2011 is shaping up to be the year digital postal mail goes mainstream.
This follows years of experimentation, numerous market tests, extensive technology development and a decade-long feeling that “there’s got to be a better way, but we’re not there yet.” And we weren’t.
However, improved technology, coupled with greater consumer awareness, means we are there now.
Digital postal mail is more than a reality in 2011; it is becoming an important way for mailers to save money. Postal rate hikes and environmental concerns have focused mailers’ attention on the benefits of going paperless.
Over the years, entrepreneurs, venture capitalists and mailers themselves have spent large sums to create electronic alternatives to postal mail. Thus far, none have generated broad consumer interest. The industry’s best-case average for paper suppression is a woeful 15 percent.
That low success rate has created a great opportunity for companies seeking to “do it right” by developing solutions that meet mailers’ needs and delight consumers.
Zumbox is of those companies.
The technology is ready, mailers recognize the need, consumers want a “better way” and I am expecting spirited competition as different approaches emerge, which is good for everyone.
This is the first in a series of posts intended to help mailers better understand digital postal mail and the vendors in the space. The first deals with market realities that should be considered in making a decision about which provider(s) to select.
As CEO of Zumbox, I am obviously biased toward our solution, which has been more than three years in development and underwent extensive market testing in 2009 and 2010. However, several companies are emerging and each offers a different value proposition. I expect more than one will reach mailer and market acceptance and become a commercial success.
As the market develops, large mailers will likely choose to work with more than one provider of digital postal mail services. We are hearing from mailers and service providers across the industry that they plan to support multiple approaches from three to four different vendors in an effort to let the consumer markets decide who is really the winner. We are also gratified to hear from them that Zumbox is always on that list as the leading innovator of the digital postal mail market since 2009.
This makes sense because consumers will be the path to success and mailers will want to work with the providers that offer the easiest and best way to reach different types of consumers.
Exclusive Don’t Make Any Sense
The relationships Zumbox forms with its mailers, print service providers and mailing industry technology providers are expressly non-exclusive across the board. Our clients and partners should be free to choose the vendors they wish to work with, unconstrained by complicated legal agreements. (While we have heard of other vendors asking for exclusives in these relationships, the most common reaction from mailers seems to be “How stupid do they think I am?”)
The necessary communications infrastructure, absolute requirements for encryption, secure transmissions, availability, redundancy with the ability to meet high service levels in these areas, plus mandatory requirements for real privacy and security will limit many companies from entering and succeeding in the digital postal mail business.
I believe there will be three to five market participants who successfully enter the market and begin serving customers. From that group, consumers and mailers will choose an even smaller number of winners.
Why This Is the Time to Choose
While I believe Zumbox is a best-of-breed provider that understands, after 18 months of market testing with consumer households, exactly what the consumer wants, there is probably no wrong choice for a mailer today except for choosing not to participate. Even if you don’t choose Zumbox, I strongly urge you to choose somebody to work with now, provided that they can deliver the security, privacy, integrity and consumer experience that customers require. You should begin to realize cost savings and learn from the experience in 2011.
The opportunity to provide consumers – perhaps your customers – with the solution to their paperless worries is too great not to dive in at this point. For forward-thinking mailers that are always looking to enhance customer communications and increase paper suppression rates, exploring digital postal mail is on their top list of initiatives today and beyond.
In my next post: I will offer specific criteria you can use to select a digital postal mail service provider, including security, privacy and the necessary consumer experience. In the meantime, please feel free to contact me directly with questions or to find out more about working with Zumbox.
