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Marketers must invest in multichannel approach

Generating high levels of response, conversion or brand engagement is never easy in direct marketing. Unquestionably, it is vital to pick the right mix of channels. However, as channels have proliferated — mail, email, SMS, telemarketing— settling on the appropriate ones and giving them the optimum weighting is becoming more problematic.

“Consumers have preferences for different channels at different times of the day,” says Direct Marketing Association (DMA) director of media channel development, Robert Keitch. “No one channel is going to do it for you — end of story. The days of having a simplistic mix are gone.

It comes down to understanding who the customer is.”Consumer habits are evolving; for example, people now spend more time interacting with the web or their mobiles than sitting passively in front of the TV. Richard Higginbotham , head of marketing at marketing services provider CDMS, believes many marketers have as yet failed to exploit this shift.

“Once the customer has been identified, successful multi-channel implementation allows the marketer to actually contact the customer through the channel they prefer,” he says. “Ensuring customers are receiving communications through a medium to which they are responsive is key to producing customer satisfaction and improving ROI.”

There is plenty of evidence that a multichannel approach to direct marketing tends to deliver far better results than concentration on a single touchpoint. Research from Royal Mail, for instance, has found that integrating digital advertising with direct mail campaigns can increase customer spend by almost 25%, while 55% of ‘confident web users’ prefer to be contacted by a combination of direct mail and online .Anthony Miller, head of media development at Royal Mail, says this shows that consumers recognise the benefits of online, email and direct mail for different types of communications — and how well they work together.

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TNT Post to help business mailers get greener

TNT Post is launching a service for its business customers to help them measure and reduce the carbon impact of their mailing activity.
TNT Post customers will be able to access a web-based carbon calculator, to measure the carbon impact of all contributing mail fulfilment elements used to produce and deliver their mailings.
The calculator was developed by The CarbonNeutral Company and Edinburgh Centre for Carbon Management.
The service comes in response to the government’s target of reducing carbon emissions by 20% by 2020 and the Direct Marketing Association’s 2003 agreement with the government, which commits the direct marketing industry to reduce its environmental impact over the next 10 years.
The aim is to reduce landfill, to benefit the environment, while also leading to more effectively targeted direct marketing.
The calculator takes into account the entire mailing chain, from the type of paper, ink and packaging used, to the fulfilment, data cleansing, undeliverables capturing, transportation and delivery of each mail item.
The result is a calculation of mailing emissions, broken down into carbon contributing factors.
Once identified, TNT Post recommends how these individual carbon levels can be reduced by, for example, highlighting the importance of using recycled materials for mailings and recommending suppliers who can print on sustainable and recycled materials including Forest Stewardship Council sourced paper for existing mail packs.

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Postal pilot project ends successfully

The General Postal Corporation (Q-Post) announced the successful end of the first Arab Countries RFID Pilot Project yesterday. The pilot project, started on March 8 with Qatar, Saudi Arabia and the UAE, ended on June 8.

“The pilot was conducted under the observation and advice of Universal Postal Union (UPU). It was a huge success with good participation from Q-Post, Saudi Post and Emirates Post,” said Ali Mohammed Al Ali, Chairman and General Manager, Q-Post at a press conference yesterday.

The pilot tested live different Radio Frequency Identification (RFID) technologies for measuring the quality of services of letter mail. The RFID pilot aimed to demonstrate the abilities of the different technologies within the same environment in the field of real-time monitoring networks. Hidden mail of almost 4,000 test items was circulated over the test period among the three countries. The time of posting and delivery was noted to measure the quality of services.

“This is a small project but its magnitude is much greater. The whole postal world has been eagerly awaiting the result of this pilot. The project will provide us a lot and is capable of satisfying all postal requirements,” Akio Miyaji, Quality of Service Coordinator, Universal Postal Union, told The Peninsula. “This project is the first in the whole postal world and is for service quality improvement. The results are excellent and this will help the technology to be introduced in more countries, helping in a global improvement of the postal system worldwide in a long run,” he added.

The recommendations of the test will be sent to all UPU member countries.

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Postal Service Governor Ellen Williams appointed to new term (U.S)

President George W. Bush has appointed Postal Service Board of Governors member Ellen C. Williams of Kentucky to an additional term that expires Dec. 8, 2014. Governor Williams is Vice Chair of the Board’s Compensation and Management Resources Committee and is a member of the Government Relations and Regulatory Committee.

Governor Williams joined the Board of Governors in 2006 after President Bush appointed her to serve the remainder of an unexpired term.

After more than 25 years in government and politics, including serving as Vice Chairman of the Kentucky Public Service Commission, Governor Williams launched her own business, Ellen C. Williams, LLC, a government affairs and lobbying firm.

Governor Williams is a graduate of the University of Kentucky and lives in Anderson County, KY.

The Board of Governors includes nine governors who are appointed by the president with the advice and consent of the Senate. More information about the Board is available at: http://www.usps.com/communications/newsroom/bog.htm

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FedEx F3Q:08 Preview

FDX F3Q:08 Preview – Likely More of the Same

FDX TO REPORT F3Q (FEB) QTR ON THURS, MARCH 20TH. With the potential for pre-reports prior to a competitor’s conference this Wed., followed by FDX’ report on Thurs, we suspect this could be a tumultuous week for the transports. We have little insight into FDX report, but expect more of the same with recent reports from FDX where they beat low expectations but on-going numbers move downwards.

WE REMAIN BELOW CONS. Our unchanged USD 6.28 and USD 6.54 EPS estimates for F08 and F09 remain 1% and 8% below current Cons. of USD 6.33 and USD 7.13. We believe we are generally below Cons. mostly as a result of our expectations for increased drags on Ground costs related to on-going and unforeseen new issues related to the contractor model. We assume only 3% EBIT growth for Ground for F09 and we suspect Cons. assumes closer to 20% Ground EBIT growth.

FUEL LIKELY A DRAG BUT NOTHING LIKE LAST QUARTER. We estimate roughly that net fuel impact (higher y-o-y fuel costs net of higher y-o-y surcharge rev) will represent about a USD 0.04 net drag on EPS during F3Q, much less of a drag than the estimated USD 0.29 drag in F2Q y-o-y, but not the net benefit we had expected earlier in the qtr.

MORE VISIBILITY INTO THE FREIGHT ECONOMY. UPS recently noted that after relatively solid Dec. and Jan. months that Feb. and early March dom. package vols. weakened once again. It will be interesting to see if FDX experienced similar trends, or whether UPS’ trends were accented by its Teamsters contract ratification (see ATA data below). Our sense is FDX likely showed similar trends with relative strength most of the qtr. Int’l vols. remain solid.

WE REMAIN ON THE SIDELINES. Despite FDX’ seemingly appealing valuation at 13x our low end forward EPS, we continue to see risk from FDX’ contractor model going forward. FDX tends to update legal and tax issues related to its contractors during its 10Q filings right after earnings reports, so we believe there remains risk around earnings periods.

INVESTMENT CONCLUSION: FDX stock has remained under pressure with the rest of the market the past week and since UPS warned last Wednesday during its analysts meeting of slowing domestic volumes over the past six weeks. For the full year to date FDX is now down 5% compared to UPS down 2% and the S&P 500 down 12%.

FDX is currently trading at 13.3x and 5.6x our forward twelve month EPS and EV/EBITDA estimates. This compares to UPS at 15.7x and 8.6x . This also compares to FDX’ 1, 3 and 5 year averages of 14.1x, 15.3x and 16.6x and 6.0x, 6.3x and 6.6x . While valuation for FDX seems compelling, and we continue to believe we are close to a point where domestic operations are at a bottom relative to the economy, we continue to have longer term concerns about FDX’ Ground contractor model and FDX need to spend money to attempt to show less control over its franchisees. As a result gradually over the next five years we expect FDX past ten year Ground volume CAGR of 10% to decelerate towards 5%-6%, while we expect UPS to see its past ten year Ground volume growth CAGR of 2% to gradually increase to about 3%. For now we remain very comfortable on the side lines with a Peer Perform rating on FDX and an Outperform rating on UPS. We do not recommend playing FDX’ stock into the quarter one way or another as we expect solid earnings and continued tempered guidance, with the potential announcement of further legal, tax or operating changes around Ground in its release or 10Q filings. FDX remains rated Peer Perform.

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U.S. Postal Service hit hard by gas prices

Rising gas prices are hitting the budgets of businesses that maintain fleets of vehicles.
It now costs the U.S. Postal Service USD 8 million every time there is a one cent increase in the price of gasoline according to postal authorities.
Although the Post Service gets discounts because of bulk purchases of fuel, the price increases are forcing officials to find more cost efficient ways to operate.
Some changes being considered include packing mail more tightly to reduce the number of vehicles needed for transportation.

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India Postmaster: 'Post offices across India to be interlinked soon'

All the post offices across the country will be inter-linked in about a year’s time, a senior postal department officer said here on Tuesday.
Soon, the Indian Post will also function as a full-fledged banking organisation, he said, adding postal department was also considering to rent out prime spaces it had at several places for retail and other business.
Kumar said the postal department has also tied up with ‘Kerala Spices Board’ under which, one can place an order through the postal department for getting spices delivered at their doorsteps by post.
Besides, the department had also tied up with Assam tea and Tirupati prasad so that one can get these materials through post, he added.
Kumar said the department was also forging ties with telcos like BSNL, Reliance, Vodafone and Airtel to provide range of services and products like ‘Retail post’ and ‘Bill Mail Service’ verification of addresses and delivery of bills.
The post offices already distributes coins of denomination rupee one and two on the behalf of RBI, he said adding that the department was also reaching out to universities and institutions for the sale of their prospectus and other material under ‘Retail post.’

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Ohio urges DHL to reconsider UPS move

Ohio is asking the German owner of package delivery company DHL to reconsider a proposal that could mean the loss of at least 6,000 jobs at the DHL hub in southwest Ohio.

DHL wants to drop ABX Air and ASTAR as its air cargo handlers at the hub in Wilmington and replace them with Atlanta-based United Parcel Service. UPS would handle DHL packages at UPS’ existing hubs.

Ohio Lt. Gov. Lee Fisher says Frank Appel, chief executive of Deutsche Post World Net, told him Monday that he would be willing to explore other options, but made it clear that DHL intends to move forward with the UPS transaction.

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