How Ryder rolled out a dating app for trucks
Driving innovation is hard at almost any company—particularly for established brands doing business the same way for decades. But for Karen M. Jones, CMO of Ryder Systems, the need to innovate was a mandate from the board of directors, and the way to get there had been etched into her psyche throughout her career.
Jones reveals a critical lesson learned from a major misstep while working at DHL in the 90s: If operations isn’t fully prepared for marketing to work, even the best campaign will fail.
Applying this experience to her efforts at Ryder, Jones made sure to involve operations early in the development of a truck-sharing app, and then rolled it out in stages to work out potential kinks. Recognizing that innovation is a team sport but still requires strong leadership, Jones drove the initiative with positivity, advising associates, “It’s not if—it’s how.”
What was one of the biggest lessons you learned while at DHL?
When I went to DHL in 2004, we strategized about what we needed to do to take over the U.S. market, and we did an amazing job getting the brand kicked off. I did some of the most creative advertising I've ever done in my life. It was aggressive; we even put our competition in our commercials because we had nothing to lose. That would’ve been a good strategy for a lot of companies, but we didn’t have the operational capabilities to outdo the domestic competition, so we ultimately built more new business than we could handle. The quickest way to go out of business is to advertise a bad product, and that happened to us even though a lot of great people and effort went into it. It was a huge lesson in what not to do and in the limitations of marketing—not every lesson you learn in business is a resounding success. I personally think you learn more from failures than from successes in many ways, shapes, and forms.
Now you’re at Ryder, how much room has there been to innovate?
Ryder is an 85-year-old company, and 85-year-old companies can have a hard time innovating. But about three and a half years ago we had a mandate from our board of directors that got us thinking about changes in the transportation logistics industry. We looked at everything out there and, as we thought about real threats to our business, we narrowed down to four focus areas where we had fantastic opportunities to grow. One was around big data, which covers a multitude of things. Another was in electric and autonomous vehicles. We were also combating e-commerce competition on behalf of our customers.
What was the last area?
The last area was in asset sharing. For this one, we created a truck sharing app called COOP by Ryder that has just taken off. It was developed because we found out that trucks sit idle 24 percent of the time, so we were curious to see if people could make money from sharing. We call it Airbnb meets Match.com for trucks.
What challenges did you encounter on the road to getting COOP live?
Our biggest hurdle was internal. Our CFO at the time was worried that this would cannibalize our rental business, so I had to come back with data and statistics to get him on board. There were 8 million commercial vehicles on the road, and between us and our biggest competitor, only about half a million rental vehicles available. This was a huge market opportunity, but the CFO was worried that our pricing in the market would erode our price premium.
So how did you overcome your CFOs concerns?
Having customer insights that came directly from research was really important. The web is such a powerful tool for showing where customers search from, where they spend time, and what they want to learn more about. You can narrow down those facts and statistics to compelling data points. Data for data's sake is never good, but data with an impact that resonates with your customers wins every time, and top-down support is critical to success. From a customer perspective, we had to solve their common concerns, including customers not being sure they wanted to deliver apples to a grocer in a truck that's a competitive brand. We did find that people are willing to ignore the brand issue once they realize the real revenue impact of the product.
Initially, this was about serving existing customers, right?
Yes. The nice thing about being a startup in your own company is that you bring your customer base with you. We went to our lease customers and said, “We know you don't use your lease vehicles every day, so here's a way for you to monetize those assets, make your lease payment note, and put it into a pool. We vet the drivers. We make the insurance. It's very low risk for you with very high reward.”
How did you roll out the app?
We started the product in Atlanta because there was a huge density of truck volume there, we've grown to Georgia and Florida, and this year we're headed to Dallas. We marketed COOP through outdoor billboards, digital advertising, search advertising. Initially, we spent the first six months in each market with our current customers and 60-75 percent of our initial transactions were from our own customer base. Since then, our customer base has shifted to 70 percent brand-new customers. It's an amazing mix and that gives us the opportunity to continue upselling other services in the Ryder portfolio.