Bernhard Bukovc, chairman of the Postal Innovation Platform, shares some insights from the organization’s latest trend report, highlighting how the parcel and postal market is facing increasing competition and a fight for market share in 2024
The Postal Innovation Platform (PIP) recently published its Postal and Parcel Trend Report 2024, which sheds some light on the trends, challenges and priorities that are shaping the postal and parcel market this year.
The report’s primary objective was to gain a deeper understanding of the challenges and priorities that postal and parcel companies are facing this year and over the next three to five years, while also recognizing the diverse nuances across different global regions.
The key trends for the postal and parcel sector in 2024 are digitalization, e-commerce, sustainability and a tougher economic environment combined with strong competition. The research shows that digitalization is considered to be the trend that will have the biggest impact on the postal and parcel industry in the coming years, with 83% of CEP executives supporting this view. Data is the driving factor for efficient postal and parcel processes, and digitalization is the backbone of any successful logistics operation.
Several services have been identified as industry priorities, including interfaces with customers, such as chatbots; digital wallets or solutions to empower customers to customize their services as much as possible; various types of e-commerce solutions; digital solutions for processing and visualizing flows with the ability to interfere and change the process; digital health and government services; cybersecurity; cross-border commercial solutions; and trusted digital communication services.
Competition and market share are at the forefront of the challenges faced by postal and parcel companies this year. Competition is high and business models are changing, with new market entrants and e-commerce platforms bypassing traditional postal and parcel streams and often building their own delivery networks. Out-of-home solutions accelerate this development.
The number-one challenge facing postal and parcel companies is maintaining and capturing market share in an increasingly competitive and changing environment. Therefore, postal and parcel companies are powering up with investments in their e-commerce service portfolios and offerings, including fulfillment solutions, marketplaces, returns and consumer convenience. Investments in first- and last-mile solutions, sustainability, digitalization and C2C solutions follow shortly behind.
The importance of digitalization as the overall driving trend in 2024 is also highlighted by the findings concerning the main challenges for 2024. Right after competition and market share, the adoption and integration of new technologies as well as cybersecurity are named as important challenges that the industry is facing.
According to the research, the top priority for this year, where the postal and parcel industry will invest most resources, is still e-commerce, which provides the growth opportunities for the sector. However, competition is getting tougher and market share is the main challenge postal and parcel companies must cope with. Investment in a stronger e-commerce market offering is the logical consequence, including investment in the entire e-commerce ecosystem.
The report also sheds some light on two particularly interesting areas within e-commerce: returns and the growing C2C market. The results show that the operators who can offer the best and most convenient services at a relatively low price will probably win a greater market share. Convenience is key, and for C2C solutions as well as e-commerce returns, the most important features are convenient access points (such as lockers) and label-free (no printer needed) opportunities.
Download the full report at www.postal-innovation.com/trendreport2024
This article was originally published in the June 2024 issue of Parcel and Postal Technology International.
