16 Jul Digital Freight Matching and Loss of Privacy
Digital freight matching–is it really the way of the future as we’ve been lead to believe? Many products have added the ubiquitous “digital” as a prefix, and these new digital products are often much better than their non-digital predecessors. It follows that digital freight matching should also be better than plain old freight matching.
From what I can see, most people agree that digital freight matching offers a better end result. But there is some disagreement and more than a few considerations to take into account when we look into the viability of both providers and platforms while questioning whether the loss of privacy is worth the hefty investment.
I’m talking about data privacy because it’s often a big concern for brokers. Ideally you want all of your information in the platform, so you can see optimal results from the platform. And this is where the struggle begins. You see, prospecting, courting, and landing a new customer is a big investment. Handing over this kind of information for a fee is interesting, but giving it to someone while paying for the pleasure of doing so creates an internal conflict.
Brokers have been doing this for some time with public load boards such as DAT and Truckstop. Some try to disguise those loads in an effort to feel safer about what information is being exposed to their competitors while others don’t hesitate. Many digital freight matching platforms are “moving” the load board from the public to their own platform. Some claim to use advanced methods such as ML or AI to look at carrier history, ELD info, or other data points in order to get to the best option.
While that may be true, what history is being considered? Is it history with the carrier, carrier history on a provider’s system, or a combination of both. In my opinion the more information (history) you can use, the better the results should be.
Brokers typically bring the value of load and carrier information. While digital freight platforms bring the value of technology and hopefully carrier adoption. Technology is the place where most providers excel. But when you take carrier relationships into account (and that is where many providers are subpar) the value of a digital freight platform comes into question.
In recent months the number of digital freight matching platforms out there has increased with new entrants including ELD providers. Some ELD providers are now offering digital load boards on the ELD or in-cab device itself. All of these providers are relocating the traditional load board to their own devices or platforms.
Take a step back and give this a good strong look. You’ll quickly realize that what you are seeing is brokerage in its purest form–matching available freight with available capacity. This could quite possibly be the reason some digital providers have become brokers. After all, if those providers excel in bringing capacity to market it makes perfect business sense to offer that up as a broker.
We do not yet know what platforms will survive. I predict that what survives will be less than what is now available. We’ll have to wait and see how many of those survive and make the transition to full-blown brokerage. Hopefully the provider you choose doesn’t move in this direction, and your investment in customer acquisition isn’t wasted.
A better version of posting loads and hoping for the best is most likely not your answer. Having the best relationship with capacity in order to understand in advance where the capacity will be is the better strategy.
In the long run, brokers will need to utilize the available tech to make sure their operations are running efficiently as possible, as well as, to offer the level of customer service expected in this day and age. There is not a single perfect answer. Each organization will have to make the best decision for their particular operation. If holding onto information or believing you are the only one with certain data is your “competitive advantage,” you might just be in for a big surprise.