DHL is planning to introduce more online and mobile services for parcel customers in Germany tocontinue benefiting from the e-commerce boom, a senior manager said. Meanwhile, deliveries for
insolvent customer Quelle have been resumed following a payment dispute.The parcels business is still growing despite the crisis and lower mail-order volumes thanksto the increase in e-commerce and the price-driven switch of express shipments to standard parcels,Andrej Busch, DHL Parcel Germany board member and head of marketing, said in a press briefing atlast week’s German logistics congress in Berlin.
While B2B parcel volumes would drop as a result of lower GDP this year, DHL expects B2Cgrowth of about 14% – 15% a year, Busch said. About 70% of DHL’s 2.5 million daily parcels inGermany are B2C or C2C items, he said. In 2008, DHL Parcel Germany had revenues of nearly €2.6billion.
Change in the parcels business is being driven by the internet, Busch stressed. Customers nowexpect simpler services that are always available, and technology is changing how parcel operatorsview the market.
“In the past, service providers were focused on shippers. Today there is more pull fromcustomers. There is more recipient focus,” he pointed out. German online shoppers, for example,often had a choice of having their goods delivered by DHL or by Hermes. “So we have to convincecustomers through the service that they experience,” he explained.
A forthcoming product innovation next year will be the introduction of an SMS messagingservice informing customers in advance when their goods will be delivered. “Recipients will havethe option of changing the time of delivery,” Busch said. A re-routing option, instructing DHL todeliver to an alternative address, could follow one year later. This would probably carry anadditional charge.
DHL is also thinking about using electronic identities rather than home addresses to identifycustomers. This would enable consumers to create profiles with information such as their preferreddelivery addresses and times. The ID could also be used for deliveries of ‘Internet letters’, thesecure e-mail system currently being tested by Deutsche Post, as well as for e-commerce activitiesand payments, Busch said.
“An address is not the best way to identify a person. An e-mail address, for example,identifies a person better than a (home) address,” he stated. “An e-mail always reaches the person.That has to be the future for parcels.”
DHL is also focusing strongly for growth on the Packstations parcel collection and drop-offboxes, which have now been rolled out at 2,500 highly frequented locations across Germany, such asrailway stations, shopping centres and major supermarket stores. There are currently some 1.2million registered users but DHL believes there is a potential customer base of some 10 millionGerman households. Between 5% and 10% of DHL’s parcel volumes are delivered to the Packstations,Busch said. An average of 10 parcels are delivered daily to each box.
Asked about the return on investment for the expensive hi-tech and physically securePackstations, Busch commented: “The Packstations will pay off over the long term. The business caseis also a question of customer loyalty.” Packstation customers, for example, order about 30% moregoods online than other consumers, resulting in higher parcel volumes. Delivery is now the numbertwo criteria for online shoppers, he pointed out.
DHL is now building up an online shopping community through its ‘Meinpaket’ portal, whichfeatures an online product search engine, price comparisons and exclusive offers, together withonline orders and deliveries to a Packstation. “Our role cannot be only to deliver the parcel. Thatwould make us into a commodity,” Busch declared.
* DHL temporarily stopped deliveries of Quelle parcels in Germany this week over concernsthat it might not be paid by the insolvent mail-order company. Deliveries were resumed today(Friday) following negotiations. Deutsche Post DHL CEO Frank Appel said: “Now that it has beenensured that our service will be paid, we will resume service again today and will provide ourservices as usual.”
Quelle has launched a mass sale of all remaining goods at bargain prices next week before itis closed down with the loss of some 6,300 jobs. Some 18 million goods are currently in itswarehouses and will be delivered by DHL once they are sold. DHL will close down threelogistics centres operating for Quelle with the loss of 400 jobs after 320 DHL staff working forQuelle already lost their jobs earlier this year due to declining volumes.
