Lila Snyder, Executive Vice President and President of Commerce Services at Pitney Bowes, shares global e-commerce trends and challenges related to fulfillment, delivery, and returns, as well as opportunities for adapting quickly and sustainably.
Avenue Code: Tell us about your role and day-to-day responsibilities as Executive Vice President and President of Commerce Services at Pitney Bowes.
Lila Snyder: In my role as President of Commerce Services at Pitney Bowes, I lead two distinct but interconnected businesses that power commerce in different ways. Our Presort Services business is the largest workshare partner of the United States Postal Service, processing more than 17 billion mail pieces annually on behalf of major US mailers, including leading banks, insurers, and health care companies. I also lead our Global E-commerce business, which provides retailers and marketplaces with a host of brand and consumer-focused fulfillment, delivery, and returns services. Global E-commerce is the fastest-growing business segment within Pitney Bowes. Both Presort and Global E-commerce depend on a shared technology and transportation infrastructure. Together, they account for more than half of Pitney Bowes’ total revenue.
AC: Pitney Bowes made its name in letter mail. Why and how did it decide to build a global e-commerce business?
Lila Snyder: In so many ways, shipping and e-commerce are natural adjacencies to mailing. In 2012, Pitney Bowes’ revenue was in decline and the company, under the direction of a new CEO, Marc Lautenbach, decided that the best way to leverage our strengths and change our trajectory was to stabilize our core mailing business and begin to establish ourselves in shipping and e-commerce.
We entered e-commerce with a single client, eBay, and helped them create their global shipping program so that eBay sellers in the US could reach millions of buyers worldwide. Over the years, we’ve added over 600 retailers, marketplaces, and sellers, all while keeping a 1:1 relationship with each client and creating a strong client success team.
What makes the Pitney Bowes client experience unique is that we approach e-commerce thinking about consumers first and how we can help retailers strengthen the relationship between consumers and their brands, which means we’re doing everything possible to grow our clients’ businesses. To that end, we’ve had a few important acquisitions, including Newgistics, that allow us to more effectively assist retailers and marketplaces with fulfillment, delivery, and returns.
AC: Your educational background includes a Ph.D. in Mechanical Engineering from MIT. How has that training filtered into your role at Pitney Bowes, particularly in terms of understanding logistics and the impact of technology?
LS: I think of engineering primarily as learning to be a good problem solver. My professors told me that, no matter what they taught me, technology would evolve into something new by the time I graduated. So the most important skill is not learning a particular technology, it’s curiosity. If you can ask the right questions, applying a logical construct grounded in analytics, you’ll be a quick learner when it comes to new tech in new contexts.
AC: Pitney Bowes’ 2019 Global Online Shopping Study reported increasing consumer frustration related to difficulties with delivery and returns. What’s your perspective on why consumers are frustrated and what shipping companies can do to counteract this? Are there new logistical issues, or are consumer expectations changing?
LS: We’ve been tracking this for the last several years and are surprised by how fast the frustration has increased. It boils down to two primary factors: First, more consumers are shopping online more frequently, which means there are more opportunities for frustration. Second, consumer expectations are rising. Every year, our expectations are changing based on how the best companies are raising the bar, and retailers that don’t adapt to these new standards within 12 months will disappoint consumers worldwide.
Consumer expectations are simple: we want fast and free delivery. The back-end process, however, is enormously complex and must account for a multitude of factors, from employment rates and the number of staff in a given warehouse to shipping logistics and weather challenges. Retailers need help structuring this process while strengthening their brand, and this is where Pitney Bowes comes in. We’re different from our competitors in that we’ve built our business entirely on retail e-commerce, which gives us greater sensitivity and expertise in building tech processes that simplify the entire process.
AC: With so many complex factors in fulfillment, delivery, and returns, is there any one place that’s more susceptible to breakdown? How important is data in solving these issues?
LS: There are a hundred potential breaking points, and they are all important. For instance, someone might package the wrong item or put the wrong label on a package. Any number of things can happen, so the emphasis becomes managing exceptions and reducing errors. Data is incredibly important in this process because it exposes what’s happening where.
AC: What are some of the biggest challenges your team faces in creating and implementing global strategy decisions?
LS: The biggest challenge is the rapid pace of change, and this isn’t unique to Pitney Bowes. Global markets and technology are changing so quickly that you almost can’t get through the cycle of strategy and implementation before the marketplace changes. For example, cross-border trade laws and tariffs have had a huge impact on our business, because different markets around the world think differently about importing, and the pace of change is rapid.
The other aspect of adapting quickly is being able to communicate strategy decisions quickly and clearly so that every employee understands the vision. Every small action needs to be moving toward the overall vision.
AC: What trends in tools and technology do you see impacting retail in 2020?
LS: It’s a big question, so I’ll focus on what’s within our wheelhouse. There will be more online shopping, and more of it will be happening via mobile devices. This creates many branding opportunities for retailers, such as branded tracking tools. No matter how much investment retailers put in the up-front consumer experience, they’ll lose consumers if the post-purchase experience isn’t equally excellent. Retailers must keep the brand experience strong throughout.
We also believe that automation technology in warehouses is incredibly important, particularly given where we are in the unemployment cycle. Peak seasons are extremely hard to deal with if retailers aren’t prepared with automation, and this factor will only continue to increase in importance.
AC: This is an area I haven’t heard discussed very much, but there’s absolutely a strong post-purchase branding opportunity, particularly when we consider that consumers purchase multiple items from multiple retailers at the same time. It’s easy to become confused about which packages are from which retailer. How can brands stand out after purchase?
LS: The biggest opportunities are creating unique labeling and packaging and providing all tracking data when the consumer asks for it. Just watch any teenager after they place an online order - they refresh the tracking information about a hundred times! On average, we find that consumers track a package eight times after hitting the buy button. The complexity of the physical aspect of e-commerce is hard to comprehend from the consumer perspective, so providing tracking information helps consumers see where an item is and how it’s moving. It helps build trust and provide peace of mind.
AC: One trend we’ve seen gain incredible momentum in the past year is subscription box services. What are your thoughts on where this trend is taking e-commerce and how it will change the retail landscape?
LS: Many of our clients offer subscription box services. These services fall into two primary groups. The first is convenience - offering items everyone needs on a replenishment basis, such as personal care items, health and beauty items, pet food, etc. Convenience was the major driving force behind the first subscription box services.
The other side of subscription box services - browsing - is what I find more interesting. In a world of online search, we rarely take the time to visit malls to explore new brands. Instead, we take a 40-question personality quiz, and sample items show up at our front door. If we don’t like them, we send them back. For retailers, this changes the landscape - either they’re becoming subscription box services or they’re including their products in others’ subscription boxes.
AC: Do you see browsing-oriented subscription boxes as taking the place of personal recommendations from family and friends?
LS: It’s more supplementary. Data and data science are great, but friends and siblings always know us better than a questionnaire. Word-of-mouth recommendations work in tandem with subscription box services. People enjoy and recommend subscription box services because they offer a curated experience when we have less and less time to shop physical stores.
AC: Pitney Bowes was founded nearly 100 years ago and is now a global technology company serving approximately 1M customers in 100 countries. What is the key to Pitney Bowes’ success in adapting to and thriving in such a rapidly evolving industry?
LS: Our CEO is a big believer in culture, which is what drew me to Pitney Bowes. You won’t find a company that’s been in business for 100 years that doesn’t emphasize doing the right thing the right way. We have examples from every decade of decisions Pitney Bowes made that prioritized doing the right things for employees, shareholders, and the broader community.
Beyond this, we’ve kept our services relevant by focusing on innovation and the client. We are a global technology company, and we’ve consciously built a team of engineers and innovators who think broadly about how to evolve every process. Innovation has been especially critical for us over the last ten years as we’ve had to find Pitney Bowes’ future. For example, we recently delved into e-commerce, and now these services comprise a third of our revenue. Being rooted in e-commerce also allows us to focus on the client. If we’re helping our clients succeed, then we’re succeeding.
AC: Tell us more about the Pitney Bowes culture and values.
LS: Every company has values, but the best way to figure out what they are is to talk to the people who work there, not to read what’s written on a website. Culture comes down to how a company addresses hard decisions that affect people. When I joined Pitney Bowes, I knew I could trust their culture because it was a theme in every conversation with every employee.
Since joining, we’ve conducted a sort of historic excavation of how all of our former CEOs have spoken to clients and employees, and it’s all been consistent with a common set of values. We look to our past to guide us, and it’s rare now for companies to be able to do this, because building a strong culture and solid relationships with employees and clients only happens over time. We sum it up in a simple phrase, “we do the right thing, the right way.”
AC: What do you or your company look for in your strategic partnerships?
LS: We’re big believers in win-win partnerships. We don’t go into strategic partnerships with the goal of getting the lionshare of the benefit. For instance, we’ve been partners with the US Postal Service for 100 years, and that’s because the value benefit is equal for both parties.
Beyond this, we believe that culture fit is extremely important in strategic partnerships, because you have to have common ground to accomplish goals. One of the benefits of being a 100-year-old company is thinking of partnerships as relationships that need to be around for the next decade, not just the next year. We take a long-term rather than a quick-fix approach.
AC: Was there a defining moment for you personally that made you into the industry leader you are today?
LS: I can’t point to any one moment, but I can say that risk taking is at the heart of my leadership style. I believe that most people don’t take enough career risks. If we don’t step outside our comfort zone, we won’t develop professionally or personally. Growth only happens when we’re uncomfortable, so the more risks we take, the faster we develop.
For example, I got a Ph.D. from MIT, and when I graduated, I decided to take an atypical path to gain business experience to supplement my tech background by joining McKinsey. I took every opportunity to grow as quickly as possible, and that mindset eventually led me to Pitney Bowes. I went from being a successful consulting Partner to being a division President with P&L responsibilities. Every risk comes with a bit of failure, but the benefit on the other side far outweighs it.
AC: What can newer companies learn from a 100-year-old company?
LS: Don’t lose focus on the client, and never stop innovating.
AC: Great advice, Lila. Thank you for sharing your insights around consumer expectations and opportunities for e-commerce brands to add more value!
Anna Vander Wall
Anna Vander Wall is a freelance senior editor and writer in the tech industry and beyond. She particularly enjoys collaborating with Avenue Code’s talented Snippets contributors and whitepaper authors.