PostNL N.V. (AMS:PNL)
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Sep 15, 2026, 10:11 AM CET
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Investor Update

Jun 7, 2021

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Welcome at PostNL. Thank you for joining our first deep dive on Digital Next. My name is Jochem van de Laarschot. I'm the Director of Communications and Investor Relations at PostNL. This is the first time we organize a deep dive for investors and the financial markets. It allows us to engage with you on content and topics not directly related to the hard financial facts and figures. Today will be all about digital and our digital strategy. It will be about the key activities in digitalizing our business to realize our ambition, to be your favorite deliverer. Our program for today. Bart Delmulle, our Chief Digital Officer, will kick off. Bart will elaborate on Digital Next and zoom in at transforming the core commercial engine at PostNL. He will be followed by Renee van Geffen, our Project Lead for Last Mile Delivery.

She will present Delivery Preferences, a project that will provide consumers with more control over delivery of their online orders. After that, we open the floor to your questions to be answered by Bart, by Renee, and by Marcel Krom, PostNL's Chief Information Officer. The presentations will be made available through our website, where you can also find a replay of the event later on. Time to introduce Bart Delmulle. He joined PostNL last February as Chief Digital Officer, a new role in the company at the level of the executive committee. Most recently, he was a partner at Bain & Company. Before Bain, he was a company global leader in the simple and digital practice at McKinsey & Company. In these roles, he advised several Dutch and European companies in their transformational digital journeys.

Bart brings a broad experience in the broader tech, digital, and e-commerce space to the table. He has a distinctive track record for creating value in digital and customer experience transformation. Bart, over to you.

Bart Delmulle
Chief Digital Officer, PostNL

Good afternoon, everybody, also from my side. It's a pleasure to be here and to talk to you through Digital Next. Today, in a short presentation, I want to do three things. I want to quickly recap why we're doing Digital Next, our digital acceleration, and how we're approaching it, and then deep dive on the transformation of our commercial core to show you real examples of what we've been doing and what we're working on, and lastly, indicating the way forward and how we're going to approach it in the years to come. The starting point is, of course, as already pointed out by Jochem, that we want to be the favorite deliverer. What does this mean? We want to deliver special moments, and we want to do so by being the leading logistics and postal service provider into and from the Benelux.

Of course, the world is an ever-evolving space, and especially our market is evolving rapidly. It does two things. It raises the expectations of our customers and consumers drastically, but it also provides opportunities to reinvent our operations. The bar for customer experience is rising all the time. Everything you get in this ever-digital world is very simple, easy to use, and very digital. On top, there's many more digital services that are possible also in our industry. There's a lot of data that we can use to offer better services to our customers that help them in turn to be successful. Of course, our platform approach is simplifying everything. On the other side is a more and more real-time data.

For example, now also the data that we get from our 240,000 road container trackers that we can use to drive and steer our operations in real time. At the same time, there's been massive advances on robotization and automation. For example, for processing, but also for picking or for cross-docking. Of course, it is a more and more open world. In this world, we need to be connected and integrated seamlessly with our customers. How is Digital Next going to contribute to this? Our vision is actually to be the most efficient and innovative e-commerce and postal logistics platform into and from the Benelux, of course, that is really seamlessly integrated with both our customers and consumers, and that we are driven by data. Together with our customers, we want to deliver distinctive experiences to our customers. What do we promise? Three things.

One, we want to make it very easy and smart to interact with us in the way our customers and consumers want it. We want to make it very easy for our customers to become customers, and then very easy to do business with us, whether in our daily sending cycle or whether they need service from us. Secondly, we want to run the most efficient and adaptable supply chain, again, data-driven, so that we actually can provide the flexibility and speed to our customers that they need. We want to offer more innovative products, normal products to additional products, but also digital products and services and platform that actually helps them to be successful in ever-growing e-commerce market and postal market. To do so, we actually are not starting from scratch. We actually have made major steps in the past years on many aspects.

We have very much modernized or have made big steps in modernizing our IT. We have done away with a lot of legacy. We have lots of applications that are native to the cloud. We have modernized our core systems. We also have made major steps already in automating our operations. Automating sorting, also robotization and picking. We also have made major steps already on our digital front-end, our interaction layer, both on the B2C side and the B2B side. On the B2C side with our app and our bots, I'll come to it, and on the B2B side with our portals, our APIs, and plugins. I'll also talk about those. How are we approaching it? We are taking a programmatic approach to do this acceleration, consisting of three value drivers and three foundations. The three value drivers are, one, to transform our commercial engine.

That's what we will discuss today. Transforming our core logistics and operations. On top of this, better, healthier, more digital core, also innovating internal services, service for our consumers, for our customers, but also moving more towards an open platform. To enable this, there's three things we're working on. We're working on our IT foundation, ever modernizing this even more, but also making it faster so that we can actually bring faster change to the market. Secondly, improving our data foundation. Making more data, more higher quality data, easier available for the business to use and exploit. Of course, there's a big people aspect, especially in a company like PostNL. We're also changing our DNA. We want to go from doing digital to being digital. There are some critical aspects in there.

For example, becoming a truly agile enterprise, but also stepping up our digital skills and capabilities and really changing towards a more digital culture. If I now dive into our commercial engine, we look at it in four big components. First of all, the simplification and making it smarter of our product portfolio, both as a value driver in its own right, but also as an enabler to digitize, because there's a lot of complexity in it, logical for a company like us, and we will need to reduce that complexity in order to be able to digitize. It's almost a prerequisite for the rest of our digitization. Secondly, that's a very big focus for us as a service company. We're the sum of all the customer journeys that you actually have.

We want to actually deliver seamless journeys to our customers and consumers, both from a customer interaction point of view, but also from an internal point of view. We want this to be aligned. Thirdly, we want to make a tremendous shift towards digital-first channel mix, towards self-service, both in B2B and B2C. Lastly, we want to do this smart. We are investing, and we have already invested in creating one very good view, both on our customers, our e-commerce customers, for example, but also of our consumers. One klantenbeeld, as we call it in Dutch, where we actually have a very good view, a 360 view on our consumers. In everything we do, we really take a digital mindset. There's four fundamental pillars underpinning all this. First, simplicity. I mentioned it already. You can't digitize what's not simple. There's a lot of legacy.

We need to reduce that complexity. Secondly, make things smarter. Add intelligence, add data, add AI, so that we can be more individualized, that we can be more proactive, that we make everything smarter. Thirdly, of course, digital by design. A digital-first mindset. We do things digital. If we can't, we do it physical for those moments of truth that truly matter, for example, but then we even do it better by adding intelligence. For example, by giving good tools to our frontline, to our bezorgers, deliverers, but also, for example, in all the call centers. Underpinned by that needs to be a real customer obsession. You will see this coming back. We want to do this outside in, starting from and with our customers and consumers. We've done a lot already, and we are advancing.

We will now talk, or I will now talk through some examples. Later, we'll really dive into our consumer in control initiatives. I'll do so by talking quickly through five examples. One of the things we do, and I mentioned, is really rethinking our customer journeys. For example, I become a customer, I make a return, I receive, I get help, both for consumers and our customers. As I said already, we're a service company. In fact, we're almost the sum of all these journeys. If we fix those and redesign those for the digital world one by one, we will actually have transformed the company. To do so, we really have a structured, repeatable approach that we're deploying across the company, our journey factory, in which we are now in wave one, where we started with, for example, I return, and I get help.

If I go into the return journey, where we're actually quite far, what are a couple of examples? We are, for example, injecting AI so that we have more predictability in returns for our customers so that they can plan better and deal better with it. We're also infusing digital tools so that actually we get more to label-less returns, that we are sure that the consumer has sent it back, so there is more certainty. We are investing in kind of changing the interaction layer, so there's more proactive communication to our customers so that they know what's coming and not, and there's less predictability. We're also building in, for example, technology, so that we actually know what the feedback is of our customers so that we can act on it and get ever better. We are deploying kind of the IT system for that.

If I change to more the interactions and the channels and start with the consumers, we are shifting quite dramatically to a self-service kind of environment. Structured or starting from our big and strong PostNL app, on which you have 7 million users and in which lie 6.2 million accounts. An app that has a rating of a 4.5 already, a very good rating. An app that we will continue to build out as a secure communication channel so that customers know, consumers know that we are talking to them, and they are talking to us. That we can have secure in-app communication, but also use it as a platform for additional services. For example, the traffic meter, so that they know whether or not there is a lot of traffic at a retail point or not.

We will complement that with our self-service channels in which we continue to invest. We have made good steps on our bots in B2C, but also B2B, with Daan, with Sam, for example, which we're actually continuing to build out. At the moment, we have 300,000 conversations per month, half of which actually lead to resolution through the bots, which is a major step forward. Of course, we're going to complement that with our other channels, also online channels, postnl.nl, but also physical channels in our call centers where we're improving. One of the things we're also doing in all this is to make it more personalized, individualized, so the customers truly get what they want, and to also make it proactive. If I shift to the customer side of things. We're also expanding there our channels and offering towards self-service.

We have our portals, mijnpostnl.nl, where we already have 80,000 users. More or less the whole customer base is migrated to it. On this portal, our customers can actually do full self-service and find a lot of functionality that helps them in their business. For example, pre-announcements of insights in their business, insights in their invoices, insights in where cases stand in case they need help. We also have already developed a kind of dedicated portal for our smaller customers that actually need more standardized products, a more simple portal through which they can self-service then again. Of course, we do all the personalized dashboards for our customers on that, so that they can actually see and check the performance of our delivery. They can see how many returns are coming, functionality we're building out, so it becomes really true one view on their business.

In addition to that, we're also building the channels, of course, for our digital interactions. At the moment, we have 200 APIs already, which are being used all the time, which are also growing quite rapidly, with 50% which are being used for track and trace services, but also label generation and other shipment services. This is growing quite dramatically. We already have 7 billion API calls per year. If you think about that's actually 5x, 6x as much as that we are processing parcels per day. You could say that we're already quite a fantastic or quite a significant digital player, and that we are complementing also, which is here on the right with plugins. We already have a number of plugins.

The latest one we announced is a Shopify plugin, again, which allows our customers to actually better run their business, which will have to do with pre-announcement or delivery options, and we're continuing to build those out. Last example. Last example is around our Last Mile. Also there, and in our retail, we continue to drive for self-service and automation. At the moment, the rate is around 8% in terms of self-service, and we continue to build that out. We are piloting a number of things, for example, our new Cloud Up Levels in Utrecht, but also all kind of new self-service concepts in retail, which also there will actually drive the better self-service of our customers. Just to highlight a little bit what we're doing beyond our commercial core and what we're doing in our operations, and then also on the business models.

In parallel to this, we're also transforming our logistical operations, starting from a single vision with three pillars. One, we want to really move towards a fully data-driven and real-time supply chain, where we can use all the data to really steer it. That's why this year we have developed or introduced, sorry, the 240,000 IoT trackers on our own containers. We're also actually doing machine learning so that we can actually do better forecasting, so that we can have better real-time alignment with our customers. Secondly, we continue to invest in the robotization and automation of our core logistics. We do robotization in our processing, we do automation in the packing, and of course, we are continuing to evolve our cross-docks also into automating that. Lastly, third component, we're also digitizing our frontline. The whole delivery, the depots.

We're providing tools to our drivers to be more productive. For example, machine learning-based tool that helps them to load their vans better, van loading tool, so that they're then more productive when they actually do the delivery. We're also digitizing, for example, the tools they have to come back to debrief, which allows them to do it faster, but at the same time, again, allows us to capture data that we can use to actually make and optimize our delivery process. Once we have this solid core and digitized core, we have an opportunity to actually add to it. We have prioritized three digital innovations or business model we want to double down on and invest in. Those three should be additive and reinforce our core. The first one is consumer services. As indicated, we want to build from our very strong app.

We actually want to turn that into a secure communication channel, drive to in-app communication, and make it a true engagement platform in which they interact with us all the time and the other way around in a personalized fashion, so that we actually get to know them better, even better, and can even serve them better. Secondly, we want to, based on all the data we have, whether it's operationally or linked to our daily sending cycle or insight in our consumers. We want to actually help our customers by providing them even more data and insights in real time so that they can run their business better. So that they are more successful. Building on our APIs, but also with the plugins. Lastly, we want to evolve more to an open platform. We want to open up our app platform so that we can add new operators.

New operators, for example, green operators or same-day that are more flexible than us, so that we even have a higher density and a better proposition towards our e-commerce players in terms of last mile. Those three should also reinforce each other. If we, for example, add green networks, we can also think about new revenue models again on the consumer side. They will also reinforce each other. More options will attract more customers, e-commerce customers, where they can attract more consumers. It's a flywheel we're going to put in motion for PostNL. Of course, all this needs the foundation to make it happen. We are strengthening our IT foundation. We continue to modernize. We shift to a cloud-based application landscape.

We continue to move to a service architecture to improve and build out our internal API, so that we actually can develop faster and accelerate this transformation much faster, but also are more agile and more adaptable in the market, so we can recompose ourselves. Secondly, as set, we also continue, and that's a big priority to invest in our data foundation. Making the data available, quality data, easily available for the business. We're working at the moment on quite some initiatives on that to make that happen, so that we can really unleash all the data we have. In addition, how to use that data. We're setting up and we're thinking about a use case factory where we can actually more rapidly identify, prioritize, and deploy the use cases like the ones we've done in the past. Lastly, it's about our digital DNA.

A very strong focus point. We're investing a lot of time and attention and energy with a couple of components. Our agile model, which we are evolving, which had a strong starting point, which we're bringing to the next level, so that we're truly agile at scale. We have now more than 1,000 people working in our agile teams delivering all this. They are actually delivering 700 features by quarter, which is quite significant. The acceleration of the past year has allowed us to deliver, in fact, 60% more features than we did last year. Year-on-year, 60% more productivity in our whole agile engine. Two-thirds of that is all digital features, and at an even higher reliability than it used to be before. We're also investing in our people, in building the capabilities and skills.

We, for example, have a big Digital Academy in which we continuously train 900 more people in all the elements of digital and also all the things we are doing, which we are also scaling up. We are also building and investing in building new ways of working, new capabilities. DevOps, Machine Learning Ops, Site Reliability Engineering, that we actually more and more get it into our genes to do digital and to be digital. How are we going to go forward? I will not go through this entirely, we have a clear plan. That's the message, where we are now in a phase of focused acceleration across all the dimensions I talked about, where you've seen some of the big initiatives, which are then rapidly going to scale and then going to embed.

We're going to work systematically across those six dimensions, and we know where we need to be on all those six dimensions. We will also report back to them, on them to you on a periodic basis. It's not rigid. It's well thought through, but it's not rigid. We also have a test and learn approach. We will actually see what works, test, and adapt along the way. That's how it is. We are sure that we will discover a lot in the years to come that you might have not thought about, but that we still need to pick up given that the world continues to evolve very rapidly amongst us. Maybe before I close, if you think and listen about this presentation, and you listen a little bit to the undertone and a couple of the key aspects, there's a couple of elements to point out.

We are starting from a very strong foundation that has been put in place over the past years through this team, and especially in the leadership of Marcel, which will also join us later. We actually have a well thought through, aligned, well sequenced, and doable plan. In this transformation, we really think a lot about the doability. All the things we need to do, the digitization we need to do still needs to be made, and there's quite some thinking to be done on that to make sure that we can do as much as possible with the resources we have. We are not only focusing on what value creation levers. We are also focusing on how to get it done and with whom to get it done. That's where it typically goes wrong and where there's too little time invested.

We have taken the opposite, and we are over-investing on that and over-indexing on it. Fourth, agile, as I mentioned. We have a good plan, but we will still test and learn and adapt along the way. I will do so with our customers and our consumers. We'll do it with them, and we'll do it in kind of an open way. For sure, we will focus on the value creation, capturing the benefits. What will this bring if we do this and we do this successfully? For our customers, it will be an easy company to do business with, and we will jointly deliver great experience to the consumers, and we will help them to be successful in a thriving e-commerce market. Secondly, for our consumers, they will get these distinctive experiences. They will be in control. We will put them in control over what they receive.

Third, for operators, we will be a platform, a platform of opportunities in which they can connect. What will it bring for us and our employees? For our employees, a thriving company where it is exciting to work in a dynamic environment where there are opportunities to be part of the digital world and to learn digital capabilities. To become an even more attractive employer that attracts, develops, and retains talent. Of course, for PostNL and the shareholders, a more performant company, EBITDA and cash flow, but also a healthier company, a company that is better positioned for the future. Lastly, also almost a goal in its own right, a more faster and more adaptive company. If there is one thing that we all know, is that in a digital and more digital world, you end up in a state of continuous change.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Thank you very much, Bart. We look forward to see you in the Q&A later on. We move on to our next speaker, Renee van Geffen. Renee is our driving force behind innovation in an important and rapidly changing part of the customer journey. She has several years of experience in e-commerce, logistics, and product management. In recent years, Renee was responsible for digital products at PostNL. She was involved in the innovation of track and trace and consumer-in-control services. Renee, over to you.

Renee van Geffen
Project Lead for Last Mile Delivery, PostNL

Good afternoon. The last mile is where we make the difference for customers and our consumers. We may deliver post and parcels on a large scale, but we're working really hard to making the delivery of a parcel a personal experience. It's the combination between seamless digital solutions and real contact between the deliverer and the receiver that hits the sweet spot and helps us achieving our ambition of being the favorite deliverer in the Benelux region. PostNL strongly focuses on constantly improving its customer journeys. We know from customer research that when consumers have been given control over their delivery, that their satisfaction is significantly higher. What we do is we give control to the consumers. This may sound simple, but it's a major call on our logistic capabilities, and it requires innovation in terms of information and interaction concepts.

Speaker 4

On February 15th this year, we introduced the delivery preferences in the Netherlands. This is a great example of how we're changing our core commercial engine, and it's one of the pillars needed for accelerating our digitalization. This new service enables us to achieve three important goals. First, we increase the digital engagement with receivers and boost their satisfaction. Second, we collect new relevant data about receivers, and with that, we can design further new services and increase our competitiveness. Third, we gain operational efficiency. Before we go into this a little further, I'd first like to share with you what the delivery preferences are and how they work in the real world. This next video has that story.

Ik ben Nicole van Marle. Ik ben strategisch programmamanager consument. Mijn naam is Laura Versteegh en ik ben momenteel productmanager op het domein Bezorging Laatste. De ambitie van PostNL is om de favoriete bezorger te worden. Dat doen we door digitale innovaties te realiseren die aansluiten bij de behoefte van onze klanten. Om in die behoefte te kunnen voorzien, hebben we de bezorgvoorkeuren. Met die bezorgvoorkeuren kunnen consumenten zelf aangeven waar, hoe en wanneer zij dat pakketje willen ontvangen. Ze kunnen bijvoorbeeld kiezen binnen de niet thuis-voorkeuren. Dat betekent dat als zij niet thuis zijn, dat wij als PostNL al weten waar die ontvanger graag zijn of haar pakket wil ontvangen. Wij kunnen ze dan bijvoorbeeld kiezen voor een PostNL-punt, voor de buren of voor een afgesproken plek. [/Foreign language]

Die afgesproken plek is een plek in of rond het huis die veilig en droog is en waar de bezorger makkelijk bij kan. Mocht je niet zo'n afgesproken plek hebben, dan kun je ook kiezen voor een pakketkluis. Dat is een hele grote brievenbus die je voor je deur neer kan zetten, en dan heb je het alsnog dezelfde dag in huis. Uit onderzoek meten we dat de consument echt blij wordt als hij het pakketje in één keer ontvangt. Dat is ook iets waar de webwinkel weer ontzettend blij van wordt. Tot slot is het een voordeel voor PostNL, omdat wij maar één keer langs hoeven te komen en daarmee minder onnodige kilometers hoeven te rijden. Als PostNL hebben we miljoenen mensen die de PostNL-app gebruiken en nog veel meer mensen hebben een PostNL-account.

Wat dit uniek maakt, is dat we al die mensen met een PostNL-account de mogelijkheid bieden om aan ons door te geven wat wij met dat pakketje mogen doen. Dat maakt het een hele mooie digitale en innovatieve oplossing voor heel veel mensen in Nederland. Als deze consument een pakketje bestelt, plakken wij die voorkeur op dat pakketje. Zo wordt die informatie meegegeven tot in de handheld van de bezorger. De bezorger weet dan, als die consument niet thuis is, wat hij met het pakket moet doen. Er gaat een wereld achter schuil. In de eerste plaats moet die data worden meegegeven aan het pakketje. Wordt door het hele systeem gevolgd. Aan de andere kant kun je ook op basis van die data voorspellingen doen.

[Foreign language] The start is now made. The foundation is laid and now we really have the digital relationship with the consumer and the consumer will also discover that he can set his preferences in his or her account. Now it's up to us to continue that and to serve the consumer even better in what he or she wants in the future.

As you could see in the video, it takes just a few clicks and then as a consumer, you've set your delivery preferences. Behind the scenes, all kinds of things are now kicking into action to make sure that we deliver your parcel according to your preferences. To create a seamless journey, we have to fully align our digital interactions with our operational processes.

Renee van Geffen
Project Lead for Last Mile Delivery, PostNL

This starts with the e-commerce players. They send out their parcel with a barcode, but they also send us in advance a digital data file containing all relevant data about the parcel. For example, the receiver's email address. This data sets off a whole chain of processes. For example, a machine learning model will predict the day of arrival at our sorting center. We also use this data file to match the parcel to a PostNL Account, and therewith to the Delivery Preferences. Of course, we comply with privacy rules and regulations at all times. Only people with highly validated PostNL accounts are able to set their Delivery Preferences. That's to say, we must be completely sure always that the parcel is addressed to and meant for the person to whom the PostNL account belongs to.

Today, we have 6.2 million PostNL accounts, of which 2.4 million have the highly validated status. This provides a strong foundation and a springboard for further growth. The delivery preferences. When we started in the Netherlands, only on a small scale. We took the first steps, and unfortunately, we were not able to set live the standard preference straight to a PostNL location due to COVID-19. We were able to introduce the delivery preferences not at home. This year we started small, but in the following weeks, we rolled out the service throughout the whole country. Up until now, we've sent out 1.8 million PostNL emails to people with PostNL accounts, inviting them to set their preferences, and 140,000 of them have already done so. In addition, another 11,000 people have set their delivery preferences on their own initiative.

If we look at the results, the options that people have chosen, we see that 24% have chosen a pre-agreed Safe Place, 31% opted for the retail location of PostNL, and 45% of the people chose delivery at neighbors when not at home. We also see in our data that frequent online shoppers are overrepresented. They set their delivery preferences 1.7x more often than non-frequent online shoppers. This new service enables us to deliver more parcels at the preferred location, at first attempt. From consumer satisfaction research, we know that satisfaction can be up to 40% higher, if consumers have control over the delivery of the parcel as compared to a failed home delivery attempt without exercising this control. In addition, the service also enables us to increase the digital engagement that we have with receivers.

People who've set their delivery preferences are seen online 30% more online on our platform. This is key. As a strong relationship with consumers strengthens the core of our business. This new service does not only increase our competitiveness and increase consumer satisfaction, it also provides us with an opportunity to gain more operational efficiency. Please note that not all delivery options hold the same price tag. To achieve structural consumer satisfaction and operational efficiency, we have to strike a balance in the options we offer when and where. We do this on the basis of our data. The delivery preferences only have just gone live, and we're really pleased with the first results. The next few weeks and months we'll spend strengthening the foundations and ensuring high-quality levels.

One example, we will introduce a photo when the parcel is delivered on the agreed spot. We see new opportunities. For one thing, the segment of frequent online shoppers is bound to grow, increasing the potential for this new service. By adding more options, the relevance of the delivery preferences will grow as well. What the best strategy is, depends on our data and the things we find in there. Only time will tell what that is. Thank you very much.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Thank you very much, Renee. We will now move on to Q&A. Next to Bart and Renee, we are happy to have Marcel Krom with us. He is Chief Information Officer and member of the executive committee of PostNL. Since 2009, he is one of the driving forces behind the digitalization of PostNL. Marcel and his team built the strong IT and data foundation on which we are building and accelerating our digital transformation today. He was also the winner of the CIO of the Year Award 2020, in recognition of his work on the best customer experience, innovation, and efficiency. Please welcome on the stage Bart, Marcel, and Renee. Some practical information first. Before we begin, people invited to join this virtual meeting can indicate that they would like to ask a question.

You can do so by using the raise hand button on the upper left side of the screen. Just to be sure, this feature is not available to people following this session via the webcast. When it is your turn to ask a question, you will get a pop-up about using your microphone and camera. On the bottom of the pop-up, please click on the right green button, and then we will be able to get you live connected to the studio to ask your questions. While I'm here, I'll take the liberty to ask the first question myself to you, Marcel. What is the best decision that we took in the last, let's say, decade, when it comes to digitalization?

Marcel Krom
Chief Information Officer, PostNL

I think we made a lot of decisions in the last 10 years. I think one of the most important decisions is that we kept on working on our IT infrastructure during good times and during bad times. What I mean with that is that in 2012, when we had a difficult time, we made the real choice to go fully for the cloud. With moving to the cloud, we also made two extra decisions. That is taking out legacy relentlessly. We also went into a new enterprise architecture, which was a decomposing of our functionality. It sounds a little bit complex, but if you have big systems which are tied together, then it's very hard to change very fast. We made smaller functionalities, and that is what we have done from 2012 to 2017.

The next level is that we have built digital building blocks, like an API system, like a data lake, like the plug-ins, which enables us to build digital business models. The next step is that we will go fully native into the cloud solutions with microservices, which we can tie together via very strong interfacing via APIs. That scalability is a real necessity to make progress in digital, but also to be more flexible. It's, I think, relentlessly the same choices in making our landscape more flexible and more scalable.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Thank you, Marcel. Again, if you're interested to ask a question, go to the upper left side of the screen. I think it is over there on that side, and push the raise your hand button. I'll ask a second question to you, Bart. You have just recently joined PostNL. Can you tell us a little bit about your first impressions when arriving at the company?

Bart Delmulle
Chief Digital Officer, PostNL

As I pointed out, building on Marcel, there's an extremely strong foundation to build from on three dimensions. First, it's the IT infrastructure that Marcel has just pointed out, which has been extremely purposeful and very goal-oriented, so it's all additive. Secondly, of course, the degree of robotization and automation there is already in the process, in the picking, and so forth, which again, also is something PostNL is very strong at and we can build from. The third component is really the build-out of the digital front end, so the build-out of all the digital channels, both on B2C and B2B and where that stands. Which gives us, in fact, if you all combine it and combine it also with the knowledge there is already in the company, a good starting point to exploit it.

It's not a digital transformation where some things have been done on the front end, and then when you look inside it, there's maybe not so much to see here. It's exactly the opposite. Strong foundation to build from.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

When you look at customer centricity, which is a fundamental part of digitalization, where do you think PostNL is currently in the journey?

Bart Delmulle
Chief Digital Officer, PostNL

We are quite strong. We're still the favorite here. The challenge is that we need to remain in an ever-changing landscape, as I pointed out, because expectations are rising every day on the consumer side, driven by the digital natives, which make it very simple and easy to use and of course are digital per se. Also with the customers, where the digitalization is very important because it's not so much about the interactions between us as people and the companies, but more and more about the data that goes between both parties, in fact.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Given your background, I'm assuming you are well-positioned to compare what you see at PostNL with what is happening at peers, also in the international context. Any observations there to make?

Bart Delmulle
Chief Digital Officer, PostNL

The same observation, a strong starting point. Yeah, as I said, the world is moving, so we need to move also at pace. That's why this is not really a digital transformation, but it's the acceleration of the digital transformation. That's why we have a lot of attention also on our operating model and how we are able to deliver faster digital innovation to the market. Our agile next building, the digital capabilities, getting to a digital culture. We don't want to just do digital. We want to be digital, in fact.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Thank you. I'm looking at the camera to see if anyone is raising their hand at this moment to ask a question. Please do so by using the raise your hand button on the upper left side of your screen. If you're not asking the questions, I will. Renee, a question for you. With regard to the option to leave a parcel at a Safe Place when you're not at home, the advantages for both consumers and PostNL are clear. How can we be sure that the parcel is still there when it is left in an open space around the house?

Renee van Geffen
Project Lead for Last Mile Delivery, PostNL

The service is called Safe Place. We really ask consumers to find a place around their house that's deemed safe. Upon delivery, we ask the deliverer to assess that. If he thinks that this place is not safe for whatever reason, he will deliver the parcel at their neighbors' or even at a PostNL retail location. Not all house types have a space around them where they can find a Safe Place. That's why we're developing a parcel locker at this moment that you can install right next to your door, so that more people have access to a Safe Place around their house and can use the delivery preference's Safe Place.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

The project has been running for a number of months, and we've seen first examples. When you look specifically at consumers, can you dig a little bit deeper into their responses, the sort of feedback that we get?

Renee van Geffen
Project Lead for Last Mile Delivery, PostNL

Most people are really enthusiastic about this new service. We see some hiccups. Some people, if they want to use Safe Place, for example, they said, "Well, just throw it over the fence," for example. Everybody's still learning, right? Consumers are learning what are safe places. We are learning, oh, we have to think about this and instruct consumers better. We have to sometimes help our drivers a little bit to really use the service appropriately. Mainly positive reactions.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Thank you. We talked a little bit about peers. There's a similar question when it comes to the, let's call them, the smaller players, the startups, who can move really fast into digital. How can we compete with that sort of group that is up and coming at the moment?

Bart Delmulle
Chief Digital Officer, PostNL

That's a good question. That's always the question. I think it's very important that you actually have a healthy core. That's why we have so much emphasis on it. That's why 80% of our effort is on that. If you really digitize all customer interactions, make it better, make a better experience both for customers and consumers, create kind of these digital highways with our customers, at the same time also really transform our operations and ultimately sort them, I think then we'll have a better basis to do all these experiments on the new business models. Then we will actually be more successful in setting them up and bringing them to maturity. At the same time, will it allow us to actually exploit kind of the assets that we have already? We have very many assets the attackers don't always have.

It's just about us making it possible to use those in an attacker game. For example, if you talk about really being more of an open platform, yeah, we are already acting like that internally. All the technology exists for that. It is fully decoupled, so we can actually just exploit that to become more of a platform that is open for third parties, as an example.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Maybe looking slightly broader to the market as a whole, so to say, and to the digital space that we are entering more and more, what are some of the trends that you see that will impact basically everyone, all around us?

Bart Delmulle
Chief Digital Officer, PostNL

We've talked about many. The big question is, how will the platform world play out in our industry? That has played out in very many industries. When there is friction, there's also friction in our industry. The question is, and we are not there yet, but what will be the impact on our industry, and how will that change actually how companies work and interact with each other? Also, how will it actually make it simpler for consumers, and will it displace some things that exist today?

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Marcel, the next question to you, it's about data integrity, because data obviously is one of the key elements in everything we do in this area. Of course, there are concerns when it comes to cybersecurity and all that. What can you say about the measures that PostNL is taking to make sure that the data of our consumers, of our customers, is safe at all times?

Marcel Krom
Chief Information Officer, PostNL

Yeah, that's a variety of measures. We have strict agreements with our partners who deliver the technology. Out of cybersecurity part, we also have an internal cybersecurity department who gives us the lead how to control all those aspects. Out of cybersecurity part, we do all we can. Of course, you never know whether it's enough, because the world of cybersecurity is changing very rapidly. You need to stay very alert. You see that each year, we invest more into cybersecurity to protect our assets. If you look into data integrity, then the generation of data, the preservation of data, and the usage of data is, of course, technical, maybe a little bit difficult. Also out of privacy regulation, you need to adapt to those.

Especially with the new regulation, we have to be very careful and to instruct our people and also to guide our people and to learn a lot about those new kind of regulation, what you can do and what you cannot do with data to keep us. To keep it as trustful as that we are as PostNL.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Thank you. We move on to the screen to Andre Mulder of Kepler Cheuvreux, who is online. Andre, please go ahead.

Andre Mulder
Analyst, Kepler Cheuvreux

Good afternoon. A question on the appearance of the Americans on the B2C market in the Netherlands. They're usually B2B players, but they're also actors in B2C. I'm sure you're perfectly aware of what everybody is doing. How do you look at these players? Where are you compared to these players? Are you better than them, or are you doing things differently? What can you tell us about that?

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Bart, I think that's a question for you or for Marcel. The question Andre is asking is how do we compare to the American companies that are coming to Europe and moving into B2C?

Marcel Krom
Chief Information Officer, PostNL

I think Bart will add on. I think one of the major differences between those companies and us is that we are really looking into the infrastructure of the Benelux, how we can make a differentiation in our own market. What we see is that, especially on the area that Renee also has elaborated a lot on, is that the connection we have with the consumer, with the preferences, but also in the trust which we have with that customer group, is one of the big differences, I think, if you compare it to those players. Bart?

Bart Delmulle
Chief Digital Officer, PostNL

Yeah. We of course have a very good relation with our customers. We also have a fantastic customer experience from the consumer. We're actually investing quite a lot to continue to build on that, both to get to know them, but also to drive the engagement with them, but also to deliver an even better experience to them. That's a way we'll actually also solidify this relation. As I pointed out, for example, we now have this app. We have 7 million of them. 6.2 million accounts are sitting behind that. Quite some of those are really very well-validated. We will to actually drive continuous engagement on this app between us and our consumers so that we strengthen this relationship.

I use always the example, it's a little bit like when you're in home alarm, your challenge is actually to shift out or to make sure that people actually arm their alarms. The moment you actually add climate control and that kind of things and an app to your alarm system, consumers start using the app and actually start interacting with you all the day. Because they actually check the climate control or the air quality and so forth, and at this moment, you're in this continuous dialogue, which strengthens continuously the relation, but at the same time also allows you to capture more and more data, learn more and more from them. Which actually allows you again to do many things to their benefit. That's actually something we focus on quite a lot.

We have something which is called our one central consumer view, in which we're actually building up all this knowledge so that we can also deliver very personalized experiences to these consumers. When you come to the PostNL website as a consumer, you actually get at this moment a personalized experience already.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Andre, does that answer your question?

Andre Mulder
Analyst, Kepler Cheuvreux

Yep. Thank you.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Thank you. Thank you for asking that question. Again, if you want to ask a question, you can use the raise your hand button, top center of your screen. It is, I think, a good moment to talk about the automated parcel machines. There is quite a lot of things in development going on, with new companies entering the market, existing, expanding abroad. When it comes to this side of the delivery. I am not sure whether to look to you, Renee, or to you, Bart, but can you answer the question?

Bart Delmulle
Chief Digital Officer, PostNL

Sure. Yeah, of course, there's also a lot of innovation on that front, as we've seen all the announcements there are, also all the announcements there are in the Dutch market even. Technology makes, again, many things possible on the delivery side and in the last mile. At the moment, and as I pointed out, we already have 8% self-service in our last mile, both in last mile, but also retail. We're actually also investing on that and actually evolving our last mile. We actually have a broad range of things that we're doing there. For example, on the individual level, we will have actually the individual parcel lockers that Rene mentioned that can complete, that we again can combine, and which we can make smart together with those delivery options. We're also looking at different APMs.

We already have APMs in the market. We're also looking at different variants. We have a very big, the Clever on that we're actually at the moment testing also in Utrecht. As one example, we're looking also to scale up the more traditional APMs. From a retail side, from a self-service side, of course, there we also have a lot of things going on and a lot of pilots. Personally, I think the landscape will evolve, like in every market, especially when you look to the Polish market, how it looks there. It will be a function of actually how the geography looks like and what will be the competition.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

We got a follow-up question online, which is how do you expect the economics of the Safe Box or the investments around them to work also towards clients? If you understand what I mean.

Bart Delmulle
Chief Digital Officer, PostNL

To customers you mean or?

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

We have to make investments to create the Safe Box and to make sure that that is one more option that we deliver. One investor asks, how does that work in terms of economies?

Bart Delmulle
Chief Digital Officer, PostNL

Marcel, as you know, do you want to?

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Try to achieve.

Marcel Krom
Chief Information Officer, PostNL

That's always a balance, is to see in what kind of areas you can have an APM and where we make expectations out of our data. We know how much time it takes before an APM is economically viable. If you look into the data, then we know in which areas we can put an APM, and after how many months it will be economically viable. Out of that perspective, you can make a business case for the APMs and also the areas where you put those APMs. That's the economical perspective. Next to the economical perspective, you also have the customer experience, strategic investment, of course, where we see that customers really want to have an APM in their neighborhood. We have made the business cases based on the area, the drop rate, and the customer preferences to see where the APMs are economically viable.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

That's actually a nice bridge, a segue to a next question for Renee. The solution that you have presented of delivery preferences, how does it impact the time it takes for the deliverer to deliver the package? Also, how does it impact drop duplication and the hit rate?

Renee van Geffen
Project Lead for Last Mile Delivery, PostNL

Thank you. Well, let's start with the time the deliverer spends at the door. That depends on the option chosen, right? For a Safe Place, most we find from our first results that the most safe places are really close to the front door. It doesn't take too much time extra to deliver the parcel. Actually, it takes less time than the delivery at the neighbors. We see that 24% of the people have chosen Safe Place, and it mainly saves us time because those parcels would normally most likely have gone to a retail location. That takes obviously more time to deliver. How does it impact our hit rate? Well, if people are not at home, they probably still won't be at home, but they've set their delivery preferences.

Maybe we could say that all parcels delivered in a Safe Place count as a first time, a hit rate parcel. In that sense, we would increase hit rate as well. Drop duplication, well, for home delivery, not so much, but for all parcels that are rerouted to a retail location, yes, we will increase the drop duplication even more if we, after the COVID-19 crisis and our retailers have more capacity, introduce the standard preferences straight to a PostNL location. All those parcels, we won't put them in their normal delivery routes, but send them straight to a PostNL location. Many operational advantages.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

You talked about COVID-19 and its impact. Bart, a question to you. When looking at everything digital, things were moving fast already. If we've learned one thing in the last 12 to 14 months is that they could be sped up easily even further as a result of the pandemic. If you look at what happened, how do you reflect on the progress that has been made in general, but also specifically at PostNL?

Bart Delmulle
Chief Digital Officer, PostNL

This is not specific to our industry, but adoption of digital has actually just been massively pushed forward in the past year due to COVID-19. Also with us, and we've seen that both in the interactions, the shift to digital sales, digital service, and so forth. We also have seen it more in the operations. We also have actually had to deal with much more higher and predictable peaks sometimes. We also have had to, on the short term, leverage actually all our data analytics to the max to actually be able to deal with it. It also has been a very good exercise in actually seeing how far can we actually push our operational model and to which extent can we actually leverage all the technology and digital technology that we have today to actually improve our operations when there's actually enormous volumes.

Jochem van de Laarschot
Director of Communications and Investor Relations, PostNL

Thank you. We have no further questions at this stage. We are going to organize more deep dives focused on Digital Next, but also on other topics. For instance, ESG, more specifically, our efforts to improve the environmental metrics of PostNL. This is for the second half of the year. We also hope to invite you, if possible, face-to-face. Let's hope so, to welcome you to the Netherlands, where we are working hard to open the first small parcel sorting center, a fairly new and innovative approach to sorting parcels with shoebox size, which will allow us to increase our capacity by many folds. I would like to thank you for taking the time to be with us here, and for taking questions. We would welcome your feedback on this deep dive. We will send you a quick survey to collect your comments.

As I said, the presentations and the replay of this event will be made available through our website. If you have any further questions, please don't hesitate to contact the IR team at PostNL. Thank you very much, and see you next time.