Showing posts with label document. Show all posts
Showing posts with label document. Show all posts

Tuesday, November 24, 2009

The Future of the Document is the Future of Mail

In order to understand the future of mail, one needs to first understand the future of the document. The word "document" immediately congers up an image of a written, printed format. That image is too narrow in today's multi-modal communications world that includes information that can be provided printed on paper but also in numerous forms on a computer display or in text-messages, or other format on a wireless smart phone.

At the recent Document forum, Craig Le Clair of Forrester Research illustrated that companies develop three types of documents: Structured documents - identical or nearly identical documents that are sent to a large number of recipients at the same time;
On-demand documents - documents that are created in a way that allow the recipient to receive the document on their own schedule; and
Interactive documents - documents that use personalized information to create a document designed for one person. A fourth type of document, called Transpromo, represents an interaction between structured and interactive documents. These documents reflect the ability of new digital printers to develop personalized documents but print them as if they were a structured document. As such they neither fit the structured or interactive category but fall somewhat in between.

As the chart above shows mailed documents are primarily structured documents and to a lesser extent interactive documents. In both types of documents, and the transpromo documents that fall in between, the sender determines the schedule that the recipient receives the document.

The recent declines in mail volumes and shifts in mail mix reflect the growth of on-demand documents and a shift from structured and interactive mailed documents to their digital alternative (e-mail.).

Shift from Structured to On-Demand Documents
The documents that have shifted rapidly in this direction include financial payments and printed news and opinion, price lists and big-book catalogs. Travel and college brochures and catalogs are other examples of structured documents that have been replaced with websites that allow the recipient of the message to view information that once was printed.

Shift from Interactive to On-Demand Documents
The entire process of distributing specific prices to specific customers has changed so that much of this is produced. The use of web forms allow customers to do the paperwork on their own schedules that once required printing in an office. (Just think of how different the process is of opening a bank or brokerage account or making changes to the account. While a bank officer can combine your personal information into the loan documents in the branch off of the bank's computer, individuals can now do it on their own schedule without requiring the bank employee to act as an intermediary.)

Shift from Mailed Interactive to E-mailed interactive
This is the shift of personalized documents from printed to digital form. Business correspondence reflects this change. Also collaboratively produced documents that once were sent hard copy to other writers by mail or Express, now are sent as file attachments to that all parties can edit digitally, allowing the original author to make changes faster than ever before. E-mail also allow writers to use structured digital documents, whether in the form of pdf files that cannot be altered by the recipients in formats that are less restrictive.

Shift from Mailed Structured to E-mailed Structured
E-mailed structured documents are mass mailings from one sender to many recipients. These documents include:notices of bills and statements, newsletters, notices of new web content that is available for viewing, advertisements from vendors that the recipient has allowed to send e-mail and pernicious spam promoting get-rich-quick schemes or spreading viruses.

In many ways structured e-mail is nothing more than an digital glossy envelope. The real content is either an attachment to the e-mail or on a site which can be accessed by clicking on the link on the e-mail.

The one problem that senders have with e-mailed interactive and structured documents is that the recipient treats the messages, attachments and links in a similar fashion to on-demand web content. The more e-mail that the recipient gets the more likely that a particular message will be ignored until after the sender would like the e-mail viewed. The sender wants the recipient to look at the attachment or click on the link and take the appropriate action. For example, companies that e-mail bills want the link clicked so that the bill is viewed and payed. Advertisers want the advertisement clicked so that the advertisement is read and a sale made.

Senders of digital documents have found that mail can help increase the value of the documents that they have shifted to digital formats. Mail sent in conjunction with e-mails increases the sales that the the e-mail generates. Websites that offer a full catalog of products, describe a college, provide information on resorts or the schedule of a theater or outside venue will more likely be be accessed if potential customers receive mail enticing them to look. The combination of mail with e-mail and website content is receiving the greatest attention among advertisers but those sending bills and statements may find that combining post cards with e-mail bills may increase the speed that customers pay.

The mail sent from now forward will be different than what was sent before. Many mailers will find that electronic delivery is sufficient without supplementary encouragement of mail. For these senders, mail will become a legacy delivery method available only existing customers who have not chosen to switch to electronic delivery or to those new customers that request it. This is the expected direction of transactional mail, mail that represents over half of First Class volumes.

Those customers that that still use mail will use formats that are smaller and lighter generating less postage per piece. The proportion of letters, flats and cards will shift as customers experiment with formats that minimize their paper, printing, and postage costs. J.C Penney has announced that this fall it will send its last big book. J. C. Penney is not abandoning the mail. Instead it will send smaller specialty catalogs tailored to the interests of the recipient, directing them to the website for both a wider selection of options and the order process. Eddie Bauer has replaced some of its catalogs with post cards that direct the recipient to the website to see all of the deals available.

In the next six months, various parties will propose business models for the Postal Service. The viability of these models will depend on whether they will allow the Postal Service to adjust fast enough to decisions senders make regarding how they will produce and send documents and the impact that this will have on mail volumes, Postal Service revenues and the operating networks necessary to sell, collect, transport, sort and deliver mail.

Note: If you would like a clearer picture of the drawing, e-mail me at alan.robinson@directcomgroup.com and I will send the PowerPoint slide.

Monday, September 28, 2009

Xerox and the Future of Mail

Today, Xerox announced the purchase of Affiliated Computer Services (ACS) in a move that Xerox investors clearly found troubling causing the price to drop by 14%. This move should trouble postal stakeholders as well as it sends a strong message regarding what "the document company" thinks about the future of printed documents.

Xerox's business currently is focused on three business segments: 1) equipment for producing / scanning documents in an office; 2) equipment for producing documents in production settings; and 3) document management outsourcing. With the merger, Xerox's reliance on the future of paper documents drops from 100% to 67%. (See Xerox's presentation on the merger.) Steve Gerbel, founder and president of Chicago Capital Management called the merger a "transformative fix." Xerox's presentation to analysts, clearly expects that its future growth will come from the merged company's non-document based business and over time "the document company" will not be as dependent on paper documents.

Why does this matter to the Post? Now, the leading firm designing machines, processes, and software to handle paper documents will now help their customers move the document based, mail-delivered processes to electronic, Internet-delivered processes. Xerox's decision to seek a way to continue to serve existing customers as they abandon documents to the Internet suggests that senior management no longer sees growth prospects in print. The thinking behind Xerox's merger decision should provides postal stakeholders worldwide a wake-up call about the long term prospects of hard-copy delivery.

While some of the 14% decline in Xerox stock, reflects the dilution of current shareholder's holdings, I would argue that the size of the decline also reflects a major revaluation of the value of Xerox's document based business. If the financial market now thinks Xerox's document based business is worth less today than it was yesterday, then the financial market could soon realize that it needs to rethink the valuation of the printers, paper manufacturers, mailing equipment suppliers, and the document-delivery portion of the publicly traded Posts as well.