• on Jun 2nd, 2014 in Products & Services | 1 comment

    If your favorite catalog looks more like the Sports Illustrated swimsuit edition or even an issue of Life magazine, there’s a good reason. These high-end photo displays and glossy spreads help retailers sell products online. Retailers are pouring more money into catalog design, including expensive photo shoots, because they find this drives online and in-store sales. Catalogs and other hard copy advertising act as bait to lure the customer into online or brick-and-mortar shopping.

    So it would seem that physical stores and hard-copy ads are not dead; they are evolving to complement a retailer’s digital presence. As a Wall Street Journal article noted, the catalog is like “a store window display, and a source of inspiration, the way roaming through store aisles can be.” Bonobos, a menswear store that advertises better-fitting pants, started to dabble in catalog mailings and found they had a significant impact on sales. The company found that 20 percent of its new customers had received a catalog, and those that do get catalogs spend 1.5 times as much as new shoppers who don’t receive a catalog.

    But the convergence of digital and physical shopping goes beyond the continuing popularity of catalogs. Retailers can no longer view online sales and sales at physical stores in isolation. Customers are browsing and shopping using both mediums jointly. These days many consumers use online research before they make a purchase in a physical store, what is known as webrooming. They also browse physical merchandise in stores before buying an item online, a practice called showrooming. According a report by Accenture, 78 percent of survey respondents have used webrooming and 72 percent of respondents have used showrooming.

    Clearly, the Postal Service benefits from more catalogs in the mail and ensuing parcel fulfillment. But it would also benefit from a surge in advertising directed at both the physical and online presence simultaneously. For example, at the most recent PostalVision 2020 conference, retailers showed how they are embedding digital advertising into physical objects. Marks and Spencer is producing a catalog that customers can scan and go directly to the company’s online catalog where they can make purchases. Ikea has a catalog that allows customers to see what furniture would look like in their house. Advertisers could embed digital coupons into advertisements that allow recipients either to use the coupon in the physical store or scan it and go directly to the website with the discount code activated.

    What do you think? Will embedding digital advertising into physical mail help to maintain or stem the decline in advertising mail? What other opportunities could the Postal Service benefit from related to the convergence of digital and physical shopping?

  • on Nov 13th, 2013 in Delivery & Collection | 6 comments

    This week the Postal Service announced plans to move into one of the few remaining frontiers of package delivery – Sundays.

    Under a new negotiated service agreement approved by the Postal Regulatory Commission, e-tailing giant Amazon.com will use the Postal Service’s Parcel Select service to ship everything from clothing to garden tools on Sundays. The program is running now in the New York and Los Angeles metropolitan areas, with a rollout planned in 2014 in Dallas, Houston, New Orleans, and Phoenix, to name a few.

    Sunday delivery isn’t exactly new. The Postal Service delivers 7 days a week using the premium Priority Mail Express product. So, what’s really new is the low cost of the service – making it a solid option for consumers.

    Utilizing the Postal Service’s ubiquitous delivery network Amazon.com is able to keep its costs down and, for example, give its Amazon Prime members who get unlimited, free two-day shipping the flexibility to get packages on Sundays.

    The Postal Service faces stiff competition as it seeks to grow its package business and take advantage of the explosion in e-commerce. But it has seen significant gains in its parcel sector through innovations such as flat rate Priority Mail packaging.

    With this latest move, the Postal Service is looking to strengthen its market position in business-to-consumer shipping and to further distinguish itself from its main competitors – FedEx and UPS.

    What do you think of the Amazon.com partnership? Do you foresee operational, staffing or other problems for the Postal Service as it ramps up for Sunday deliveries? Will this be a net financial win for the Postal Service and its customers?