Benchmarking and comparing prices for containers across markets is something that is very complex to understand unless you have big data and the necessary models to run it through to derive insights and make decisions. For a freight forwarder or a carrier, analyzing data does not fall in their niche, though it is something that is critical to understand the market and competitors better, while growing their business based on market intelligence.
Xeneta, a freight rate benchmarking platform focusing on ocean freight, helps its customers understand how the market is performing. It aggregates rate data from various companies into a platform and enables customers to see what the market average is and the lows & highs of it, for shipping a container between two locations.
“We target cargo owners – so the BCO shippers, freight forwarders, and even carriers. We are based in Oslo, Norway, but our customers are all over the world, with the crux of our market in Germany and our second biggest market in North America,” says Katherine Barrios, chief marketing officer.
Shipping logistics and supply chain is an extremely complex industry and mired with a lot of competition across its length, as many tech startups mushroom in the space every year. But it needs to be noted that Xeneta addresses and focuses on companies that are shipping cargo on the procurement side. Its place in the supply chain comes a step before the companies working on digital freight forwarding, freight booking platforms, and freight hubs.
“The space we work in is less crowded than in other different parts of the supply chain. The area we address is very complex with a lack of transparency, and it takes time to modernize and change the way that procurement is done and in benchmarking freight rates,” explains Barrios. “We have been successful over the past couple of years, but the segment is so niched that not many companies are addressing it yet.”
One of the factors that decidedly tilt the scales in favor of Xeneta is the amount of data it has have amassed over the years. “We collect over 2 million data points a month of the contracted rates that we have,” notes Barrios. “We have been able to create a platform that easily scales up to collect data, crunch and spit it out into a user platform that is completely on-demand and real-time. The platform has advanced visualization of charts and presents rate information in a user-friendly way.”
When Xeneta started out, it kept its platform open for everyone and did not monetize initially to gather more data and to validate its idea based on inputs from large companies. Since then, based on its customer interaction, the platform has gone through a myriad of changes, with features being added and unused ones removed.
“We have over 700 companies that have provided us data, and over our lifetime we have had more than 2,000 users,” says Barrios. “We collect feedback from the market, do customer validation rounds, launch beta programs, and validate the new features that are coming out to make sure we aren’t developing something that nobody wants.”
Xeneta is a company that isn’t just selling a new product, but offering a new way of doing business – making its traction a bit harder to come by when compared with a normal startup. “We have very long sales cycles – enterprise-size cycles – because we sell to very large companies. We are selling our solution to companies that follow the traditional and legacy way of procuring freight,” adds Barrios. “What we are providing now is data intelligence that is constantly available and keeps people on top of the market and trying to teach people how to use this data to improve the work that they are already doing.”
On the marketing and sales side, it is challenging to convince companies to use data and technology to increase their work efficiency. “Our data can help them benchmark better and more accurately, make their teams more efficient, cut costs, improve bottom line savings, and help their overall supply chain,” says Barrios.
Being a completely neutral company that is not tied down to BCOs, carriers, or freight forwarders makes it a worthy alternative to indices like the Shanghai Freight Index, which is state-owned in China. This helps the company to put data more into the spotlight and challenge the legacy thoughts that exist in the industry about procurement.
“We have over 45 million data points on our platform, and we have been witnessing over 161% data growth year on year, which is a key metric for us,” concludes Barrios. “We have data for 160,000 port-to-port combinations on the ocean side. In the next quarter, we plan to launch air freight benchmarking on our platform as well.”
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