Parcel post grows as letter-mail keeps falling

Postal mail in Malta is undergoing a significant transformation as it adapts to a changing digital landscape, with a noticeable decline of 7.1% in letter mail and bulk mail volumes in 2022.

While the decline reflects the ongoing shift from traditional paper-based communication to digital alternatives, the Malta Communications Authority says the postal sector has remained proactive in exploring avenues for growth.

Postal mail volumes decreased from 31.1 million items in the previous year to 28.9 million mail items in 2022 (7.1% decrease). Within the domestic mail category, the volume decreased to almost 23 million items.

Year-on-year, there were significant drops in bulk mail and letter mail, which in 2022 decreased by 6.1% and 10.5% respectively compared to the previous year. Registered mail experienced a substantial decline of 44.6% and parcel mail experiencing a modest decrease of 1% in yearly volumes from 2021 to 2022.

However, outside the universal postal service, there was a year-on-year increase of 27% for courier or express-based services. Here, volumes for mail items weighing greater than 2kgs up to 31.5kgs showed a substantial growth of 417,418 items, representing a significant year-on-year increase of 52.6%.

In its annual report, the MCA says postal service providers answer to the digital challenge by providing online tracking, e-commerce integration, and online payment options for customers.

It is with parcel mail volumes that customers appear to be more acquainted with these days, where the increasing popularity of e-commerce has allowed the postal service to respond to these new opportunities.

With dominant postal operator MaltaPost – owned in part by Lombard Bank (71%) – have set about to raise certain fees in recent months, most notably with newspaper post, the MCA says market conditions may not always be favourable to the incumbent provider. “There are no easy solutions to the complex issues faced by the postal sector,” the MCA said. “The industry must navigate through evolving market dynamics, changing consumer preferences, and technological advancements while ensuring the provision of a reliable universal service.”

In February, a survey by the MCA found that among 500 participant households, there was a 5% decrease in general satisfaction with postal services, from 74% to 69%. Approximately 62% reported no change in the number of letter mail items received in the previous 12 months, compared to 59% in 2018. Meanwhile, 31% noted a decline in received letter mail, compared to 34% in 2018.

More interestingly, 40% of households in 2021 stated they did not send any letter mail, compared to 43% in 2018.

And 31% of household respondents reported an increase in received parcels, compared to 27% in 2018. The main reason for this upswing was attributed to the prevalence of online shopping, which became more frequent due to the pandemic in 2020.

Local online shopping also saw significant engagement, with 70% of household respondents confirming they received goods from orders placed on local websites in the past 12 months.