saving posts by making markets
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© 2013 Van Alstyne et. al.
Saving Posts by Making Markets
Marshall Van AlstyneBoston University & MITTwitter: @InfoEconmva@bu.edu, marshall@mit.edu
Postal Vision 2020Washington, DCApril 11, 2014
© 2014 Van Alstyne, permission granted to redistribute so long as all copyright information is preserved.
Geoff ParkerDirector, Tulane Energy Institutegparker@tulane.edu
Tushar ShankerBoston Universitytshanker@bu.edu
1st Class + Std Mail ~ 70% Rev, 90% Vol
$4.8B loss in 2012 ($15.9 including mandatory health and retirement)
Source: USPS Financial Report 2012 Form 10-K
Twitter: @InfoEcon 3 PlatformEconomics.org
Source: USPS Financial Report 2012 Form 10-K
Twitter: @InfoEcon 4 PlatformEconomics.org
Twitter: @InfoEcon 5 PlatformEconomics.org
You’ve just paid $15 to see Ironman when you’re presented with…
Unsolicited car ad Unsolicited preview
Which ad makes you happy?
Which ad makes you happy?
Twitter: @InfoEcon 7 PlatformEconomics.org
Consequences of ads that don’t make people happy.
Twitter: @InfoEcon 8 PlatformEconomics.org
Digital Ad Revenue Crosses $10B
Source: Internet Advertising Report 2013
Puzzle: mail ads are declining but digital ads are rising?
Twitter: @InfoEcon 10 PlatformEconomics.org
User Advertiser
Google Platform
1. Users declare interests2. Advertisers buy
attention3. Google refines its
matching algorithmPlatform
User Advertiser
Wash…Rinse…
Repeat…
Preferences +Interactivity +
Feedback
Twitter: @InfoEcon 11 PlatformEconomics.org
Twitter: @InfoEcon 12 PlatformEconomics.org
Even broadcastis going interactive.
Twitter: @InfoEcon 13 PlatformEconomics.org
We Need…
… to let recipients express their preferences… … interactivity…
… feedback to drive improvement…
… to route flows of mail, of data, of
money…… partnerships with industry …
… a business model.
Twitter: @InfoEcon 14 PlatformEconomics.org
ALL BUILT AROUND PAPER?… doing all this…
Twitter: @InfoEcon 15 PlatformEconomics.org
John L. Webb
47 East River St.
New Brunswick, NJ 08901
Consider a new kind of stamp
Twitter: @InfoEcon 16 PlatformEconomics.org
Sender
Recipient
Content
Date
Recipient gets this!
Twitter: @InfoEcon 17 PlatformEconomics.org
Stop Sending
Love It!
Tell Me More
☐
☐
Twitter: @InfoEcon 18 PlatformEconomics.org
Stop Sending
Love It!
Tell Me More
☐
☐
Twitter: @InfoEcon 19 PlatformEconomics.org
Win for Recipients
• Gets Voice!• Archival, on-demand
retrieval of ad content and coupons
• Green, less landfill• Get buy-it-now option• Bi-directional: Can request
info, declare intent to purchase home furnishing, schedule oil change, try new restaurant
• Get Paid!
Twitter: @InfoEcon 20 PlatformEconomics.org
Win for Mailers• Learn what they like and what
they don’t• Like permission based ads,
much higher response rate• Can reward for forwarding ads
to friends and family• Notification of delivery,
opening, interest in product, interest in seller
• Physical mail becomes portal to mobile access
• Can motivate behavior, not just clamor for attention
Twitter: @InfoEcon 21 PlatformEconomics.org
Win for USPS• Avoids Do-Not-Mail• Can charge more for unwanted
mail• “Move Updates” at the press of
a button• New source of revenue from
escrowed funds• Closes data feedback loop
enabling value proposition relative to Google and Facebook
• Enables electronic commerce• Data layer creates platform for
ecosystem of biz partners
Twitter: @InfoEcon 22 PlatformEconomics.org
Platforms get enormous value from 3rd party developers
Most firms can only concentrate on most valuable
apps
Profits increase when others add to platform’s “Long Tail”
USPS can have its version of MS Word / PowerPoint / Exceland let business do everything else.
These areecosystem partners
Twitter: @InfoEcon 23 PlatformEconomics.org
Challenges• What about elderly access?
– DMA: Trend is extremely favorable– Works for any device with web access & camera– Can pre-load app & starter account on mobile devices
• How handle rollout?– Use public records: driver’s license, voting, phone records, even direct
mail lists– Advertising pays for rollout and even motivates adoption– Solves problem of hybrid mail
• What happens to unclaimed coupons?– Simply expire and can be reused
• What happens when people claim coupons but never buy?– Advertisers will figure this out fast!
Twitter: @InfoEcon 24 PlatformEconomics.org
Opportunities
Total Ad Market $167B Total E-Commerce Market $225
TelevisionDesktop InternetMobile InternetNewspapersMagazinesOutdoorRadioCinema 135%
Twitter: @InfoEcon 25 PlatformEconomics.org
Opportunities
Twitter: @InfoEcon 26 PlatformEconomics.org
Australia Austria Belgium Canada Cypress Denmark
Portugal Spain Sweden Switzerland UK USA
OpportunitiesFinland France Germany Greece Hungary Iceland
Ireland Italy Luxemburg New Zealand Netherlands Norway
Twitter: @InfoEcon 27 PlatformEconomics.org
Australia Austria Belgium Canada Cypress Denmark
Portugal Spain Sweden Switzerland UK USA
Opportunities
Finland France Germany Greece Hungary Iceland
Ireland Italy Luxemburg New Zealand Netherlands Norway
Twitter: @InfoEcon 28 PlatformEconomics.org
Redeemable Information Coupons
… let recipients express their preferences… … provide
interactivity…… feedback to drive
improvement…… route flows of mail, of data, of
money…… partnerships with industry …
… a business model.
Twitter: @InfoEcon 29 PlatformEconomics.org
For more on Redeemable Information Coupons• How to Strengthen Ad Mail by
Building a Digital Information Market. (Van Alstyne, Parker, Tushar) OIG RARC report 14-002 Dec 11, 2013 http://ssrn.com/abstract=2377476
• An Economic Response to Unsolicited Communication (Loder, Van Alstyne Wash) Advances in Economic Analysis & Policy 6(1) (2006) http://ssrn.com/abstract=1762212
© 2013 Van Alstyne et. al.
Saving Posts by Making Markets
Marshall Van AlstyneBoston University & MITmva@bu.edu, marshall@mit.edu
Postal Vision 2020Washington, DCApril 11, 2014
Money
Geoff ParkerDirector, Tulane Energy Institutegparker@tulane.edu
Tushar ShankerBoston Universitytshanker@bu.edu© 2014 Van Alstyne, permission granted to redistribute so long as all copyright information is preserved.
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