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Grab a coffee and take it all in.
It’s fascinating how your world has kind of changed and how guys have adapted to it, but obviously there’s a lot of talk about the death of mail marketing. How d you see that today and what can you tell people about how that now effectively works as a medium?
We are going through a very interesting renaissance of what’s old is new again. I’ve been watching some of the early indication of that for the last little while, and we have seen that in our parcels business, and if you go back to 1860s and 1870s when Eaton’s Catalog was the giant mail order machine, and even forget about the fact that we were doing this 100, 150 years ago. Now it’s e-commerce. E-commerce is essentially mail order shopping on steroids. I the think same thing for marketing mail. We have had that for a long time, catalogs and so long. It was effective. It worked.
And within the last two or three decades we have been chasing the shiny object called digital, which absolutely has a place but a lot of companies kind of jumped into with all in, all in digital, and they are now realizing that in fact there is a role for the good old-fashioned paper that has some very interesting romantic notions and it has these attributes. Touch, feel, smell that you can’t really get through digital.
So I think there’s a bit of a renaissance going on and I’m very excited about the future of the good old-fashioned paper-based advertising.
So you guys did a cutting edge study on neuromarketing. I know that seems totally incongruous with the world of where you’re going. But what did you learn from doing something of that ilk?
We felt that over the years digital being so kind of new shiny object, we were missing the scientific and more authentic proof behind why certain things worked for a hundred years. So that was one of the big motivations.
The second motivation was people wanted proof and data points but what I would say turned out to be even more surprising was the gap we found between physical and digital in terms of brand retention, brand recall. Usually a few percentage point differential in neuroscience research is considered huge. We had 20, 25 point differential between digital and physical. So, we found what I would call a gold mine of data which we have been sharing with our large customers to a point where brands like Canadian Tire, who had given up on catalogs for decades, have re-embraced catalogs. We’re looking at Amazon doing direct mail again. We’re looking at Zappos looking at catalogs again.
So I think this study has been instrumental in reminding large brands that there is real proof, there is real value in what I would call the tactile nature of the physical mail, smell. So when Starbucks was looking at a campaign, they had a coffee smell on their promotional direct mail offer, a discount offer, a coupon offer. Who doesn’t love the smell of coffee on a piece of paper? Can you recreate that in digital? Absolutely not.
We had our quarterly magazine Incite, and we made its cover page as a chocolate and it smelled like chocolate. The nature of a physical product allows you to romance the brand very differently than a pure digital. No matter how hard you try, you’re not going to hug your SmartPhone and your laptop and what not, but you can kiss a beautiful piece of direct mail.
You talk about that physical for a second and romancing, and obviously as humans and that human-to-human connection we’re starting to lose a little bit of this of this true connection. How does the world of Amazon, as you mentioned, kind of start to affect you and your business?
Amazon has been a multi-faceted customer for us. On the one hand, they’re one of our large e-commerce customers. On the other hand, they have been a competitor. They have been an inspirational role model for technology and they have been also an amazing task-master for us.
But the most fascinating thing happened two weeks ago when Amazon reached out to us saying, “Hey, do you have somebody in your office who runs direct mail and we would like to talk to them?” And that email on our floor made circles to every single executive within minutes as an amazing proof point that pure digital plays, pure companies, are recognizing some of the work we have been doing for the last three years, four years, the value of that physical relationship.
Let’s call it the new products, the new future, treating yourself like a start-up as a 150-year-old company, really moving with Amazon. Moving to Smartmail marketing, moving to these new programs where you’re looking at neuromarketing. What does the future look like for Canada Post?
I think future is looking very exciting at this moment. We have proven over the last seven years, by taking our billion dollar parcel business which was rather declining 2009, 2010, to be a $2 billion business, and we have proven that in seven years that what’s old is new again and we can reinvent the company.
We’re doing the same thing with Smartmail marketing. We have rebranded that to Smartmail marketing. We have taken our Unaddressed Admail product, it’s now positioned as a highly targeted neighborhood mail. So I think the future is exciting yet there are always going to be challenges, yet there are always going to be disrupters just lurking behind the wall who can jump in and reinvent and do certain things that may disrupt our businesses.
So we’re very focused on innovation, making sure that we are not left behind and all the hard-earned progress we have made we can hold onto that.
What do you think the one thing that brands can do to really transform the way they engage with people?
One thing would be don’t forget that we’re humans, and humans like to touch and feel. I think brands went through the last decade embracing digital and almost forgetting that their customers were in fact humans. The amazing feeling you get when you hug someone, and that’s what the brands are lacking in my view, who are rapidly embracing digital which is an important part of their marketing, their e-commerce and their customer relationship strategy. But don’t forget that customers are humans and don’t forget to touch them once in awhile.