31 August 2009 - Steve Lawson - © Hellmail Postal News

There is little doubt that the internet, whilst transforming the way most of us communicate with the modern world, has put the squeeze on traditional postal services. We've all become so used to the speed and immediacy of email, it is rare these days that we choose to hand write a letter, stick it in an envelope, and post it. For a third of a price of a stamp we can even send a text message. In fact paper post has almost the same status now as the Telegram against the marvels of the telephone (or 'Telling Bone' as TV's 'Catweazel' described it), earning itself the unfortunate title of 'snail mail' in the process. For postal operators, these are difficult times and most are having to reinvent themselves, consolidate, or even cut services.

Not all is doom and gloom however, and there is evidence to suggest that post will be with us for some years yet. Hybrid mail could in time, help integrate traditional postal services with our present obsession with everything digital, once everyone latches on. For those unfamiliar with the concept, Hybrid mail is the link between the computer desktop and the conventional letter box, with software that enables users to create and send a letter electronically and for it to be printed, despatched, and posted elsewhere - allegedly at a lower price than if you did the entire job yourself. Such services are now already being offered by all the major postal operators but Swiss Post has gone one step further by teaming up with Earth Class Mail to provide customers a way to access their post from practically anywhere using a mobile phone or computer. Using vetted operatives, letters can be opened, scanned and made available, well, from the relative comfort of any armchair

Such apparent leaps in technology, whilst not exactly rocket science, do give an insight into the way in which we are likely to use postal services in the future, although all these ideas do rely on almost universal access to the digital world. With the UK government's plan to improve internet access, including a levy on phone lines to help pay for it all, the Royal Mail will have little choice but to continue to improve access to online services over the coming years, and presumably with fresh ideas that depend even less on the working hours of postal workers.

Correos, the Spanish postal operator, once notorious for being somewhat unpredictable, if not slow, has invested in a computerised postal network and spent a fortune on its virtual post office, seeing an increase in online sales of around 18% for the first half of 2009. The number of transactions was also up compared to last year, from 154,584 in 2008, to 180,502 this year - a growth of 16.8%. The message must surely be, ignore the internet and you do so at your peril.

The shift towards online services and the loss of business to the letters market has been partly obscured as postal operators concentrate on direct mail and a growth in small parcels due to the rise in services such as eBay and Amazon, but both the UK and the U.S face difficult decisions on what should or should not be protected in order to save money.

U.S. Postal Regulatory Commission Chairman Dan Blair, speaking to Fox News earlier this year said:

"This is different because we've seen a decline in volume across all classes in percentages not seen since the Great Depression. You couple that with the decline in first-class mail as well - the mail mix isn't as profitable as it once was."

In fact his view is that reducing delivery days (not a favourite with the direct marketing industry either), would actually accentuate decline and suggests that the closure of some U.S. post offices would be a better move to reduce overheads, but even this may only be a temporary reprieve for an industry that continues to see annual decline in the volume of letters. The UK has pruned its post office network by 2,500 over the last couple of years and replaced others with mobile post offices that visit one or two times a week in rural locations. That in itself may also accentuate decline with post office customers looking for other ways to keep in touch.

Royal Mail Letters now only contributes around 1% to group profits and whilst the UK postal dispute (more or less a ressurection of the one in 2007) seems to focus on just how all this change is to be implemented, and 'pay' apparently thrown in to the mix, few would disagree that change is essential to ensure Royal Mail can continue to provide the Universal Service Obligation and avoid mass redundancies although even the USO depends on where we go next technologically speaking. Like most postal operators it is trying to play to its strengths including the physical advantages of hand-delivered mail rather than the virtual equivalent, but at the same time trying to second-guess the market and establish products that straddle the physical and virtual world. Tough call.

Hybrid mail may well be part of the answer but technology moves on at such a relentless pace, it could be that eventually, the mobile phone rather than a street address, becomes the key entry point for most communications, with possibly the inclusion of a swipe ID card to aid verification of the recipient. Earth Class Mail clearly believes this is the way forward. For Swiss Post, which has bought in to the idea, it may well be the best answer in the medium term, helping slow down decline and buy it time whilst it develops new ideas based around the same technology.

Its easy to forget that most postal operators were originally purveyors of Post, Telegraph and Telephone services, including the Royal Mail in its GPO days, but with the Telegraph almost extinct and telephone services over the years, split and run by numerous privatised companies, operators are by no means strangers to sweeping change. What makes this so very different is that for the first time (with the exception of the FAX machine), we are able to feed in a document at one end and the recipient able to read it seconds later via a mobile phone on the other side of the world.

Traditional postal operators have no way of competing with that and despite some optimism by Deutsche Post that decline has now reached its lowest point, most predict it will actually continue for the foreseeable future, or until a widely accepted means of shifting documents around has been established that we can all live with.

The Germans have already moved into the parcel pick-up station, an interesting concept I saw at last years Post-Expo where parcels can be collected with a relevant ID card from a rather large vending machine. Still, it does have the distinct advantage of being 24 hour and providing the unit isn't too far away, wouldn't be a bad idea. In France however, the idea of using Metro stations as a delivery pick up point for La Poste customers has prompted strike action (in a way only the French know how), even if the idea might just suit customers. You start to get a sense that theres a real fight going on here to hang on to a long-lost postal mecca in the face of the post-digital revolution.

I wouldn't rule out house deliveries for a while yet, but with deliveries in the UK already creeping into the afternoon and much of that made up of advertising material, most people seem unphased by all the fuss being made by the postal union (the CWU) - apathetic even. To be fair, people have more important problems to contend with right now and can send emails all day long, strike or no strike. Its that difference that is shaping the future of postal services and why resisting change will inevitably prove fruitless, otherwise we're back to singing the praises of the Telegram once more. Noble perhaps, but still fruitless.

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