Reinventing POs in a digital world
The Deutsche post office across from the train station offers DVDs, umbrellas, phone cards and toys – with the processing of mail appearing nearly an afterthought. And the facility housing it is not a post office at all. Deutsche Post occupies a corner space in a bank.
With mail volumes decreasing 1 to 2 per cent annually in many countries, European postal services from Germany to Sweden to Switzerland have reinvented themselves over the past decade as multifaceted delivery and information companies tailored to the virtual age.
Though Deutsche Post by law still delivers to every address six days a week, it has jettisoned tens of thousands of buildings, 100,000 positions and its traditional focus on paper mail. “We realized that being a national postal provider was an endangered business, that we had to redefine the role of postal providers in a digital world,” said Clemens Beckmann, executive vice president of innovation of the German post office’s mail division.
With the US postal service facing insolvency, it is looking towards Europe for new operating models, even though US legislation currently precludes adapting some of those innovations.
Partime post
After selling off all but 24 of 29,000 post office buildings in the past 15 years, the German postal service is now housed mostly within other business ‘partners,’ including banks, convenience stores and even private homes. In rural areas, a shopkeeper or even a centrally located homeowner is given a sign and deputised as a part-time postmaster.
At the same time, many European postal services, including the one here, have developed a host of electronic services that are increasingly making traditional post offices and mailboxes obsolete. Bills and catalogs can go first to digital mailboxes run by the post office on customers’ computers, and the customers can tell the post office what they want it to print and deliver. And while Americans are asked to send in suggestions for what celebrity should grace the next stamp, Germans can buy virtual postage from their cellphones.
Deutsche Post has expanded package delivery networks to profit from the uptick in online shopping and has also progressively expanded its offerings into completely new areas, like running online marketplaces for freelance writers similar to eBay. Instead of watching its business be eroded by more aggressive marketplace competitors, as has happened in the US, Deutsche Post completed its purchase of the logistics company DHL in 2002, meaning many Americans have been customers of the German post office.
European postal services vary widely in their degree of adaptation to the digital age. “But the USPS is probably the best example of a pure monopoly that has seen the least change,” said John Payne, the chief executive of Zumbox, a Los Angeles-based startup that offers virtual mailboxes for personal computers in the US on a private basis and that has sold the program to foreign postal services.
European postal services started to think about new business models in the 1990s, when the European Commission opened up postal monopolies to competition and liberalized regulation. But the subsequent changes have come in response to declining mail volumes and, to a lesser extent, pressure to reduce greenhouse gas emissions.
Virtual mailboxes can receive, store and organize years of bills, sparing digital customers the need to check one by one the websites of credit card companies and cellphone providers. While this free service was slow to catch on in Sweden, membership has spiked in the past year, said Anders Asperg, head of product and market development for the Swedish post office.
For actual packages, Deutsche Post customers can choose to pick up items at automated banks of lockers in places like train stations; the locker number and opening code is sent to their cellphones. Posten, the Swedish post office, allows vacationers to transmit cellphone photographs that Posten prints as postcards and delivers as physical mail.
Surprisingly, perhaps, new postal models have not meant the end of direct marketing (aka junk mail), a lucrative business – though executives say such promotional material will be increasingly likely to arrive via computers and cellphones.
PostNord – an umbrella company that includes both the Danish and Swedish postal services – now even helps smaller companies develop direct marketing campaigns through its “Advertising Planner,” which boasts: “It’s just as natural for PostNord to ensure that your offer reaches the right customer at the right time via satellite and cyberspace as via a traditional postman.”
