DM Views: Growing Global Mail: Opportunities and Obstacles
Did you list the global mailing industry? If not, you're overlooking a sector wherein market dynamics, new technologies and regulatory change are poised to reinvigorate the value of mail and related services.
The industry's image lags reality. Mail is viewed as a dying communications medium used by a remaining few "unwired" individuals. That unreconstructed view of mail is just plain wrong. In the United States alone, the mailing industry generates $900 billion in revenue, drives more than 8 percent of the GDP and accounts for more than 9 million jobs.
But it is the new value of mail and related services -- more tailored and personalized, more secure, more competitively priced and more flexible -- that is the breaking news in this industry's future. In the world of TiVo, the national no-call registry and an unending avalanche of electronic spam, mail's non-intrusive, highly personalized, traceable reach gives marketers reason to reconsider mail as the key to unlocking the fortunes of one-to-one marketing.
Technology associated with customer-oriented mail continues to improve. Printing costs are falling. Quality and prices are improving in data mining technology. Data-rich, readable symbology on letters is enabling delivery applications, like the U.S. Postal Service's Confirm, to track mail from origination to delivery. Over time, tracking and tracing will offer marketers "date certain" delivery options, enabling unprecedented precision in direct mail campaigns.
The mailing industry has innumerable unexploited opportunities to help businesses. The biggest competitive advantage every postal operator has is its universal network of carriers who deliver to millions of homes daily. Among the hottest new growth services in the delivery market is home-to-home shipment of packages resulting from online auctions by providers like eBay and Amazon.com, an industry opportunity that did not exist until recently.
What's the catch? To capitalize on these innovations, postal operators must focus on the growth potential in their core offerings while working with regulators to achieve greater flexibility in the pricing and modeling of new products and services. Companies like Wal-Mart, Intel and Dell Computer have revolutionized retail thinking with continually declining prices. Regulators must give postal operators the flexibility to offer similar, promotional rates to new businesses and for new products and services.
There are an infinite variety of delivery options for which some recipients will pay a premium price. Conceptually, letter carriers could provide delivery and pickup service for other items such as video rentals or pharmaceuticals. The key is always to innovate, to find ways to reduce costs in the network and to unlock additional economic value for the recipient.
Posts also must encourage and expand work sharing as a core business strategy. As stakeholders for a growing mailing industry worldwide, we need to be vocal advocates for eliminating practices that drain resources from postal operators and detract from their core mission. Postal operators need to work with their governments to develop strategies that enable ongoing value delivery and cost reduction.
Governments and postal operators need to recognize that a vibrant mailing industry will generate far more jobs, both in the public and private sectors. In the United States, the mailing industry has more than 10 times the number of employees outside the USPS than within it.
Finally, the industry must reconcile disparate international rules that govern mailing technology and operations. Postal operators are protective of their particular standards and processes, but individual, uncoordinated actions make the industry smaller and less competitive than it could be.
Each of these changes is eminently achievable. The value that each change would unleash will mark the beginning of a dynamic period of growth for the global mailing industry.