The Substitution of Letter Mail in Targeted Communication

Abstract

We all receive letters, ads, bills and invoices . While all this mail may seem to be increasing, it is in fact mainly the personalized advertisements sent by aspiring direc t marketers that we get more often, whereas many orders, bills and invoices have bee n routed electronically through redesigned business processes . By that, ordinary busines s mail have already been replaced by telefax and electronic data interchange (EDI), an d the same substitution effect will hit us customers as soon as companies switch to cal l centers and the Internet for electronic commerce .

The objective of this thesis is to find out, first, the impact of the expansion of electronic communication on letter services and second, the most important criteria for selecting a communication mode . We focus on targeted communication, leaving out mass communication. More specifically, the communication modes studied are ordinary letter, hybrid letter, telephone, telefax, electronic mail (eMail), EDI and the Inter - net. The methods used are econometric modeling based on operator statistics and surveys based on user interviews .

The results indicate that about 40 percent of 1st and 2nd class letter mail has already been replaced by electronic communication means in Finland, and the substitutio n process will continue at an increasing pace . The most important substitute so far has been telefax, but eMail is expected to take over soon . As a counter-argument against the substitution effect has presented that some electronic communication means, especially the telephone, actually has generated further demand for letters . Our result s show that this effect really has existed, but has tapered off during the last two-thre e decades . There is also competition between the electronic modes of communication . In particular, eMail has challenged telefax lately, indicating that the telefax machine i s reaching the peak of its life cycle .

In the surveys users mentioned, the advantages of letter mail are still its data security , personal nature and legal capacity . In the case of electronic messages, there still i s some distrust as to whether they will reach the intended recipient and a fear that outsiders will gain access to them. A missing legal capacity, such as the lack of an electronic signature, seems to hinder the use of many electronic devices in targeted communication.

A conclusion based on the results is that we live a transitional period before a radica l change in the field of targeted communication will take place . The hybrid network solutions and information services which make use of different digital networks simultaneously will be the prevailing trend . The postal service organizations can not slow down this development nor would it pay off Instead of relying on the survival of th e traditional letter mail services alone, the postal organizations should develop new hybrid communication services and through partnerships offer even purely electroni c communication services