e Commerce Package Business Bruce Klein USPS Shipping
e. Commerce Package Business Bruce Klein USPS Shipping Product Management February 21, 2018
e. Commerce Package Business • What is e. Commerce? • What are the possible different business models? • What is most important for customer engagement and retention? • How is the Postal Service positioned to support e. Commerce?
What is e. Commerce? e. Commerce (electronic commerce or EC) is the buying and selling of goods and services, or the transmitting of funds or data, over an electronic network, primarily the internet. These business transactions occur either as business-to-business, business-to-consumer, consumer-to-consumer or consumer-to-business.
What are the possible different business models? • • • Distribution Centers (B 2 C) Distribution Center to Store (B 2 B) Ship from Store (B 2 C) Merchant Network (C 2 C) Fulfillment House (3 PL) Returns (C 2 C/C 2 B/B 2 C)
Evolution of B 2 C by Industry Segment
USPS Volume Share of B 2 C Business Segments
What is most important for customer engagement and retention? User Interface and User Experience Seamless; Simple and Easy Ordering and Return's processes, couple with timely and accurate notifications.
Most convenient carrier for returns Statistics show that the returns experience is the number-one source of pain for online shoppers. Our footprint of over 31, 000 retail locations and 155 million pickup and delivery stops nationwide can help you: • Reduce barriers to purchase. • Increase customer loyalty. • Improve inventory management. • Lower costs. 1. "E-Commerce Returns Best Practices, " Shorr Packaging Corp. , October 14, 2015. 2 of 3 online consumers would buy more with free returns. 1 95% of online customers would repeat business if returns process is simple. 1
How is the Postal Service positioned to support e. Commerce? Where Infrastructure and Technology Meet to Deliver
We connect every address, every day From business to personal and every place in between for over 240 years 225, 000+ vehicles 156 M delivery points nationwide 31, 585 retail outlets More than Mc. Donald’s, Walmart, and Starbucks combined Delivery 7 days/week 5. 2 billion packages/year, 506 million mailpieces/day
Package processing 24/7, fully integrated, end-to-end processing Automated Package Processing System (APPS) • 9, 500 pieces per hour throughput • High-accuracy sortation for handwritten and machine-printed addresses
Our customers are your customers— our brand is an extension of yours Delivery expectations are ever changing. Key needs center around: Reliability Visibility Security Value Seamless experience Sustainability
Security and confidentiality The United States Postal Inspection Service® enforces over 200 federal laws related to crimes of theft, fraud and abuse of the U. S. Mail®. The sanctity of your package is the government mandated mission of the U. S. Postal Inspection Service. • USPS is the only courier to have their own law enforcement • Customer packages are protected by federal law • Largest computer network linking 32, 000 facilities—all working together to keep your mail and your business safe • Secured mail recovery facility for processing any damage or loss packages
Trusted and Reliable USPS has been named the most trusted government agency for the past five years. 99. 99% Of packages are delivered undamaged In 2017, for the tenth straight year, USPS was named one of the 10 most-trusted companies for privacy in North America. 1 Low loss and damage: 99. 99% of First-Class parcels and Priority Mail® are delivered undamaged/without loss 1. 2017 Most Trusted Companies for Privacy Study, The Ponemon Institute, January 31, 2017 Volume of packages vs Losses & damages
Cultivating a sustainable future Greenhouse gases cut 13. 3% since 2008 Americans rank USPS no. 1 of 13 federal agencies (According to a 2016 Gallup poll) Facility energy use reduced 31. 4% since 2003 We recycled Purchased $236 million of environmentally preferable products Our free packaging 223, 796 tons of waste meets Sustainable Forestry Initiative or Forest Stewardship Council certification standards
Outpacing our competitors In growth and reach While our industry is growing at a rate of 6%, USPS is growing at 16% Key player in e-commerce delivery USPS even takes competitors’ packages the “last mile” for delivery
2017 Peak Season Delivery We increased holiday operations to deliver for our customers. ~800 M • Christmas Day delivery in many metros ~700 M • Three shifts per day in key markets • 35, 000+ seasonal workers ~355 M We continue to outpace the competition in package delivery growth
Enhancements in visibility Innovations that answer our customers’ expectations Improved scanning technology for better tracking and real-time notifications Predictive delivery notifies customers of estimated delivery time within one hour My USPS lets consumers manage incoming packages Informed Delivery™ sends a daily email with images of mail that’s on its way
Innovative solutions That redefine the customer experience • Sunday delivery • Same-day delivery • Ship-from-store • Grocery and customized delivery • Poised for the next big thing
Looking forward To a future of transforming the customer experience through data, infrastructure, and technology World’s third-largest IT infrastructure Upgrading vehicle fleet Deployed 263, 000 new Mobile Delivery Device (MDD) scanners nationwide Upgrading retail POS systems and kiosks
Innovating mail The Postal Service focus on innovation extends into mail technology and marketing as well. Irresistible Mail • Designed to do more • Proven results • Tactile, Interactive, Connected
Direct mail—solutions that deliver 73% Direct mail delivers of consumers prefer direct mail 1 30 x higher response rate than email 2 Direct mail tops all other media for delivering the highest ROI for B 2 C marketing 3 31% 38% For acquisition For retention 1. Epsilon Channel Preference for Mobile and Non-Mobile 2. Digital Direct Mail Printing in North America: Market Analysis & Forecast (2013– 2018), Interquest, November 2013. 3. "Direct mail delivers results, " Pitney Bowes, 2015.
Direct mail strengthens digital 65% of people who received direct mail made a purchase or responded 1 69% are more likely to open a mailpiece with color text and graphics on the front before opening pieces with no headline or graphic 2 45% increase in response rates when print is combined with web, email, and mobile 3 1. Epsilon Channel Preference for Mobile and Non-Mobile 2. Digital Direct Mail Printing in North America: Market Analysis & Forecast (2013– 2018), Interquest, November 2013. 3. "Direct mail delivers results, " Pitney Bowes, 2015.
Partners and Tools Partners • PC Postage • Shipping Software Tools • Free shipping software • Windows-based, Browser, API’s • USPS. COM and API’s • • • Informed Delivery Address Tracking Package Pick-up Pricing Service standards
Proven Shipping Options ECONOMY Parcel Select 1 Retail Ground 1 Media Mail Bound Printed Matter FAST Priority Mail 1 envelopes and packages (1 -3 days) First-Class Package 1, 2 (1 -4 days) FASTER Priority Mail Express envelopes and packages (Next Day)2 PLUS Multiple International shipping options also available Returns 1 1 Services 2 Some available for Return Services restrictions and certain limitations may apply USPS Tracking included on all barcoded packages
Shipping Solutions Key shipping products USPS has a full range of products to deliver packages in a timely and affordable manner. First-Class Mail® Description Delivery time Parcel Select® Economical, ouncebased Commercial Base® Pricing up to 13 ounces Fast and affordable, date-specified delivery Economical ground service for regular and large packages Affordable presorted parcel ground service for packages that weigh less than 1 pound Delivery in 1 to 3 business days 1 Domestic delivery averages 2 to 9 business days (not guaranteed service) Includes free USPS Tracking® online and at retail 2 Includes free USPS Tracking for domestic shipments Can combine with Tracking/ extra services to delivery confirmation confirm delivery Insurance Dimensional (DIM) weight Surcharges Parcel Select Lightweight® Priority Mail® Insurance for loss or Includes up to $50 of Insurance available damage up to $5, 000 insurance 3 with most for additional fee for merchandise only shipments 4 Insurance available for additional fee No DIM weight charges USPS only applies No DIM weight pricing charges to domestic Priority Mail packages over 1 cubic foot shipped to zones 5– 9 No surcharges for fuel or residential, rural, and regular Saturday delivery
Shipping Solutions Key shipping products USPS has a full range of products to deliver packages in a timely and affordable manner. First-Class Mail® No DIM weight charges Dimensional (DIM) weight Surcharges Priority Mail® Parcel Select® USPS only applies No DIM weight pricing charges to domestic Priority Mail packages over 1 cubic foot shipped to zones 5– 9 Parcel Select Lightweight® No DIM weight charges No surcharges for fuel or residential, rural, and regular Saturday delivery
Simple solutions USPS makes integration of your systems simple by providing the support you need. • Our team of Operations Integration Specialists reduces the time it takes to get up and running with USPS. • Payment methods, acceptance, transportation and equipment, packaging, and processing • And, our Technical Integration Specialists help you make a seamless IT transition by implementing technologies that make it easier to do business with USPS. • USPS Web Tools® (APIs), e-commerce web portal, Electronic Verification System (e. VS®), Electronic Data Interchange over Internet, e. Postage, PC Postage®, Scan-Based Payment, Barcodes (IMb® and IMpb™)/label/mailpiece certification
Exceeding customer expectations is critical to our collective success We put our strengths to work for you. Enduring partnerships and expertise Convenience of our nationwide access Established infrastructure Secure technology infrastructure Emphasis on sustainability Innovative and customized solutions
Thank you for your time! Bruce Klein bruce. r. klein@usps. gov
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