(DRAFT) - Asia Pacific Post Cooperative 2020 - APP Country Guide

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APP ePacket Marketing Strategy

                                               (DRAFT)

                                               Asia Pacific Post Cooperative
                                                                                            2020

                                                                                           Our Vision
                     To bring APP ePacket to be the first choice of e- commerce market in Asia Pacific.

Doc 5 – APP ePacket Marketing Strategy Draft
Table of Contents
1. Brief Summary
            o    Introduction
            o    Background
            o    Situation Analysis
            o    Service Description
            o    Service Network

2. Segmenting, Targeting, Positioning
            o    Segmenting
            o    Targeting
            o    Positioning
            o    Tagline
            o    Branding

3. Product Features
            o    Weight & Size Limit
            o    End to End Transit Time
            o    Tracking status
            o    Delivery option
            o    Insured service

4. Competitive Strategy

5. Marketing Mix Strategy
            o    Product
            o    Price
            o    Promotion
            o    People
            o    Process
            o    Physical Evidence

6. Long Term Milestone

Doc 5 – APP ePacket Marketing Strategy Draft
1. Brief Summary
Introduction
APP ePacket, is a service platform run by Asia Pacific postal operators. As a common platform, the
success of APP ePacket will depend upon all operators who join the network. Thus, the same
understanding on what values to be created, what strategy to take to win the competition, and how
to create and deliver the values through this service is a to priority to all postal operators in the
network. The gap or the difference understanding on those areas will lead to counter productive
efforts and be difficult to produce synergistic output. The formulation of APP ePacket Marketin
Strategy aims at providing a reference to all operators and everyone who take a role in creating,
communication and delivering values of APP ePacket.

Background
Asia Pacific Posts community is aware that e-commerce transaction is growing fast from time to time.
It goes along with the growth of the internet and mobile phone users in this digital era. At the same
time shopping behavior is also changed to most population in this world. In 2019, it is predicted that
nearly 50% of the population in Asia Pacific are using internet. Meanwhile, the number of digital
buyers in 2019 is predicted 1.9 billion all over the world. The share of e-retail sales in 2019 will be
13.7% of all retail transaction in the world.

The e-commerce transaction trend basically does not replace the current cross border document and
goods traffic from individual and business markets. Document and goods traffic from individual and
business markets are still there. However, the promising future of cross border e-commerce traffic
needs to be responded by postal operator in Asia Pacific.

With the view to respond the needs of e-commerce market, APP ePacket was created in 2015 to keep
postal operators in Asia Pacific relevant to market.

Situation Analysis
With the view to respond the needs of e-commerce market, APP ePacket was created in 2015 to keep
postal operators in Asia Pacific relevant to market.

Some figures below will show the urgency of postal operators in Asia Pacific to respond the needs of
e-commerce market.

Doc 5 – APP ePacket Marketing Strategy Draft
E-commerce share of total global retail sales       E-commerce share of total retail in the Asia
 from 2015 to 2023                                   Pacific region in 2018/19

 Number of internet users in selected countries in the Asia-Pacific region as of January 2019, by
 country

                                                                              Source: Statista Research

A survey by Rakuten Marketing in 2019 to 4,500 consumers across nine key markets within APAC,
on the purchasing behaviour of customers from some APAC Countries (Australia, China, Hong Kong,
Singapore, South Korea, Malaysia New Zealand, Japan and India) showed the following data:

Doc 5 – APP ePacket Marketing Strategy Draft
IN-STORE                         ON-LINE SHOPPING
      COUNTRY
                               (OFF-LINE)         DESKTOP/LAPTOP     MOBILE                                   TABLET
 AUSTRALIA                         64%                 18%             13%                                      5%
 CHINA                             39%                 21%             32%                                      8%
 HONGKONG                          57%                 14%             21%                                      8%
 SINGAPORE                         54%                 21%             19%                                      5%
 SOUTH KOREA                       47%                 23%             25%                                      4%
 MALAYSIA                          51%                 16%             24%                                      8%
 NEW ZEALAND                       67%                 18%             13%                                      3%
 JAPAN                             62%                 20%             14%                                      4%
 INDIA                             40%                 22%             29%                                      9%
 ALL COUNTRIES                     53%                 19%             21%                                      6%

Some market data from APP members show the following figures and information :
  1        Postal Operator               China Post Group           Korea Post           Philippine Post      Thailand Post

  2    Market Size of Cross-        USD : 12.339 billion       USD : 7.2billion                               USD : 4,313
       border e-commerce                                       Online shopping sales                          Million
       (estimated-2019)                                        in 2019 was 7.2billion
                                                               USD, which had gone      No data available
                                                               up 65.4% compared
                                                               to the same period in
                                                               previous year.
  3    Market Share in Cross-       USD : 4.167 billion        USD : Unable to get
                                                                                                              USD : ……%
       border e-commerce            % : 33.77%                 the exact data, but
                                                                                        No data available
       (estimated - 2019)                                      we take up just a                              Not available
                                                               small portion for sure
  4    2 Main Competitors in        A.     4PX                 A Global carriers like   A 2Go                A. DHL
       cross border e-commerce      B.     Yanwen Express         DHL, FEDEX, UPS       B LBC                   eCommerce
                                                               B Platform                                       Thailand
                                                                  companies like                             B. Local
                                                                  Coupang, G market                             consolidators
  5    Market Share :               Competitor A= 8.68%                                                       Not available
                                                               No data available        No data available
                                 Competitor B = 4.63%          No data available         No data available    Not available
  6    Competitive Advantage of Competitor A (4PX)             Competitor A             Competitor A
                                                                                                              Competitor A :
       Competitors:             • Independent                  • Reasonable Price       (2Go)
                                  commercial clearance           and service quality     • Country-wide       • Flexible price
                                  capacity                     • Various                     shipping
                                • More tracking events           customized options
                                  including customs              like DDP
                                  event and flight event
                                 Competitor B                  No data available
                                                                                        Competitor B         Competitor B :
                                • Competitive market
                                                                                        (LBC)
                                  price                                                                       Not available
                                • Powerful network to                                   • Country-wide
                                  integrate information                                   shipping
                                  from various parties                                  • Unique cross-
                                  including seller, carrier,                              border package
                                  airline, customs and                                    forwarding
                                  partners for final                                      services
                                  delivery

Doc 5 – APP ePacket Marketing Strategy Draft
7     Main Challenges to        •   Fierce price         •   Inflexibility in rates •   Dominance of
                                                                                                             • Price
       acquire cross border e-       competition from the •   DDP                        cash-based
       commerce market                                                                                         competition
                                     competitors                                         transactions
       (export)                  •   Unstable operation                             •    Logistics           • Sales team
                                     performance                                         concerns as         • Service quality
                                 •   Increasing costs for                                Philippines is an
                                     all ends                                            archipelago
                                                                                    •    Internet
                                                                                         connectivity
                                                                                         while with high
                                                                                         mobile phone
                                                                                         and social
                                                                                         media usage

Service Description
APP ePacket is a postal delivery service platform agreed among APP Cooperative members to
exchange e-commerce goods among APP members with specific features developed in accordance
with the needs of e-commerce market.

Service Network
The main network of APP ePacket is Asia Pacific Postal (APP) Operators. However, Non APP
Operators will be the secondary network of APP ePacket.

Currently there are 23 members of APP ePacket supporting the network.

ASIA                                      PACIFIC                                             NON-APP
1. Brunei Post (in process)               20. Australia Post
2. Bhutan Post                            21. New Zealand Post
3. Cambodia Post                          22. Solomon Island Post (New)
4. China Post (New)                       23. Vanuatu Post
5. Hongkong Post
6. India Post
7. Pos Indonesia
8. Japan Post
9. Korea Post
10. Laos Post
11. Macao Post
12. Pos Malaysia
13. Maldives Post
14. Mongolia Post
15. Philippine Post
16. Singapore Post
17. Sri Lanka Post
18. Thailand Post
19. Vietnam Post

Doc 5 – APP ePacket Marketing Strategy Draft
2. Segmenting, Targeting, Positioning
Segmenting
We segment the market into to categories : e-commerce market and non e-commerce market.

E-commerce market comprises:

        E-commerce sellers
        Market Places
        E-commerce buyers

Non e-commerce market comprises:

        Individuals / Consumers
        Corporates / Business

Targeting
APP ePacket is supposed to be focus on targeting three e-commerce market segments:

    1. E-commerce sellers
    2. Market Places
    3. E-commerce buyers

Positioning
Value proposition offered by APP ePacket service are : Trackable, Affordable, reliable (safety &
speed).

Positioning Statement:

APP ePacket is a service for e-commerce market looking to tracked, safe and competitive delivery
service destined to Asia Pacific countries. No courier service provider can offer the similar service with
the same price.

Doc 5 – APP ePacket Marketing Strategy Draft
Tagline
APP ePacket:

                 “ Price first, quality is priority”

Branding
The recommended Brand name is “ePacket”. However, members can create their own Brand

Having one Brand “ePacket “ will enable members to arrange some joint marketing activities.

3. Product Features
Weight and Size Limit
Weight Limit:

Weight limit standard is up to 2 kg. However, members may arrange bilateral agreement to agree on
the weight limit up to 5 kg

Size Limit:

APP ePacket items may not exceed 900 mm for the sum of the length and width and depth, and the
greatest dimension may not exceed 600 mm. However, members may arrange bilateral agreement
to agree on expanded size limit.

End to End Transit Time
End to End Transit Time is divided into 2 categories: In City destination and Out City Destination.

In City Destination : 3 - 5 days, depends on the destination country and delivery zone

Out City Destination : 6 - 10 days, depends on the destination country and delivery zone

Doc 5 – APP ePacket Marketing Strategy Draft
Tracking Status
APP ePacket shall provide the following tracking status:

        Item posted
        Item despatched from origin OE
        Item arrive at inbound OE
        Item held by customs for inspection
        Item ready for delivery
        Item delivered

Delivery Option
APP ePacket shall arrange home delivery as a default. Whenever appropriate, other delivery options
of location and time could be provided.

Insured Service
It is strongly recommended that the sending countries provide compensation to customers in the
event of item lost or damaged, in cooperation with insurance company or in one or another way.

Others
Other features that could be provided in accordance with e-commerce market needs:
    •   Packing service
    •   Valuable goods handling
    •   Fragile goods handling

Doc 5 – APP ePacket Marketing Strategy Draft
4. Competitive Strategy
The competitive strategy of APP ePacket is “Cost Leadership for e-commerce market segment”. With
this strategy, APP ePacket shall be the cheapest e-commerce delivery service among the providers.

5. Marketing Mix Strategy
Price
The pricing strategy in accordance with other products among postal operator is described in the
following matrix:
                High

                                                                              EMS
        SPEED

                                                     PARCEL     PRIME
                                           E-PACK
                                                     REGISTERED
                             UNTRACKED
                             / TD
                Low

                                                                                     High
                       Low
                                                        PRICE

Promotion
The recommended promotion is:

    •      Focus to particular market segment as targeted.
    •      Promotion Highlight : price, tracking, quality (safety & speed)
    •      Sales promotion (discount, voucher), listed/advertisement in marketplace web, and social
           media.

Doc 5 – APP ePacket Marketing Strategy Draft
People
All employees who get involved in end to end business process of APP ePacket shall understand that
the main values to be created in APP ePacket service are : trackability, affordability , and reliability
(safety and speed).

The employees shall have the awareness of loosing customers/money when their works do not meet
the requirement. Customer focus culture shall be developed to all employees, so that they will work
in the manner that customers expect.

Process
All end to end process of APP ePacket shall guarantee the excellent quality of tracking, the safety of
goods, and the achievement of transit time standard. In this regards, a zero defect of operation shall
be a target to achieve by all operation staffs.

To support the creation of the most competitive price of APP ePacket product, efficient operation
shall be implemented to all end to end process of APP ePacket, and no re-works are allowed to the
APP ePacket Operation. In this regards, continues improvement shall be done to all level of operation
to get the most effective and efficient way of work.

Reward and punishment system need to be implemented to lead the employees work in the expected
manner.

Physical Evidence
The environment in which APP ePacket service is delivered and where the company and customer
interact, and any tangible components that facilitate performance or communication of the service
shall reflect the value that APP ePacket offer to customers. Efficient manner, commitment to SOP,
safety and timeliness shall be clearly seen by customers in the service environment, employees,
building interior/exterior, lay out, customer communication media and all operation processes.

Doc 5 – APP ePacket Marketing Strategy Draft
6. Roadmap & Milestone

    Strengthen the basic:                                    Go Global:
    • Operation Excellent                                     • Network expansion (All
    • Service Excellent                                           APP members)
    • Brand Awareness                                         • Network expansion (US
                                                                  & European countries)
                                                              • Marketing campaign

            2020                         2021                          2022                     2023

                               Sustainable Growth:                                  Market Leader in Asia
                                                                                    Pacific:
                                • Maximizing sales
                                                                                    • Market Acquisition
                                • Maximizing profitability
                                • Focus on Customer                                 • 30% market share of e-
                                   satisfaction & loyalty                              commerce market
                                                                                    • Focus on competitive
                                                                                       advantage

Doc 5 – APP ePacket Marketing Strategy Draft
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