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Productization in digital freight forwarding

Updated: Feb 3, 2022

Beyond ‘Online’

In today's world that is revolutionized (read: shook up and slightly confused) by digital technologies, it is important to take a step back and evaluate what it means for us before we jump in feet (or head) first. There’s a rush to go ‘online’. Is that enough?

We would like to present a point of view that urges freight forwarders to not only digitalize their business operations, but also think about a productization strategy.

What is productization?

Packaging a Service – box it with inclusions, exclusions, add-ons, options and a fixed price – that’s productization.

Why is productization important?

Omnichannel does not exclusively apply to retail. Customers everywhere expect the same service and quality irrespective of where they make their purchase – in person, mobile, tabs, desktops, watches and other wearables.

Without productization, we are essentially selling services designed for an ‘offline’ environment through an ‘online’ channel. That’s bound to give some trouble, isn’t it?

This is a business with more exceptions to the rule. The thought of a pre-packaged or a pre-constructed offer brings out many ‘what if’ scenarios. In the offline environment, we have the luxury of the go-to person who will fix any issues as they crop up. And they do!

We have all been guilty of falling prey to the ‘what if’ and ‘worst case’ scenarios. What if the consignment needs extra packaging, what if the consignment weighs more that planned, what if it rains and so on. And then we bundle in everything to mitigate these risks, which may or may not arise. The customer suddenly sees a price point that is not only much higher but is also riddled with assumptions.

However, Digitalization, by virtue of its nature, calls for transparency, clarity, choice and minimum human intervention.

Productization does exactly that. With clearly defined activities that are included, services that are optional and clearly defined price points, productization removes ambiguity for customers. It allows customers to know exactly what they are they are signing up for, choose any add on services they see value in and pay for exactly what they need.

There are many examples of services as products driven by the digital imperative –

· When a freelancer who designs your logo promises 3 free revisions

· When an airline sells a ‘super saver’ ticket

· When you book a movie ticket and add a tub of popcorn to your purchase

· When you walk into a store to buy diapers and come out with a six-pack (ok that’s not digitalization but it’s a happy, albeit sleep-deprived, customer!)

You can think of many more, can’t you?

Last but not the least, a big advantage of digitalization is that it allows your customers to find you. But without a productization strategy for your digital channels, that’s about all your customers can do – find you. But with pre-constructed offer of services published on your own or third party platforms, your customers can not only find you, but also see upfront what they can expect from you. If they like, they book.

So what should freight forwarders do (or not do)?

Don’t just create an online presence – Avoid the pitfalls of a “lift and shift” approach to digitalization of your business. Thoughtfully packaged digital offerings of your services that clearly state costs and allow shippers to make bookings and payments easily will resolve several concerns your customers have. Like your airline associates did for passengers, consider the following parameters to construct the freight forwarding product –

  • Route

  • Schedule

  • Rates

  • Mandatory charges and optional services applicable at origin

  • Mandatory charges and optional services applicable at destination

Give it a name, tag it, track it, analyze it, add, or remove services and create as many products to serve the needs of various customers as needed.

Build more into platforms than quoting and booking - Once a shipper is on your platform, they should be able to complete entire end to end transactions on the platform without having to get off it. For example, a shipper may make a booking online but must resort to emails to send documents to complete a transaction.

Continue investing in relationships – Leverage technology and build automations into your operations to free up your team member’s time. They can then invest more time into building relationships with not only customers but also carriers and global partners. This will go a long way into providing global coverage, building new service offerings, and improving customer experience.

Learn, adapt & grow is the new mantra. View them as challenges or opportunities to improve, digitalization is breathing new life into the freight forwarding industry.

Perhaps it hasn’t been completely figured out yet, maybe it’s a matter of time. Whether the changes are incremental or disruptive, a better world is just around the corner.

Do leave a comment below and let us know what you think.

Visit to start constructing and publishing your offers of freight forwarding services today!

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