Digital transformation in the postal industry

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With the world embracing digital technology at an ever-faster rate, customers (both senders and receivers) are increasingly expecting to interact directly with the postal service through digital channels. In addition, according to the Universal Postal Union, 73% of postal services indicate that they have increased their investment in digital postal services. Therefore, it is clear that the digital postal services landscape will continue to evolve in many directions.

Digital transformation is affecting the postal sector

The postal infrastructure forms the backbone of a government’s communications with its citizens. Although postal services play a vital role in connecting people, businesses and governments across the world, the postal industry is grappling with its greatest challenge yet: digital disruption.

Historically, access to a postal network was as important as access to digital and mobile communications is now. Today, the overwhelming success of email, social and mobile media has led to a decline in physical letter volumes and – more importantly – substitution by other means of communication.

Digitalization has changed the role of the postal sector as letter volumes decline and parcel volumes grow. Whereas letter volume decline has shaped the postal market and continues to drive changes, the advances in ICT (information and communications technology) create new opportunities and demands for the postal market. The combination of strong letter volume decline and growth in parcel volumes has important operational and economic implications for postal networks.

A turning point

Postal services are at a turning point: they need to adapt to remain relevant, competing with digitally native companies in different areas of their product portfolios. To be able to compete effectively, postal services need to speed up the digitalization of their products. This means that postal operators that have not yet fully digitalized need to do so urgently or risk being excluded as digital service providers for e-government, e-commerce and e-finance services.

Two things are safe to say: the importance of digital post will rise, and hardly any commercial service can match the tradition and deeply ingrained trust that postal networks hold. But increasing public pressure for sustainability leads to an urgent need for innovation when it comes to the postal industry.

From physical to digital

Secure, flexible, inexpensive communication between citizens and public authorities – for example, through a digital postbox – is one of the many advantages of increased digital communication.

Digital postbox services are a secure delivery channel where consumers can view, manage and organize their digital communications from multiple providers in a single location, through a single login. Through this channel, consumers can receive and respond to various transactional communications and securely manage other business relationships, such as paying bills, uploading and storing documents, and receiving important notices and reminders.

A secure digital postbox is much safer than sending physical communications via the ordinary postal system because it is much easier to steal information from a physical postbox. Among other benefits of a digital postbox are savings on internal and postage costs while simultaneously reducing your environmental impact.

In some geographical regions, finding the exact mailing address of an intended recipient may be difficult, or many intended recipients may live at the same address. However, with safe digital post, the sender has a guarantee that each document will be received by the right person.

Trust is increasingly important

It is a fact that the postal industry is being disrupted by technological developments. Digital means of communication are replacing paper-based ones and decreasing the demand for physical letters. In other words, this is a call to action to increase the pace of digital transformation within the postal and express industry.

In some EU countries, governments themselves have driven the development in a digital direction, pushing new digital services that enable them to communicate with their citizens in a secure and trusted way. But many countries are waiting to take the next digital steps, such as digital mail.

Among the different factors influencing usage, trust in government is increasingly important. An advancing digital economy and society affect people’s routines, and this can only work if people trust the organization that is accountable for that change. Citizens might only be willing to share personal data online when they trust their government to provide high-quality – and therefore secure – online service.

There is still a lot of ground to be won, even among the frontrunners in e-government. According to the EU’s eGovernment Benchmark Report 2019, the way forward in e-government services is to build digital public services that people trust and will therefore use because it makes their interaction with government easier.

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