NZ Post looks to be digital postie

20:13, Oct 16 2011
NEW APPROACH: Paul Reid, NZ Post's head of technology innovation, has swapped his desk for a lazyboy chair and a laptop.
NEW APPROACH: Paul Reid, NZ Post's head of technology innovation, has swapped his desk for a lazyboy chair and a laptop.

Paul Reid, the man charged with bringing New Zealand Post into the digital era, has done away with his desk and reclines in a black leather lazyboy, laptop at the ready.

He says it's for comfort reasons more than anything else but it seems a fitting, new-age set up for the general manager of innovation and technology.

The exodus to email for personal and business communications means postage volumes – and NZ Post's profits – are plummeting.

"Snail mail" companies around the world are facing the same challenge – the United States Postal Service has posted multi-billion dollar deficits for the past four years.

But unlike its US counterpart, which has begun an advertising campaign warning people of the security risks of email, NZ Post is after a slice of the online communications pie.

Reid believes NZ Post still has an important role distributing mail, particularly parcels, "but its relevance to start-up businesses has been slowly eroding".


"If you think back 20 years ago, when you started a business one of the first things you did was open up a post account. That was your primary access to your potential customers and consumers.

"Today, what's the first thing you do? You get a website and you'll actually change your company name if you can't get the website address."

NZ Post's Yellow Pages rival Localist, yet to expand outside Auckland, aims to be the place where small to medium-sized businesses interact with their consumers online.

The company's site, which launched three months ago, now has more than 47,000 businesses listed and in the past month notched up 138,000 unique visitors.

That community of businesses could make use of NZ Post's digital mail channel – which would provide a secure means for sending and receiving mail such as bills and receipts online, but also integrate with other systems, such as accounting systems, saving hours of transferring or rekeying data.

NZ Post handles about 800 million items of physical mail, including parcels, a year.

Reid says about 400 million start out their life in a digital format, and half of those are already processed by its business mail subsidiary Datam – previously called Datamail – putting it in prime position to be New Zealand's digital postie.

NZ Post plans to launch a beta version of the channel to test the concept before a full market launch early next year.

It will initially be for business-to-business communications but could also be opened to consumers so, for example, they could receive their bills electronically via NZ Post.

Trust, or knowing who you're dealing with, is key to doing business online, and NZ Post's reputation means it's well positioned to play a role in guaranteeing that trust, Reid says.

It has struck a deal with Internal Affairs to provide biometric identity verification at its retail stores – taking digital photographs of people and checking their credentials – for the Government's $122 million iGovt identity verification scheme, which will allow people who have verified their identity to conduct secure transactions with a range of government agencies online.

The company is in discussions with private sector players, who could also use the service to let their customers do more online.

"If you have one of these identities you'll be able to open up a new bank account online. Everyone's interested. If you're a merchant selling alcohol, or if you're a company providing any goods and services online who are you sending the bills to? An email address is just an email address."

That identity service will complement the online mail channel, Reid says, allowing businesses to send electronic mail to "a pool of consumers that are verified in the digital world".

The company plans to revamp its NZ Post and Kiwibank branches, and has begun opening concept stores in the Kapiti Coast, which let people pay bills at self-service kiosks.

People are becoming increasingly comfortable with the technology – "you don't go to an airport now and not expect to check in at a kiosk" – and could in future use video kiosks at its stores to video conference with banking and other specialists, Reid says.

NZ Post has also developed software that will let online businesses use its address and postal rate information on their sites, so their customers see exactly how much it would cost them to have something delivered – rather than a generic shipping cost – and have the address form automatically filled in after typing in just a few letters.

"It's about enabling New Zealand businesses to transact online a lot easier."

Critics of NZ Post's digital initiatives have warned they could cannibalise its core business but Reid says it has little choice.

"It's happening regardless. Your strategic decision is to sit back and watch, or be part of it.

"New Zealand Post faces a series of challenges that everyone is fully aware of and for me personally that's why I joined this company. It's going to be an exciting journey over the next three years."

The Dominion Post