Post has seen lots of last-mile innovation in the Nordics. Now, Posten Norge is taking on the first mile by combining e-postage with home parcel collection.
The Nordics are famous for their development of postal pick-up/drop-off (PUDO) points and the move away from ‘to door’ deliveries. This is probably due to the specific geographies and sparsely populated areas – particularly in the North – not to mention the high labor costs in these countries.
Norway’s Posten Norge is now offering a simple and affordable – at least by Norwegian standards – product offering a ‘from door’-type service. For a surcharge of Nkr15 (US$1.85) over the regular postage fee, customers can arrange at-home parcel collection. Customers can go online, pay for postage and arrange for next-day collection of parcels.
The service is for parcels weighing under 2kg (4.4 lb) that will fit in the customer’s mailbox, of which there are more than 2.4 million. Most of the mailboxes are ideal for this kind of service. No stamps are necessary, and the online payment generates a single-use code that the customer writes on the parcel.
Customers who don’t have a mailbox big enough to take the parcel can also pay postage online and lodge the parcel in one of Posten’s red post boxes.
Digital twist on an old idea
Home parcel collection is not a particularly new idea but what is interesting here is that technology is making use of a traditional personal mailbox – which are very popular, especially in rural parts of the Nordics – to offer a new service and a transaction that is more efficient from a customer perspective.
There is no investment in physical infrastructure required on Posten Norge’s part, and there’s good use of existing assets such as postpeople and customer mailboxes. There may even be an environmental benefit thanks to the reduction in emissions and passenger kilometers resulting from fewer trips to the post office/PUDO point.
The downside is the possibility of reduced foot traffic at post offices. At a time when post offices are losing over-the-counter transactions, the potential loss of parcel transactions won’t be popular in some quarters.
Having said that, the strict limitation on parcel size and weight means that, combined with the continuing growth in e-commerce and returns, there will probably still be strong customer numbers visiting Posten retail points to lodge parcels.
The counterargument is that offering residential parcel collection via online payment is a step forward in customer service, and if the post doesn’t give customers what they want then someone else will. The Nkr15 surcharge is attractive by Norwegian standards, and the process is childishly simple – all you need is access to a computer or smartphone and a traditional ballpoint pen.
“This is an offer for those who want a simpler working day and this new service contributes to that,” says Tone Wille, CEO of Posten Norge.
Posts disrupting themselves
We quite like this idea as it is a new and simpler take on what Deutsche Post has been trying to do with its Paketkasten personal lockers.
This service will be especially attractive for e-commerce returns, specifically those items that don’t have a free returns option, which is always a real pain point for the consumer.
It’s a simple initiative, combining existing infrastructure and online postage payment. It also avoids the costs of more technologically advanced at-home parcel locker solutions that are already on the market.
The post’s extensive delivery network means it is best-placed to offer this service, but that isn’t an excuse for complacency on posts’ part. Small, nimble competitors are snapping at the posts’ heels, with a good example being Citibox’s offering in Spain.
We like this sort of initiative and hope that it takes off in Norway. Let’s see how the project develops: if successful, it can play a part in the evolutionary disruption of the last mile.
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Marek Różycki is managing partner at Last Mile Experts, specializing in CEP and e-commerce last-mile advisory.