Digital Layer Trends - Postal Vision 2020...• Capturing the SMB Marketing Automation Opportunity...

1 © 2012 InfoTrends www.infotrends.com © 2012 InfoTrends

Digital Layer Trends PostalVision 2020

Matt Swain Associate Director June 12, 2012

@SwainfoTrends

@InfoTrends

#PV2020

2 © 2012 InfoTrends www.infotrends.com

Comprehensive Research on Customer Communications

• Vertical Insight: Enterprise Communication Requirements (Announced)

• Service Expansion Opportunities for Document Outsourcing (In Progress)

• The Emergence of Digital Mailbox Services (2011)

• Capturing the SMB Marketing Automation Opportunity (2011)

• Mobile Technology: Making Print Interactive (2011)

• The Future of EBPP in North America (2010)

• Capturing the Cross-Media Direct Marketing Opportunity (2010)

• Trans Meets Promo: A European Perspective (2009)

• Multi-Channel Communications Measurement and Benchmarking (2008)

• Trans Meets Promo… Is It More Than Market Hype? (2008)


Agenda

Digital Disruption

Relevance of the Postal Service in a Digital Age

Preview of the UPU .post Initiative

Conclusions and Recommendations

1

2

3

4


Strategic Paths for Service Providers

Innovation Driven

Operations Driven

Dying

Surviving Thriving

Greater

• speed • quality • efficiency • sustainability • customer service

New

• services • products

• customers • business models

Continuous investments in …

•technology •business processes •sales & marketing

that lead to …

Striving


Digital Disruption


Social Media Statistics at a Glance

• More than 900 million Facebook users

− People spend over 700 billion minutes per month on the site

• LinkedIn has over 150 million members in 200 countries

− A new member joins every second

• There are over 200 million Twitter accounts

− 20% of tweets contain brand-related inquiries about products/services

• YouTube exceeds 3 billion views per day

− Over 72 hours of video are uploaded every minute, 4,320 hours every hour, and 103,680 hours every day


Continued Growth in Mobile Connectivity


The Consumer of Today The Consumer of the Future

Image source: Apple.com


Millions of Mobile Payments Made at Starbucks

Source: Starbucks


$39,132 $38,071 $39,045

$43,432

$49,698

$20,000

$30,000

$40,000

$50,000

$60,000

Q1

20

07

Q2

20

07

Q3

20

07

Q4

20

07

Q1

20

08

Q2

20

08

Q3

20

08

Q4

20

08

Q1

20

09

Q2

20

09

Q3

20

09

Q4

20

09

Q1

20

10

Q2

20

10

Q3

20

10

Q4

20

10

Q1

20

11

Q2

20

11

Q3

20

11

Q4

20

11

Q1

20

12

Q2

20

12

Q3

20

12

Q4

20

12

E-Commerce Spending Growth Continues in the U.S.

2007 2008 2009 2010 2011 2012

$ Millions

Source: Q1 2012 U.S. retail e-commerce sales estimates, comScore, 2012

?


New Paper from the USPS Office of Inspector General

Opening sentence:

“As a highly trusted, venerable government institution with both a legal mandate to protect privacy and the authority to protect users from fraud, the U.S. Postal Service is in a unique position to play a key part in a vital infrastructure for new digital identity creation and authentication services.”

Source: Risk Analysis Research Center, Office of Inspector General, USPS, 2012


Preferred Way to Receive Mail in the Future

50%

32% 34%

32%

61%

48% 44%

63%

46%

31%

2% 4% 3%

22%

8%

Personal correspondence

Business correspondence

Transactional mail Advertising mail Periodicals

Physical Digital Don't send/Don't know

How would you prefer to receive the majority of each type of mail in the future?

N = 1,528 Consumers in the U.S.

Source: The Emergence of Digital Mailbox Services, InfoTrends, 2011


24.5 23.9 23.0 21.9 20.5 18.7

3.7 4.3 5.2 6.5 8.3 10.5

0

5

10

15

20

25

30

2010 2011 2012 2013 2014 2015

Paper Digital

Billions of Documents Delivered

28.2 28.2 28.2 28.4 28.8 29.2


B2C Forecast for Transactional Communications in the U.S.


Hybrid Mail Services – Solving a Near-term Problem

Physical to Digital

Digital to Physical


Digital Mailbox Services – Solving a Long-term Problem

United States

International (a sampling)


24.5 23.9 23.0 21.9 20.5 18.7

3.7 4.3 5.1 6.2 7.6 8.5

2.0

0

5

10

15

20

25

30

2010 2011 2012 2013 2014 2015

Paper Other Digital Digital Mailbox

Billions of Documents Delivered


Emergence of Digital Mailbox Services in the U.S.

28.2 28.2 28.2 28.4 28.8 29.2


Relevance of the Postal Service in a Digital Age


USPS Viewed as “Not Necessary” or “Minimally Important”

6%

12%

29%

16%

27%

31%

Today In 5 Years In 10 Years

Business Consumer

Relative to your business needs/lifestyle, how would you rate the value of the U.S. Postal Service over the next 10 years?


N = 301 businesses and 1,528 Consumers in the U.S.


Support for Various Changes in Postal Delivery

35%

17%

40%

30%

19%

34%

Eliminates Saturday Delivery

Delivers Mail 3 Days a Week

Delivers Mail 3 Days a Week AND Delivers Digital

Mail Daily

Business Consumer

How would you/your organization react if the U.S. Postal Service eliminated Saturday mail delivery? Delivered mail three days a week? Delivered mail three days a week, but delivered digital mail every day?


N = 301 businesses and 1,528 Consumers in the U.S.


N = 1,138 Respondents that are already using/willing to try a digital mailbox service

Most Attractive Potential Providers of Digital Mailbox Services (Consumer Survey)


9%

9%

9%

9%

10%

14%

14%

17%

23%

32%

Microsoft

Yahoo!

American Express

Apple

U.S. Postal Service

Chase

Bank of America

Google

My own bank or credit union

Amazon

If the following organizations all offered digital mailbox services, which ones would you be most likely to try?

Three Responses Permitted


• The Postal Service Role in the Digital Age Part 1: Facts and Trends

• The Postal Service Role in a Digital Age Part 2: Expanding the Postal Platform

• eMailbox and eLockbox: Opportunities for the Postal Service

• Bridging the Digital Divide: Overcoming Regulatory and Organizational Challenges

• Meeting America’s Emerging Communications Needs

• Digital Identity: Opportunities for the Postal Service


Number of Postal e-Services Introduced Globally

0 0 2 0 3

11 5

9 11

34

53

23 25

36 38

52 50

33

55

82 85

19

90

19

91

19

92

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

Source: Measuring Postal e-Services Developments: An Industry Perspective, UPU, 2011

27 © 2012 InfoTrends www.infotrends.com Source: Measuring Postal e-Services Developments: An Industry Perspective, UPU, 2011

Worldwide Development of Postal e-Services versus the Mean Level of their Respective Importance


Preview of the UPU .post Initiative


http://www.youtube.com/watch?v=06Pj-Pg2Aes


Conclusions and Recommendations


Degree of Change

Time

Changes in the Environment - Economy - Customer - Competitive - Technology

Misalignment Gap between

environment and company changes

Source: IBM Business Model Transformation, adapted from Gerry Johnson, Kevan Scholes, Richard Whittington, Exploring Corporate Strategy, 7th Edition © 2005 Prentice Hall, Pearson Education Limited

GAP

Incremental business model

innovation

Changing Market Dynamics Require New Approaches

Transformational business model

innovation

Transformation

Demise


InfoTrends’ Opinion

• The universal delivery needs of consumers have changed

− The USPS and its regulating bodies must appreciate and respond to those changes or recognize a reduced relevance to consumers

• Continue to explore and embrace digital solutions

− Following an operational-efficiency path alone will result in lower consumer satisfaction and accelerate a transition to alternative media

• Consider opportunities in supporting digital mailbox services

− Whether it is an eMailbox, a .post initiative, a white-labeled solution, or providing a component of the identity and authentication services, the USPS should play a more active role in this space


[email protected]

SwainfoTrends

blog.infotrends.com

Digital Layer Trends - Postal Vision 2020...• Capturing the SMB Marketing Automation Opportunity...

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