INDUSTRY ANGST OVER AUSPOST MOVE

In a move causing angst in the print and mail industries, Australia Post has ended daily deliveries for regular addressed and unaddressed letters, extended delivery schedules, and upped the price of a stamp by 25 per cent.

Industry professionals are frustrated by Australia Post's cut services and increase prices strategy, and are questioning the decision-making of the communications minister, and of the AusPost management, and there are mutterings about the motives of the union.

Kellie Northwood, CEO of industry employers' group Visual Media Association, said, "This is one further step in a process which at times feels deflating. However, there are more opportunities into the future, and we will continue to advocate for all of our industry, especially the societal role of the letterbox in which the only media able to be delivered into the home, every home, every day, is printed pieces in the letterbox, addressed and unaddressed.

"The role of the letterbox to address increasing concerns of cybersecurity breaches, accessibility to internet connectivity in the home, socio-economic disadvantages, elderly, people with disabilities, and as one of the most effective marketing channels with highest ROI across other channels in singularity, and as the most trusted brand equity builder, is not disputable. Disappointingly, the minister has at times missed these important messages. We continue to work with her office and the department to ensure our industry is now accurately reflected."

Marketing guru Malcolm Auld slammed the move as ‘strategically flawed’, said it was completely contrary to the approaches in other countries, where DM is growing. He also said AusPost has shot itself in the foot, by hindering the use of printed direct mail, which is often used to sell product that is then mailed in parcels to customers.

Auld also said, “Australia Post is one of the only postal services that has walked away from supporting direct mail for marketing purposes.

“While volumes and the investment in marketing support for mail as a media channel are growing in the US, UK and Canada, Australia Post is headed in the opposite direction. In the USA in 2022 Direct Mail was one of only three channels in which marketing budgets increased by more than 100 per cent year on year – the other two were TikTok and in-game advertising.”

Along with alternate days delivery, the mail monopoly will also take longer to deliver standard letters, it will now take up to four working days, and no more than five, for letters mailed within the same state as the destination, and for interstate letter delivery the target is within six days, with no more than eight days.

AusPost will also be able to charge more ‘commercial rates’ for Priority Mail. It will still run daily deliveries for Express Post, and for Parcels, which it where it sees its future. CEO and managing director Paul Graham made this clear, he said, "The new regulations will enable Australia Post to focus on what Australians want most; flexible and more reliable parcel deliveries with enhanced tracking technology and more delivery options.”

The government owned entity is using the strategy for letters of cut services and increase prices – a single stamp is now $1.50 up from $1.20 – as its bids to stem huge losses in letters. The letters business recorded a $182.1 million loss in the six months ended December, as letter volumes fell 11.9 per cent. Mail industry professionals say employing strategies to build on the strengths of mail would be a far better approach.

According to Australia Post, four in five households bought something online last year, and 9.5 million received a parcel in the 12 months to December, with some 100 million parcels delivered.

However, letter volumes are declining rapidly, down by two-thirds since peaking in 2008. According to AusPost, the average Australian sends 15 small letters a year and receives two letters a week. Australia Post expects that number to halve in five years.

Northwood said, "The VMA has been working with government, Australia Post, the Mail Industry Coalition (MIC) and key stakeholders to develop our communications across the impact of the modernisation of the postal service throughout Australia.

"We stand by the fact that the mail, print and related services sectors represent a sovereign manufacturing industry, delivering one of the lowest emitting media communication channels available to all equally and employing 229,194 Australians across metro and regional locations with skilled and unskilled labour requirements.

"Our extensive submission was key to this educational process and assisted the Minister, Australia Post and Key Stakeholders to understand the role of our industry. This process was largely supported by the Mail Industry Coalition formed by the VMA in 2022, and I thank all those parties for your insight and the privilege of working with you all and continuing to work with you on the future of mail.

“The industry did support alternate day deliveries for a stabilisation of pricing, however, did not support the 22 per cent increase in Business Mail prices recently impacting our members. We are encouraged our membership by Business Mail service – Charity Mail and PromoPost – were less impacted by the total overall increase, however we now are working with key stakeholders across PreSort and looking to opening a new communication pathway directly with banks, telcos, utilities and more who are reliant upon transactional business mail and seeking improved ROI given the substantive pricing increases, further will be advised to this program in the coming week,” furthered Northwood.

“The VMA is continuing to work with Australia Post, the MIC and Key Stakeholders across the modernisation into the postal service, in particular we are reviewing the PrintPost Business Mail product. Smaller publishers have reported they are struggling under the price increases as they have reduced subscription options and advertisers. The government is always keen under democratic measures and freedom of speech to implement protection of independent media which VMA is also supporting via a print and mail channel. With this in mind, we are looking to how we can develop a potential sub-product to mitigate pricing inequalities or impacts to smaller publishers to assist them in retaining their printed publications. This has been tabled with the department, Australia Post and key stakeholders, we welcome any industry voices to this discussion and any other modernisation discussions,” said Northwood.

“Should any member wish to learn more about the MIC or the Mail Industry Strategic Board, please do not hesitate in contacting me directly, we are here to ensure all our industry voices are represented and heard,” concluded Northwood.