e-commerce track - iata.org€¦ · airmail growth trends airmail growth trends monitored since...

e-Commerce TrackThank you to our Sponsor

WELCOMESaskia Van Pelt

Director Business Development, Schiphol Cargo

Introduction to IATA’s White Paper

Andre MajeresManager Cargo & Mail Operations and Standards, IATA

>1%Global trade volumes

UberCargo, Amazon, new Silk-Road,

Posts… stronger competition

Too complex!

ReputationPremium price with low-cost service

3 daysTo get a quote!!!

7/10Customer satisfaction

The supply chain in the past

… and today

What is air cargo logistics doing?

Scanning the HorizonAn IATA Cargo white paper

StB: The 6 goals of the program

Modernizing cargo

distribution

Capitalizing on

e-commerce

Optimizing the end-to-end journey

Moving to data

on-demand

Developing real-time

interaction

Making quality

relevant

Making air cargo easier, smarter and faster


“Air cargo serving e-commerce”

An IATA White Paper


e-commerce growth is the ‘not-to-be-missed’

opportunity!2.3 trillion USD in 20172.9 trillion USD in 20183.5 trillion USD in 20194.1 trillion USD in 2020

Online Sales (2020: est.)

“Air cargo serving e-commerce”- An IATA White Paper


Cross-border e-commerce is mainly low cost and light-weight

36% < 25 EUR 81% < 2 kg

More than 50% of all online shopping isfootwear, apparel & consumer electronics



e-commerce is a growth driver for the air cargo industry

Parcel delivery volume more than doubledin the past decade



Digital technologies have revolutionized the retail industry, buying patterns & consumer expectations, and will continue to do so.



Air cargo has to adapt and offer products and services that serve their e-commerce customers:

• Network coverage, flight frequency and flexibility• Visibility via end-to-end tracking and instant notification• Attractive cost adapted to the demand• Speed and fast delivery with various last mile solution



Is the air cargo industry ready to offer the right logistics solutions?

Air cargo industry action plan

IATA’s pipeline of initiatives


Find out !

e-commerce logistics White paper

iata.org/e-commerce-logistics [email protected]

http://www.iata.org/whatwedo/cargo/stb/Documents/StB-Cargo-White-Paper-e-commerce.pdf

http://www.iata.org/whatwedo/cargo/Pages/e-commerce-logistics.aspx

mailto:[email protected]

Economic Update – Growth and Global Projection

Jörgen Van MookHead of Network Management & Innovation, IPC

e-Commerce growth & e-Shopper trendsAirmail volumes, opportunities & challenges for Posts and Carriers

Jörgen van MookHead of Network Management & Innovation

• e-Commerce growth• e-Shoppers trends• airmail volumes• e-retailer logistics• post – carrier cooperation

E-COMMERCE GROWTH FORECAST

Note: includes physical products ordered online via any device, regardless of method of fulfilment, excludes travel, tickets, servicesSource: Euromonitor International, IPC analysis

E-COMMERCE BOOMING GLOBALLYEvolution online retail sales – 2017 vs 2016

+12%

+16%

+17%

+30%

+25%

Source: Euromonitor International; data for internet retailing in Brazil, China, Russia, the UK and the US

9.7%OF RETAIL WAS ONLINE IN

2017

(VERSUS 8.4% IN 2016)

E-retail per country

IPC Online Shopper Survey

Download the report from: www.ipc.be

18%SHOP ONLINE ON A

WEEKLY BASIS

% Shopping online on a weekly basis

Device preference

SMARTPHONE POPULARITY GREATLY INCREASING

(FROM 14% IN 2016 TO 24% IN 2017)

34%BOUGHT FROM LAPTOP

34%BOUGHT FROM CHINA

3%

2%

14%

3%

3%

12%

12%

18%

34%

Other

Netherlands

Australia

Japan

France

UK

Germany

US

China Seller country

Seller website

Zalando

1%

Asos

1%Apple

31%Other

2%Wish

8%

Alibaba / AliExpress

14%

eBay

18%

Amazon

25%

58%BOUGHT FROM “TOP 3”:AMAZON, EBAY, ALIBABA

Product category

49%OF PRODUCTS PURCHASES ARE

CLOTHES, FOOTWEAR & CONSUMER ELECTRONICS

Product weight

51%OF CROSS-BORDER PARCELS WEIGHED LESS THAN 0.5 KG

LOWER AVERAGE WEIGHT THAN IN THE 2016 SURVEY

Product value

39%COST LESS THAN €25

LOWER AVERAGE VALUE THAN IN THE 2016 SURVEY

Delivery provider

70%DELIVERED BY THE POST

COMPARED TO 2016, USE OF THE POST SLIGHTLY DECREASED AND “DON’T KNOW” SLIGHTLY INCREASED

THERE WAS NO CHANGE FOR THE OTHER COURIERS

AIRMAIL GROWTH TRENDSAirmail growth trends monitored since IATA WCS 2015International Post Corporation monitors cross border airmail volume trends on intercontinental flows exchanged between postal operators (post-to-post)

• Regions: Asia Pacific; BRIS; Europe; North & Central America• Representative subset of countries per region• No domestic volumes• Volume info from electronic dispatch pre-advice data shared with IPC

(representing 60-80% of global cross border volumes)

AIRMAIL GROWTH + 11.6% Global Airmail – All Inter-regional

Growth Q4 vs Q4 previous year

3 years ago @ IATA WCS15

2 years ago @ IATA WCS16

Last year @ IATA WCS 2017

Q4 2017 vs Q4 2016:

Monthly volumes KG, period Jan 2013 – Jan 2018

Q4 2014 vs Q4 2013: +16.5%

Q4 2015 vs Q4 2014: +19.7%

Q4 2016 vs Q4 2015: + 4.5%

AIRMAIL GROWTH

+ 36.4%

Inter-regional: Asia Pacific - Europe

From: 3.4 million KG Month DEC 13To: 9.5 million KG Month DEC 17

Monthly volumes KG, period Jan 2013 – Jan 2018Q4 2014 vs Q4 2013: + 66.6%

Q4 2015 vs Q4 2014: + 24.1%

Q4 2016 vs Q4 2015: + 16.7%

Inter-regional: Asia Pacific - Europe

Q4 2017 vs Q4 2016:

Month of November (10.4 million KG)

higher than month December

AIRMAIL GROWTH

- 18.9%



Q4 2014 vs Q4 2013: + 36.1%

Q4 2015 vs Q4 2014: + 5.6%

Q4 2016 vs Q4 2015: - 24.8%

Inter-regional: Europe - Asia Pacific

Q4 2017 vs Q4 2016:

Inter-regional: Europe - Asia Pacific

AIRMAIL GROWTH

+ 22.1%



Q4 2014 vs Q4 2013: + 48.5%

Q4 2015 vs Q4 2014: + 35.1%

Q4 2016 vs Q4 2015: + 17.1%

Inter-regional: Asia Pacific – North & Central America

Q4 2017 vs Q4 2016:

Inter-regional: Asia Pacific – N & C America

AIRMAIL GROWTH

• Global Post-to-Post Airmail shows consistent DOUBLE DIGIT growth

• Month of November overtakes Month of December as Peak Month

• Large variances per region of airmail trends; Q4 2017 vs Q4 2016:• Asia Pacific to other regions : + 30%; • North & Central America to other regions: +1%• BRIS to other regions: + 6%• Europe to other regions: -14%

Delivery Experience

85 %FROM SATISFIED TO

EXTREMELY SATISFIED WITH POSTAL DELIVERY

Online Shopping Experience

DeliveryExperiencePost

DELIVERY TOO LONGIS MAIN REASON FOR

DISSATISFACTION

Shopping Experience

93 %FROM SATISFIED TO

EXTREMELY SATISFIED SHOPPING EXPERIENCE

Transit time

41%MORE THAN 10 DAYS

“Day 2 is stasis. Followed byirrelevance. Followed byexcruciating, painful decline.Followed by death. And thatis why it is always Day 1. It’salways worth asking, do weown the process or does theprocess own us? In a Day 2company, you might find it’sthe second”

Jeff Bezos, Amazon (April2017)

Source: IPC Global Postal Industry Report 2016

Source: IPC Global Postal Industry Report 2017

North America

International

Fulfilment, Sortation & Distribution

19

97

20

16

20

14

20

12

20

10

19

99

2010 2011 2012 2013 2014 2015 2016

USA 23 32 42 52 61 75 101

Brazil 0 0 0 0 1 1 1

Canada 0 1 2 4 4 5 6

China 9 10 12 15 17 17 17

Czech Republic 0 0 0 1 1 2 2

France 2 2 3 4 4 4 4

Germany 4 6 8 9 9 9 9

India 0 0 0 1 8 19 25

Italy 0 1 1 1 1 1 1

Japan 5 7 9 10 10 10 10

Mexico 0 0 0 0 0 1 1

Poland 0 0 0 0 3 3 3

Slovakia 0 0 0 0 0 0 0

Spain 0 0 1 1 2 2 4

UK 5 7 8 8 8 10 13

197

129

Fulfilment centres

1 4

86

48

81% OF ALL ITEMS SOLD THROUGH ALIBABA-OWNED SITES IN 2017 WERE DELIVERED THROUGH THE CAINIAONETWORK

(FROM 60% IN PREVIOUS YEAR)

ALIBABA’S NEW MISSION IS TO REDUCE DELIVERY TIMES TO 24HRS DOMESTICALLY AND 72HRS INTERNATIONALLY

“In the next 5 to 8 years, thenumber of parcels in China maysurge to 1 billion per day. ”

- Jack Ma, Alibaba (May 2017)

ALIBABA ANNOUNCED ITS INTENTION TO INVEST RMB100 BILLION (US$15.2 BILLION)OVER THE NEXT FIVE YEARS TO FURTHER STRENGTHEN ITS GLOBAL

LOGISTICS NETWORK (THROUGH CAINIAO)

Zalando’s new fulfilment centres toincrease cross-border delivery speed

e-Retailers Threat & OpportunityOPPORTUNITIES FOR POSTS & AIRLINES THREATS TO POSTS & AIRLINES

ECOMMERCE CONTINUES TO GROW WITH NEEDFOR AIR MAIL/CARGO CARRIERS AND POSTAL LASTMILE DELIVERY SERVICES

INVESTMENTS TO BECOME SELFSUFFICENT AND TOBYPASS AIR CARGO CARRIERS AND LAST MILEDELIVERY COMPANIES

POSTS AND CARRIERS ARE CURRENTLY PARTNERINGWITH E-RETAILERS

PARTNERING BETWEEN E-RETAILERS EXPANDINGPROPRIETARY TRANSPORT AND DELIVERY NETWORKS

POSTS MAY MOVE UP VALUE CHAIN OFFERINGONLINE SERVICES PARTNERING WITH MERCHANTPLATFORMS AND E-RETAIL ONLINE MARKET PLACES

E-RETAILERS CONTROL END-TO-END ECOMMERCESUPPLY CHAIN INCREASINGLY BIND MERCHANTS TOTHEIR FULFILLMENT SERVICES

POST-AIRLINE COOPERATION TO MAKE AIRMAIL AMORE COST EFFECTIVE RELIABLE DELIVERY SERVICE

E-RETAILERS MAY BECOME AIR-CARGO AND LAST-MILE SERVICE PROVIDERS BEYOND ECOMMERCE

•FoMBA

Expand Post

Carrier EDI•Standard

Operating & Messaging procedures

Paper Free transport

& accounting

•Forecasting &

Allocation

•Enhanced Equipment

Mutually agreed KPIs & actions

FoMbAPost-Airline cooperation providing more visibility and a consistent reliable air transportation service in the most cost effective way

85% paper free

Thank you for your attention !!

History of e-Commerce

Saskia Van PeltDirector Business Development, Schiphol Cargo

Air Cargo Solutions for the e-Commerce (Retail) Industry

Moderator

Jonas van Stekelenburg – Head of Cargo, Schiphol Cargo

Panelists

Ana Hinojosa - Director Compliance and Facilitation, WCO Roger Su – Head of Global Network Planning and Operations, Cainiao/Alibaba Saskia Van Pelt – Director Business Development, Schiphol Cargo

Networking BreakTrinity Exhibit Hall

New Players New Rules!

Wendy Eitane-Commerce and Physical Services Coordinator, Universal Postal Union (UPU)

59© UPU 2018 – All rights reserved

E-commerce: New customer behaviour –A postal perspective

Wendy EitanE-commerce and Physical Services Integration Coordinator,Acting Supply Chain CoordinatorUniversal Postal Union

12th IATA World Cargo Symposium

Dallas, 14 March 2018

60

- 192 member countries, one single postal territory for all postal exchanges

- UPU Treaty

- UN agency responsible for international postal exchanges

- Postal Market US $ 300 Billion

- Largest Physical Network

- Ensuring the satisfaction of cutomers’ needs

61

E-commerce Growth 2013-2018

62

Changing Customer Demands

63

A large number of

consumers believe

delivery to be part

of the online

shopping

experience

A third of online

shoppers have had

a bad experience

Most customers

won’t buy from an

online shop that

has a costly or

inconvenient

return policy

Changing Customer Demands

64

What are customers buying?

6.COMPUTERS

4. HEALTH AND BEAUTY

2. ELECTRONICS

3. BOOKS, MUSIC, MEDIA

1. CLOTHING

5. SPORTS AND LEISURE

The top 6 products purchased online

65

These new demands are changing the way

retailers do business

Consumer /Retailer

relationship

Varying delivery options

Closer proximity Warehouse to

consumer

Borderlessaccess to products

66

165000

170000

175000

180000

185000

190000

195000

2016Q4 2017Q4

Air transport weight: 10% increase on Q4

0

50000000

100000000

150000000

200000000

250000000

300000000

350000000

2016Q4 2017Q4

Air transport items no: 32% increase on Q4

More lighter weight items

What is the impact on air transport?

67

Trends

What is the impact on air transport?

0

10000

20000

30000

40000

50000

60000

70000

80000

20

16

-05

20

16

-07

20

16

-09

20

16

-11

20

17

-01

20

17

-03

20

17

-05

20

17

-07

20

17

-09

20

17

-11

20

18

-01

Transport weights - trends

Air

Sur

Air trend

Surface trend

0

20000000

40000000

60000000

80000000

100000000

120000000

20

16

-05

20

16

-07

20

16

-09

20

16

-11

20

17

-01

20

17

-03

20

17

-05

20

17

-07

20

17

-09

20

17

-11

20

18

-01

Number of items - trends

Air

Sur

Air trend

Surface trend

68

New demands are changing supply

chain stakeholder requirements

SAFETY

EAD

69

The New Reality of the Post

70

Products and Services

Processes and Procedures

Delivery Options

Tracking

Reliability

How the UPU is responding to customer needs

71

Barcodes

Security Standards

Visibility

IT

How the UPU is responding supply chain needs

72

Key Takeaways

Coordination is needed across the supply chain partners – interoperability is key to responding to customer needs

E-commerce is changing customer behavior and supply chain requirements

Postal operators are innovating and making efforts to understand the needs of their customers, the changes in their marketplace and new supply chain requirements

1

2

3

73

Thank you!

[email protected]

Top 10 e-Commerce Fails

Saskia Van PeltDirector Business Development, Schiphol Cargo

IATA’s Pipeline of Initiatives Supporting e-Commerce

Speakers

Silvia Chacon Ramos – Manager Vertical Industry, Swiss World Cargo Brendan Sullivan – Head of Cargo Operations, IATA Michael White – Head of Cargo Network Services (CNS)

IATA’s pipeline of initiatives supporting e-Commerce

Security – Supporting eCommerce

• Advanced Cargo Information (ACI)

• Electronic Consignment Security Declaration (e-CSD)

Collaboration is key

Trusted Traders ProgramAuthorized Economic Operator (AEO)

Seal of quality for e-Commerce platforms

Safety – Supporting eCommerce

A division of Swiss International Air Lines Ltd.

Technology & Innovation: Leapfrog to the XXI Century

Interactive Cargo• The time is now

Technology & Innovation: Leapfrog to the XXI Century

Fast Cargo – Supporting eCommerce

“We sell speed – we need to protect that speed”Lise-Marie Turpin (Former Vice-President Cargo, Air canada).

Strengthening their first value proposition is crucial for our member airlines to support and capitalize on e-commerce growth.

Optimizing the end-to-end

journey

3

2

1

Our visionCargo handling in airports will be safe, secure and efficient through the application of high-quality common standards in handling facilities and provided transparently. This will be verified through globally-accepted assessments, and reinforced by identifying best-in-class cargo handling facilities.

Visibility on cargo facilities capabilities and capacity Checklist based on all relevant IATA standards and

built from the Cargo Handling Manual Alignment with established IATA Audit & Certification

programs: IOSA, ISAGO, CEIV

Under development

Coming next The Standards Manual The Auditor qualification and training The governance structure The Audit pilots The Publication Platform

iata.org/smart-facility

Smart FacilityTransparency in cargo handling

The cargo facility of the future will be smart, connected, green, safe and secure, and fit for purpose in size, location and for the people who use it.

IATA’s Pipeline of Initiatives Supporting e-Commerce

Speakers

Silvia Chacon Ramos – Manager Vertical Industry, Swiss World Cargo Brendan Sullivan – Head of Cargo Operations, IATA Michael White– Head of Cargo Network Services (CNS)

Closing RemarksSaskia Van Pelt

Director Business Development, Schiphol Cargo

Denim and Diamonds Gala Dinner

Hosted by American Airlines Cargo

Buses depart the Hilton Anatole Grand Entrance

beginning at 19:00

Ticket required for entry.

Dinner After Party Hosted by

Join us after the American Airlines Cargo dinner at the BACKYARD for a memorable After Hour’s party!

At 11:00pm, some buses will keep the party going and bring delegates to an after party at the BACKYARD! Delegates will be on their own for all expenses and returning back to the hotel.