Post, courier benefit from online retail - Datamonitor

One of the areas that remained relatively buoyant internationally, despite the recession, is online retail which is leading to a rise in home deliveries. This is one of the findings from research by independent market analyst Datamonitor that revealed that this rise is benefiting post offices and courier firms contending with a difficult trading environment.

5 Feb 2010

A strong 2009 Q4 for e-retail saw retailers competing aggressively to capture share of festive spending by distributing discount codes and offering free delivery, so many consumers were tempted into purchasing their Christmas shopping online.

US home delivery rates up

In the US, both UPS and FedEx announced rate hikes for their home delivery products, indicating autonomous growth in this segment despite a fragile economy. “This offers these firms an opportunity to climb out of a situation of generally weak demand and downward pressure on prices,” said Datamonitor's senior analyst Erik van Baaren.

Europe eyes home delivery

TNT has shifted its focus on to the home delivery segment where, starting from its home market in the Netherlands, it has announced partnership agreements with large retailers to help them establish an online presence in Europe. The company aims to provide so-called special delivery solutions involving the functions of billing, technology, logistics and marketing for high-street retailers. Through this move, it is aiming to expand its remit within the home delivery market, away from just the delivery of parcels.

Van Baaren said, “As electronic substitution continues to ravage mail volumes and market liberalization has not yet materialized in Europe, forcing the company to partly withdraw from the European mail market, this is a necessary move that also hones in on current market trends within the retail market. It also reflects the growing importance to private consumers of a full-scale service portfolio that includes gift returns. This directly benefits those retailers that operate multiple sales channels.”

TNT's strategic intentions also follow an important trend in the European express market, as identified in Datamonitor's European Express Market Map 2009, which highlighted cross-border business-to-consumer volumes as offering the highest potential over the next five years.

With other factors such as demographic changes, better websites and consumers looking for online bargains, Datamonitor views this as a logical move that can help the express market recover.