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11
OUR MARKETS
Strategic Report
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Whistl Annual Report 2016
Parcels
Within the Parcels market we continue to extend our
service offering and this now includes next day tracked,
business to business and 48-hour services. The UK parcel
sector remains the main driver of growth in the delivery
market with continued volume growth in 2016.
Whistl’s Parcels business saw an 8.6% volume growth
compared to 2015. Books were a key sector for new
business growth and three of our top five new accounts are
book wholesalers. Parcels remain a key part of our growth
strategy in the UK and international markets and, with an
excellent run rate of new business wins at the back end of
2016, we expect strong double digit growth in 2017.
International
The volume of the international outbound Parcels market
as a whole grew by 4.0% in the last year, however Whistl
saw a 30.2% growth in international business during 2016
versus 2015.
As part of our international strategy to grow inbound and
outbound mail and Parcels activities we broadened our
carrier network from one key supplier to multiple partners.
In 2016 we converted one of our largest financial services
customers to use our international services.
Downstream Access Mail
Bulk mail is our core business area, which comprises a
portfolio of collection and sortation services, with onward
delivery via Royal Mail (known as Downstream Access or
DSA) and DSA accounts for 58% of the total letters market.
Whistl’s share of the Downstream Access Mail volumes in
2016 was over 50% and we remain the key competitor to
Royal Mail Retail. The ability to deliver real value continues
to be important in a highly competitive market. By focusing
on excellent account management and consistent quality
of service, we have retained all key strategic customers in
2016, alongside delivering significant new client wins.
Although overall mail volumes in the UK remain under
pressure, Downstream Access Mail volumes have remained
remarkably stable since 2011. There are, however, still
an annual five billion items which do not go through
Downstream Access which presents an opportunity for
Whistl.
The main market factors that influence the growth or decline
of mail volumes include ‘e-substitution (which is the main
driver for decline of transactional mail volumes, (such as
invoices and statements); GDP growth (traditionally a driver
for advertising mail growth); and Royal Mail price rises.
Doordrop Media
Doordrop Media focuses on targeting, distribution and
sampling services and we continue to be market leader
in this sector. It remains an important marketing medium,
particularly for the financial sector, charities, retailers and
ecommerce companies.
Doordrop Media remains one of the most effective
customer acquisition channels for marketeers. Our
Doordrop Media business has outperformed the market and
increased its share of Royal Mail distribution volumes from
24.6% to 30.7% and it also saw an increase in revenue of
19.7% compared with 2015 revenues.
CEO Business Review