Commerce between the Nordic countries represents a significant portion of total commerce in the Nordic region. At the same time, Europe is the Nordic region’s most important trading partner. The demand for Nordic end-to-end solutions and cross-border solutions to, from and within the Nordic region is rising.
However, the overall logistics market in the Nordic region has been relatively stable in recent years. The Nordic logistics market that is relevant to PostNord equates to about SEK 160–190 billion. This includes everything from home deliveries of parcels and road freight, to advanced logistics services such as TPL. The Swedish logistics market is characterized by consolidation, intense competition and cost focus. The biggest players are Schenker, DHL, DSV, PostNord, Bring, GLS, and Posti.
Position: Through its own network and international partnerships with DPD, among others, PostNord has a leading position in the Nordic distribution and logistics market, where the e-commerce-related logistics sector is expanding rapidly. The Group’s logistics offering is to a large extent harmonized within the Nordic region.
Potential for growth in e-commerce remains strong
E-commerce is expected to continue to expand by more than 10% annually over the next few years. The basic driving forces of e-commerce are simplicity and availability for consumers and recipients. The major share of e-commerce purchases are still made from domestic companies. However, it is increasingly common for consumers to look for products beyond their country’s borders. Sites in the United Kingdom, Germany, the United States and China, above all, attract Nordic consumers.
One of e-commerce’s most important competitive factors is an effective and seamless system of logistics. The method, location, time and cost of goods delivery have become increasingly important to consumers at the time of purchase. One strong trend is “omnichannel concepts”, which offer the same customer experience, irrespective of channel.
Position: Today, PostNord has a unique reach and a leading position as expert and partner to the majority of e-retailers in the Nordic countries. All-in-all, this represents further attractive opportunities for growth. About a third of the new agreements signed by PostNord are in the fast growing e-commerce segment.
Patterns of communication changing
With the shift to digital channels mail volumes are decreasing. In the Danish market, digitization has been, and still is, proceeding at a very high pace. This results from several factors coming together at the same time, not least legislation on digital communication from and to public sector agencies. PostNord offers an expanded range of wholly and partly digital communication services.
In Sweden, digitization is still moving at a slower pace, and one clear trend is towards combinations of physical and digital communication. Given the trend towards digitization, the decline in mail volumes will continue.
This changing market is a challenge to all postal corporations. Some countries have modernized the regulatory conditions to enable postal corporations to run competitive and financially sustainable operations while meeting the changes in needs of consumers and businesses for postal services. Denmark passed new postal legislation in 2016. In Sweden, a review of the way in which the postal market is regulated is in progress.
Position: PostNord provides the universal postal service in Denmark and Sweden. PostNord is therefore the only player that reaches all households and businesses in both countries. PostNord holds a strong position in the combination of digital and physical communication via our omnichannel solution. PostNord has also started offering mail services in Norway.
Growth in combinations of digital and physical advertising
The total advertising market saw a slight rise in Sweden and Denmark, almost exclusively within digital channels. However, in the traditional advertising sector, the decline continues, above all in printed media.
Position: In order to develop the digital-physical combination, PostNord launched ShopGun in Sweden in autumn 2016. The product combines the week’s advertising sheets and offers in an app. A strong area of focus going forward will be to help customers improve their market communication outcomes by combining analysis, segmentation and impact measurement with physical and digital advertising solutions in the Nordic region.