Digitalizing the postal industry

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What are the benefits of fully digitalizing the postal industry?

Digital disruption: it has built new business empires and destroyed old industries. With emerging technologies and business models, even the biggest, most established enterprises are trying their best to modernize to keep up with the times. Take the postal industry, for example. To survive, it must adapt. And to adapt, it needs to embrace digital transformation.

Why should the postal service industry modernize?

Post isn’t dead but it needs to stay relevant and cater to the changing needs of customers. Modernizing the postal service industry is the first step in embracing digital transformation. The associated benefits include increased profits and the possibility to save on labor costs while positively influencing the climate by cutting down on usage of paper and gas.

Increased profits

Right now, postal services that haven’t modernized are losing profit. Let’s look at the US Postal Service. An organization older than the country it serves, USPS is US$160bn in debt. That is double the size of its revenue. It’s not just about the price of stamps. According to a report by Forbes in 2019, the USPS loses nearly US$3bn a year. The logistical maintenance as well as politics and mounting competition have not exactly helped drive revenue toward the US postal service industry.

Sending messages by post isn’t even the more cost-effective option either. Based on a report by Radio New Zealand, the cost of sending a domestic letter rose to NZ$1.20 (US$0.69) in 2018, while the cost of large mail rose by 40 NZ cents (23 US cents) and oversized packages by 60 NZ cents (35 US cents). The increases were implemented to counter New Zealand Post’s plummeting revenue.

Saves on labor costs

Think about how many people are required to handle a single letter. From the stamp vendor to the postman, there are simply too many steps. The process has become even more outdated with the ongoing pandemic forcing people indoors and limiting physical contact. By modernizing and using digital solutions, the required labor would be cut down.

Does not waste resources

Paper, gas, time: these are all valuable commodities that are being misused in the traditional postal process. We’re all familiar with the climate situation and the huge role of deforestation and the use of gasoline. As for time, well, it can be spent elsewhere – perhaps in helping the industry progress.

Responds to the needs of ‘flexible addresses’

The rise of remote working, co-working spaces and the newest trend of ‘workations’ (work vacations) renders permanent addresses rather outdated and pointless. Even if a regular post retained its former glory, it would be counterproductive to keep letters and other forms of traditional correspondence waiting in a postbox for weeks.

There are many ways to digitalize and modernize

You wouldn’t take a carriage if a car were available. Snail mail still has some use and has shown effectiveness in direct marketing. In France, it’s still largely how retirees and the less fortunate obtain their pensions and benefits. When the pandemic raged and lockdowns were declared, private couriers continued operations while many national postal services in Europe cut back. Those that didn’t, such as Royal Mail, were faced with a backlash for endangering staff.

On a practical note, why would you send out a letter that could take a couple of days to arrive when you can do it electronically in real time? Post isn’t dead, but it’s important to see it in the context of the 21st century. This option to digitalize starts with looking for platforms and a partner that can help you accelerate the modernization process.

How has the postal industry tried to keep up with the times?

The postal industry hasn’t been stagnant. Despite its snail’s pace, it has made attempts to modernize. One solution is to use data and analytics as well as automation to help sort through the millions of letters and parcels received via post.

Here are some examples of the postal system trying to keep pace with the times:

Denmark’s Digital Post

In November 2013, Denmark required businesses to receive digital letters in secure digital postboxes as part of the government’s campaign to replace physical mail. Digital Post is the national electronic mailbox ‘for messages and communications implemented by the Danish public authorities’. With strong encryption and the requirement of a NemID (civil registration number), the country’s Digital Post promises to be secure. One of the ways users can access it is via digital postbox supplier e-Boks.

So determined is Denmark to transition away from a physical post that its digital strategy of 2016-2020 mandated that public authorities are to send digital-only messages rather than paper-based ones. According to this legislation, ‘Citizens are required to use digital self-service for a wide range of services, and to digitally receive letters and notices from public authorities’.

As people demand more and more in terms of connectivity, the post should continue to tailor itself to the needs of its customers. The time to go digital was yesterday, but it’s not too late yet. Change the way you communicate surely, securely and just the way you like it.

Australia Post’s eLetter hybrid mail service

In 2002, Australia Post and print software provider PrintSoft joined together to launch the Post eLetter service that allowed clients to use their personal computers to create letters, invoices, statements and postcards, which can then be submitted electronically to the Australia Post service bureau, where they are automatically sorted and marked with barcodes. Then the actual message is printed and processed in the post office nearest the delivery location. Three years later, Australia acquired the global operations of PrintSoft.

Deutsche Post’s E-Postbrief

Developed in 2010, the E-Postbrief provided German residents with their own nationally sanctioned address featuring their real names and ending with

Priced like traditional post, communication via this email-esque platform was secure. To obtain an address, one needed to submit identification documents. The lack of anonymity barred spam and prevented identity theft. In another hybrid mail system, users also had the option of having their messages sent purely electronically or having them printed out and then delivered physically.

In 2012, in the face of mounting competition, Deutsche Post removed personal encryption and digital signature capabilities to make it easier to use.

Sweden’s e-Letter

Merging manual and digital processes was a quick solution to the declining postal industry. Sweden partnered with Posten AB to print out emailed letters and send them to recipients physically.

Itella’s Anttila Living Lab trial

Rural areas continue to depend on traditional posts for information and communication. However, this Finnish innovation tried to come up with a digital solution. The experiment involved 124 households and 17 companies in Anttila, a small village near Porvoo, Finland. Postal home delivery was confined to two days per week; on the other three weekdays, post was placed in assigned lockers in the village center. A text message was sent to inform recipients of any letters or parcels in their lockers, letting them decide whether to retrieve them. Unretrieved packages would be sent to the recipient’s home address on the two post days. First- and second-class mail was scanned and delivered electronically to the customer’s Netposti digital account, before being delivered as usual.

Netposti was yet another Finnish move toward modernization. The free service gave customers their own secure digital postbox that accepted what would otherwise be traditional post electronically. It streamlined the posting process and kept it secure since communication did not go through the public internet. Moreover, users could only accept mail from approved senders. Netposti also offered complimentary archiving for up to seven years.

USPS’s AR tech and Federal Cloud Credential Exchange

Despite its lack of capital for innovation, the USPS continues to soldier on. In 2014, it tested augmented reality tech to convert standard print ads to interactive experiences. It also introduced a cloud-based clearing service that streamlined red tape by validating the credentials of people who wanted access to government benefits.

How can e-Boks help modernize the postal industry?

As a digital solutions provider, we at e-Boks have erased borders and pulled the future right to the present by offering a secure and safe way for people to communicate effectively. No stolen mail, no mail theft, no hacking – just efficient conversation.

As the Danish government encouraged digitalization across the country two decades ago, one of the first steps it mandated was sending the pay slips of government employees via our platform at e-Boks. Eventually, our role was expanded to manage the government’s document box system, which replaced paper letters from the public sector to Danish citizens. Many other companies, such as Danske Bank and the ISS (International Service System) payroll department, have also opted to use e-Boks to handle their private, internal postbox and document management systems.

Since e-Boks’ digital postboxes require Danish citizens to use their NemID – a national log-in solution for internet banks and government websites – to register, issues such as identity theft have already been solved. Easily accessible via mobile, they also address the geographic limitations of regular mail. Our products are fully customizable, right down to the kind of mail users want to receive.

Seeing Denmark’s digital transformation, Ireland followed suit, hiring e-Boks in 2019 as the digital bridge between public authorities and private citizens. Using current technology and government regulation (such as eDelivery and eIDAS), we came up with an efficient digital infrastructure for Irish residents, businesses and officials to use to communicate. We also came up with a customized hybrid cloud solution, where the cloud is used but messages are kept on-site by the Irish government.

We are also responsible for providing public and private digital posts in Norway, Greenland and Sweden.

From secure mail to digital signatures, hybrid solutions to environmental conservation, e-Boks and its continued growth are leading the way to a new kind of postal system – one that befits the 21st century and beyond.


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About Author

Christoffer Augsburg is a growth marketing manager at e-Boks Nordic AS in Denmark. With more than 21 years of experience digitalizing societies, e-Boks has been the chosen provider of secure and effective communication lines between governmental institutions and their citizens, as well as companies and their customers. The digital postbox allows companies to distribute their communication instantly and with 100% delivery rate, while end users receive the information in a secured environment with opportunities to digitally sign and pay for the sent documents.

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