The new Austrian Post eCommerce platform
BY SANDY STRASSER
(Published in The Produktkulturmagazin issue 2 2017)
Even the venerable Österreichische Post (Austrian Post Office) has been unable to extricate itself from digital transformation, something which has above all become evident through the dramatic fall in the number of letters it handles. Nevertheless, there has been a noticeable increase in terms of parcels due to e-commerce, which is a development that the company is now planning to exploit. However, the journey into the digital age also means moving into uncharted waters. We spoke to Gerald Gregori, Head of E-Commerce Innovation Management at Österreichische Post AG, about the new online marketplace ‘from Austria for Austria’.
Mr Gregori, for the past two years your company has been working on also offering retailers digital services. The result is shöpping.at, an online platform that went live on April 5 of this year. What is this major project about?
As Austria’s largest parcel service, we have always been a central partner to retailers on their e-commerce journey. With our takeover of Systemlogistik Distribution GmbH five years ago, we have expanded our services to include fulfilment – in other words, the warehousing, consignment and packaging of products. So, entering the digital era and offering a marketing platform for Austrian retailers and manufacturers was a logical further development. And that is precisely what shöpping.at is: an online marketplace ‘from Austria for Austria’.
What has motivated you to launch this service?
As you correctly mentioned earlier, letters are coming under increasing pressure. Although the parcel segment is growing, we – just like virtually all other postal services worldwide – are searching for new business fields. We are achieving two aims with our new online marketplace: we are further securing our parcel business, simultaneously generating additional revenues.
To what extent are you trying to stand up to Amazon et al with this service? What advantages do you have compared to the market-dominating behemoths?
One advantage is the noticeable visibility of retailers on the platform, offering them the possibility to showcase themselves with an editorial. Furthermore, there is no risk that successful products are ‘hijacked’ – in other words, absorbed into one’s own range – as shöpping.at it not a retailer itself, but functions as an intermediary. And the fee structure will also be interesting: no set-up fees, no running fees, merely a sales-related commission in the single-digit range that will vary depending on the product group. The fact that deliveries will all be made by Österreichische Post represents a further reason for customers to shop at shöpping.at.
With how many retailers did you launch the service and what kind of products or services do they offer?
We launched on April 5 with 60 retailers and approx. 500,000 products. One month in, we already have 85 retailers and almost 900,000 products. The range comprises everything that online shoppers fundamentally expect: electronics, apparel, toys, books, media, DIY equipment, etc. Our plan is to cover as many of our customers’ daily requirements as possible.
How would you like to see the number of participating retailers grow moving forward? What expertise do they have to bring to the table?
We want to grow systematically and we have set no limits regarding expansion. I would be thrilled if every Austrian retailer were to join us at some point in the future. Here, a retailer has to fulfil three important requirements: good product photos and descriptions must be available in digital form, the necessary IT competence has to be present and the up-to-date accuracy of data, above all of the stock, has to be systematically provided.
What role does your company play within the context of this collaboration?
Post E-Commerce GmbH, a fully-owned subsidiary of Österreichische Post AG, is responsible for setting up, further developing and operating shöpping.at. Parcel logistics are handled by Österreichische Post AG’s parcel division, with the optional fulfilment service supplied by Systemlogistik Distribution GmbH, another fully-owned subsidiary of Österreichische Post AG.
What response have you had from the Austrian population during the first eight weeks of operation?
Fundamentally, there has a lot of positive resonance in the media, although there has also been some criticism relating to the assortment and pricing on various online forums. This has not come as a surprise – after all, we are only at the start of our journey. However, we are taking the criticism very seriously and working very intensively on these issues.
What revenues and purchasing power do you expect with regards to this mammoth project?
We do not publish concrete target figures, but suffice it to say that e-commerce is one of Österreichische Post AG’s major development areas on which we are focusing heavily. With group revenues of approximately two billion euros, there has to be a certain magnitude behind a new business division if it is to be relevant in the long term.
What special features does the technical architecture of your online platform have?
First of all, I would like to point out that we are a marketplace – in other words, an intermediary and not a retailer. This has resulted in us having to reconfigure the SAP Hybris platform, which is actually a shop system, fairly intensively in collaboration with our IT partner. Secondly, operating the new service has meant that we had to break new ground and we are now the world’s very first client to operate a cloud-hosted SAP Hybris solution.
Who was this partner and how did you select them?
Within the context of an invitation to tender, Netconomy from Graz was selected as the central partner and we have been successfully working with the company for more than two years now. The combination of SAP as a major software partner and a local partner specialising in SAP Hybris has proven very successful.
To what extent should shöpping.at be viewed as an important part of your comprehensive digitalisation strategy?
Within our e-commerce segment, it is practically the nucleus of our digitalisation strategy, for which we have great plans for the future.
To what extent do you envisage becoming active in the networked market outside Austria moving forward?
A potential development could be the establishment of further online marketplaces based on our new online platform in those CEE region countries in which we are also actively involved with parcel firms.
Gerald Gregori’s career has brought him to Österreichische Post AG via stints at Unilever and Roland Berger Strategy Consultants. Between 2012 and 2014, he was Logistics Services Business Unit Manager, and has been running the E-Commerce Innovation Management division since January 2015, where he is responsible for shöpping.at. Furthermore, he is Vice President of the BVLÖ and a member of the ECR Austria board.
A brief portrait of Netconomy
Netconomy is one of the leading SAP© Hybris© service providers within the German-speaking region, currently employing in excess of 300 Hybris experts focusing on consulting, project management, programming, implementation, quality management, maintenance & servicing, further development, customer service and application operation. The primary aim of the firm is to accompany customers during their digital transformation. This is achieved by supporting their business models with state-of-the-art omnichannel technology for convincing customer experiences across all channels. Here, quality and sustainability are always top priorities, combined with a profound understanding for marketing and sales and distribution. As a close SAP© Hybris© partner, Netconomy has been voted ‘Global Most Innovative Partner of the Year’, has received the ‘SAP© Partner of the Year in Specialised Solutions’ twice and has been ‘Recognised Expertise HANA’ certified. Furthermore, NETCONOMY has been selected as the ‘SAP Hybris Partner of the Year 2017’ for the overall EMEA region and chosen as a finalist for the prestigious SAP Pinnacle Awards 2017. The headquarters are based in Graz and it operates further offices in Vienna, Zurich, Dortmund and Berlin. The company’s customers include the Swiss Migros Group, the XXXLutz Group Leder & Schuh, A1, AVL, Agrokor or BASF.
A STRONG FOUNDATION
For the implementation of shöpping.at, Österreichische Post AG employed the expertise of Netconomy Software & Consulting GmbH. The portal is based on an SAP© Hybris© platform and is cloud-hosted. Third-party applications and services are linked in using FactFinder, an SSO service and CRM system. Currently, there are 85 retailers online with 900,000 products.
Picture credits © Florian Klauer/Unsplash