.

WPP Group's Ogilvy & Mather Worldwide of New York created the campaign.

Previous low ad spending
Based in Plantation, Fla., DHL last year spent $18 million in measured media, compared with $83 million for FedEx and $156 million for UPS, according to TNS' Media Intelligence/CMR. DHL has had no above-the-line advertising since the early 1980s, according to a spokesman.

About $100 million of the new campaign's spending will cover advertising through the end of the year with another $50 million dedicated to nontraditional means such as PR, direct mail, viral communications, and online gaming, in which a DHL truck races one from UPS, said Richard Metzler, executive vice president of the Americas for DHL Express.

Outdoor ads are running in some markets now, with a national rollout in August. The company assumed sponsorship of Nascar's Michigan 400, now called the DHL 400, and is considering other sports sponsorships, Mr. Metzler said. An internal program is under way to communicate to employees the new it's-not-what-we-do-but-how-we-do-it DHL.

Create a new brand
Mr. Metzler said next year likely would see slightly less marketing outlays, though this is the beginning of a long-term initiative to create a new brand out of one that had been dormant. The work is aimed primarily at 25- to 54-year-old men.

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