Sales and Postal Partnerships for

Cross-Border E-Commerce Growth

Tim Walsh

UPU Partnership Forum For

Electronic Services

Berne, 21st April 2015

Defining Partnerships, Broadly

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Two or more parties agree to change how they do business, jointly innovate and/or control part(s) of their common business system, for mutual benefit;

Based on trust, openness, collaboration and shared risk/reward to, inter alia, develop new services; open and access new markets and/or create competitive differentiation, in a timely manner, that would not otherwise be achieved by working alone;

“Partnership” is neither a single, defined transaction nor shared ownership and full integration models, but rather revolves around:

A relationship overtime (short or longer-term), involving a measure of joint development, operational/process integration and information sharing, in one or more functional areas;

Joint planning, review and/or operations based on structured around mix of resources, competence complementarity and shared overall objective(s);

A mutually beneficial business model, based on: revenue sharing, profitability, cost/ complexity reduction, speed to market, operational improvement, market access, and/or innovation etc.;

Partnership Strategies

High

Low

Degree of

Collaboration

Organizational

Combination

Strategic Alliances/

Dependencies

Supplier via tendering:

defined transaction

Preferred Supplier

arrangement

Joint Venture

Merger

Acquisition

Business partnering

Source: Adapted from Robert Maynard Strategy: The Right Match, 1996 Partnership Models

Suppliers: e.g. for supply-

chain integration;

Channels/intermediaries: e.g.

leverage sales expertise;

Customers: e.g. joint

innovation programmes;

Competitors or peers: e.g.

UPS/USPS; technology

licensing partnership;

Platform partnerships:

access new segments of

customers, source

innovation, access value

within wider eco-system;

Pitney Bowes: Enabling Cross-Border E-commerce

o Cross-Border Shipping

o Anywhere to Anywhere Accurate and

Guaranteed Landed Cost Calculations

o Classification & Eligibility Services

o Management of Global Customs Processing

and Compliance

o Parcel Protection, Enhanced Tracking

For over fifteen years, we’ve been helping businesses successfully develop

and manage their cross-border Ecommerce platforms.

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Pitney Bowes’ ClearPath® Cross-Border Ecommerce

MERCHANT /

SELLER Merchant’s catalog is analyzed to

determine eligibility and classification

Parcels are transported to the Pitney

Bowes Hub (single parcel or freight at

local tariffs)

Pitney Bowes prepares the parcels for

International line-haul:

• HS Classification

• Export Compliance (ECCN) review

• Import Restrictions Screening review

• Content Inspection (if applicable)

• Commercial Invoices

• TSA Screening

• End-to-End Tracking

Automation of domestic shipments to Pitney Bowes’ hub:

• Merchant or seller prepares parcels

• Advanced Shipping Notice is transmitted to Pitney Bowes

• A Universal Parcel Identifier (UPID) is generated

• Merchant / Seller sends parcels

Pitney Bowes coordinates

and consolidates parcels

for international line-haul

(by country and region) Goods are cleared

through foreign

customs via a

Pitney Bowes

Broker

CUSTOMER

Pitney Bowes coordinates

with a postal operators and

agents for linehaul and

delivery Customer can see end-to-end

tracking from receipt at the Pitney

Bowes Hub to final delivery.

Sales Channel Partnerships

oCross-Border

Technology (via

Platform integration)

oParcel handling &

shipping services

oCross-border

technology

oParcel handling &

shipping services

o Cross-border

technology (via

direct integration)

o Parcel handling &

shipping services

ClearPath®

Service

Portfolio

Strategic

Partnerships

o Deep, integrated

relationship

o Full product &

services suite

o Customized

solutions

o Global deployments

Channel Partners

o Pre-Built integrations

to support integration

for online merchants

o Extended Sales

channels

oDirect integrations for specific

merchant needs

oDirect relationship with retailer

and decision makers

Merchant

Direct

Global Ecommerce Channel Partner Ecosystem

Resellers

System

Integrators Platforms

Variety of Revenue Models

Gateway to Merchants

OEM Potential

Value Add Potential

Direct Integration

Gateway to Merchants

Direct Connector

Integration $$$

Potential

Platform Expertise

Volume $$$ Potential

Resellers

leverage served

platforms

SIs assist with

Platform

Connectors –

“Universal

Connector

Strategy”

Resellers

leverage SI

efforts

ClearPath®

Channel Resellers

• Partners with extensive

reach into merchant

accounts;

• Sell-through, co-sell, and

referral relationships with

channel partners: • Examples: BorderJump,

International Checkout

• Provide sales and

marketing enablement to

channel sales teams;

• Engage merchant direct

team to facilitate to close

as needed;

Channel Partnership Overview

Direct & Integrated

Solution Platforms

• Develop strategic

partnerships with

enterprise-class orgs for

direct integration: • Examples: IBM, MasterCard,

American Express, Visa,

ShipRush

• Facilitate the creation and

maintenance of direct

connectors with various

platforms: • Examples: Volusion,

BigCommerce, Hybris

• Develop lead generation

initiatives to feed PB

merchant direct business;

System Integrators

• Cultivate tier 1 & 2

relationships with SI with

domain expertise: • Examples: TCS, WiPro,

Accenture

• Educate, inform, &

enable SI on ClearPath

solution and its value

proposition

• Assist in identifying

opportunities;

• Conduit between SI and

Pitney Bowes’ product,

engineering and

marketing teams

Pitney Bowes Global Ecommerce: Postal Partnerships

• Directly, or indirectly through

partners, we leverage local postal

providers for final mile delivery in

many countries;

• Today 50+% of parcels we manage

are delivered via the local postal

provider; we aim to grow this to

around 60% in 2015;

• PB manages the international line

haul and customs clearance, and

seek postal partners in country of

destination for delivery;

• Postal providers are often the most

competitive solution for final mile

delivery in country, and make for

strong partners based on their

universal coverage within a country;

Pitney Bowes Global Ecommerce: Postal Partnerships

• Critical attributes for postal delivery

partnership, include:

o Client focused;

o Highly consistent transit times – typically

in country transits of 2-5 days 97% of

the time or better (depending on the

size of the country – large countries

may allow for longer transits to

extended areas);

o High tracking quality data – 97%+ of

parcels receive a delivery confirmation

event. This is often the more

challenging SLA for a postal provider to

achieve;

• We also work closely with the USPS and

Royal Mail for the parcels coming inbound

to our hubs in the US and the UK;

Further Partnership Opportunities With Posts

Partnership Proposition

Description

1 Landed Cost solution • Integrate PB’s solution into the Post’s marketplace – standalone implementation or

“white labeled” to merchant sites with postal branding; • Customize local implementations of PB’s Ecommerce and/or shipping platforms;

2 Compliance and Regulatory Services

• PB solution to help the posts comply with customs and regulatory requirements;

• Perform product classification and screen parcels to ensure that they meet local customs compliance needs (Hazmat, Export, Shipping Size and Import);

3 Ecommerce Managed

Services (full service

beyond just landed cost)

• Perform customer quoting and compliance services;

• Receive inspect, measure, over-label and consolidate outbound parcels;

• Move “data enhanced” consolidated freight internationally; • Manage all postal channels to ensure operational readiness;

4 Postal Channel Enablement Services

• Integrate the landed cost solution into the postal channels (POS, kiosk, web) to enable better international shipping experience;

5 Logistics Hub

Enablement and Operation Services

• Design, deploy and operate posts’ shipping hub to facilitate outbound Ecommerce;

• Customize and integrate shipping platform software to help manage hub and dispatch operations;

6 Global Postal

Ecommerce Platform As A Services

• Design, develop and operate a Global Ecommerce platform powered by PB

ecommerce and shipping software;

• Offer end-customers the choice of using end-to-end post Ecommerce services in

addition to other expensive rapid international dispatch options;

• Deliver Ecommerce Managed Services using End-to-End Post Dispatch Network for those customers who choose this cost-effective option;

Partnership Benefits Include:

Cost reduction... speed to market/ implementation… operational

excellence… new revenue sources… customer satisfaction

benefits (convenience, ease of use)… compliance to new

regulations (e.g. UCC, Implementation, 2016)

Conclusions

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Partner Match: critical for successful partnership, and includes domain complementarity, recognition of mutual core competencies, goal compatibility, management style and culture;

Strategic Orientation: agreement on overall strategic orientation is more important than on specific projects, since latter can be changed easily (more resources allocated, operational innovation etc.) if ultimate objectives are shared;

Operational Success: depends on plans, activities and processes that dual management teams establishes throughout the life of the partnership:

Joint planning, development and review: can range from the sharing plans to the joint development of strategic objectives, and their review against client needs/performance;

Joint operating control: incentive to drive change/improvement without needing prior approval from the partner;

Effective communications: at all levels, and between teams;

Effective Risk/Reward Sharing lies at the core of successful partnerships, both financial and non-financial;

Create integrated solution for road users, providing surrounding point of interest and street data via handheld devices;

Synergy helped PB to move into the telematics/mobile space, while Inrix gained solution powered by best location data and positional accuracy;

Strong partnership developed Geo-engine within 12 months equipped with innovative features and algorithms, and supporting 34 countries;

Working with an innovator such as Inrix helped drive enhancements to PB capabilities (type-ahead, APIs, data, routing

Some Other Digital Partnerships, I

Partnership with TCS to assist insurance companies in visualising,

quantifying and understanding risk;

PB Location Intelligence software combined with TCS next generation

platform to streamline the underwriting process; improve accuracy and

reduce costs

Integration of PB Location Intelligence software to social media platforms;

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Advanced Technology Partner as channel for a variety of PB software, allowing new ways of developing at solutions at speed, and deploying these to clients;

Migrating PB’s Spectrum OnDemand to AWS enabled the product to handle up to 30 times the number of transactions, opening up the product to a new range of clients looking for massive scalability;

Creates powerful engineering and software development test environment and facilitates greater PB agility - when load on an application increases, AWS automatically provides resource within in minutes, allowing applications to scale up/down as needed;

Some Other Digital Partnerships, II

Combines the strength of PB’s software solutions with IBM’s software, third-party and open

technologies/ tools, speeding the availability of new services which allow developers and

companies, on a Platform As A Service (PaaS);

For PB, the partnership expose our location-based services, e-commerce fulfilment, Internet

postage, and parcel management solutions to IBM’s API management and an extended

ecosystem of innovators and developers;

Speeds the availability of new services from Pitney Bowes to vast new markets globally.

Annex Pitney Bowes

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As The World of Commerce Has Evolved, Pitney Bowes Has Evolved Too.

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1957 1961

1978

1920 The birth of an industry

Social gets smarter Simplifying

global ecommerce

Keeping pace with

business transactions

Increasing productivity

for high-volume clients

Transferring funds

electronically

Postage by Phone® is introduced

by Pitney Bowes, eliminating the

need for businesses to make trips

to the post office.

Major social media platforms

use Pitney Bowes Location

Intelligence technology to

enable more contextually

relevant experiences.

Pitney Bowes simplifies

the complexity of overseas

shipping for commerce clients.

Pitney Bowes introduces

the first automatic mail-

sorting machine.

Arthur Pitney, the inventor of

the first commercially available

postage meter, joins forces

with Walter Bowes to form

Pitney Bowes—and change

the way companies of all

sizes do business.

Pitney Bowes introduces

the mail inserter to boost

productivity, drive precision

and decrease costs in large-

volume mailing.

Growing in software

Pitney Bowes expands its

software footprint through a

variety of software acquisitions—

including Group 1 Software and

MapInfo—and gains recognition

as one of the world’s largest

software companies, according

to Software Magazine.

2009 2012 2014

1998

Digital

document delivery

The launch of D3 software

enables message management

via hard copy, web, email and fax.

Pitney Bowes Today.

We’re a global technology company offering innovative products and solutions that enable commerce in the areas of Customer Information Management, Location Intelligence, Customer Engagement, Shipping and Mailing and Global Ecommerce. 90% of the Fortune 500 and more than 1.5 million small and medium-sized businesses in approximately 100 countries around the world rely on products, solutions and services from Pitney Bowes.

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We Help Clients To Get It Right By Enabling Transactions In Commerce Across Five Areas.

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Customer Information Management

Using trusted data to drive insights and intelligence

Location Intelligence

Transforming location and business data into enhanced insight

Customer Engagement

Delivering relevant and engaging interactions across the customer lifecycle

Shipping & Mailing

Driving parcel handling and mailing efficiency with end-to-end innovation

Global Ecommerce

Simplifying a complex global marketplace

Thank you

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www.pb.com

@PBECommerce

Tim.Walsh@pb.com

Tel 00 44 7743 840 396