1. Bas van Heel SALES & MARKETING AS CHANGE AGENTS PostEurop, Kyiv, September 4, 2006

2. - 1 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt YOU EXPECT MAIL MARKET TO BECOME VERY DYNAMIC 2006 web survey PostEurop members EU (n=14)Non-EU (n=6) % Do you believe addressed mail will be completely liberalized in the next 5 years in your country? Do you believe there will be competing delivery networks in addressed mail in your country in the next 5 years? Do you believe substitution will decrease the volume of addressed mail by more than 5% in the next 5 years? Do you see growth opportunities in certain segments in addressed mail in the next 5 years? NoDon't knowYes Source:2006 BCG websurvey within PostEurop members, n=20 from 43 %

3. - 2 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt MANY ISSUES FACING POSTAL OPERATORS… What is the effect of substitution on volume and mix? What is the most likely entry model of competitors?

4. - 3 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt MANY ISSUES FACING POSTAL OPERATORS… Do we want a low cost or a high service delivery network? What kind of sorting footprint do we need in 5–10 years time? Should we stop delivering Saturday or Monday?

5. - 4 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt MANY ISSUES FACING POSTAL OPERATORS… What is our brand: trust, best value, or innovation? A Post Office is: a SME logistics centre, a retail bank, a place to meet? What pricing strategy/tactics to use against competitors? What are our most valuable customers? Segments?

6. - 5 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt MANY ISSUES FACING POSTAL OPERATORS… What is the effect of substitution on volume and mix? What is the most likely entry model of competitors? What is the definition of quality? What is the best product offering per client segment? Do we want a low cost or a high service delivery network? What kind of sorting footprint do we need in 5–10 years time? Should we stop delivering Saturday or Monday? What is the value of one stop shopping in a diverse portfolio? What is our brand: trust, best value, or innovation? What should our brand architecture be? A Post Office is: a SME logistics centre, a retail bank, a place to meet? What are our recovery standards? Is natural attrition enough to match lower FTE requirements? What pricing strategy/tactics to use against competitors? What is our sales pitch? What are our most valuable customers? Segments? How to grow Direct mail?

7. - 6 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt …THESE ISSUES SHOULD BELONG TO A WELL DEFINED PROCESS Commercial strategy Value proposition per segment Innovation Branding Channel management Customer Service management Planning Pricing and yield management Account management Sales force effectiveness What is the effect of substitution on volume and mix? What is the most likely entry model of competitors? What is the definition of quality? What is the best product offering per client segment? Do we want a low cost or a high service delivery network? What kind of sorting footprint do we need in 5–10 years time? Should we stop delivering Saturday or Monday? What is the value of one stop shopping in a diverse portfolio? What is our brand: trust, best value, or innovation? What should our brand architecture be? A Post Office is: a SME logistics centre, a retail bank, a place to meet? What are our recovery standards? Is natural attrition enough to match lower FTE requirements? What pricing strategy/tactics to use against competitors? What is our sales pitch? What are our most valuable customers? Segments? How to grow Direct mail?

8. - 7 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt MOST PROCESSES ARE CROSS-FUNCTIONAL AND REQUIRE MAJOR FRONT END INPUT Commercial strategy Value proposition per segment Innovation Branding Channel management Customer Service management Planning Pricing and yield management Account management Sales force effectiveness HumanresourcesInformationTechnologyPurchasingFinanceNetworkplanningOperationsDevelopmentCustomerserviceMarketingSalesRegulatory

9. - 8 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt Excellent GoodMedium Low HOW WELL IS YOUR COMPANY DOING? Compared To Best Practice In Other Sectors Commercial strategy Value proposition per segment Innovation Branding Channel management Customer service management Planning Pricing and Yield management Account management Sales force effectiveness All operators (n=20) Average performance: Source:2006 BCG websurvey within PostEurop members, n=20 from 43

10. - 9 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt Excellent GoodMedium Low HOW WELL IS YOUR COMPANY DOING? Compared To Best Practice In Other Sectors Commercial strategy Value proposition per segment Innovation Branding Channel management Customer service management Planning Pricing and Yield management Account management Sales force effectiveness All operators (n=20) non-EU (n=6) EU (n=14) Average performance: Source:2006 BCG websurvey within PostEurop members, n=20 from 43

11. - 10 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt HOW WELL IS YOUR COMPANY DOING? Compared To Best Practice In Other Sectors People and accountability Market/ competitor intelligence Target settingReporting Process and organization design Internal and External Communication Source:2006 BCG websurvey within PostEurop members, n=20 from 43 Excellent GoodMedium Low Average performance: Commercial strategy Value proposition per segment Innovation Branding Channel management Customer service management Planning Pricing and Yield management Account management Sales force effectiveness

12. - 11 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt DETERMINE DIRECTION PER SEGMENT Source:Industrial company Product (sub) segment % Segment strategy Customer segment % Grow Improve then grow Restructure CS1 CS2 CS3 CS2 CS4 CS2 CS3 CS2 S A CS4 S A1A2 A3A4 A5B1 B2B3B4B5B6C1C2D1D2D3D4 E1 E2 Product AProduct BProduct CProduct DProduct E Commercial strategy

13. - 12 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt POS PERFORMANCE ANALYSES LED TO NEW CHANNEL STRATEGY POS 04-05 growth (1) (%) POS growth POS monthly sales 05 (2) ('000 units) Refocused channels Channel management Source: FMCG example

14. - 13 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt SUCCESSFUL PLAYERS RELY ON MIX OF FORMATS Channel management "In smaller cities, buyers familiar with regional circumstances are an advantage – here franchising makes a lot of good sense" Note:"Concessions“ as per the BCG definition is called "shop in shop" by Mexx (commodity risk borne by Mexx) Source:Company information; press & literature search; BCG analysis Directly operated stores (in cities with population > 250,000) Concessions (population 100,000 - 250,000) Franchise (population 30,000 - 100,000) Number of stores (D)

15. - 14 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt Clear relationship with volume … SALES FORCE BEHAVIOR NEEDS TO BE ALIGNED WITH COMMERCIAL STRATEGY Commission in 2002 (EUR x 1,000) Index of price target achievement in 2002 Target exceededTarget missed Sales in 2002 (in units) … not with price M&S effectiveness Each dot stands for a salesperson Commission in 2002 (EUR x 1,000)

16. - 15 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt BEST PRACTICE S&M PROVIDES COMPLEMENTARY CHANGE AND SOURCE OF COMPETITIVE ADVANTAGE Large one-size-fits-all

17. - 16 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt BEST PRACTICE S&M PROVIDES COMPLEMENTARY CHANGE AND SOURCE OF COMPETITIVE ADVANTAGE Large one-size-fits-allEfficient one size-fits-all

18. - 17 - Copyright © 2006 by The Boston Consulting Group B.V. All rights reserved. 93002-00-PostEurop conference-04Sept06-V9-BvH-AMS.ppt BEST PRACTICE S&M PROVIDES COMPLEMENTARY CHANGE AND SOURCE OF COMPETITIVE ADVANTAGE Large one-size-fits-allEfficient one size-fits-allAgile, customer-oriented