Chris Stevens, Head of Industry Distance Selling - Global Sales Management, Swiss Post International Management AG & Sonja van Dorslaer, General manager van Swiss Post International Belgium Thanks to the impressive development of e-commerce, recent years have proven successful for distance sellers, despite challenging economic conditions. In Europe, online sales have doubled since 2005. Growth rates in most European e-retail markets exceeded 20% in 2011, an d the majority of consumers are now buying online as internet sales nudge closer to the 10% of all retail sales mark. However, there are major differences across European countries; payment insecurity, privacy concerns, and lack of trust barriers still exist. Cross-border sales represent a small percentage of online transactions, where concerns about international shipping and the lack of cost transparency still hold back sales. In responding to customer needs and those of merchants and online sellers, the need for a competitively-priced, reliable European packet and parcel network, coupled with visibility of the actual landed cost of shipping has never been greater. Swiss Post will highlight various distribution options and customer-driven service features that are available to help Belgium-based merchants achieve greater online sales within and beyond Europe. In depth appreciation of the key trends driving cross-border e-commerce. Assessment of the barriers that still exist, and how merchants (SMEs and larger sellers) can benefit from an effective high-quality parcels network. Visitors will also be given an overview of the total landed cost model being developed by Swiss Post to help boost cross-border sales through transparent shipping costs and total visibility.

1. growth
‘Staying At Home Is Not An Option’
Helping Merchants Boost Cross-Border e-
Commerce Sales
eShop Expo, Brussels
28 March 2012
Chris Stevens – Head of Industry Distance Selling
Swiss Post International Management AG
Global Sales Management (GSM)

2. Fact
>85% of the world’s online population
has used the Internet to make a
purchase.
AC Nielson Global Online Survey January 2009
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 2

3. “By 2014 Swiss Post Selling Industry
The Distance – with and through its
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post

4. Market Definition
the distance selling industry
DISTANCE SELLING
Mailings / Online (e-shop) Mobile T-Commerce Direct selling
Catalogues
e-Commerce
Business to Consumer Business to Business
Consumer’s perspective - any order made in an e-shop
Domestic Cross Border from a non domestic retailer.
Integrates both channels and provides the
most competitive delivery option depending
B2C Mail B2C Parcel on weight and/or value
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 4

5. Sizing the Cross-Border Opportunity - Europe
orders for physical goods
 EU population 2010: ~ 501 Mio.
 37% made at least one on-line purchase in 2010
 4% shopped from a country outside the EU
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 5

6. Challenges - Europe
cultural and legislative
◙ 27 countries in the European Union
◙ Own customs and tax authorities
◙ 23 official languages
◙ Plus Norway and Switzerland
◙ One single currency – the Euro – plus other currencies (GBP, SEK,
NOK, CHF)
◙ A single EU customs territory with ‘no borders’, but…
◙ Separate tax rules and regulations
◙ Import VAT and Duty payable in state where goods enter the EU
◙ Exceptions: LVCR (Low Value Consignment Relief) for low value items
◙ Off-shore fiscal representation options exist
◙ How to offer a single, workable, cost-effective solution for Europe?
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 6

7. Business opportunity
future growth potential
Almost a quarter of persons aged 16-74 in the EU27 have never used the internet
% of individuals who have never used the internet, 2011
Source: Emota
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 7

8. Consumers: Cross-border shopping
common in the Nordic countries, developing across Europe
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 8

9. Barriers and Needs
“By 2014 Swiss Post – with and through its
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post

10. Overview
the e-commerce value chain
Customer data & Online Order Warehousing & Customer Care
Marketing appear- management Distribution
ance
New Existing Shop Billing & Order Warehousing &
Warehouse Delivery Return Customer
customers platform payment preparation Mgmt Service
customers Distribution
− Online Mining
− Data − Online − Individual − Country − Delivery − Central − Customs − − Consumer
Pickup points
Campaigns
− Customer Campaigns Shop specific cost stocking − VAT support
− Quality check
− offline − offline platforms payments calculator − Inventory − Track &
segmen- − Home − Restocking
Campaigns
tation Campaigns − SME − Credit check (guarantee) management Trace
delivery − transport
transpor- to
− Data Mining
− Loyalty pro- − Data Mining platform − Payment − Pick & pack
retailer
tation to
grams
− Customer − Customer guarantee − labelling
retailer
segmen- segmen-
tation tation
− Social Media − Social Media
integration integration
− Address- − Address-
Management Management
− Search Engine − Newsletter-
optimization Management
− Third party − Loyalty pro-
Platform grams
management
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 10

11. Drivers and barriers
reasons for/against cross border shopping
Main drivers for cross-border Main barriers for cross-border
on-line shopping on-line shopping
1. Price 1.No need
lower prices, compare prices, better price due to Can find everything I need in my own country
lower taxes and exchange rates
2. Exclusive products 2. Lack of trust
Not sold in own country Quality of goods, not confident in receiving goods,
warranty
3. Wider range of products 3. Possible high delivery costs
4. Convenience 4. Complicated & long return processes
Any time of the day
Source: IPC Cross border e-commerce report 2010
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 11

12. What cross-border e-Commerce needs…
from a private consumer’s perspective
Shop
− Provide Search Engine or comparison site
promotion
− Provide retailer with innovative online promotion tools
support
− Find best process model for each
scenario to achieve competitive competitive end-to-end delivery cost
cost structure
− Provide escrow service to bring additional safety for Localized payment and escrow
retailer and shopper service
− Find ways to provide convenient return processes for each scenario
Transparent return
processes
− Use track& trace of higher valuable products
Secure and trusted home
delivery
− Develop calculator application and feed it with „total cost of order“ transparency
relevant data of products and overall delivery cost
and guarantee
− Choose the right product segments in
the respective scenarios product and/or price attractiveness
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 12

13. What cross-border e-Commerce needs…
from a merchant’s perspective
− Provide escrow service to bring additional safety for Localized payment
retailer and shopper and escrow service
− Develop calculator application and feed it with „total cost of order“
relevant data of products and overall delivery cost
transparency and guarantee
− Use track& trace of higher valuable products Secure and trusted home delivery
− Find ways to provide convenient return
processes for each scenario Transparent return processes
− Find best process model for each scenario
to achieve competitive cost structure competitive end-to-end delivery cost
− Provide Search Engine or comparison site
Shop promotion
− Provide retailer with innovative online/offline promotion tools
support
− Choose the right product segments in
the respective scenarios product and/or price attractiveness
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 13

14. What cross-border e-Commerce needs…
from a postal organisation’s perspective
Shop
− Provide Search Engine or comparison site
promotion
− Provide retailer with innovative online promotion tools
support
− Provide escrow service to bring additional safety for Localized payment and
retailer and shopper escrow service
− Develop calculator application and feed it with „total cost of order“ transparency
relevant data of products and overall delivery cost and guarantee
− Find ways to provide convenient return processes
for each scenario
Transparent return processes
− Use track& trace of higher valuable
products
Secure and trusted home delivery
− Find best process model for each
scenario to achieve competitive cost competitive end-to-end delivery cost
structure
− Choose the right product segments in
the respective scenarios product and/or price attractiveness
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 14

15. What consumers require
certainty, predictability and trust
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 15

16. Why are posts so interested in e-commerce?
huge potential
While e-substitution is the driver for the
decline in physical mail,
e-commerce is driving the
only significant growth in postal services.
IPC executive Forum on e-commerce, Oct. 2010
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 16

17. The positioning of B2C Parcel
“By 2014 Swiss Post – with and through its
helping merchants and SMEs go cross-
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
border
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post

18. The role of B2C Parcel
designed to facilitate cross-border e-commerce
November 2010
2011
2012
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 18

19. B2C Parcel
providing merchants with quality and reliability
100g to 30kg
26 countries
Best-in-class postal partners
Home delivery standard
Track & Trace: cross-border parcel
tracking in ONE system
Insurance 50 EUR per parcel or EUR
10 / kg (>5kg)
Single point of contact
Professional advice by your personal
Swiss Post customer advisor
Local prepaid return solution
Web-based customer interface
Additional services (e.g. PickPoint)
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 19

20. The positioning of goCommerce ©
helping Swiss companies develop an online
“By 2014 Swiss Post – with and through its
presence is the world’s acknowledged leader in
partners –
global cross-border full service e-commerce”
www.post.ch/gocommerce
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post

21. The importance of the shop platform
basis for international expansion
the online shop platform is the control centre of the entire value chain,
because this process step influences practically all of the downstream, but
also the upstream process steps
 Shop platform seen as central control unit for the entire value chain
 Successive modules are influenced by this control unit
Providing a shop platform means helping merchants grow
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 21

22. goCommerce ©
one contract – one partner – one turnkey solution
Integrated
distribution interface ◙ Boost revenue with new online
sales channel – minimal upfront
investment
◙ Exploit potential of domestic
Onlineshop and cross-border e-commerce
◙ Save time and money with the
integrated distribution interface
◙ Eliminate need for evaluating
„Ready to use“ and programming shop
payment processing software
Text
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 22

23. AW Shop
Premium Design ©
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 23

24. Integrated online payment via SwissPost
providing the best known online payment methods
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 24

25. The positioning of POWA
“By 2014 Swiss Post – with and through its
an international partnership designed for
partners – is the world’s acknowledged leader in
global cross-border fullfootprinte-commerce”
a rapid cross-border service
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post

26. POWA (and VENDA)
a stunning customer base
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 26

27. Creating International Sites
low risk, transaction-based model
• Traditionally companies try to layer multi-lingual, multicurrency into their
main e-Commerce site
• Brands are turning to new secure ‘private cloud’ technology to deploy
International sites using ‘cloning’
• Low-risk, fast deployment
• Dozens of sites in a few weeks
• Complementary to existing e-Commerce footprint
• PCI DSS Level 1 compliant – critical for foreign sites as some
countries have PCI compliance embedded into criminal law
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 27

28. The positioning of TLCS
“By 2014 Swiss Post – with and through its
partners – is the world’sblock to facilitate
an essential building acknowledged leader in
cross-border transparency
global cross-border full service e-commerce”
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post

29. Cross border shopping
why are consumers reluctant?
Transparency:
knowledge about total landed cost before closing the online deal
generates security for the shopper
Trust:
A guarantee that there will be no additional costs arising, offered by a
trustworthy company (e.g. Swiss Post) generates trust
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 29

30. Our Total Landed Cost Calculator Model
a robust gateway for e-Commerce built upon 3 key principles
Simple Shipping
 We provide shipping label, necessary forms and indicia
Simple Pricing/Billing
 Regionalized pricing by zones
 Insurance, end-to-end tracking and address cleansing/correction at no
additional charge
 Accurate pricing based on actual weight, detailed billing of each package
shipped
 No more guessing.
Simple Tracking
 End to end tracking across multiple carriers
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 30

31. Swiss Post
“By 2014 Swiss Post – with and through its
creating the infrastructure for
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
innovative cross-border e-Commerce
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post

32. Swiss Post
Excellence delivered
We see ourselves as your
partner. We make you successful.
We always produce
something extraordinary. Idea
Vocation
Originality Excellence delivered.
Promise
Corporate culture
We are already working
today on your success
We deliver Swiss quality tomorrow.
worldwide.
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 32

33. The positioning in Belgium
“By 2014 Swiss Post – with and through its
Assisting e-merchants to go cross border
partners – is the world’s acknowledged leader in
global cross-border full service e-commerce”
as measured by the share of e-commerce initiated b2c parcels sent across the world by or on behalf of Swiss
Post

34. Services available from Swiss Post Belgium as from today
Customer data & Online Order Warehousing & Customer Care
Marketing appear- management Distribution
ance
New Existing Shop Billing & Order Warehousing &
Warehouse Delivery Return Customer
customers platform payment preparation Mgmt Service
customers Distribution
− Online Mining
− Data − Online − Individual − Country − Delivery − Central − Customs − − Consumer
Pickup points
Campaigns
− Customer Campaigns Shop specific cost stocking − VAT support
− Quality check
− offline − offline platforms payments calculator − Inventory − Track &
segmen- − Home − Restocking
Campaigns
tation Campaigns − SME − Credit check (guarantee) management Trace
delivery − transport
transpor- to
− Data Mining
− Loyalty pro- − Data Mining platform − Payment − Pick & pack
retailer
tation to
grams
− Customer − Customer guarantee − labelling
retailer
segmen- segmen-
tation tation
− Social Media − Social Media
integration integration
− Address- − Address-
Management Management
− Search Engine − Newsletter-
optimization Management
− Third party − Loyalty pro-
Platform grams
management
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 34

35. International distribution services
available out of Belgium
• Worldwide : B2C International / B2C Professional
up till 2 kgs
postal channel
low cost - no track & trace
• Worldwide : B2C Parcel
up till 30 kgs
B2C delivery service
value for money – track & trace
• Switzerland : B2C into Switzerland
duty free import solutions for consumers
• Norway: B2C into Norway
duty free import solutions for consumers
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 35

36. e-commerce delivered.
Chris Stevens - Swiss Post, Global Sales Management
E-Shop Expo, Brussels_03/2012 Page 36