rafal brzoska: mail change

2012www.PostalTechnologyInternational.com

In 2010 107 trillion emails were sent compared with 438.5 billion physical mail items.1 Mail is no longer the main means of correspondence, as it was years ago. With new technologies being developed people are now more likely to use their computers and the internet, as well as mobile devices to spread the news and keep in social and business contact . What is the future for the postal industry and which areas should be carefully investigated by posts?

Beginnings of InPost How is the business environment changing and how can posts benefit from new opportunities that technologies are bringing? InPost, which has just recently won three World Mail Awards for Growth, Innovation and E‑commerce, was founded by the author 11 years ago while a student of economics. Beginning with distribution of unaddressed mail, the company entered the addressed mail businesses five years ago. Although distribution of catalogues and letters is still a cash cow for the organisation (10 percent market share of addressed mail and 30 percent of unaddressed mail in Poland) a few years ago we decided to enter the e‑commerce and social commerce markets – using the popularity of Facebook – and mobile commerce – with our own MVNO providing mobile phone services.

E‑commerce is currently worth US$686.6 billion worldwide. According to Invesp the market will grow to US$1,400 billion by 2015. Having made the decision to enter that market, InPost decided to create its own automated parcel terminals. easyPack 24/7 is currently operating not only in Poland but also in Estonia and will shortly be available for customers in the Czech Republic, Slovakia, Spain and Russia.

Having developed the solution from scratch, we know that it is not only about

demanding and they are no longer willing to queue at post offices or arrange a meeting with a courier to collect their parcels. It takes only 17 seconds to collect a parcel from easyPack. Once the parcel is delivered to the box, the customer receives an email and SMS notification. Fifty‑one percent of our customers collect the parcel within six hours of notification.

The system also has a great number of benefits for operators, whether a postal operator or express carrier. They include:• Lower last mile costs by up to 80 percent;• Elimination of the problem of failed deliveries to 0.036 percent;• Increased range and market penetration.

How many couriers do you need to deliver 500 parcels a day? One courier can

What are the benefits to posts of becoming active in e-commerce, social commerce and mobile commerce? and hoW can they do it?

Mail change

Rafał Brzoska, InPost

the machines (both hardware and software) but also about working with our partners (e‑retailers and other companies generating parcels) to win customers. We keep it simple, considering the needs of the customer at all times. All our products and services are aimed at simplicity of use and interaction with the company.

The same thinking governed the development of the easyPack 24/7 solution, which we wanted to be easy and convenient to use for our customers. Our outdoor solution allows customers to collect their parcels 24 hours a day, seven days a week. It is not just a slogan as 37.45 percent of the parcels are being collected between 18:00 and 08:00. With greater speed of life people are becoming more

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normally deliver 50 to 70 parcels a day, so it would take between seven and 10 couriers. With 80 boxes in each machine and just seven stops a day, InPost can deliver over 500 parcels with just one person. That allows us to reduce the cost of the last mile by 80 percent.

One of the biggest and most expensive problems for courier companies is failed deliveries, which usually range between 12 and 20 percent. The problem does not apply with self-service automated parcel machines, where the parcel waits for the customer and not the other way round. The solution also confers flexibility of delivery as it can be fed with parcels any time of day and night.

The solution is designed for the following segments:• E-commerce players (e-retailers, internet auction sites) can offer a more cost-effective and convenient delivery option on their goods.• Mail-order and multilevel marketing companies benefit from convenience and lower costs of distribution for their customer and consultants.• Electronic equipment service

organisations slash the cost and time of logistics, simultaneously increasing customer satisfaction.• Couriers and postal operators can benefit from the infrastructure and make savings on part of their deliveries, eliminate failed delivery attempts or extend collection time to 24/7.

The machine is not enough With over two years of experience operating the business in Poland and having already achieved the operational break-even point, it is important to say that possessing only the machines will not be enough. What we think is important and makes the business successful is tight cooperation with our partners. InPost is working hard with its e-commerce partners to boost sales for them and to generate traffic to easyPack 24/7 machines.

For example in June 2011 InPost, with the online store Paatal.pl, which sells cosmetics and beauty accessories for women, undertook a campaign aimed at creating awareness of the easyPack 24/7 delivery channel and increasing sales through that channel. Paatal.pl prepared

special gifts worth US$8.70 and US$15.70 for customers who spent more than US$17.50 and US$35 respectively.

The campaign was communicated using marketing banners, e-mailings and posts on Facebook, and resulted in 56 percent growth in the use of easyPack delivery. In addition the easyPack delivery channel was chosen for 18 percent of all orders during the campaign and after the action by 23 percent of all customers of Paatal.pl. This illustrates how important it is to work closely with e-retailers to meet customers’ needs.

The world’s third largest country If all Facebook users were a country it would be the third largest in the world. There are currently over 750 million users and it is still growing. Interestingly 30 percent of users access Facebook through their mobile devices. The majority of users are between 18 and 34 years old and 50 percent of them log in every day and use the platform for at least 20 minutes a day. On average each user is connected to 130 friends and acquaintances.2

Those numbers cannot be overlooked by marketers. Wired magazine has reported that 90 percent of all purchases are subject to social influence and a similar result was found by The Nielsen Company, which has said that 90 percent of consumers trust recommendations from people they know. Bazzarvoice.com states that 67 percent

“The solution also confers flexibility of delivery as it can be fed with parcels any time of day and night”

InPost’s easyPack 24/7 – automated parcel terminals with a multitude of benefits

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more is spent online after recommendations. It is therefore vital for companies and brands to be present in social media. It is now ‘the place’ where people are spending huge amounts of their free time.

Mark Zuckerberg, CEO of Facebook, once said: “If I had to guess, social commerce is next to blow up.” Booz & Company predicts that US$30 billion will be spent on the social commerce market in 2015. In August 2010 Groupon teamed up with GAP and sold 440,000 coupons worth more than US$11 million just in one day. In March 2010 Procter & Gamble sold 1,000 disposable diapers via its Facebook store in just one hour.

With the growing importance of social media and group sales, InPost decided to enter that business in Autumn 2010. We have developed our own Facebook application called InFlavo. It enables companies and individuals to sell their products via the popular social network platform. The solution is already integrated with payment and delivery options. One of InPost’s goals is to drive parcel traffi c to easyPack 24/7 machines from purchases completed via Facebook.

InPost has also launched InFlavo Culture, the purpose of which is to reap the commercial potential of the fan pages of musicians, celebrities, writers, etc. Programme participants are able to sell music in electronic form, tickets to cultural events or concerts, activity related gadgets, clothes, publications, paintings, etc. The potential is really huge.

In mobile we believe It is an interesting paradox that historically posts were often linked with telecommunications under a single company. Starting around 20 years ago it became common for the two to be split. However there are now some postal organisations that are looking into the telecommunications businesses again. Examples are Poste Italiane and CTT Correios with their MVNOs. InPost entered that market in 2010 with its InMobile subsidiary.

Why is there such interest in the mobile communications market for posts? There are already over 5.28 billion mobile cellular subscriptions globally. Interestingly only 1.19 billion also have fi xed telephone lines.3 Mobile retail is expected to reach

US$12 billion in 2014 whereas mobile commerce is set to reach US$119 billion.4 Mobiles can be used in m-commerce, m-ticketing and m-coupons.

What is InPost’s response to that? One is to offer a mobile version of InFlavo. Last year the company purchased an MVNO from Carrefour and now is offering two services: Carrefour MOVA, targeted to customers of that retail chain and FreeM, targeted at the youth market. The idea is very simple. Carrefour MOVA is based on a loyalty programme where customers shopping at the supermarket chain Carrefour receive free minutes according to how much they spend shopping. FreeM is targeted at the younger generation, enabling them to browse internet pages for free. Every 30 minutes an advert is

displayed on the device’s screen. This enables successful geo-targeted campaigns, so InPost can offer a good target group for companies, be they Procter & Gamble and Unilever, supermarket chains or brands such as McDonald’s or Levi’s.

The fi rst results are based on the ‘free minutes for shopping’ model and ‘view2surf’ advertising:• A 15 percent bigger shopping basket when using ‘free minutes for shopping’;• A 10 percent increase in demand for selected products in targeted marketing promotions;• Over 100 percent higher rate of viewing mobile ads using view2surf technology;• High satisfaction rate for full-screen mobile advertisements.

Summary The postal market is currently undergoing a lot of changes. Trust, which has been a major ally, is helpful but will not be suffi cient to enable a post to survive in the current business climate. The world is moving fast and therefore fast decision-making processes and quick times to market are vital to success. All activities should be totally customer driven and the customer should be at the forefront of everything the business does.

In every business it is important to understand the profi le of your target customers. InPost recommends the full potential from exploiting the opportunities now available through new technologies and social media. It is not an easy fi eld and it is changing all the time, but with a proper marketing strategy and tailored approach the company can achieve success. Out-of-the-box thinking and looking at things from the consumer’s perspective always helps. ■

1. Business Insider and UPU2. Facebook, http://www.facebook.com/press/info.php?statistics3. International Telecommunication Union, October 20104. PromotionalCodes.org.uk

“All activities should be totally customer driven and the customer should be at the forefront of everything the business does”

InPost’s InFlavo Facebook application

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