Chris Stevens, Head of Industry Distance Selling - Global Sales Management, Swiss Post International Management AG & Sonja van Dorslaer, General manager van Swiss Post International Belgium
Thanks to the impressive development of e-commerce, recent years have proven successful for distance sellers, despite challenging economic conditions. In Europe, online sales have doubled since 2005. Growth rates in most European e-retail markets exceeded 20% in 2011, an d the majority of consumers are now buying online as internet sales nudge closer to the 10% of all retail sales mark. However, there are major differences across European countries; payment insecurity, privacy concerns, and lack of trust barriers still exist. Cross-border sales represent a small percentage of online transactions, where concerns about international shipping and the lack of cost transparency still hold back sales. In responding to customer needs and those of merchants and online sellers, the need for a competitively-priced, reliable European packet and parcel network, coupled with visibility of the actual landed cost of shipping has never been greater. Swiss Post will highlight various distribution options and customer-driven service features that are available to help Belgium-based merchants achieve greater online sales within and beyond Europe.
In depth appreciation of the key trends driving cross-border e-commerce. Assessment of the barriers that still exist, and how merchants (SMEs and larger sellers) can benefit from an effective high-quality parcels network. Visitors will also be given an overview of the total landed cost model being developed by Swiss Post to help boost cross-border sales through transparent shipping costs and total visibility.
1. growth
‘Staying At Home Is Not An Option’
Helping Merchants Boost Cross-Border e-
Commerce Sales
eShop Expo, Brussels
28 March 2012
Chris Stevens – Head of Industry Distance Selling
Swiss Post International Management AG
Global Sales Management (GSM)
2. Fact
>85% of the world’s online population
has used the Internet to make a
purchase.
AC Nielson Global Online Survey January 2009
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 2
3. “By 2014 Swiss Post Selling Industry
The Distance – with and through its
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post
4. Market Definition
the distance selling industry
DISTANCE SELLING
Mailings / Online (e-shop) Mobile T-Commerce Direct selling
Catalogues
e-Commerce
Business to Consumer Business to Business
Consumer’s perspective - any order made in an e-shop
Domestic Cross Border from a non domestic retailer.
Integrates both channels and provides the
most competitive delivery option depending
B2C Mail B2C Parcel on weight and/or value
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 4
5. Sizing the Cross-Border Opportunity - Europe
orders for physical goods
EU population 2010: ~ 501 Mio.
37% made at least one on-line purchase in 2010
4% shopped from a country outside the EU
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 5
6. Challenges - Europe
cultural and legislative
◙ 27 countries in the European Union
◙ Own customs and tax authorities
◙ 23 official languages
◙ Plus Norway and Switzerland
◙ One single currency – the Euro – plus other currencies (GBP, SEK,
NOK, CHF)
◙ A single EU customs territory with ‘no borders’, but…
◙ Separate tax rules and regulations
◙ Import VAT and Duty payable in state where goods enter the EU
◙ Exceptions: LVCR (Low Value Consignment Relief) for low value items
◙ Off-shore fiscal representation options exist
◙ How to offer a single, workable, cost-effective solution for Europe?
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 6
7. Business opportunity
future growth potential
Almost a quarter of persons aged 16-74 in the EU27 have never used the internet
% of individuals who have never used the internet, 2011
Source: Emota
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 7
8. Consumers: Cross-border shopping
common in the Nordic countries, developing across Europe
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 8
9. Barriers and Needs
“By 2014 Swiss Post – with and through its
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post
10. Overview
the e-commerce value chain
Customer data & Online Order Warehousing & Customer Care
Marketing appear- management Distribution
ance
New Existing Shop Billing & Order Warehousing &
Warehouse Delivery Return Customer
customers platform payment preparation Mgmt Service
customers Distribution
− Online Mining
− Data − Online − Individual − Country − Delivery − Central − Customs − − Consumer
Pickup points
Campaigns
− Customer Campaigns Shop specific cost stocking − VAT support
− Quality check
− offline − offline platforms payments calculator − Inventory − Track &
segmen- − Home − Restocking
Campaigns
tation Campaigns − SME − Credit check (guarantee) management Trace
delivery − transport
transpor- to
− Data Mining
− Loyalty pro- − Data Mining platform − Payment − Pick & pack
retailer
tation to
grams
− Customer − Customer guarantee − labelling
retailer
segmen- segmen-
tation tation
− Social Media − Social Media
integration integration
− Address- − Address-
Management Management
− Search Engine − Newsletter-
optimization Management
− Third party − Loyalty pro-
Platform grams
management
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 10
11. Drivers and barriers
reasons for/against cross border shopping
Main drivers for cross-border Main barriers for cross-border
on-line shopping on-line shopping
1. Price 1.No need
lower prices, compare prices, better price due to Can find everything I need in my own country
lower taxes and exchange rates
2. Exclusive products 2. Lack of trust
Not sold in own country Quality of goods, not confident in receiving goods,
warranty
3. Wider range of products 3. Possible high delivery costs
4. Convenience 4. Complicated & long return processes
Any time of the day
Source: IPC Cross border e-commerce report 2010
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 11
12. What cross-border e-Commerce needs…
from a private consumer’s perspective
Shop
− Provide Search Engine or comparison site
promotion
− Provide retailer with innovative online promotion tools
support
− Find best process model for each
scenario to achieve competitive competitive end-to-end delivery cost
cost structure
− Provide escrow service to bring additional safety for Localized payment and escrow
retailer and shopper service
− Find ways to provide convenient return processes for each scenario
Transparent return
processes
− Use track& trace of higher valuable products
Secure and trusted home
delivery
− Develop calculator application and feed it with „total cost of order“ transparency
relevant data of products and overall delivery cost
and guarantee
− Choose the right product segments in
the respective scenarios product and/or price attractiveness
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 12
13. What cross-border e-Commerce needs…
from a merchant’s perspective
− Provide escrow service to bring additional safety for Localized payment
retailer and shopper and escrow service
− Develop calculator application and feed it with „total cost of order“
relevant data of products and overall delivery cost
transparency and guarantee
− Use track& trace of higher valuable products Secure and trusted home delivery
− Find ways to provide convenient return
processes for each scenario Transparent return processes
− Find best process model for each scenario
to achieve competitive cost structure competitive end-to-end delivery cost
− Provide Search Engine or comparison site
Shop promotion
− Provide retailer with innovative online/offline promotion tools
support
− Choose the right product segments in
the respective scenarios product and/or price attractiveness
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 13
14. What cross-border e-Commerce needs…
from a postal organisation’s perspective
Shop
− Provide Search Engine or comparison site
promotion
− Provide retailer with innovative online promotion tools
support
− Provide escrow service to bring additional safety for Localized payment and
retailer and shopper escrow service
− Develop calculator application and feed it with „total cost of order“ transparency
relevant data of products and overall delivery cost and guarantee
− Find ways to provide convenient return processes
for each scenario
Transparent return processes
− Use track& trace of higher valuable
products
Secure and trusted home delivery
− Find best process model for each
scenario to achieve competitive cost competitive end-to-end delivery cost
structure
− Choose the right product segments in
the respective scenarios product and/or price attractiveness
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 14
15. What consumers require
certainty, predictability and trust
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 15
16. Why are posts so interested in e-commerce?
huge potential
While e-substitution is the driver for the
decline in physical mail,
e-commerce is driving the
only significant growth in postal services.
IPC executive Forum on e-commerce, Oct. 2010
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 16
17. The positioning of B2C Parcel
“By 2014 Swiss Post – with and through its
helping merchants and SMEs go cross-
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
border
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post
18. The role of B2C Parcel
designed to facilitate cross-border e-commerce
November 2010
2011
2012
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 18
19. B2C Parcel
providing merchants with quality and reliability
100g to 30kg
26 countries
Best-in-class postal partners
Home delivery standard
Track & Trace: cross-border parcel
tracking in ONE system
Insurance 50 EUR per parcel or EUR
10 / kg (>5kg)
Single point of contact
Professional advice by your personal
Swiss Post customer advisor
Local prepaid return solution
Web-based customer interface
Additional services (e.g. PickPoint)
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 19
21. The importance of the shop platform
basis for international expansion
the online shop platform is the control centre of the entire value chain,
because this process step influences practically all of the downstream, but
also the upstream process steps
Shop platform seen as central control unit for the entire value chain
Successive modules are influenced by this control unit
Providing a shop platform means helping merchants grow
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 21
24. Integrated online payment via SwissPost
providing the best known online payment methods
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 24
25. The positioning of POWA
“By 2014 Swiss Post – with and through its
an international partnership designed for
partners – is the world’s acknowledged leader in
global cross-border fullfootprinte-commerce”
a rapid cross-border service
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post
26. POWA (and VENDA)
a stunning customer base
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 26
27. Creating International Sites
low risk, transaction-based model
• Traditionally companies try to layer multi-lingual, multicurrency into their
main e-Commerce site
• Brands are turning to new secure ‘private cloud’ technology to deploy
International sites using ‘cloning’
• Low-risk, fast deployment
• Dozens of sites in a few weeks
• Complementary to existing e-Commerce footprint
• PCI DSS Level 1 compliant – critical for foreign sites as some
countries have PCI compliance embedded into criminal law
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 27
28. The positioning of TLCS
“By 2014 Swiss Post – with and through its
partners – is the world’sblock to facilitate
an essential building acknowledged leader in
cross-border transparency
global cross-border full service e-commerce”
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post
29. Cross border shopping
why are consumers reluctant?
Transparency:
knowledge about total landed cost before closing the online deal
generates security for the shopper
Trust:
A guarantee that there will be no additional costs arising, offered by a
trustworthy company (e.g. Swiss Post) generates trust
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 29
30. Our Total Landed Cost Calculator Model
a robust gateway for e-Commerce built upon 3 key principles
Simple Shipping
We provide shipping label, necessary forms and indicia
Simple Pricing/Billing
Regionalized pricing by zones
Insurance, end-to-end tracking and address cleansing/correction at no
additional charge
Accurate pricing based on actual weight, detailed billing of each package
shipped
No more guessing.
Simple Tracking
End to end tracking across multiple carriers
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 30
31. Swiss Post
“By 2014 Swiss Post – with and through its
creating the infrastructure for
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
innovative cross-border e-Commerce
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post
32. Swiss Post
Excellence delivered
We see ourselves as your
partner. We make you successful.
We always produce
something extraordinary. Idea
Vocation
Originality Excellence delivered.
Promise
Corporate culture
We are already working
today on your success
We deliver Swiss quality tomorrow.
worldwide.
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 32
33. The positioning in Belgium
“By 2014 Swiss Post – with and through its
Assisting e-merchants to go cross border
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post
34. Services available from Swiss Post Belgium as from today
Customer data & Online Order Warehousing & Customer Care
Marketing appear- management Distribution
ance
New Existing Shop Billing & Order Warehousing &
Warehouse Delivery Return Customer
customers platform payment preparation Mgmt Service
customers Distribution
− Online Mining
− Data − Online − Individual − Country − Delivery − Central − Customs − − Consumer
Pickup points
Campaigns
− Customer Campaigns Shop specific cost stocking − VAT support
− Quality check
− offline − offline platforms payments calculator − Inventory − Track &
segmen- − Home − Restocking
Campaigns
tation Campaigns − SME − Credit check (guarantee) management Trace
delivery − transport
transpor- to
− Data Mining
− Loyalty pro- − Data Mining platform − Payment − Pick & pack
retailer
tation to
grams
− Customer − Customer guarantee − labelling
retailer
segmen- segmen-
tation tation
− Social Media − Social Media
integration integration
− Address- − Address-
Management Management
− Search Engine − Newsletter-
optimization Management
− Third party − Loyalty pro-
Platform grams
management
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 34
35. International distribution services
available out of Belgium
• Worldwide : B2C International / B2C Professional
up till 2 kgs
postal channel
low cost - no track & trace
• Worldwide : B2C Parcel
up till 30 kgs
B2C delivery service
value for money – track & trace
• Switzerland : B2C into Switzerland
duty free import solutions for consumers
• Norway: B2C into Norway
duty free import solutions for consumers
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 35
Chris Stevens – e-Shop Expo, Brussels March 2012 -
The internet has become part of the essential fabric of modern day life with people of all ages and cultures being on-line through various mechanisms – computer, tablet, smartphone. According to a recent global survey conducted by The Nielsen Company, over 85 percent of the world’s online population has used the Internet to make a purchase, up 40 percent from 2007, and more than half of Internet users are regular online shoppers, making online purchases at least once a month. Chris Stevens – e-Shop Expo, Brussels March 2012 -
As one of the world’s leading postal operators, Swiss Post International, through its customer-oriented subsidiaries, of which Belgium is an important company, is pleased to have the opportunity to discuss the e-Commerce industry here at e-Shop Expo. Since 2010 we have been embarked on a new Global Sales Strategy for international business of which Distance Selling is the most important industry. For us, DS comprises the ‘traditional’ mail order and catalogue distribution sectors, and the increasingly-important and rapidly-expanding e-commerce sector. Chris Stevens – e-Shop Expo, Brussels March 2012 -
The DS market is characterised by the ‘traditional segments’ of mailings, catalogues, teleshopping and now e-commerce. Today, we are going to look at the B2C area of cross border distribution and explore some of the developments being implemented to support merchants achieve greater online sales within and beyond European borders. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Main message there is a huge market potential for European merchants to develop effective and profitable cross-border online sales. Broadband penetration is increasing rapidly in Europe European consumers are becoming more willing to buy cross border, especially from neighbouring countries. The European Commission’s plans to create a ‘single digital market’ has at its core the goal to double e-commerce volumes by 2015. The EC puts the value of the European e-commerce market at and estimated Euro 120 billion with 70% of turnover concentrated in the three large markets of Germany, the United Kingdom and France. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Europe is a complex and changing region – it is multi-lingual, multi-cultural and a long way from being homogenous. Tax rules and regulations vary by country. Navigating through the differing VAT and Duty rules requires expert guidance and support. The LVCR rules are an additional complexity. For higher value items an exporter will need to register in each country if the sales level exceeds the limits. Centralised fiscal representation for Europe is therefore a must and exists today… Chris Stevens – e-Shop Expo, Brussels March 2012 -
Whilst there is an increasing prevalence of internet usage across Europe and Globally, the Eurostat figures confirm that around 25% of EU-27 individuals between the ages of 16 – 74 have never used the internet. Therefore, this clearly opens up the huge potential still ahead once many of those people come on line. Chris Stevens – e-Shop Expo, Brussels March 2012 -
We have recently completed a study of online and cross-border shopping in the Nordic region, which underlines that sales are growing exponentially in this region. Not only are Scandinavians buying from their neighbouring countries, but increasingly are willing to buy cross-border from other countries. The price and availability of product in the region is stimulating growth; an example is certain UK fashion e-retailers seeing 40% year-on-year growth in sales into Norway due to price competitiveness (Sterling‘s weakness against local currencies) and an increasing willingness to buy confidently from English- language websites. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Despite good news stories, there are still a number of barriers preventing consumers buying cross-border. The European Commission believes that around 50% of all consumers avoid making x-border purchases due to the perceived price of services, quality of service issues, delivery information weaknesses and the lack of effective payment systems. Chris Stevens – e-Shop Expo, Brussels March 2012 -
We have developed a Value Chain approach to identify and address those gaps between customer needs and what a postal operator must put in place to develop an effective on-line range of services and solutions and thereby grow its business. The next part of my presentation will focus on what those gaps are and how merchants are responding in working with us. Chris Stevens – e-Shop Expo, Brussels March 2012 -
The drivers behind e-commerce growth are well known, but there are still barriers which slow down cross-border shopping: TRUST – will my goods be as ordered, will they arrive, and what about warranties if things going wrong? COST – will it always cost more to shop from overseas? RETURNS – this can be complicated and a complex process. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Looking at the consumer’s needs for cross-border e-commerce we see that the ‘total cost of order’ transparency and guarantee are fundamental. Abandonment at the checkout stage is a problem facing all online retailers and this is especially true for cross-border sales. It’s all very well knowing what the price of the product is at checkout, but who wants the surprise of a nice bill at delivery for shipping, customs clearance costs, duties and taxes? This leads to high levels of rejected and returned shipments and pretty unhappy customers! Chris Stevens – e-Shop Expo, Brussels March 2012 -
Merchants need support in the promotion of their shop and product range as a key area of support that post offices can give. We see that merchants want to work with partners that can help boost online sales. For us, this value added approach is bringing benefits as you will see later. Chris Stevens – e-Shop Expo, Brussels March 2012 -
From a post office’s perspective, our core business is delivery; historically that has been through usual postal channels (unguaranteed, with little or no added value) but increasingly customers expect us to become more integrated into their value chain. Competitive delivery (often through alternative distribution partners) has become the norm. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Investigating shopper behaviour and expectations, it is clear that for a shopper - when buying cross-border - certainty about the whole cost – of product and transportation - is very important. Predictability You need to control the whole delivery channel in order to provide predictability. Trust A recent European Commission study on cross-border online shopping behaviour, reveals that almost half (48%) EU consumers were more confident when ordering goods from sellers in their own country. Chris Stevens – e-Shop Expo, Brussels March 2012 -
I am sure that all my postal sector colleagues here today would agree that e-commerce offers the best, if not only route towards growth as we see a global decline in physical mail such as correspondence and transactional mail. Our infrastructures are being adapted to cope with the expansion in e-commerce volumes here in Europe, the Americas and Asia-Pacific. Chris Stevens – e-Shop Expo, Brussels March 2012 -
I wish to spend a few minutes now exploring some of the innovations underway designed to help merchants develop their cross-border businesses. The first innovation is B2C Parcels – this type of service is also being implemented by our industry competitors and the integrated carriers, but their networks are designed to handle B2B business and are struggling to cope with the demands of a B2C network. Chris Stevens – e-Shop Expo, Brussels March 2012 -
The service covers shipments up to 30kg with track and trace as a standard feature. Customers can access the system through a web-based interface and also have the option for a pickpoint delivery to cope with the customer demands should they not be at home to receive parcels. We handled over 100,000 parcels in the pilot phase and now major e-commerce companies are lining up to join the network. Chris Stevens – e-Shop Expo, Brussels March 2012 -
We have identified earlier that merchants require support in developing a web presence that can help them expand cross-border. This is particularly true for SMEs and even larger companies that wish to sell overseas. We have developed turnkey solution called ‘GoCommerce’ which provides an integrated webshop programme. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
‘ GoCommerce’ is a low risk programme for Swiss companies which eliminates the need for an investment in shop programming software and payment systems – Swiss Post handles the entire design, implementation and management process leaving the merchant free to concentrate on sales. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
Today we are going to build a simple website on a standard template, but you can use a designer toolkit to create custom templates that you can deploy into multiple sites. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
1. We see ourselves as a partner to our customers. Swiss Post offers its customers ranges, solutions and advice tailored to their requirements. 2. We make our customers successful. Swiss Post thinks ahead on behalf of its customers. We involve ourselves in our customers' processes and develop customized services that are both innovative and unique. 3. We are already working today on your success tomorrow. On a daily basis, Swiss Post refocuses on behalf of its customers. We are thinking today about what challenges you will face tomorrow. 4. We deliver Swiss quality worldwide. Swiss Post demonstrates expertise, commitment and flexibility. We work in partnership with our customers, partners and suppliers. 5. We always produce something extraordinary. Swiss Post is well-known for shaping the future of the markets through its industriousness, expertise and reliable innovations. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -
We have developed a Value Chain approach to identify and address those gaps between customer needs and what a postal operator must put in place to develop an effective on-line range of services and solutions and thereby grow its business. The next part of my presentation will focus on what those gaps are and how merchants are responding in working with us. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Today we are going to build a simple website on a standard template, but you can use a designer toolkit to create custom templates that you can deploy into multiple sites. Chris Stevens – e-Shop Expo, Brussels March 2012 -
Chris Stevens – e-Shop Expo, Brussels March 2012 -