UPS proved today it isn't afraid to poke fun itself.
The delivery service opened a New York press event by showing a popular College Humor video, "How UPS Deliveries Actually Work." The video shows a UPS guy stealthily waiting until a woman leaves her home, so that he can run up to her door and leave one of the infamous brown, yellow and white UPS InfoNotice slips. The woman returns, and in disbelief, says, "Attempted delivery three times?! But I was only gone 20 minutes."
Alan Gershenhorn, UPS's chief marketing officer, called the spoof a "colorful exaggeration," while admitting it's an experience the company doesn't want its customers to have. "UPS has recognized the love-hate relationship that all too many consumers have with the notorious delivery notice," he said. "UPS is introducing a first-of -its-kind delivering service, designed to ensure that missed deliveries are a thing of the past."
That service, dubbed UPS My Choice, is meant to increase the likelihood of a successful delivery on the first attempt. Consumers signing up for the program, which launches Oct. 3, will receive phone, email or text alerts notifying them a day in advance of a package delivery and providing a four-hour window. When those alerts are received, consumers can electronically authorize release of packages receiving a signature or reschedule the delivery for a later date. For $5, the package can be rerouted to another address or the nearest UPS Store. A $40 annual fee gets consumers all of those benefits, along with a delivery calendar showing the status of deliveries, the option to select a two-hour window and the ability to provide instructions to drivers about where to leave packages.
UPS execs are calling the program a "game-changer" and an "inflection point." Mr. Gershenhorn said it will be a competitive advantage, attracting new customers and benefiting shippers. He noted that QVC is already embracing the program and will be promoting it to customers. He expects other retailers to follow suit.
"We've talked to a lot of shippers, and they're all very excited about the service. They see how it will help drive sales and deliver a better customer experience," Mr. Gershenhorn said. He added, "We've done a lot of analytics with [QVC] to understand how many of their customers get deliveries on the first attempt, and based on that , they're very excited about what this can do for their receivers."
The timing of the announcement isn't accidental. UPS is hoping to grab consumers' attention in advance of the holiday season, when it ships upward of 440 million packages. It expects demand for the program will grow along with growth in e-commerce. Online sales reached $32.6 billion last year, up 12% from the prior year, with Cyber Monday sales exceeding $1 billion for the first time.
Measured media spending behind the program will be incremental though limited largely to digital media for the launch. Ogilvy & Mather handles creative for UPS, which spent $105 million on measured media last year. Last year the company also launched its largest marketing campaign ever, replacing "What can Brown do for you?" with "We [Heart] logistics."
Christine Owens, senior VP-brand management, said the program will be marketed with a "very robust" website, as well as videos that will be broadcast through YouTube and Facebook. UPS will also use its own assets to market the program, with more than one-third of its 4,400 stores actively promoting the program. Its delivery notices have also been redesigned to include an aqua box that tells consumers "You Decide When and Where Your Packages Are Delivered" and urges them to sign up for the program.
Mr. Gershenhorn said the UPS My Choice effort will be the company's first foray into talking directly to consumers -- it typically talks to shippers. "We've talked to shippers with a consumer angle, but [with this program] we really are looking to enroll consumers. Our studies show that even consumers who receive a few packages a month see the benefit of a $40 membership," he said.
Executives declined to comment on how big of a revenue driver the program could be, though they did acknowledge that more deliveries on the first attempt would mean fewer miles driven and less gas used.
"There's lots of sophisticated technology behind all this: address matching, alias matching and fraud prevention, the way we route and optimize our drivers," Mr. Gershenhorn said. "This is the only comprehensive consumer program that allows consumers to get the visibility, the control and the flexibility that we're providing."