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UPU April 2013. Introduction Review Customer and Mailer Survey Data Review Direct Mail Economics Review Postal Implications and Strategic Options Review.

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Presentation on theme: "UPU April 2013. Introduction Review Customer and Mailer Survey Data Review Direct Mail Economics Review Postal Implications and Strategic Options Review."— Presentation transcript:

1 UPU April 2013

2 Introduction Review Customer and Mailer Survey Data Review Direct Mail Economics Review Postal Implications and Strategic Options Review Business Positions Initiatives and Developments 2

3 Media Choice Harte- Hanks 2000 the benefits of direct mail – Consumers are targeted based on knowledge – Messages personalised and differentiated – Tailored call to action drives a specific response – Campaigns have measurable ROI – Captured responses add to knowledge – Creates a one to one relationship with consumers 3 Mass Target Broadcast Events & Sponsorship Outdoor Advertising Directories Publications Website Social Media S.E.O & SMS % Direct Mail Banner & Click Pay

4 10 Trends on Consumer Communication Sentiment Consumer SentimentsMarketers Sentiment 1 40 out of 50 open direct mail –Brand Relevance Personalisation CouponsUnderestimate 2 15 out of 50 happy to receive direct mail and Underestimate 3 1in 50 happy to receive text/ sms messageOverestimate 4 30 out of 50 reject business friend request and 40 out 50 ignore bannersOverestimate 5 Preferred Retention Communication 60% 40% mail &7% phone 6 40 out of 50 object to marketing text messagesUnderestimate 7 Coupons 30 % redeem regularly $2 enough to motivate behaviourUnderestimate 8 Retail Cards 60% of population still not subscribedOverestimate 9 25 out of 50 uncomfortable with personal data exposureUnderestimate % of consumer spending motivated by direct promotionsUnderestimate 4 fast.MAP 8th Annual Marketing-GAP Tracker

5 Observations There is a gap between marketers perception and desire to move communication into a social mobile world and the preference of communication for more traditional relationship based pushed information – Consumer-preference and behaviour data needs to be used to maximise restricted budgets. – Consumers’ preference is for mail and . – A small but growing minority are receptive to mobile and social-network contact and permission- based contact with these as part of a multi-media campaign can generate improved results – The percentage of those who open direct mail is still high compared to, acceptance of mobile, SMS and social media – Marketers miss these current facts and push mobile, social media and Twitter. – Customers and prospects can be alienated if these media are used. – Consumers are becoming steadily less willing to divulge personal information – 97% redeems coupons but relevance rather than value drive use. – Since 2006, marketers have underestimated the motivational power of coupons. – Targeted promotion has a big impact on consumer spend. There remains opportunity for Direct Mail to win share in the marketing mix but knowledge relevance targeting and ROI have to be proven to counteract the digital bias 5 fast.MAP 8th Annual Marketing-GAP Tracker

6 Source: TNS Consumer Panel Economics of Direct Marketing ROI is key to campaigns ( driven by product contribution and conversion rate) – 1:1 Breakeven – 3:1 Expected – 5:1 Great Campaign. Product price and contribution aligns DM to certain sectors e.g. Financial Mail Order, Automotive Conversion rates and cost per sale key to media choice

7 Mailer s Future Sentiment on Advertising Spend & Mailing Customer Acquisition Insurance 66% Mail Order 60% IT Outsourcing 80% Mail Order 30% Insurance 34% Retail 100% Mail Order 10% Publishing 100% Telcom 100% Banking 100% G S D Decline StaticGrowDeclineStaticGrow Advertising Spend Source Strategia Survey Customer Retention Insurance -70% Mail Order-90% Utilities 100% Banking 30%Insurance 30% Mail Order 10% Retail 100% Banking 70% Telcom 100% Publishing 100%

8 8 Market Direction- Interactive Data Over Multiple Channels The management of data will be at the heart of future DM. Critical success factors will be single customer view, data quality, targeting, personalisation & behaviour identification Proactive Behaviour Driven Real-time Reactive Inbound Segmented Outbound Mass Mailing No List Customer Lists LoyaltyCRM Customer Knowledge Sophistication Wave 1 Wave 2 Wave 3 Wave 4 Customer Identification & Segmentation The Customer Interaction Engine Execute Target Analyse Data Create Data Response Analysis Plan Customer Interaction Engine

9 Postal Implications and Strategic Options Mail will have a smaller share in the wider marketing mix Need to educate market and close gap between receiver sentiment and mailer intention Data and targeting of both senders and customers key to improve response rates ROI is the critical driver of media choice 9 Lower prices to impact ROI Enhance relevance of campaigns Support data management to impact ROI Integrated direct and interactive marketing media solutions

10 10 Potential Postal Positions Develops a range of New Delivery Products Focus on efficiency and campaign returns Enhanced Delivery Catalyse the development of Direct Marketing Competences in the economy Builds services and infrastructure to support developing industry and challenge broad cast media Market Maker Develop range of outsourcing services to manage and enhance the use of data in defining focused high response direct marketing campaigns Develop services to support integrated multi media direct mail campaigns Data and Campaign Manager

11 The Strategia Group11 Post – Future Potential Services Find Understand Make Retain Plan Distribute Identify Manage Data Create Campaign Manage Campaign ProduceDistributeRespond Interact List Brokerage & Procurement Single Customer Database Administration Unaddressed Direct Mail Planning System Mailing List Preparation Unaddressed and Leaflets Permission Marketing Reply CouponsCustomer Loyalty Mgt Geo-MarketingEffective Measurement Campaign Media Selection Address Cleaning & Verification Addressed DMDM PortalInbound Telemarketing Geo- Demographic Data Administration & Processing Campaign Planning Outsourcing Print On Demand Bulk E- Message Distribution In-House Permission Marketing Campaign Response Design List Enhancement Database Building & Warehousing Campaign Management DM Aspects of Mailroom Outsourcing Multi-Channel Message Distribution Campaign Outsourcing Campaign Response Services Multi-Channel Address Services Data Mining Outsourcing Telemarketing Campaign Management Social Media E-Coupons Promotions/ Incentives Campaign Response Analysis

12 Acquiring the Competences for Diversification Direct Marketing will be increasingly data driven and multi- media.Post option is either to seek to dominate an increasingly price sensitive and at best a relatively decling market or participate in the wider market NEW COMPETENCE HISTORIC COMPETENCE Identify Manage Data Create Campaign Manage Campaign ProduceDistributeRespond Build Acquire Partner

13 Bring Development of Multi Media Marketing ServiceComment Integrated Physical Direct Mail  Audience analysis, profile report-base., customer acquisition, cross- & up-sell, churn, non-response analysis  Address list provision based on multiple socio-demographic variables  Database cleaning services  Traditional range of addressed and unaddressed physical delivery services Digital Direct Marketing Customer Dialogue  Across all digital channels - web, , mobile & social media  Provision of tools & solutions provided on a SaaS & monthly fee model  IDA is a web-based tool for customer dialogue in digital channels using SMS, e-DM newsletters, supported by impact statistics & analysis  Creating a significant competence to support customers in designing, developing & implementing market communication strategies Keytecq  A partner company specialising in online marketing campaigns CRM  Provide CRM portal on a SaaS basis to wide customer base with continuous overview of all contact points  Integration based on open standards with web & SMS technology with Oracle database platform & Microsoft. Net for information exchange & integration  Delivery on a modular basis Agency MRM (Marketing Resource Management System)  Controls marketing activities from planning to implementation & follow-up  Focus on effective budget control in campaign planning, marketing communication, material handling/distribution, time to market/reporting  Wide range of creative production & management services related to multi media advertising content Creation of Bring Dialogue through acquisition – a specialised business unit (140 employees) responsible for direct marketing. Key focus is to create & manage multichannel campaigns across physical, mobile, web, & social networks 13

14 Deutsche Post Direct Marketing ServiceComment Integrated Physical Direct Mail  Traditional range of addressed/unaddressed mail management products & tools. Key innovation is to create online management of the products & to seek online/offline integration in reply tools & CRM systems  Maintain Address – verify; online address factory; Info Manager; relocation database, premium address  Buy Address - business & household across the Germanic speaking countries Mailing Factory  Creating direct mail items online including cleansing, buying addresses & printing  Infopost Manager to help & prepare dialog marketing campaigns  Prospect service a web based solution to select zip code areas for distribution of unaddressed mail  XML Postage Optimization of Infopost items within a workflow Digital Direct Marketing Werbemanager (Advertising Manager)  Campaign manager for SMEs for advertising in local search engines & banner campaigns  Tool handles campaign planning & optimisation, performance reporting & payment to the marketer  Pricing model based on a minimum period of 12 weeks with 3 package options (S/M/L) charged monthly  Search Engine Advertising: 350 clicks €249; 800 clicks €499; 1300 clicks €749  Ad banner: flashes €199; flashes €349; flashes €599 CRM Nugg.ag  Acquisition of the behavioural targeting service provider in online marketing, nugg.ad (Berlin) in July 2010 underlining DPG Strategy 2015 to increase internet marketing & third party services  Nugg.ag expertise in analysing consumer behaviour online (a market dominated by Google) DialogManager Online  Strategic sale ales alliance with Microsoft on CRM Software Service  Customers buy Dynamics CRM service to realise the complete functions of the CRM solution of Microsoft combined with postal functionalities (address check, cleansing & postage optimization & delivery) Agency  Agency Services Goal is to increase position in the growing internet advertising market. The Nugg acquisition signals continued growth in this area & the implementation of the E3 strategy - providing marketing solutions using digital channels & cross-media target groups 14

15 E-Commerce and Digital Marketing – GSI Marketing Services Division Comprises 8 specialist companies, employs 1,100 employees across 6 US offices, London & Singapore with revenues $150M ($49M margin), positioned to capture offline-online shift in marketing & advertising spend 15 FeaturesComment MBS  Offers database-driven marketing services & solutions that help marketers innovate, advance & automate the marketing process for greater return on their marketing investment PepperJam  Affiliate marketing network that provides advertisers & publishers with industry leading pay-for-performance tracking, reporting, communication & payment solutions Silverlign Group  Integrated marketing strategy & design agency TrueAction  Full-service digital agency focused on areas of strategy, usability, design, media & photography Clearsaleing  Online advertising analytics technology that provides a platform for operational & multi-channel marketing attribution - an accurate way to measure, compare & optimize profit & ROI of online advertising campaigns e-Dialog  Develop & implement targeted marketing campaigns Fetch Back  Fetch Back's solution is designed to put marketing messages in front of lost prospects that have left a web site in order to attract them back & convert them into customers M3 Mobile  Marketing solutions company focused on targeting consumers through the mobile channel in order to raise brand awareness & drive revenue

16 Marketing : Smart Delivery Innovation 16 Leaflets and Coupons growing but limited value from a marketing/ ROI perspective Premium Leaflets Features Leaflet to find buyers Coupons to incentivise registration Registered relationship- to build permission Exclusive E- Coupons to build loyalty E- Mail offers to increase contact and targeting Social Media to drive interaction Managed data pool to enable Campaign Analysis Premium Leaflets is an outsourced marketing system which refreshes the leaflet market and makes it interactive

17 Conclusions Direct Mail is still valuable but needs to compete with other media and perception Improving accessibility to direct mail can widen the market Understanding and Improving the economics is a prerequisite critical features: production and mail costs, conversion rates, cost of sale, contribution and ROI Post who simply stay only as deliverer of physical items will face at best relative loss of position and revenue in the advertising market Post can seek positions in wider interactive marketing through developing a range of services around data, integrated media and interactive response 17

18 18 Thank You Adrian King The Strategia Group


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