A report in the August 2nd edition of the New York Times reports that the Internet has resulted in an increased volume for the US Postal Service. This conclusion was against most people’s prior expectations.
On the one hand, e-cards, paying bills online, filling in forms online have all taken business away from postal services. In 2005 the Postal Service reported a 1% drop in first class mail compared with 2004.
On the other hand, the high street’s loss in terms of buying online is the postal services gain, as is e-bay. The increase in the Postal Services parcel services was 2.8% from 2004 to 2005. It is estimated that in the US e-bay packages alone account $1billion worth of postage.
The New York Times quotes James Cochrane, manager of package services at the Postal Service “Six years ago, people were pointing at the Internet as the doom and gloom of the Postal Service, and in essence what we’ve found is the Internet has ended up being the channel that drives business for us,”.
The fact that the Internet has turned out to be a driver of business rather than a killer shows the difficulty in making predictions, and the dangers of doing so with yesterday’s values.
The story reminds me of a project in the UK, in the mid-90s, looking at OTC (Over the Counter pharmaceuticals). The project noted that over the next 20 years the population would age considerably. So, the project team reasoned that the demand for products such as corn plasters, haemorrhoid cream, and heat sprays for arthritic limbs and joints should all increase. However, they had assumed that tomorrow’s 60 year olds would be like their grandparents. They had forgotten that the fifty-somethings were the baby boomers who had rocked through the 60s, 70s, 80s, and 90s breaking rules and creating the ‘me’ society. With the advantage of hindsight it is clear that the growth has been in men’s grooming, anti-aging creams, and Viagra!
With thanks to ScuttleMonkey
Considering how recently it was reported that the U.S.P.S. was in danger financially, their decision to move so many services online seems like it was a sound one and may very well have turned things around for that entity.
Posted by: panasianbiz.com | September 07, 2006 at 05:14 PM