Revisiting the marketing approach between seaports and dry ports in Malaysia: current trend and strategy for improvement

Abstract

Purpose

This paper aims to explore the comparative analysis of marketing strategies between seaports and dry ports. Second, this paper proposes a recommendation to improve marketing approaches in both nodes.

Design/methodology/approach

This research analyzes current marketing approaches to improve the freight volume and enhance interrelation between them for a comprehensive collaboration in the freight supply chain. This research employed semi-structured interviews via an e-interview questionnaire.

Findings

The result shows that dry port and seaport practice a mixed marketing strategy. Some marketing elements that a seaport applies are also applied by a dry port, like focusing on the target customer, joining exhibitions and face-to-face meetings. Customized service to clients, frequent discussion on the effective marketing plans and increasing the facilities at the seaport and dry ports can improve the marketing strategies in dry port and seaports.

Originality/value

Seaports are the critical components in esteem-driven context, which add to supply chains by creating value-added services in the transport chain. Nonetheless, research between dry ports and seaports has increasingly drawn the attention of scholars during the last decade. Having said like that, there have not been any pragmatic studies undertaken in the Malaysian context that mainly discusses the marketing prospect of the dry ports and seaports especially during COVID-19 outbreak.

Citation

Jeevan, J., Rahadi, R.A., Mohamed, M., Mohd Salleh, N.H., Othman, M.R. and Mhd Ruslan, S.M. (2023), "Revisiting the marketing approach between seaports and dry ports in Malaysia: current trend and strategy for improvement", Maritime Business Review, Vol. 8 No. 2, pp. 101-120. https://doi.org/10.1108/MABR-09-2020-0060

1. Introduction

In the past decade, many changes have occurred in the shipping industry, as well as in the market structure and the organization of seaport terminal operators. The growth of container cargo since the 1960s and the increase in port productivity for the adoption of technical equipment dedicated to container movement have allowed ships to become more abundant in achieving better economies of scale. The combined results of the conditions just mentioned together with the increase in the average distance covered by each ton of cargo during sea transport have determined the new structure of ship services based on transshipment. It only requires a few ports, perhaps located very close to the ideal shipping route, where containers – collected from several origins – are carried by small vessels. They are loaded on larger vessels and unloaded at the port, another hub from which they have just loaded on the feeder ship to reach their destination.

The development of strategic alliances between liners appears to be a possible solution to these problems and an efficient tool, especially for liners without large financial availability, to overcome increased competition in the sector and to enter new markets. Ryoo and Thanopoulou (1999) point out three objectives that can be achieved by companies through strategic alliances which include expanding the operational limits of one company, reaching a scale that is useful for competing in global markets and rapidly entering new markets, maximizing returns from each partner's resources. If strategic alliances allow even medium-sized liners to face global competition – representing a valid alternative to increased company expansion – at the same time, they reduce the contractual power of ports and terminals at ports.

The adoption of the hub and spoke scheme in scheduling liner services makes every large company operating to be equipped with a hub where it can manage terminal activities by fine-tuning with the arrival of the ship's arrival all ship economies of scale (Musso et al., 1999). Hence, the integration of inland terminals has been reached to enhance the efficiency of freight movement to and from seaports. It is proven that participation in this category of inland terminals affects seaport competitiveness by enhancing seaport performance, increasing service variations for seaports, improving seaport-hinterland proximity, increasing seaport trade volume and enhancing seaport capacity (Jeevan et al., 2019a). In addition, this dry port has a significant capacity to play the role of an integrator between shipping lines and inland operators, providing rapid transport facilities to the clients in different locations, aggregating minuscule demand especially from small and medium industries (Carboni and Orsini, 2020). Conversely, the performance of both nodes has been affected due to the COVID-19 pandemic. For example, in the second quarter of 2020, the global trade volume decreased to 27% (Hoffman, 2020). This produces a dramatic impact on seaports and dry ports to sustain in the vigorous global trade market.

Owing to this global pandemic and diminution of global container volume, the seaport and dry port need to revisit the marketing strategy to align with the current trend. Hence, this paper aims to explore the comparative analysis of marketing strategies between seaports and dry ports as these marketing strategies between seaports, and dry ports are still vague within the key players of the industry especially during the COVID-19 outbreak. The paper will propose a possible recommendation to improve marketing approaches in both nodes to improve the volume of freight as well as enhance the interrelation between them for comprehensive collaboration in the freight supply chain. The result of this study will help develop a sustainable marketing approach for seaports and dry port terminals to survive during the global pandemic.

2. Importance of marketing in freight nodes

According to the European Commission, the volume of European trans-ocean maritime transport is doubling between the year 2000 and 2010 (European Commission, 2000). The core of the existence of shipping lines is gradually shifting from pure shipping operations to integrated logistics solutions (Notteboom, 2006). Through various forms of integration along the supply chain, shipping lines seek to generate revenue, streamline sea, seaport and land operations as well as create customer value. At present, container terminal operators mainly focus on increasing the scale of operations. Global terminal operators have changed their mindset from the regional seaport level to the international seaport network. However, the effects of the terminal network must still be exploited to the full.

The seaport is faced with a changing economic and logistical system (Notteboom and Wilkenmans, 2001). The global market has a dramatic impact on the rise of seaports with stable and relatively easy-to-move players, extensive business networks and complex logistics systems. Seaport authorities and management teams whose goals are very economical are forced to reassess their role and determine competencies that must lead to competitive advantage. They must also position the seaport for dynamic growth. The current problems faced by seaport managers are diverse and complex. A global marketplace, with reliable and relatively mobile players, extensive business networks and complex logistics systems, creates a high level of uncertainty in the seaport industry and leaves seaport managers in a dilemma to respond effectively to market dynamics. The focus of seaport competition has gradually changed so has the role of the various stakeholders involved (Notteboom, 2006).

Seaport managers need to reassess the organizational and management structure at the port, as well as their respective strategies. The traditional concept of a seaport being a total landowner or organization with one or many facilities in one location is no longer easy. The modern seaport concept leads to a comprehensive organization that handles a variety of services in various locations. Containerization and intramodality revolutionized modern shipping and land transportation so deeply that it was necessary to reassess the marketing approach of seaports (Islam et al., 2006). The competitive position of the seaport depends not only on the administrative structure; it is more a matter of attitude and commercial mentality. The port economy is indeed a matter of management style. The current port management goals are much more directed toward efficiency than distribution equity. Commercialized sports or corporations may experience difficulties in avoiding the politicization of so-called technocratic seaport organizations, because they often depend on external political decisions, especially in the case of government-funded port investments. Establishing an appropriate legislative framework that guarantees an efficiency-oriented approach is one of the main challenges for port policymakers (Pettitt, 2015).

Modern seaports must accommodate larger clients who have strong bargaining power over terminals and land transportation operators. As such, seaport authorities should not expect to attract cargo simply because they are a natural gateway to the rich interior. Major seaport clients focus their service packages not on the sea-to-land interface but on the quality and reliability of the entire logistics chain. Capturing and maintaining important footloose clients requires integrated services characterized by a high level of reliability and flexibility, short time to market and nonmarket conditions such as transparency in an efficient governance structure (Notteboom, 2006).

The main problem currently faced by the seaport is its very competitive environment (Jeevan et al., 2020). The seaport faces difficult times because of its former monopolistic market captive position. This situation was replaced by increasing interior parts that are now being considered by competing seaports as contested. As a result, for many business opportunities, captive and contested inland areas are blurred so that attracting and maintaining trade throughput is a key to survival and port growth. One strategic tool that port management can use to attract new customers and retain current customers is marketing communications (Cahoon, 2007).

According to Jeevan and Roso (2019), current Malaysian dry ports have no significant marketing strategy to promote their services to the clients. This is because limited fund allocation and professional workforce on dry port marketing have limited their popularity to be exposed among their current and other potential users. Incompetence to market their services to their clients has reduced the exposure of this inland terminal among the stakeholders, which eventually reduces the clients' attentiveness to this inland terminal. The marketing strategy will be the appropriate strategy to overcome underutilized capacity, improve operational efficiency and increase the business revenue (Cahoon, 2007). Conversely, these are some of the major limitations faced by Malaysian dry ports. Hence, the application of community liaison, promotion, trade and business development, and customer relationship management, as proposed by Cahoon (2007), need to be imposed in Malaysian dry ports to increase the awareness of this terminal among the users. Moreover, to undertake the marketing strategy, criteria such as customer care, service customization and diversification are crucial aspects that need to be prioritized.

According to Mandjak et al. (2019), marketing at seaports is primarily focused on three primary dimensions: service, customer and connection. This node's marketing strategy is critical for establishing a healthy connection with their specific clients and ensuring long-term company success. Additionally, they believe that very little research has been conducted, particularly on seaport marketing and that this article fills the lacuna by concentrating on seaport and dry port marketing strategies. Parola et al. (2017) argue that industrial marketing and purchasing (IMP) is critical to understanding the intra- and interseaport competition. This marketing is strategy provides a deep understanding of the current marketing phenomenon, especially on managerial activities compared to normative marketing tools Mandjak et al. (2019). Additionally, the majority of seaports are using green practices in their regular operations. In that case, implementing green marketing strategies in seaports has become a priority (Lam and Li, 2019). They contend that economic, social and environmental considerations must all be considered while guiding any seaport toward sustainable growth and development.

3. Marketing in the era of COVID-19

The COVID-19 pandemic has influenced daily business and economic life. With the new normal to normal, marketing strategies for running a business also need to be adjusted. There are limited studies on the right marketing strategy when faced with current conditions. According to Reid (2020), there are three approaches that businesses can take as start with customer empathy, tell relevant and authentic stories and be agile for the new normal.

3.1 Customer empathy

The impact of COVID-19 on consumer behavior and attitudes cannot be ignored. An ongoing study found that 76% recently took on new habits, behaviors and routines after COVID-19. Of those people, 89% said they planned to maintain some of their new habits. Consumers also tried new products, with 36% planning to continue using the new brands they had tried after COVID-19. Businesses must move forward but do it with sincere empathy. Marketers can help C-suite executives such as chief operating officers (CEO) and chief operation officer (COO) to take appropriate action by acting as a beacon for consumer understanding. Many companies already have a customer voice and research program – this can be utilized to uncover the emotions that underlie changes in people's attitudes and behavior. Doubling customer involvement and listening programs can help provide insight into the best ways to move forward.

3.2 Provide relevant and authentic stories

Impressively, several brands have produced convincing campaigns that speak to the reality of a pandemic. These steps go beyond marketing and may not immediately increase sales. However, they will build goodwill and help drive long-term loyalty. Giving back is just the right thing to do. The faster the world can defeat the COVID-19 pandemic, the greater the opportunity for all companies to survive the crisis.

3.3 Be agile for the new normal

Scientists estimate that some form of social distance might need to occur until 2022. That is a long time to hold back any type of marketing. A more important consideration is that a pandemic will have a long-term effect on the psyche and outlook of consumers. About 86% of Americans and 81% of Canadians agree that the crisis will create a new normal and lasting impact on society.

COVID-19 will most likely change the way we do our business in the future, and how we make important decisions today will influence how we live our lives tomorrow. Executives and entrepreneurs must predict the future to ensure that they can be safe from impending disturbances. There are two determinants of alternative futures that might have an impact, and the variations in these factors can change the way we live our future lives regardless of the certainty of their occurrence (Cairns and Wright, 2017; Crainer, 2014). The first factor is the time needed to build global public immunity against the COVID-19 virus, and the second factor is the extent to which governments worldwide effectively address the economic and political impacts of COVID-19. These two factors serve as the main dimensions determining future world scenarios; combining these factors will lead to the future of our alternative business.

Figure 1 highlights four sensible future scenarios and an appropriate business strategy that the company then takes. The first scenario is a world where the business will return to normal after a short recession. This scenario is the world of the future after the COVID-19 pandemic, where the time needed to achieve global public immunity is brief, and governments around the world offer the right steps to deal with economic and political contagion. The second scenario is the world in a prolonged recession. Despite the accessibility of COVID-19 vaccines and drugs to many countries around the world, governments are ineffective and slow in dealing with economic and political problems. This world may be familiar because it is a world like the great depression of the 1930s or the recent economic crisis. While receiving government financial support may be a luxury, businesses need to adapt to the new environment by embracing austerity strategies (Wenzel et al., 2020).

The third scenario is a world where markets are resilient because the government has active and supportive even though it takes longer to find vaccines and drugs for COVID-19. This scenario will bring up a new normal. The company can no longer do business as usual because the current business strategy requires health screening, physical distance, transferring most online business activities, changing the organization's size and structure. It will be a daily activity that must be carried out by many companies. The government can help and provide incentives for companies moving in this direction. The fourth scenario is a chaotic world where the global public immunity from SARS-COV-2 is rather long to achieve. Many governments cannot maintain public health because health and economic facilities become overburdened. This world will be marked by a huge slowdown in the economy because people cannot work because of widespread infections and diseases. This condition is a scenario that we all want to avoid. In the world of this scenario, companies may need to consider exit strategies, such as stopping business (Wenzel et al., 2020) to reduce potential losses. However, at the same time, companies that are leaving can consider innovating by reallocating old resources to new business models (see Figure 2).

According to Wade and Bjerkan (2020), there are three general response strategies to match organizational infrastructure with emerging market trends. There are significant opportunities for organizations that are agile enough to adjust their infrastructure, product/service portfolio or route to the market which includes the same products, different channels; same infrastructure, different products; and same products, different infrastructure.

3.4 Strategy 1: same products, different channel

One proactive business response to COVID-19 is to offer the same (or similar) products and services through online channels. This can occur through digitalizing physical products or, in the case of services, through technology-mediated delivery solutions.

3.5 Strategy 2: same infrastructure, different products

COVID-19 reduces the demand for many products and services so that organizational infrastructure is underused. The plant operates under capacity; restaurants, bars and hotels sit empty; the service provider is not used. Although the demand for some products and services has declined, the demand for others has continued to increase. Some organizations are taking advantage of this shift by using existing infrastructure to produce different products or offer new types of services.

3.6 Strategy 3: same products, different infrastructure

Suddenly struggling to meet the demand for their products and services, some companies need to quickly add to their infrastructure to increase production or shipping capacity. Finding new infrastructure is easier said than done and often requires collaboration with external partners. However, several organizations around the world are taking inventive steps to bridge the gap. Answering these questions and responding strategically to the current crisis requires a high level of creativity, openness to challenging assumptions and a willingness to look beyond what is clear in dealing with threats – and embracing new opportunities – created by COVID-19.

During the COVID-19 pandemic, some seaports in Malaysia used geoeconomics, geologistics and geomarketing strategies to mitigate the pandemic's effect. Specifically, seaport geoeconomics plans are concentrating on three major components, including geographical, temporal and policy taxonomies, to sustain relationships with customers and throughout the supply chain (Jeevan et al., 2020). Seaports that use this strategy improve their operational efficiency, seaport services, hinterland accessibility and connection, as well as build an efficient supply chain. Second, geologistics has been implemented to bolster seaport commerce throughout this epidemic. The geologistics notion entails the integration of resources in a particular region and their alignment with the logistics flow, which encompasses the process of all logistical elements for the benefit of humanity (Karim et al., 2021). Indeed, the practice of geomarketing refers to the use of geographic location in marketing to increase the connectedness among participants as a result of technical improvement (Hazimeh, 2020). Several methods have been used throughout this epidemic, with a particular emphasis on geographical factors like geoeconomics, geologistics and geomarketing. This demonstrates how marketing methods changed from client-centric to location-centric during the epidemic, owing to mobilization constraints and non-people-centric interactions. Thus, the marketing reach must be expanded from people to locations to maintain commerce continuity from one nation to the next.

4. Methodological design

Primary data collection via face-to-face interviews has been employed to answer the proposed research questions. The findings were supported by secondary data, which have been derived from the Ministry of Transportation and other intertwined organizations such as the Marine Department and Ministry of Trade and Development. The interview sessions have been conducted with a higher managerial position to ensure the validity of the responses (DuBrin, 2003). In this paper, the interviewees have sufficient knowledge of the marketing trend of the seaport and dry port in Malaysia. During this interview session, several questions have been proposed to meet the aim of the paper. Several aspects, such as respondent's name, age, position, company name, current trend, strengths, challenges and improvement of Malaysia seaport and dry port marketing system, have been questioned during the interview sessions.

Out of 15 respondents, 10 have participated, which recorded 67% of the response rate. Table 1 indicates the list of participants who have been involved during face-to-face interview sessions. Overall, 10 participants have a joint comprising seaports and dry ports. Nine of them were from seaports, and the remaining is from the dry port. The participants from seaports cluster were from Johor Port, North Port, Port of Tanjung Pelepas, Penang Port, Kuantan Port, Lumut Port, Kemaman Port, Sabah Port and Bintulu Port. The final respondent was from the Ipoh Cargo Terminal, which falls under the category of the dry port. Only one participant from dry ports was included in this study owing to their unavailability despite the fact that appointments had been made several weeks before the session. As a result, the session must be conducted according to schedule to adhere to the research's time constraints. Additionally, the number of dry port participants represented in this research is around 25% of the overall number of dry port operators in this nation (four dry ports). Charmaz (2006) asserts that the depth of the interview session is more important than the number of interviewees. This author argues that the interview session concluded when the interviewee reached a point of saturation with knowledge and more or fresh data no longer provided new insights or revealed new conclusions. Since all participants coordinate via a single system, they are aware of current marketing trends, which resulted in data saturation throughout the interview sessions.

This article used grounded theory to analyze the participants' output. This technique has undoubtedly been used for data analysis, since it demands an extensive comparison of all text parts. Theoretical models based on data-driven themes/codes proposed by Corbin and Strauss (2008). Additionally, these authors argue that grounded theory is critical for describing and comprehending how people feel, think and behave in a given context in relation to a particular research question. These elements are seldom discovered in thematic or content analyses. As a result, this article chooses grounded theory as the primary technique for data analysis.

5. Result and discussion

During the interview sessions, five main questions have been questioned to achieve the main objective of this paper. Those questions (Q) have been arranged as follows:

Q1.

How do you market your services or product to your client?

Q2.

How do you attract your client to your organization?

Q3.

Do you think existing marketing strategies at your organization are effective?

Q4.

What are the major challenges faced while promoting services to your clients?

Q5.

What are the improvement plans for the marketing strategies in your organization?

The questions were derived from the review of the literature to ensure the coherence of the research. These five questions which comprise the current marketing strategy, current design to attract clients, the effectiveness of the current marketing plan, challenges they have faced while implementing the current marketing approach and improvements plans were the main extract from the review of the literature. Grounded theory was carried out to analyze the outcome of the interview sessions (see Table 3). For the purpose to depict and simultaneously discuss the result, the outcome for each question has been conversed based on the responses from respondents. It is crucial to understand their views on each proposed question (Jeevan et al., 2019b). A total of 10 interviews were conducted with participants who had given their consent to participate. The interview session between participants and interviewer took approximately 30–40 min at a mutually convenient place and time for both parties. Similarly, during the interview session conducted during the development of this paper, the session will be concluded or stopped when there is no additional information was gathered compared to previous sessions.

5.1 Q1: How do you market your services or product to your client?

For Question 1 (Q1), all participants mentioned that they focus on the targeted clients by joining annual international exhibitions, which normally will be held in Malaysian and outside Malaysia. During this event, representatives from seaports will have a meeting with their potential customers and close the deal by providing attractive packages. In the meantime, the dry port also applies an identical strategy to market their products. According to the respondent from the dry port (FIP 10), “it is convenient for us to market our product and services during this kind of exhibition because there will be many clients who requested to keep their cargo close to their clients rather than in the seaport”. This statement indicates that this dry port needs much space to accommodate laden or empty containers as the main service to their customers. However, this particular dry port has insufficient space for accommodating an increased volume of containers in the future. Hence, additional planning for spatial enhancement via dry ports pooling system or generating additional dry ports in various locations may overcome this speculation. According to Jeevan et al. (2020), these attractive packages will boost the competitiveness or attractiveness of Malaysian seaports, which mainly refers to shipping services, seaport and terminal performance and government policy.

In contrast, these types of exhibitions will be restricted although can be executed by implementing a stringent standard operating procedure (SOP) due to the widespread of COVID-19 around the globe. Therefore, all respondents from seaports agree that advertisements, official website links and social media will be utilized to market their services and product to their potential clients. They agree that these approaches will be able to maintain their business relationship and sustain the relationship with their clients in a very safe platform.

Meanwhile, respondents from Penang Port, North Port and Kuantan Port (FIP 3, 4 and 5) agreed that marketing strategy needs to be digitalized and services need to be provided as promised time and location. Hence, they added that tailored-made prices for services at these seaports would be provided for each client based on their contribution to seaport revenue and growth. These respondents also agreed that being matured seaports in Malaysia, they do not need to be involved in rigorous marketing strategy due to their established profile around the globe. Hence, these matured seaports need to uphold the relationship with existing clients by providing satisfaction services, minimum turnaround time, productivity during cargo trans-loading procedure and providing quality and sufficient services before and after export/import. Hence, both nodes apply a very similar approach to market their services and products during this outbreak. Seaports and dry ports are very much interested in being involved in international exhibitions rather than implementing conventional marketing strategies. Conversely, some seaports are keen to utilize digital facilities through advertisement, official website links and social media to serve their respective clients. Some of the seaports are enthusiastic about utilizing their reputation to retain the relationship with existing clients.

5.2 Q2: How do you attract your client to your organization?

The interviewees (FIP 2, 3, 6 and 7) agree that clients to seaports can be attracted by providing made-to-order pricing based on demand and service efficiency. Continuous customer engagement such as sales after service or preparing documents, offering adequate facilities, giving rebates and providing cheap tariffs are some of their ways to attract clients to their seaports. They also added that geographical factors are playing a specific role in marketing geography, known as geomarketing strategy, to attract clients to use these seaports. Geomarketing deals with the spatial aspects of the economy in the marking context (Cliquet, 2013).

In that case, geomarketing uses the locational knowledge of potential markets to frame marketing strategies for greater market penetration. For example, Penang port is also well known for its cruise services. They have their terminal cruise at a very strategic location, which makes their surroundings convenient for their clients to explore the Penang city after or before the cruise activity. Besides geomarketing, the economic geography of geoeconomics also plays a role to attract clients to the seaports. Geoeconomics is the study of the spatial, cultural and strategic aspects of resources, aiming to gain a sustainable competitive advantage in the era of globalization (Søilen, 2012). In that case, the Kuantan Port has the cheapest tariff on the east coast of peninsular Malaysia and the main feeder port to export/import cargo to/from Far East countries. Hence, the location, strategic aspect and resources of the port have become the center of their clients. The concern toward the clients also has become another advantage to attract the clients. For example, Lumut port's capacity to provide door-to-door service from seaport to customers becomes the key attraction of the clients toward this seaport.

Moreover, the interviewee from the dry port (FIP 10) provides a total logistic solution or full supply chain solution for their clients. With this strategy, this dry port believes that they manage to attract more clients, sustain the existing customers and overcome the competition between other inland terminals. Jeevan et al. (2019a) indicate that Malaysian dry ports aim to accelerate national and international trade, activate intermodal in the nation, improve seaport competitiveness, enhance regional economic development and establish Malaysian port policy. The strategy performed by ICT is aligned with the general objective of Malaysian dry ports, which proves supply chain solutions to their clients to enhance the dry ports' attractiveness and boost the customers' satisfaction in any section along the freight chain. For seaports, the strategy to attract customers is based on customized pricing policy, continuous customer engagement and utilization of the advantageous available through geomarketing and geoeconomics practices. Meanwhile, a dry port is tried to engage with its clients by providing total logistics solutions along the freight chain. This scenario indicates that seaports are adapting a macro strategy and micro strategy by dry ports to gain the trust of their clients.

5.3 Q3: Do you think existing marketing strategies at your organization are effective?

Based on this question, out of 10 respondents, only two respondents from the seaports (FIP 2 and 5) answer were moderate, and the rest answer yes. Besides these two participants, the remaining respondents agree that the current marketing strategy is effective, and it is evident through the increase of profits and annual cargo handling. These can be evident by continuous support from business partners and an increase in company growth like the expansion to accommodate a bigger volume of container stacking in the yard and the increase of throughput during container trans-loading.

The respondent from the dry port (FIP 10) mentioned that the current marketing approach is effective due to the availability of an effective freight network. This information has been the key agenda that our dry port will utilize during the marketing activities. This dry port is one of the entities in the Malaysian freight system which can transfer containers via road and rail. This respondent also argues that the implementation of the East Coast Railway Link may create a new paradigm shift in their business prospect. This dry port believes that the emergence of this railway link may increase the cargo volume from the east coast of peninsular and gain additional strength to support seaport operations in this region by providing easy access to the rail services.

On the other hand, respondents from Sabah and Kuantan ports (FIP 2 and 5) argue that they are applying a moderate strategy in their organizations because the marketing strategy cannot be too stagnant due to the nature of the maritime businesses. They believe the root of the marketing strategy needs to be pragmatic, which can be transformed in any method, approach or plan according to the type of cargo, duration the cargo will be placed in the seaports and the continuity of the cargo. Both seaports are firm for not being very inflexible in their marketing strategy and keen to embrace new marketing approaches align to improve seaport efficiency and maintain the trust of their clients.

In a nutshell, most seaports are quite comfortable with their current marketing strategies. Some seaports refuse to be rigid in their marketing plan due to the nature of the maritime business. Adaptation of seaports with current trends will be an added advantage for these seaports to sustain in this business. Hence, the preparedness of seaports to adapt to the 4th industrial revolution is essential to muddle through the vibrant business nature. Also, the dry port has a different view from the micro perspective. This inland node required a comprehensive railway link to increase the existing marketing plan to spread the business prospect to the east coast of peninsular Malaysia. Hence, the availability of facilities and connectivity of dry ports can become a marketing medium for organizations to attract their customers.

5.4 Q4: What are the major challenges faced while promoting your services to clients?

Question 4 (FIP1) shows concern by informing that competitors, trade war, increase in fuel price and changes in government policies were the main challenges faced by them. For this seaport, main competitors are Port of Tanjung Pelepas, Port of Singapore Authority and Port Klang. Hence, this seaport requires substantial marketing tools to outshine these seaports to attract customers. In the meantime, lack of financial support, sufficient workforce, the low performance of seaports and language barriers (FIP 2, 5, 6 and 9) were some of the internal limitations that make their marketing strategy fail to reach the clients. Language barriers, such as communication breakdown and different business practices, especially with partners from China, are major challenges to be faced while promoting their products and services (All participants from seaports). With these limitations, the marketing strategies are unable to attract clients and divert their potential clients to neighboring seaports of Malaysia, especially Singapore, Vietnam, Thailand or Indonesia.

Besides internal limitations, external restrictions are also considered as key challenges to some seaports while executing the marketing strategies to promote their product and services (FIP 1, 3, 4, 6, 7, 8 and 9). For example, less geographical attractiveness, shallow water depth, trade war, increase in global fuel price and changes in government policies become the factors that limit the effectiveness of marketing plans in seaports. For example, North Port is located in between well-established seaports such as West Port and Penang Port. In this situation, the clients tend to use the well-established seaports as their point of destination to be privileged by operational efficiency. The introduction of a new policy by the International Maritime Organization (IMO) which forces all vessels to comply with Annex VI has become a huge hindrance to shipping lines (see Figure 3). This regulation required all vessels to use low sulfur fuel to enter any seaports around the world. This decarbonization plan creates another issue for seaports to find their clients who prefer to use vessels that follow the IMO regulation. Henceforth, seaports need to be selective while choosing their clients which affects their performance and revenue.

In addition to this issue, decarbonization shall not be neglected since it is another global issue besides COVID-19 (Notteboom, 2020). There is no reason to turn back and all seaports need to move forward to engage in a decarbonization strategy. In that case, seaports need to be updated with a digitalization plan, focus on optimization strategy and willingness to share their data with other players in the supply chain to ensure the seaport operations will not be significantly affected due to carbonization and COVID-19 outbreak. Again, the capacity owned by seaports will be an attractive point or complementary marketing tool for shipping lines and inland operators to proceed with their trading activities with enormous support from their clients. Predicated to these consequences, the blank sailing will be reduced which currently reaching 20% (Notteboom, 2020), shipping line can be transformed from survival mode to active mode due to the continues demand from the traders and cargo no need to wait for a longer time in the transit point or seaport which eventually will maintain the price of cargo at the point of destination.

Respondent (FIP 3) mentions that the promoting plan cannot be extensive toward mega vessels because of the limitation on their water depth and the existence of two bridges in Penang that averting mega vessels to enter this region/seaport. Therefore, the Penang Port has utilized its geographical capacity by transforming it toward geomarketing and geoeconomics approaches. Hence, this seaport focuses on feeder and cruise vessels as their target clients during this pandemic. Despite several uncontrolled limitations are there, seaports always being innovative to cater to their clients and find new customers for their services and products. Whereas for dry port, competitors are their key constrain. In general, the functionalities of Malaysian dry ports are categorized into four main functions, including transport and logistics function, information processing function, seaport function and value-added service function (Jeevan and Roso, 2019). While executing these functions, each dry port must compete to excel in the freight chain network, especially in the hinterland region. The response in this interview session (FIP 10) explains that “the competition from other dry ports and other types of inland terminals in this region preventing us from focusing much on marketing strategy and we need to think innovatively to serve our clients along the freight chain effectively.” Table 2 indicates the basic challenges faced by ICT especially on transportation, container management, location and community which decelerates the efficiency of marketing approaches toward their clients.

5.5 Q5: What are the improvement plans for the marketing strategies in your organization?

Based on the responses, almost all seaports agree that maintaining a healthy relationship with clients will be a great strategy to ensure the success of their marketing strategies. They also added that maintaining a good relationship will create more (in) formal meetings, which become an ideal platform for sharing their current products, services, adaptation toward new policies and a redesign or advising about the navigation route for their clients cost-effective freighting. Assigning a person in charge (PIC) for each client will be another strategy to enhance their current marketing approach whereby this PIC will disseminate the latest information about their seaports. Collaborating with their clients and having connections with mainline operators or engagement with relevant market segments can help to improve the marketing strategies of their organizations.

Meanwhile, (FIP 4) added that “we believe the staffs need to be trained and educated with the current trend on global maritime business so that they can come up with an innovative plan.” Respondent (FIP 8) echoed this statement by adding “we have to educate our staffs on how to design the marketing approach by considering the business competition with other seaports in neighboring regions.” On the other hand, (FIP 7) suggested that “we need to train our staff to learn additional languages as well as understand the procedures involved at the seaport origin and comprehend the information from shipping lines which originated from East Asia.” This respondent also added that “outsourcing edifying staff to execute the marketing approach would ensure that promotion on media through digital technologies and other vibrant tools will be more productive to expand networking and to spread the business prospect at the other part of the world.” Grounded by these strategies, these respondents believe that current marketing strategies can be improved significantly. Besides that, one of the respondents (FIP 4) revealed that “it is not enough to promote what does the seaport has, but the package outside the seaport needs to be included.” This response added that seaport tourism needs to play its role in enhancing the effectiveness of the seaports' marketing approach. The seaport tourism activity beyond seaports, such as city cruises, entertainment centers, food courts and shopping malls, needs to be assimilated during the seaport marketing activities (see Table 3).

For dry port, the respondent (FIP 10) believes that promoting their services and products on media and maritime exhibitions will be an improvement plan on their marketing strategy. Further, the assurance to provide comprehensive rail service for long-distance cargo, effective inland logistic services and cost advantage for the clients will be the key demand from the customers. Besides that, this respondent also added that this dry port keeps updating its performance through benchmarking. According to Jeevan et al. (2017), the benchmarking approach provides the lesson from other dry ports to reduce negative implications in the current dry port. Through this strategy, the quality of the operation level of this specific intermodal terminal will be improved and optimized which will be a significant marketing approach, especially during the COVID-19 outbreak. Hence, these elements need to be updated for complementing the existing marketing plan to attract more clients to use this dry port along the freight chain.

6. Synergies between seaports and dry ports

According to Jeevan et al. (2019a), a collaborative connection between dry ports and seaports should be formed to guarantee that dry ports participate in the efficient management of container freight, hence benefitting consumers. The effectiveness of dry ports is determined by the competition between seaports and dry ports for comparable purposes. Seaports, for example, want to capitalize on precedence by delaying container movement from seaports to dry ports. Thus, the dry port operator is unable to compete with the supplier and deliver containers on time, but a collaborative partnership between the seaport and dry port may avoid this.

During the past several decades, the seaport business has continued to evolve as global commerce, external markets and consumption have risen. These factors have resulted in seaports becoming more competitive, active and sustainable. Because of the changes, seaports are obliged to manage and monitor their performance to attain organizational performance. The dry ports need to aid seaports in their performance management and monitoring. Nowadays, dry ports have been put up as critical connectors for effective global freight transit and corridor development (Witte et al., 2014). The rising volume of container traffic and demand for seaport services have resulted in this node boosting its capacity as well as the functionality of services. This represents an increase in container freight transit. Nonetheless, owing to the restricted quantity of land for seaport development, congestion has worsened, particularly at major container seaports.

To alleviate congestion and promote competitiveness, seaports want to expand freight flow via dry ports. Priority should be given to increasing the productivity of ports operations. According to Wan et al. (2014), the inland expansion of seaports in response to the expanding number of inland ports or dry ports is critical to sustaining seaport productivity and ensuring their global competitiveness. Dry ports have grown greatly in importance as anchoring for enhancing seaport profitability, reducing congestion in seaports, expanding terminal capacity in seaports and improving seaport inland connectivity. Dry ports help and increase the capabilities and performance of seaports by improving multimodal connections for hinterland deliveries (Ngoc et al., 2011).

According to participant replies, seaports primarily aid dry ports by enhancing productivity, ensuring cargo continuity, increasing freight movement efficiency via modal split and expanding dry port capacity through operational assistance. Among the primary benefits acquired by dry ports are the easing of container rotations, the assurance of cargo continuity, the enhancement of service dependability and the enhancement of seaport–hinterland connection. On the other hand, dry ports facilitate intermodal transit, particularly for last-mile connections between the south and north coasts of peninsular Malaysia, as well as between the east and west coasts. Furthermore, dry ports enhance documentation efficiency and facilitate seaport container rotation competence. In such a situation, the performance and service differences in seaports, the reduction of hinterland proximity and the increase in trade volume and capacity are the primary benefits acquired by seaports as a result of the presence of dry ports in the freight system.

Additionally, unpredictability in worldwide market trends may be attributed to an environmental component, and unpredictable international business climate, rivalry among current rivals and entrance hurdles to new markets. As a result, these elements have been the primary impetus for extensive collaboration between these two country's nodes. Thus, to establish cooperation between seaports and dry ports in this nation, numerous factors must be addressed, including coadjuvant (mutual agreement), public–private partnerships (PPPs) and alliances. These collaboration tactics have been tested among seaports, particularly in this nation. As a result, it is conceivable to generalize the present cooperation strategies that have been employed only among seaports to include both seaports and dry ports.

To begin, the coadjuvant technique may be used to initiate collaboration between seaports and dry ports. Cooperation, collaboration agreements, complementary cooperation, information exchange and institutional cooperation are all necessary to commence cooperation between seaports and dry ports under this strategy. According to preliminary research (Jeevan et al., 2019a), several seaports in China, including the Port of Dalian, the Jiangsu Taicang Port, the Port of Haikou City, the Fujian Fuzhou Port, the Guangzhou Port, the Beibuwan Port, the Ningbo Port and the Qingdao Port, have become sister seaports to Port Klang. They are ready to share resources for seaport research, training, apprenticeship, information exchange, technical aid, traffic development and service setup as sister seaports. In this context, a similar technique might be emulated, in which seaports act as mentors for dry ports to accomplish the aforementioned goals.

According to Ismail (2013), PPPs are the most often employed vehicle for the government to delegate some of its obligations for delivering successful public services to private parties. According to preliminary research, ways for implementing PPP among seaports include collaboration with the port authority, commercial cooperation, industrial cooperation, joint investment and agreements for the interchange of services. Similar tactics might be used in this scenario to act as a catalyst for collaboration between seaports and dry ports. Assimilation of dry ports into seaport authorities, participation of dry ports in seaport cooperation plans and investment plans, as well as agreements for the exchange of services through PPP, will all be major modus operandi for boosting vertical cooperative tendencies.

Third, coalitions define the objectives and parameters of collaboration. The alliances' primary components include joint lobbying, horizontal integration, cross involvement and strategic partnerships. In general, alliances may be formed when two seaports agree to pool their resources to pursue comparable goals. As a result, a similar strategy may be used to strengthen the relationship between seaports and dry ports. For instance, the establishment of an e-port community exchange platform to share information databases, the development of human resource training and development programs for seaport personnel, the dissemination of best practices in the seaport and logistics industries and joint promotion efforts to support seaports in both countries, as well as seaport terminal investment, operations and development, are just a few examples of the types of collaboration that can be implemented between seaports and dry ports in this country.

7. Conclusion and implications

In conclusion, COVID-19 poses a significant threat to the seaports and dry ports industries. Several alternatives can be approached from the marketing side to cope with the current condition. The current marketing strategies performed by the companies are still acceptable, but to retain their current and to attract more customers, dry ports and seaports should conduct the following actions. By increasing the level of event marketing and customer relation management, companies can expect to retain their loyalties. To attract customers, the introduction of customized pricing and strategy locations are the options that the companies can explore. To maintain their current customers, companies should maintain their customer relationship, educate their staff more, particularly with skills related to new normal conditions such as online marketing, online customer relationship and so on. Finally, companies should also be wary of their competitors, the current trade wars, the increasing price of fuel and the financial constraints that they might face.

Based on the findings from the respondents, there are several ideas that we can take. On marketing the services and products to the client, respondents conclude that event marketing; customer relationship management is the management choices for sales of the products. Next, to attract the client to the organization, customized pricing and strategy locations are the option to attract the client to the organization. All of them believe that the existing marketing strategies are effective in selling their products and they believe it can help increase the organization's profit. When promoting their services to their clients, the major challenges faced by the organization are their competitors, trade wars, increased fuel prices and financial constraints. Finally, the improvement plans for marketing strategies in the organization mostly are to maintain customer relationships, educate the staff and the promotion of the products and services. It would be interesting to study the effect of the COVID-19 pandemic in the future, particularly when the vaccines have already been discovered. The current social distancing provides the companies the opportunity to be creative in terms of their marketing approaches, however, when the vaccines are already available, will the previous proven marketing approaches will return or do the companies will adapt with the discovery of new technologies and life after the new normal is implemented.

From a management standpoint, this study lays the groundwork for seaport and dry port owners to continue operating their businesses throughout the pandemic. A periodic review of marketing tools is necessary to ensure that these nodes remain realistic in the face of global trade volatility. Academically, this study compiles a plethora of data about the importance and implementation of different marketing strategies at seaports and dry ports. Initially, the literature on marketing concepts was sparse in these important commerce hubs. Additionally, from the methodological implication, the grounded theory application sheds light on the feasibility of this qualitative technique for delving into a new nexus between trading nodes and corporation marketing strategy.

Figures

Figure 1

Plausible scenarios and the corresponding business strategies

Figure 2

Three general response strategies to match organizational infrastructure with emerging market trends

Figure 3

Sulfur limits based on Marpol Annex VI

Table 1

The summary of the demographic background of respondents

Code	Respondents	Position	Experience
FIP-1	Johor Port	1. Marketing Coordinator	➢ 3 to 5 years
FIP-2	Sabah Port	1. Marketing Manager	➢ 11 to 15 years
FIP-3	Penang Port	1. Marketing Coordinator	➢ Over 16 years
		2. Marketing Coordinator	➢ 3 to 5 years
FIP-4	North Port	1. Marketing Executive	➢ 11 to 15 years
FIP-5	Kuantan Port	1. Marketing Executive	➢ 3 to 5 years
		2. Marketing Manager	➢ 6 to 10 years
FIP-6	Bintulu Port	1. Marketing Executive	➢ 3 to 5 years
		2. Marketing Executive	➢ 3 to 5 years
FIP-7	Lumut Port	1. Marketing Manager	➢ Over 16 years
FIP-8	Port of Tanjung Pelepas	1. HR and Marketing Assistance	➢ 3 to 5 years
FIP-9	Kemaman Port	1. Marketing Coordinator	➢ 3 to 5 years
FIP-10	Ipoh Cargo Terminal	1. Marketing Executive	➢ 6 to 10 years

Note(s): Face to face interview participant- FIP

Table 2

Basic challenges in dry port

Categories	Subcategories
Transportation	• Insufficient railway tracks
	• Low frequency of train movement
	• Low capacity of train decks to carry a high volume of containers
	• Less participation of local haulages for short-distance trips
	• No wide road access
Container management	• No express clearance lane
	• Insufficient space for accommodating an increased volume of containers
Location	• Located in the non-profitable zone for short-distance distribution
	• Less potential for land expansion
Community	• Traffic congestion in a selected regional area
	• Delayed upgrading of infrastructure in regional city/town

Source(s): Adapted from Jeevan et al. (2015)

Table 3

Summary of themes generated from respondents

Respondents and questions	Q1: How do you market your services or product to your client?	Q2: How do you attract your client to your organization?	Q3: Do you think existing marketing strategies at your organization are effective?	Q4: What are the major challenges faced by your organization while promoting your services to clients?	Q5: What is the improvement plan for marketing strategies in your organization?
Johor Port (FIP 1)	• Event marketing • Customer relation management	• Customized pricing based on demand and services efficiency	• Yes • Increase in profit and annual cargo handling	• Competitors • Trade war • Increase in fuel price • Changes in government policies	• Maintain customer relationship • Promotions
Sabah Port (FIP 2)	• Event marketing	• Customized pricing • Provide enough facilities and equipment	• Moderate • Lack of port efficiency	• Lack of port efficiency • Financial constrains	• Maintain customer relationship • Promotional
Penang Port (FIP 3)	• Matured port	• Strategy location	• Yes	• Competitors	• Customized pricing
	• 4Ps approaches		• Increase in profit	• Trade war	• Port tourism
	• Various nature of business		• Direct marketing	• Shallow water depth	• Educate staff
North Port (FIP 4)	• Event marketing • Monthly meeting with the client	• Customized pricing	• Yes • Increase in profit • Continues support from business partners	• Geography location • Competitors • Unstable freight rate	• Maintain customer relationship
Kuantan Port (FIP 5)	• Matured port • Event marketing	• Customized pricing – cheap tariff • Feeder port services	• Moderate • Improve in bulk demand	• Language barrier • Lack of financial resources • Different business practice	• Promotional • Maintain customer relationship
Bintulu Port (FIP 6)	• Better turnaround time • Event marketing • Quality service	• Strategy location • Second largest port	• Yes • Increase in profit • Have own support base warehouse	• Low workforce • Financial constrains • Last-minute planning	• Maintain customer relationship • Port expansion
Lumut Port (FIP 7)	• Event marketing	• Door to door service	• Yes	• Economic situation	• Customized pricing
	• Customer relation management	• Handling documents • Customized pricing	• Increase in profit • Increase in throughput	• Increase in fuel and freight rate	• Maintain customer relationship
PTP (FIP 8)	• Huge capacity to accommodate container transaction • Customer relation management	• Strategy location	• Yes • Increase in profit • Business expansion	• Competitors	• Maintain customer relationship • Educate staff
Kemaman Port (FIP 9)	• Event marketing • Customer relation management	• Regular follow up with customers	• Yes • Increase in profit	• Lack of financial resources	• Educate staff • Outsourcing • Maintain customer relationship
Ipoh Cargo Terminal (FIP 10)	• Event marketing • Customer relation management	• Providing total logistic solutions	• Yes • Connection to rail service	• Competitor • Insufficient rail track	• Promote media • Meeting authority for better inland logistics