Last month, the Universal Postal Union hosted its second Addressing Forum, a conference focusing on ‘postal addressing trends, innovations and opportunities in a fast-changing world’.

The forum encouraged leaders to examine the changing expectations of customers when it comes to e-commerce delivery options, and to evaluate opportunities and innovations in addressing, including addressing standards for cross-border trade flows. One of the key themes that emerged was finding faster ways of developing and implementing addresses at a lower cost through new technologies.

Poor addressing costs postal and logistics companies worldwide tens of billions of dollars every year. It slows down and complicates the sorting process, making automated sorting impossible to implement for many countries. In 2017, additional labor in Le Groupe La Poste sorting centres amounted to 120,000 hours due to incorrect or poor addresses – equating to hiring an extra 60 full-time employees.

Poor addressing in cross-border e-commerce means that Correios, operator of the national postal service of Brazil, manually sorts and returns approximately 6,000 parcels every day.

Inadequate addressing also dents delivery efficiency as staff waste valuable time on the road searching for the correct delivery location. The last mile of a parcel’s journey is known to account for at least 50% of the total delivery cost. Of course, this affects e-retailers too. The increase in cross-border items whose addresses don’t comply with international standards slashes the efficiency of the whole supply chain. 10% of Alibaba Group sales are negatively affected by insufficient addresses, despite efforts to improve address collection online and via partnerships with postal services.

Mongol Post delivers on its promises with what3words

Faced with similar challenges as its counterparts in other countries, Mongol Post’s Deputy CEO, Telmen Gerelt, described the country’s need for better addressing, especially as urbanisation is on the increase. In many parts of the country, citizens collect mail from Post Office boxes miles away from their homes. Inadequate addressing, including throughout its capital, Ulaanbaatar, leads to delayed and failed deliveries, frustrated customers and higher courier costs – not to mention holding back the development of businesses and the country’s economy.

To turn this situation around and improve its operations, Mongol Post decided to adopt a new addressing solution and give every Mongolian citizen an address – even if they live in the most remote region of the country. In 2016, Mongol Post was the first Post to adopt what3words as a national addressing standard, to complement its traditional addressing system.

Mongol Post customers simply identify their 3 word address via the free what3words app, write it on a package or type it into the checkout page of an eCommerce site. Mongol Post uses that unique address to navigate precisely to their customer’s front door – whether in the centre of Ulaanbaatar, the informal districts that skirt the capital, or a ger on the edge of the Gobi desert.

Delivering to a 3 word address with Mongol Post

By adopting what3words, Mongol Post is already saving time and money, reaching more customers, improving its quality of service, generating revenue and building customer trust, making it the company of choice for delivery in the country. Thanks to its partnership with what3words, sorting operations accuracy is 15% higher, nearly 3 minutes are saved on each delivery and the number of successful first-time deliveries has increased by 18%.

Operational Gains

These improvements have kick-started an entire e-commerce ecosystem in Mongolia. Earlier this year, the largest Mongolian e-retailers organised “White Friday”, a national event offering consumers discounts on their favourite products. The event was a huge success and increased online orders by 21 fold in one day.

A closer look into Mongol Post’s partnership with what3words and its value

Gerelt highlighted the importance of 3 word addresses and the benefits they could provide to postal services around the world, emphasising the system’s potential to contribute towards economic and social growth. To achieve more efficient cross-border e-commerce, he made a case for the UPU to officially recognise what3words as a global addressing standard.