Category Update: Mail models

As the physical world meets the digital space in the office mailroom, this is a sector that is having to evolve rapidly.

Without doubt the biggest change to the mailroom and packaging category continues to come from the phenomenal growth in global parcel shipping which is driven by e-commerce. Volumes over the past two years have increased by 48%, with a staggering 65 billion parcels shipped worldwide in 2016 – China (31 billion), the US (13 billion) and Japan (9 billion) represent the largest markets by parcel volume. Predictions indicate this growth is likely to continue to rise by 17-28% each year between now and 2021.

But as parcel volumes grow, so do shipping options and this is benefitting end users. Stephen Darracott, Country Manager at Pitney Bowes Australia & New Zealand, explains: “Disruptors are changing the parcel landscape in countries around the world. As the competition between traditional and start-up parcel companies gets more intense, couriers and online booking services are going head to head with large traditional carriers. This is driving down costs for consumers and businesses – the cost per parcel dropped 8% over the past year in Australia, and other markets with a growing number of carriers showed similar reductions.

“But this added choice can be difficult for SMEs to manage and navigate, with multiple shipping options, service levels and 24/7 tracking to wrestle with. Without dedicated staff it can be hard to know if you are getting the best deal and saving the most money for your company. Many offices are now considering cloud-based, SaaS solutions to help them make the most of this opportunity.”

Space restrictions

Smaller businesses are also struggling with a growing number of inbound deliveries to their mailrooms and lobbies. And they not only have to deal with company shipments, but are additionally having to cope with the influx of personal online purchases of employees whose parcels are arriving en masse at their office mailrooms.

Ever-increasing volumes, coupled with limited storage space and less manpower mean that many offices are employing dedicated parcel-sorting solutions in order to manage. These scan incoming packages and digitally alert employees, residents or customers that their delivery has arrived. This reduces storage time and labour-intensive mail sorting and will prove vital for businesses, large hotels and apartments, as well as delivery centres and parcel locker locations. Plus, there’s increased demand for time-saving devices such as automated mail-folding and inserting technology as organisations ramp up efficiency and look for improved security too.

“Compliance is also driving demand for mailing automation,” adds Darracott. “Organisations charged with the protection of privacy and data are turning towards automation to meet their obligations more effectively. This trend continues in the supplies space where web-based automatic reordering can keep businesses up and running, while offering repeat-order discounting for office supplies.”

Wrap it up

The relentless growth in e-commerce shipping is additionally benefitting those that supply all the various packaging products needed to transport them safely.

German adhesive tape manufacturer tesa, for example, refers to a study by Freedonia that predicts the market for carton-sealing tape to grow by almost 5% in 2018.

But, says Falk Butterwegge, its Head of Office Supply, Food & Digital Sales – International Sales Consumer & Craftsmen, there’s not one type of tape that fits all needs. “Having a good understanding of the various tape applications helps to increase the overall category value. Different target groups have different requirements – PVC, PP, speciality and eco-friendly tapes are all increasingly needed – including both for high-value and low-price brands.

“The mailroom sector has changed considerably over the past few years and now requires more detailed knowledge about the associated products to ensure that items are packaged securely, handled correctly and the process has minimal environmental impact.”

Providing the tools to open the parcels once they arrive has also proved a lucrative angle for the specialists that supply them.

“We have seen double-digit growth in our core range of scissors, cutters and blades every year since 2013,” says Helge Becker, Sales Director at Acme United in Germany. “This is strongly related to the increase in online shipping – the more a country or region is growing in this segment, the higher the demand for these products.

“The trend of employees receiving their online orders directly at work is increasing and further driving the need for more scissors and cutters. But growth is not just B2B-focused, but can be seen in the B2C sector as well caused partly by consumers now indulging in a style of shopping known as ‘product tourism’ – ordering items in several different sizes and colours only to return the unwanted items later. This leads to even bigger volumes of parcels that need both packaging and unwrapping.”

Letters not dead 

While the volume of traditional letters is declining at varying rates across the globe, several industries are still finding considerable value in direct mail campaigns, with personalised messages and custom-colour logos printed on envelopes leading to greater opening rates.

Adding a digital experience to conventional mail can also significantly enhance its impact. For example, connecting a mail shot to a web page using a QR code or a well-timed email offer has been shown to be very effective in driving response. This teaming of physical post with emerging digital technologies is helping to reinvent mail.

Say Darracott: “Small local businesses like real estate firms are successfully finding a valuable place in the letterbox of prospective clients along with other critical mail such as bills. Their personalised messages are reaching potential customers directly, and are not getting buried in an email inbox. Instead, they make it onto a prospective client’s kitchen counter or desk along with other important communications. That’s an important position to capture.

“Printers are now offering full print-to-mail campaigns to give customers an end-to-end solution, differentiate themselves from the competition and offer more value to clients. Non-traditional mail and print businesses are also springing up to meet gaps in local markets. We have a client who owns a taxi service and got into the mail delivery business at night when drivers didn’t have much to do. Recently he’s been able to add mail creation and on-demand envelope printing to his delivery offerings. His business is thriving and he’s franchising the operation. There are real opportunities in this rapidly-changing market.”

The influence of the digital revolution is being felt throughout mailrooms around the world and the pace of change will continue. There are a number of trends that are only going to accelerate in the future.

Future trends

Firstly, parcel delivery hours are expected to expand, meaning deliveries will potentially arrive outside normal business times. This will result in an increasing number of offices having to purchase outside parcel lockers to cope. Businesses may even choose to set themselves up as non-traditional places for all package deliveries in their area in order to provide an additional revenue stream.

Secondly, parcel-tracking technology is fast becoming critical to consumers and businesses and will continue to develop over the coming years, with information and updates more frequent and accurate.

Thirdly, ‘crowdshipping’ is likely to evolve into something far more mainstream – when an individual or business wants an item delivered, an online platform will crowdsource the job to a network of approved drivers that have the capacity to courier the goods. The sender then selects who they want based on price, specific package requirements and the courier’s feedback ratings. There will also be a rise in the use of online apps that offer parcel delivery using nearby taxis that don’t currently have a customer to transport.

As these non-traditional services take hold, there will probably be a shift in packaging supplies too, as these new services will have different requirements to traditional carriers. Additionally, as more people shop online and cross-border, packing requirements to meet different compliance standards could vary country by country. Plus, in some regions there could be the minefield of the collection of local taxes, tariffs and duties that will be crying out for a solution.

As Darracott sums up: “The confluence of the physical and digital is having a huge impact on mailroom processes, supplies and parcel packing and receiving. There is now a significant opportunity for customers to leverage the cutting-edge technologies and solutions that are becoming available to better integrate shipping and mailing into their workflow and grow their influence in their region or even across the world.”

Getting noticed

Avery UK has been investigating the way labelling and packaging can help make a parcel stand out from the crowd and raise awareness of a business and its products.

An eye-tracking study with over 1,000 participants showed that using multiple labels on parcels could have a dramatic effect. Brand loyalty (or ‘love’), the perception of quality and the intent to repurchase or recommend the supplier to others, could all be raised substantially if the right elements are built into the labelling design (see below). Handwritten fonts, bold designs with borders, images and icons, awards and accreditations, as well as elements of surprise can all be used to great effect.

Fiona Mills, Marketing Director for Avery UK, says: “While we don’t recommend businesses stick labels on their packages just for the sake of it, there is a clear case for going above and beyond a simple plain address label. A company brand label, a return address label and a friendly special message label – such as ‘Open me’ or ‘See what’s inside’ – gets across all the important information. This will include your brand, your professionalism and a way to show your appreciation for a valued customer.

“Our research demonstrates that small business owners and all those involved in sending mail and packaging really need to consider what they put on their labels. Gone are the days of quickly handwriting the address and sending mail on its way. It’s vital that packages stand out and get noticed by the recipient, so they are more inclined to tell others about your business or buy from you again.”

Mail merge

The massive growth in digital marketing has caused a pronounced shift towards email over direct mail as it’s seen as a more instant and easier form of communication. Recent estimates suggest that we receive an average of 121 marketing emails each day compared to just two pieces of direct mail.

A research report by the Royal Mail has found that 51% of consumers actually want to receive both mail and email from the organisations they deal with, while a further 17% only want to receive conventional mail. European paper merchant Antalis says this shows that if email is used in isolation to contact customers, two thirds of them could be left dissatisfied. This should serve as a reminder to dealers that direct mail still has a crucial part to play in the mix.

Antalis Marketing Manager Cassie Booth explains: “We are so conditioned to spending the majority of our day staring at a screen that we forget there are other forms of communication, and ones which we should probably be using to reach out to our customers. With people receiving a huge number of e-marketing communications each day, a tangible piece of direct mail can be a much better way of capturing their attention.

“That said, it’s important to be creative and innovative. Gone are the days when you could send out a plain sheet of A4 paper inserted neatly into a C5 envelope and expect the phone to start ringing with endless enquiries. The good news is that today there’s a wealth of possibilities when it comes to paper, print, envelopes and stickers. These offer dealers a wide creative scope to produce a completely unique concept guaranteed to lure prospects into opening a mail shot.”