Australia Post’s traditional mail business will lose $200 million this year as one of this country’s most recognised brands adjusts to the online world. Speaking at the Digital Productivity Conference in Brisbane on Thursday morning, Catriona Larritt, GM, Post Digital at Australia Post, said the company’s mail business will “lose about $200 million this year” and these losses will get “bigger and bigger as people move from physical to digital communications.” While spruiking the organisation’s relatively new Digital Mailbox service and other e-commerce initiatives, Larritt ran through some of the harsh realities of the growth in online services. Australia Post is three years into a complex five year business transformation program to address this huge shift. Larritt said Australia Post’s mail volume has been declining at about 4 to 5 per cent per year since 2008 and this year, for the first time in the company’s 204 year history, parcels will generate more revenue for the company than letters. “Undeniably, our biggest challenge is in our traditional letters business and as you can imagine mail volume is now in decline across the world because of the growth of email and social media,” Larritt said. 2008 was an “inflection point” for the growth of the digital economy as it was the year that the first Apple iPhone was release and now 6 out of 10 adults own this device, said Larritt. Social media also became mainstream during that year and the number of Facebook accounts globally has since grown from 90 million to more than one billion. “Australia Post used to have 100 per cent of the communications market – we were the Gmail, the Facebook, the Twitter of the 19th and 20th centuries. But this year we will deliver one billion less letters than we did in 2008,” said Larritt. “A mail volume decline of 4 or 5 per cent per year doesn’t sound like very much but it has a huge economic impact on our business,” she said. “Every 1 per cent of volume decline has a $20 million profit impact. So every year we need to find $100 million worth of cost savings or revenue growth just to get back to the start.” But it’s not all bad news for Australia Post with 70 per cent of parcel transactions being generated online and this business is “booming”, said Larritt. “Our domestic business generates about $1 billion in revenue and it’s growing at 10 per cent per year. Even though the Australian e-commerce market was slow to grow initially, most forecasts have it growing at double digit rates until 2020.” Australia Post was also attracting some “great digital talent” with the addition of two staff members who had previously worked at Skype and Wikimedia. Related content brandpost Sponsored by SAP When natural disasters strike Japan, Ōita University’s EDiSON is ready to act With the technology and assistance of SAP and Zynas Corporation, Ōita University built an emergency-response collaboration tool named EDiSON that helps the Japanese island of Kyushu detect and mitigate natural disasters. By Michael Kure, SAP Contributor Dec 07, 2023 5 mins Digital Transformation brandpost Sponsored by BMC BMC on BMC: How the company enables IT observability with BMC Helix and AIOps The goals: transform an ocean of data and ultimately provide a stellar user experience and maximum value. By Jeff Miller Dec 07, 2023 3 mins IT Leadership brandpost Sponsored by BMC The data deluge: The need for IT Operations observability and strategies for achieving it BMC Helix brings thousands of data points together to create a holistic view of the health of a service. By Jeff Miller Dec 07, 2023 4 mins IT Leadership how-to How to create an effective business continuity plan A business continuity plan outlines procedures and instructions an organization must follow in the face of disaster, whether fire, flood, or cyberattack. Here’s how to create a plan that gives your business the best chance of surviving such an By Mary K. Pratt, Ed Tittel, Kim Lindros Dec 07, 2023 11 mins Small and Medium Business Small and Medium Business Small and Medium Business Podcasts Videos Resources Events SUBSCRIBE TO OUR NEWSLETTER From our editors straight to your inbox Get started by entering your email address below. Please enter a valid email address Subscribe