CEE and CEE(Communication E-commerce E-customer and CEE)
SEF on Parcel IPC, October 26-27, 2010
Levente Laszlo, Magyar Posta
� Changing of communication habits
� Changing of purchase habits
� Changing of postal business � Changing of postal business
� Case Study – cross-border e-commerce
� 1998 – internet penetration on the world
� 2008 - internet penetration on the world
� 2010.10.26 (14:59) e-commerce = 449 billion EURO
� World e-retail spend 2009 = 485,4 billion EUR
� Changing of communication habits
DO YOU KNOW YOUR CUSTOMERSYOUR CUSTOMERSCOMMUNICATIONHABITS ?
� CEE EU-countries market size (inhabitants)
An average of 60-75% of the population is living in urban areas - except Romania, where the partition lies by 50%
COUNTRY POPULATION
Bulgaria 7’700’000
Czech Republic 10’200’000
Hungary 10’000’000
Poland 38’200’000
Romania 21’700’000
Slovakia 5’400’000
Slovenia 1’990’000
TOTAL 95’190’000
source: Study from PriceWaterHouseCooper, 2008
� 2009 - Internet penetration and users in CEE
Internet penetrationInternet penetration (average) reached the EU average in most of the CEE countries.
Penetration is above 80% in the TOP 20 cities (60% of inhabitants)
Internet usersInternet users vary between 10 – 40 million inhabitants on country
Increase of internet users is accelerating – average increase is about 30%
Source: Gemius, CEE internet 2010
� 2009 – Internet broadband penetration CEE
Broadband penetration
There is still a difference in broadband penetration among the European countries- 37% (average) Western Europe- 11% (average) CEE
Source: Gemius, CEE internet, 2010
� Changing of communication habits the real problem
� Booming of social media -> Facebook, Twitter, YouTube, LinkedIn, Xing
� Traditional letter mail is no longer sexy for the young longer sexy for the young generation
� How to remain attractive ?
� Changing of purchase habits
DO YOU KNOW YOUR CUSTOMERSYOUR CUSTOMERSPURCHASEHABITS ?
Multi-taskers: those who use / access the Internet whilst also watching TV , listening to music, speaking on phone
� Multi-taskers – change of buyers habits
Source: Media Meshing: Meet Europe’s media multi-taskers, 2010
TOP multi-taskers� 77% Denmark and UK� 73% Germany� 71% Belgium
� What are multi-taskers doing ?
� 34% of Internet users are searching a product with purchasing intention
Source: Media Meshing: Meet Europe’s media multi-taskers, 2010
Purchase-driving effect of aTV and internet/mobile Ads.
� Two in three say that Internet ads have driven them to make an on-line purchase
� Where are the purchases realized ?
Source: Media Meshing: Meet Europe’s media multi-taskers, 2010
The 21st
century consumer is changing its
� Be consumer centric (but how ?)
changing its purchase
habits!
� Changing of postal business
YOUR CUSTOMER IS CHANGING - ARE CHANGING - ARE YOU FOLLOWING HIS NEW HABITS ?
�European Parcel market 2016 volume of B2C
� Total market: 3.1 b parcels, EUR 8–11b by 2016
Source: TNT, 2009
� The Hungarian on-line market 2001 - 2010
� The Hungarian on-line market is estimated to reach by the end of 2010, EUR 450 million (+35%)
� The Hungarian on-line buyers profile
55% of the on-line buyers are males – with 21% more than the females.
By 2012 male vs. female will be 50-50%
12% = 1,075,000 Hungarian citizens
above 12 years have purchased goods in the
last 12 month on the internet
� Average value of a purchase order (2009, Hungary)
The average purchase order in 2009 was of HUF 11,000 (EUR 40,- )
15000
20000
25000
0
5000
10000
2003 2004 2005 2006 2007 2008 2009 2010
exclusive on-line traditional webshop average purchase order
�Reasons for shopping from home (Hungary)
49% - save time37% - less expensive
Future shoppings will increase by 1,3 times
Source: GKIeNet., Hungary 2009Source: Gemius, Hungary 2009
� Reasons for shopping from abroad (EU vs Hungary)
55%
64%less expensive abroad
domestic not available
� Convenience and lower price is the main reason for online shopping� 35% see home delivery as important reason to shop online
2%
1%
2%
13%
16%higher product quality
no large product portfolio
no reason
easier to order
not know
Source: Websurvey France, 2008Source: GKIeNet., Hungary 2009
� Case study – cross border e-commerce
FROM ABROAD TO CEE VIA BUDAPEST
.
� Classical mail order company assisted by Magyar Pos ta
The business model� Germany based mail order company is entering on the
Romanian market with the purpose of selling goods
The services offered� Local distribution of unaddressed items (flyers)� Local distribution of addressed items (catalogues a nd DM)� Local distribution of parcel with COD � Local distribution of parcel with COD � Cash collection + bank transfer of collected cash� Return logistics management (RLM)� Postal payment services linked to the returns
The contractual parties� Mail order company and Magyar Posta
� Conditions of the business model
� Sales channels used by the distance seller � Flyers, DM and Catalogues incl. order forms� Call center (telephone order)� Home page
� Bank account opened at a local bank
� Return management� Normal returns are managed by the subcontractor / distribuitor� Reverse Logistics Management (RLM) by the local postal operator (DO) � Payment of the returned goods is managed by the DO
� PO Boxes � Letter mail items� RLM
� The procedure
Distance Seller
ReceivingPost
Deliveringoperator
End Customer
xml file
� Managing the physical and digital flows
xml fileTransferreport
Explanation:->24-48 h before delivery distance seller
is sending a pre-advice (xml-file)->Magyar Posta is processing xml-file->Magyar Posta is over-labeling the items
Main features of the process:-cash collection done by the subcontractor-collected cash transferred on the domestic
bank account opened by the distance seller at local bank
- Transfer report sent to distance seller
� The xml-file
� The content of the xml-file may vary from case-to-c ase <sorszam> 1<azonosito> CU1005NI0033508152510008990<alapszolg> A_173_EKP<iranyitoszam> 525100 | Covasna<suly> 370<tobb_kuld> 1<kulonszolgok> K_UVT,K_ORZ<uv_osszeg> 89.90<eny_osszeg> 0<kezelesi_mod> 2<alapdij> 9.45<tobbletdij> 0.50<címzett> MARIA-GYOPARKA BENKO<cimzett_hely> Baraolt<cimzett_ertcsat> 0745163465
<cimzett_ertcim> [email protected]<orz_ido> 5<díj> 9.95<kozelebbi_cim> KOSSUTH LAJOS | 249 | BL / ANL AP / 2<megjegyzes><ugyfadat1> 56201419<ugyfadat2> 2187754
� Before the handover at Budapest OE of the parcel (s hipment) the electronic xml-file is sent (48 hours)
� Based on the xml-file the parcel are over-labeled� The xml-file contains all the necessary details inc l. COD amount
� Critical problems encountered
� No reliable local databases => GIS (geomarketing sol utions)� Wrong / incorrect addresses => correct addressing
Insufficient data collection on the home -page => corrections
Main Reasons on Return Parcels Total
Wrong address 570
consignee not responding after being notified three times 547
refused by consignee 4748
Total 5865
� Insufficient data collection on the home -page => corrections � Customer habits: ordering on-line (not from catalog ues)� Uncert customers ordering products with COD = no res ponses
about their orders� Too long processing time from the order to the deli very causes
refuses at delivery
� Next steps
Improving the digital process (database, tracking, reporting)
� Magyar Posta = sending e-mail messages to the recip ients tracking the events -> leaving the warehouse; leaving Budape st HUB; entering into Romanian HUB
� Subcontractor = sending SMS to the recipients for h igher � Subcontractor = sending SMS to the recipients for h igher distribution rates
� FTP-server server based automatic (2x daily) trackin g communication
� Database procedure based on html surface instead of e-mail
� Communication is not a letter mail anymore
� „E-shopping” is different type of postal business
� Cooperation and alliances for reliable „e-shopping” services-> developing cross border solutions
� Conclusions
-> targeting the buyers
� „Last mile” delivery staff can be „first mile”sales force by identifying the „e-customers”
� Be prepared -> future is here !
� Alternative future of communication ?
� Thank you for your kind attention !
Please feel free to contact us ����
e-mail: [email protected]: [email protected]