Singapore’s postal service reinvents itself for digital age
When a German lingerie brand wanted to sell bras online in Malaysia, it turned to Singapore’s nearly 200-year-old national postal service.
Singapore Post built a website, developed a marketing strategy and now delivers packages for the company, Triumph International. The customer service team even answers questions about sizing.
As postage stamps give way to keyboard clicks, SingPost is redefining the role of the letter carrier, by creating a one-stop shop for retailers’ e-commerce needs in Asia.
In South Korea, SingPost is helping to sell Levi’s jeans. In Singapore, it is stocking Toshiba laptops. In Malaysia, it is delivering Adidas sneakers.
With traditional mail services in decline, post offices around the world are scrambling to reinvent themselves for the digital age.
“Sitting on that burning platform, we looked around and said, ‘Where could we develop?’” said Wolfgang Baier, the chief executive of SingPost.
Japan Post is buying the largest private package and freight delivery company in Australia, Toll Holdings, in a bid to create a rival to UPS and FedEx. The United States Postal Service, which lost $5.5 billion last year, is providing Sunday deliveries for Amazon. Australia Post is working with the Chinese internet giant Alibaba to help local businesses connect with consumers in China.
“There are at least two business trends unfolding before us. One is the death of mail,” said Frank Lavin, chief executive of the e-commerce consultancy Export Now. “The second is this boom in e-commerce.”
SingPost’s makeover is among the most ambitious. Besides its regular postal duties, it offers a basket of services for companies, including website development, online marketing, customer service and, of course, package delivery. Following the Amazon model, it is building a network of 24 warehouses in 12 countries to stockpile goods for companies. The e-commerce team is staffed with former Silicon Valley executives.
Singapore’s central location, said Baier, makes it a natural hub for e-commerce in Asia. He recited numbers to demonstrate the scale of the opportunity: Over 600 million consumers live in the region around Singapore, and 2.2 billion people are within a five-hour flight.
“We want to be the gateway to the East,” he said.
The shift has been stark for the postal service, once a stateowned company that went public in 2003.
Four years ago, e-commerce barely figured into its bottom line. Today, it accounts for more than a quarter of the group’s revenues, which have grown by 60 per cent during that same period.
Others are taking notice. Last year, Alibaba paid $250 million for a 10 percent stake in SingPost. Alibaba and SingPost are now in discussions to form a joint venture focused on e-commerce logistics in Southeast Asia.
SingPost began using the internet as a laboratory in the early 2000s. It dabbled in various parts of the supply chain, first delivering goods from American shops to Singaporean homes. It then tried selling products on its own homegrown platform. It even dipped into the luxury goods market, starting a website called Clout Shoppe.