Deutsche Post AG (DHL) Earnings Call Transcript & Summary

Can you hear, Martin?

Martin, we can't hear You. You're muted.

Hello, and welcome, everybody, to the next edition of our Investor Relations Series, "Experience Excellence. Simply Delivered." So in the technical setup proven before, we are happy to have the same Express experts starring, then, the last time around. So we've got the CEO of the Express division, John Pearson; and Michiel Greeven and Leendert van Delft from the sales team, who are going to introduce you to the exciting world of B2B, e-commerce. As you see on the slides that we've provided to you, this is, in fact, the fifth edition of our tutorial series. Last time around, we shed a bit light on how B2B -- B2C e-commerce is actually working wonderfully for our network. And today, we are going to take a look at B2B. And promise, there is more to come in terms of Investor Relations tutorial. So just a brief summary of the key takeaways, what you're going to learn over the next 60 or so minutes. I think we have shown in the past that Express is able to deal with e-commerce, definitely in the B2C arena, where we have seen a rapid constant expansion of B2C e-comm volumes in the network in a way that allowed the margin, indeed, to expand simultaneously. So today is about the next growth vertical, e-commerce in B2B, which is another very good fit to the TDI network that we're operating around the world. And therefore, due to popular demand, we decided let's take a deeper look on how e-commerce works in B2B and how our Express network is going to be instrumental in that. And without any further ado, I'm going to show you quickly how the Q&A is working. [Operator Instructions] So with that, over to you, John.

Thank you very much, and I'll just sit on that slide for a second before I turn over. So good morning and good afternoon I think is probably the most appropriate greeting. Dealing with e-commerce, that's the words Martin used, and I think that's absolutely right, demonstrating that DPDHL, and indeed, in this case, DHL Express, have a strong competency and capability to deal with this commercial growth opportunity that has been in front of us for a number of years. And I remember in October 16, in a physical virtual tutorial in London, some of you would have been there with my colleagues in the other division showcasing, a little bit, the story of e-commerce and how we treat it as a vertical. And then we launched our -- little bit of history as I think interesting and relevant, we launched our B2C 21st century spice trade at the beginning of '17. And then in close succession, in fact, early in '18, we released B2B, the next industrial revolution. And this slide that you see now precipitates the sort of renewal, I guess, because of the pandemic and how things have moved, which my colleagues will talk about into what we're really seeing now. So with that, I'll go on to my next slide, which I take my hat off to my previous colleague, Ken Allen, and GMB that I sat on and 4 pillars, 3 letters and a passport is the lexicon of and the language of DHL Express, keeping a very simple agenda, but absolutely gets through to all our frontline people and that people are the absolute drivers of growth and quality; quality, a leading indicator and growth, the lagging indicator. When I took the chair from Ken towards the back end of '18 and officially started at the beginning of '19, we extended that and extracted, I guess, you could say, we extracted some points which we wanted higher emphasis on, our supervisory and the supervisory excellence, a program driving the capability and the competence to use the phrase, again, of everyone that manages the people that don't manage people are our front line and that it continues to be extremely important. I'll hop over the next one into efficiency, digitalization created by efficiency and, most recently, the whole sustainability story has come to a rapid form of life in our group and the ability for our entire organization to start driving the pillars of E, the pillars of S and the pillars of G through to the front line, through to our customers in all the areas that we need to do that. But the highlighted figure, e-commerce, there in bold, forms a big part of our commercial strategy. It has done, as I've just explained through our history, over the last 5 years, and even more so now, as Michiel will talk to, and it takes up a big part of our focus 2025 strategy. And with that, I'll hop on to the next slide where it answers a few questions and tells you what we're doing a little bit. We treat B2B2C as a vertical in the sense of a vertical of engineering and manufacturing, technology, oil and gas, shipping and banking, our very first vertical. And we wrap ancillary services like on-demand delivery, giving our consumers the choice where they would like to take delivery. And so it is with B2B. It's a vertical that sits within a vertical, if you will, and we're seeing rapid growth and rapid interest. And I think if any company had been wondering when to invest in B2B online [indiscernible] capability, the question has been answered for them in the sense that now is absolutely the time and now is even perhaps 6 or 12 months later than many. You'll see on the bubbles there that the share of our shipments, which is on several months in the last 12 months, closer to 50 than 45. So 1 in 2 shipments are an e-commerce shipment of one type or another. And you will see at one level, prima facie, that our margin has improved over the time that e-commerce has been a real source of growth. In fact, there are a couple of slides later that will talk to that in a little bit more detail as to how the last mile has just got easier and easier. So it fits in with our commercial capabilities. The slides that will follow from here on in talk to exactly that and demonstrate it with authenticity, and it's certainly something that the next 2 gentlemen that will present are living in the middle of. And I think that's valid in the sense that, as they say, e-commerce is the commerce. And we're moving quickly in it, we're investing highly in terms of human capital and intelligence as well as aviation resources and quality. In fact, not 1 minute or $1 that we spend on the online world is -- goes to waste. So with that, I'll pass over to Michiel. And once again, I thank you for your interest in this topic and our company.

Thank you very much. Let me see if I can take the control. Yes. So good day from my side. Thank you very much, John. Before we start to talk in detail about B2B e-commerce, I think it's good to define exactly what do we mean with B2B e-commerce. People, in general, would say it's an online order transaction between businesses via an online sales portal, but we would like to specify that a little bit more. So yes, business-to-business, where the full transaction, meaning including the payment and the shipping, is facilitated online via a transactional website without the need to become a customer or maybe to wait before a salesperson is actually reaching out to you. So in other words, as a business, can I actually place an order immediately without interfering with a sales rep? And on the next slide, it has actually presented a very good example. It's called MisterWorker. It's an Italian SME. It's, at the moment, purely B2B. And maybe Frank, if you can run the video. And the question is, on this specific website, can you buy 5 'DeWalt Table Top Mitre' Saws within 30 seconds? And here, you see it already navigating through the different products. It has a better feel of an original B2C website. You can click, you can change, you can change the quantities, you can look at the different products. There's actually some marketing segment where they promote other products that can go with that. And this is very efficient. It's very smooth. And it's giving you, hopefully, a very good example of what we mean with a very good example of a B2B site. So to the investor community, there's always an important question popping up, and Martin and also John was already referring to it. And the question is, now we know what we mean by B2B e-commerce, is that actually a good fit with the Express industry? And for sure, when we talk about B2B buyers, they expect the same customer experience in terms of quality, reliability, in terms of speed, in terms of convenience. But there's another very important element to it. If you talk about the traditional B2B distribution channel, would run quite frequently through distributors, importers and agents. So you would have like a central point production facility or a central warehouse facility from where big orders are shipped to local importers, local distributors, who would then sell the products locally and would also manage, obviously, the transportation domestically. With the B2B e-commerce, that actually is changing because it offers a business the opportunity to deal directly with the customer in the different countries. So what does it mean? That means, for the Express industry, it means that we can ship more orders, more repeated orders and most likely also more cross-border orders. So smaller, more volume, cutting out the middleman, which means, basically, for our customers, the businesses, more margins so that they can afford Express deliveries, and actually, they can better manage their supply chain. So it's more -- it's getting more efficient. So that -- those elements are obviously very beneficial to the Express industry and DHL Express in particular. But you can also add another flavor to that. Businesses, like the example of MisterWorker on the last slide, can go B2B2C. So MisterWorker actually has products that you could sell also to an end consumer. So that opens up another new window for these kinds of businesses. So -- and B2C, that's, as John talked already about it, it's our -- in the meantime now, our bread and butter. So yes, therefore, we can say there's a very good fit with Express. So talking about a good fit from a financial perspective or a profitability perspective, hopefully, most of you who have been on tutorials before, you recognize the picture on the left-hand side, where we're focusing on the B2C e-commerce and we explain why B2C e-commerce is actually very beneficial to the Express network with the different elements on the network characteristics. And the key driver there was obviously the last mile. But now I think we've proven that by optimizing the last mile by our tools and systems and processes. It is actually leading to a very efficient delivery process with a lot of first-time deliveries, which makes the whole business case very good. If we look at the B2B e-commerce side, and we would like to compare it with the traditional B2B cycles, as I explained, you have a lot more smaller cross-border orders which generates, for the Express, more volume. It generates more weight, if you would compare it to B2C, and the same is true for revenue per kilo. And if you talk about first mile, hub sort and airlift, more orders, smaller orders will create a better density, better utilization and efficiency in itself. And the last mile, if you compare it to B2C, it's obviously better, because when we make deliveries to businesses, people are always present and can always receive the package when they are there. But if you compare it to the traditional B2B, it's basically the same. You could even say that smaller orders versus bigger orders, if you, the last mile, a little bit more efficiency even there. So from the financial profitability perspective, an excellent outlook in terms of B2B e-commerce. So what is actually the market saying about the development of B2B e-commerce? There are some impressive numbers there stated by well-known research companies, and the common denominator is basically very simple. So the market is growing, it's growing very rapidly. You can see here from 2019, in value, $12.3 trillion to 2027 almost $21 trillion. So good growth numbers. The market is very relevant. As you can see, 12% of the current B2B is already related to e-commerce. And thirdly, it's actually already bigger than the B2C e-commerce market, so very interesting numbers. Numbers that we saw also a couple of years back when we started to talk about B2C e-commerce. We saw the growth. We invested in it. And actually, what we now see is exactly the same. So good growth, and we definitely see the opportunity there. And we definitely see the development taking off with our customers, lots of initiatives, developments of websites and what have you saw, a clear indication there. So we have seen what we mean by B2B e-commerce. It has good fit with Express. There is growth potential. But what is actually driving these trends? What is driving this? And that is the B2B buyers' behavior. And Gartner, research company that you all know pretty well, I imagine, they expect that if you look at the year 2025, already 33%, 1/3 of all the buyers desire a seller-free sales experience. And if you look at the millennials of this group, the 44%, they do not prefer a sales rep interaction at all. So these are important facts and important statistics to look at. 80% of all these sales interactions will occur in digital channels. So if you, as a business, as a B2B player, are not thinking about e-commerce, then these statistics would say -- would clearly point you in the right direction to start working on it and to start investing on it. And luckily, we see that 64% of the B2B companies are already working on it, are investing. But it is the time, really, to act. And then talking about the customer experience. Some businesses might think, oh, I have already a website and the people can actually download a PDF with a product catalog or you can fill in your contact details and then a sales rep might contact you within a couple of days. So that's actually my B2B e-commerce proposition. I think buyers, they expect more than that. Buyers, they are doing their research and they know what they want. And actually, they want to have the capability to place their order and to place their order and -- without any interference of a sales rep. And they basically want the same experience as they have with B2B -- or excuse me, with B2C customers. And changing the B2B customer. So what do B2B buyers, what do they actually want? So first of all, as mentioned, they want to place their order. They want to track their order. They want to see the delivery options. They want to track and trace the shipments. They want to have a closer look on the details of a product. Where in B2C, in the B2C arena, this is still quite a bit superficial. Okay, you're buying a shirt, if it's cotton or if it's any other fabric, it's good enough. If you are a B2B buyer, you want to have more details. You want to have all the specificities and you want to have all the details. So B2B buyers, they really want to act quickly and they want to buy stuff on the go. And this is obviously a big difference from the traditional channels. And then going to the millennials. This is a very important group within the B2B customers. But I'm not a millennial, I'm a product of Generation X. So I think it's better that the millennials talk about the millennials. So with that, Leendert, I'm handing over to you.

Yes. Thanks a lot, Michiel. Yes, I am a millennial, actually an early-generation millennial, which I think is the best generation ever. So yes, we played in the mud without mobile phones and we climbed in trees. But at the same time, we were also young enough when the Internet took off or when we were going to our universities, et cetera, to be completely familiar with technology. And the millennials, as a group, it is one of the accelerator in this whole B2B e-commerce trend, because millennials are no longer anymore the guys with skateboards who are hanging outside. No, these are now -- this is the group of people who are taking the purchasing decisions, which you can see here right now, millennials are already accounting for 73%, or are accounting or involved in 73% of all the B2B purchasing decisions. And again, this is a generation which grew up with the Internet, which had their mobile phones early, which are digitally native, and they expect digital experiences from the B2B companies they are buying from. And also there, the experience they have with B2C and the regularity with which they are shopping online, that is also impacting their buyers' expectation when it comes to B2B. And we saw the percentage already how millennials prefer -- 44% of millennials, how they prefer a no-sales-rep interaction. No, they want to interact digitally. They want to be online. They want to chat online. They want to find information on the websites, et cetera. Change the slides. Yes. Another accelerator, of course, a word which has been used, I think, quite a lot already, the pandemic. Yes, everything was already moving online and the pandemic really accelerated that. And that's something we spoke about as well in our October session. But impact has been significantly big on the way how B2B companies are doing their sales. Because if you look at how B2B companies were doing their sales, it was all that traditional selling model. It was sales reps flying overseas, meeting customers, sitting down, doing face-to-face meetings. Or it was B2B companies going to trade fairs and events, trying to hook up with a few new customers and a few new clients, trying to expand their customer base. But all that completely came to a halt due to the pandemic. Lockdowns were happening. Events were being canceled. So B2B companies had to look for other ways to generate their sales. And with that, many companies were looking or are looking to their e-commerce channel, to their online way of doing sales in order to keep growing their business. But those companies, and that is something what we hear from our existing customer base as well is, they're really looking around to find the right information. And that is one of the main reasons why we also pulled together this B2B white paper or the ultimate guide to B2B e-commerce, to really consult our customers in this field and to really take them by the hand and tell them, okay, guys, this is what you need to think about and this is what you need to do. And this is a trend which is not here to stay because 20% of B2B buyers, they actually say that -- or only 20% of B2B buyers, they say that they want a traditional in-person sales to be returned. In other words, 80% don't. And again, that's the need of the B2B companies in order to speak to those needs of their customers. And B2B e-commerce is not just for the small orders, because you may think like, oh, okay, so B2B e-commerce is, if I want to order one spare part or if you want to order one demo product from a company, if I become a first-time buyer of them. No, B2B decision-makers are confirming that they are willing to spend big money online in online transactions, where you can see here that 70% of B2B decision-makers, they are willing to spend in excess of USD 50,000 in one single order; where 27% within this research, which is explained in the white paper as well, confirm that they are willing -- that they were able or willing to spend more than $0.5 million in an online order where the complete transaction is happening online. So again, B2B e-commerce, not just for the smaller orders, but also for the big transactions in B2B e-commerce. How we will and how we are consulting our customers, which is also part of the white paper, is talking about the flywheel concept. Most of you will know the flywheel concept coming from the book of Jim Collins from Good to Great. We apply the same flywheel concept internally as well when we launch sales programs, et cetera. But with the white paper, we're also consulting our customers how to get their e-commerce flywheel spinning, their B2B e-commerce flywheel spinning and how to make sure that, that flywheel will increase in speeds. And I will briefly talk through this concept. So it starts on the top right quadrant, where it is all about building the e-commerce platform or, if a company has it already, making sure that it's further optimized. And again, B2B e-commerce is not about having a website, because just having a website is not B2B e-commerce. That is what most companies have or all the companies have, you can say. But what you will find on there is mission and vision statement, company history, further details about the product, but you cannot transact online, and that is what companies should start to be doing. And once that is there, then also start to migrate customers from their off-line sales channels to that online sales channels, and of course, make sure the platform is user-friendly, et cetera. We will come back on that specific part later. Once the program is there, it's about rolling out programs to increase loyalty, to have higher order values and to increase the purchasing frequency. So here also, B2B companies should learn from the B2C playbook. And again, we've learned our lesson there. And we have -- we are consulting our customers in that area already and really think about, okay, what can they do when it comes to promotional or loyalty programs? And this is also where, for the B2B companies, that data collection can start. And we all know that data has surpassed the value of oil, and that's a big benefit for these B2B companies as well, that they can do a lot of data collection. They can check their consumer behavior online. They can check the consumer needs online, they can -- can check very quickly, based on the data, okay, customers who bought product A, they're also buying more product B. So for the next customer who's buying product A, let's make sure I also promote product B. So there are also a lot of cross-selling opportunities for our B2B customers as well. Once that is happening, and our advice is to make e-commerce a vital part of your business model and even think about shuffling organizational structures, because when you want to be successful in B2B e-commerce, then your organizational structure needs to reflect the same because there will be more demand for the digital marketing teams, for the e-commerce teams, et cetera. And then the last step is to make sure that B2B e-commerce is connecting with all the other sales channels. Because we're not saying that it's 100% B2B e-commerce which has the future. No, there will always -- the need will stay there when it comes to in-person sales, when it comes to more complex orders, when it comes to bigger order, when it comes to more demanding customers. But that's also the whole idea of this flywheel is that once the e-commerce channel is there, then B2B companies should think about, okay, when it comes to all the transactional orders, let's make sure that those are all dealt with online in the e-commerce channel. And with that, free up space for their own sales team to deal with the more complex cases, to more demanding case, et cetera. And with that, a B2B company, can free up time of their own salespeople and to move from order intake-ing to really doing the consult to selling, what we are doing at DHL Express as well. And this is all part of the white paper and part how we consult it. So the reason why this is a flywheel is once that is there, then you have more insights, more data, more visibility, then the B2B companies can further optimize their e-commerce platform, collect more data, make it a better part of their business model, et cetera. And that is how the flywheel starts to increase in speed. You have seen the B2C health check, which was a crucial part of our sales approach and which has proven to be successful in B2C e-commerce. We will do the same in B2B e-commerce. Because with the launch of the white paper and with the launch of this program, "Power Up Your Potential tree," how we called it, we will also be launching the B2B e-commerce health check. For those who were in the October session, we talked through this methodology in detail. And yes, there are specific similarities when it comes to B2C e-commerce versus B2B e-commerce. And those, you can see here an example on the left-hand side. These were 3 elements which were part of our B2C e-commerce health check and which we -- which are as important when it comes to B2B e-commerce. Things like, okay, do you have that easy accessible B2B webstore? Do you clearly state on your homepage that you sell internationally, that you take international orders, et cetera? Do you have a website available in local languages? Do you use local currency, et cetera? That is as relevant in B2C as it is in B2B. But there are also some crucial differences. Take, an example, a detailed product description. And think about it, if you are buying a T-shirt as a private individual, you would like to see the color, you would like to see the size, you know the brand already because that's the website you're visiting, and you may want to see what kind of fabric it's made from, if it's made of 100% cotton or 80% lycra or whatever fabric it is. But in B2B, people want to see better, detailed product descriptions, because when B2B buyers are buying something, they want to understand, okay, does this product fit within my business process? Does this product fit with something I am already using? So that is one of the crucial differences. With that, when it comes to having a powerful search engine, because when B2B customers will end on a transactional B2B website, some might type in the product number, some type in the exact description, some type in only a vague description. So B2B companies need to make sure that this sort functionality on the website is powerful and working well. Last difference, when it comes to the difference between B2C e-commerce and B2B e-commerce, are, an example, those payment options. In B2C e-commerce, we're always speaking about having localized payment options. So consulting our customers that when they're selling to the Netherlands, that they offer iDEAL as a payment option, which is 91% of the consumers in the Netherlands, they prefer to pay with that payment option. When they sell to China, we consult them to make sure they have Alipay. When they sell to Kenya, we make sure that they offer M-Pesa as a payment option. But in B2B, there are more payment options which are needed because, yes, credit card payment is one, but not every B2B purchaser will have a company credit card or not every B2B purchaser will feel convenient to use their own personal credit card for that. So that is where it comes to, an example, thinking about offering extended payment options, offering, so payment after the fact. So once the goods are delivered, they will send you an invoice. Think about bank transfers, and these are all elements, which, again, part of the white paper and part of our consultative approach in B2B e-commerce. It's not all plain sailing. We're the last one who are saying that B2B e-commerce is easy, and that is also something we are consulting our customers with to be clear to them about the barriers and challenges they may come across when they start to invest more in their B2B e-commerce channel. Few things which are also highlighted in our research, which is based on multiple interviews, both internally as well as externally is, number one, having that digital-first mindset. Companies need to make sure that it's digital first, and I repeat digital first, not digital only, and make sure that they also have the right people on board who can roll out programs like this on their sites, so who can work on optimizing B2B e-commerce platforms, et cetera. Secondly, which is related to B2C e-commerce, but also related to the point which Michiel already mentioned, is everything which has to do with customs and cross-border shipping. Because with B2B e-commerce, situation will happen that there will be less bulk shipments moving from one continent to another and where the distributor, a local distributor takes care of transportation, and there can be an increased need of direct cross-border shipping. And that is something, again, that is our bread and butter, and that is where we can consult our customers to be successful and to tackle those challenges heads up. Third one is agility. And some larger companies, they may struggle or they may find it challenging to compete with these agile startup-like companies like MisterWorker, which we saw in the beginning. And that is also something we explained in the white paper, how to deal with those situations, and that there is the risk of being left behind if those companies do not act quickly. Last one is pricing. Now rest assured, we're not talking here about our pricing of DHL Express, but we're talking here about the pricing which B2B companies apply online. Because in B2B sales, there's a lot of negotiating of discounts or when it comes to bulk or repeated purchasers, the sales rep gets involved, try to make a good deal. So this is something which needs to be handled online in the B2B e-commerce channels as well. And also here, we have multiple ways to consult our customers and have them think about, okay, having an easy, implementable, "Buy more, pay less," option, having bold discounts online, et cetera. And that is something, if you look closely to the home page of MisterWorker, in the little walk-through video in the beginning, they are clearly persisting that on their homepage, saying, "Guys, if you buy more, your discount will be more." And these are always how we can consult to our customers. So to show one more good examples, we saw MisterWorker in the beginning as a mid-sized agile company. But here, you can also see an example of a bigger company, RS Components, based in the U.K. in the technology industry, in the spare parts industry. And we can start the video, where you can see -- it's actually the mobile experience. So this is somebody buying spare parts on the mobile and buying 2 professional 3D printers within 25 seconds on their mobile phone. And again, you've seen how that is what the customers want today. That is what the B2B customers want today. If you then link this to our website health check, our B2B website health check, also interesting to see is that even for this very innovative customers, yes, they tick these boxes off the website health check. But even customers like this, we can further consult them because if you go through the customer journey there, they're not yet offering these multiple payment options. So even for the more advanced companies, we still have something to bring to the table, sit down with them, and it is something also which is proven in all the customer meetings we are having right now. So of course, most important question, okay, why are we doing this? And Michiel already touched upon it a little bit, but this is all about applying -- let's say, applying the same trick we did in B2B e-commerce. And yes, we saw that there's not the one and only single source of truth when it comes to the market growth forecast, but we all could see the statistics and -- which is also confirmed by our first B2B e-commerce customers, and that is, yes, the B2B e-commerce markets should and will show very attractive, sustainable growth, which completely fits our network. Also, again, think about how we started with B2B e-commerce a couple of years ago. That's -- back then, we also may have had some sporadic data, et cetera, but we believed in it. We tackled it heads on. We launched, "Power Up Your Potential," and we approached, in a very systematic way, globally. And with that, we also developed this massive growth market for DHL Express. And with this program, with B2B e-commerce, we will do exactly the same on this topic. So it's about applying the same success formula. John already mentioned, it's a vertical within a vertical, but it's a vertical which is definitely emerging, and it's already bigger, today, than B2C e-commerce. We will address it in a similar structured or systematic approach, how we did it as B2C e-commerce and launch the same program globally, et cetera. And with that, we keep our customer's flywheel spinning. And with that, we keep our Express flywheel spin. So that's the whole concept about this approach when it comes to B2B e-commerce. All this is wrapped up in the white paper as well, which is available for you right now, which is showing -- and so in summary, it's showing that how the pace of the B2B e-commerce sector transformation is something which should not be underestimated. And that is why we also, as a company, have a lot to bring to the table to take our customers by the hand, both existing customers and new customers, and guide them through this journey. Those digital native buyers, combined with the ongoing effect of the pandemic, which is really pushing this change through the industry. And B2B buyers, they want to these this flexible options, convenient customer experience, flexible delivery options, all those elements. And even those B2B players who are already established, think about the RS Components example, they can still further optimize their cross-border e-commerce channels, and that is something where we can support. But one thing we know for sure is that the pay off in growth opportunity for our customers is unlimited. And with that, also the payoff in growth opportunities for us is unlimited. So with that, Martin, I would like to hand back over to you.

Excellent. Thank you, guys, for that very concise run-through, through the deck and for laying out how we are tackling the B2B e-commerce opportunity. So we got time for Q&A. We have a couple of questions that came in already. [Operator Instructions]

First of all, and that's a question coming from Johannes Braun from Commerzbank. I think you alluded to it a bit, but why has it taken longer for e-commerce to find its way into B2B trade relationships compared to B2C? What would be your take on that? And maybe, Michiel.

Do you want to take that, Michiel?

Yes, sure. So why has it taken a bit longer? I think if you look at the B2C players, they started, from a technology point of view. They had a product, and through technology, they pushed the B2C chapter. When you look at B2B e-commerce, it comes from a traditional base. And when you have an established sales channels with importers, with distributors, with agents, it is pretty difficult and maybe sometimes a bit sensitive to actually change that. So I think, gradually, B2B companies will experiment. They will develop the channel, the e-commerce channel. And then they can most likely see that actually, when you do it well and when you do it actually in coordination with your sales channel partners, you can find a solution which is better than just having the traditional channel. So I hope that answers your question.

And sometimes, I think, in life, you need -- lots of different projects are competing for IT investment dollars, and sometimes you need a little bit of a push or a catalyst to get any one particular thing moving in a direction very quickly. And I think the -- many organizations were on to this when we produced the first B2B paper in February '18. I think others, as Michiel rightly says, it's a bit like supply chains. It takes a while. Everyone thinks the supply chains will change because of the pandemic. But it takes a while to unravel these things. And these things have served companies very well over the last 2 decades. And when you have an established dealer network and other means of distributing your product, it is not the work of moments to quickly move online for some organizations. Many did move very quickly. But I think now the question, as all can say, has answered itself, and everyone is -- the tradition, and that's why I think the title to the guide is quite important, the tradition is, and I'm a traditionalist myself, the tradition has served us well and will continue to serve many avenues of selling. But the need now to shift to the digital selling platform, on to the simpler description, is very obvious and very apparent.

Okay. So that's leading to the very expected question asked by Johannes at Stifel or Mark at Barclays. So if B2C last year was around 45% of the volume, where do we stand, as for now, on the B2B count? What was the percentage like? You got an idea?

Well, Leendert can sort of put some meat on the bone. But I think we're saying at this stage of the game, it's -- firstly, it's much more difficult to discern between B2B online and what is traditional B2B, but it's -- my view is it's mid-single digit, single-digit and growing extremely quickly. But Leendert's had a good look at it by industry, not so much statistically by industry, but which industries were first into it. And maybe just share some comments on the question itself, Michiel -- Leendert, but also the industries that are progressing the quickest.

Yes. Okay. It's indeed mid-single digits that we're seeing right now. And again, what the market is seeing, that the estimation was that it was around, say, 10%, 12% of all B2B transactions which are now related to this. We did look into the data. What's interesting to see is if you look at the sectors, it was technology and automotive which was the highest, which is different than B2C e-commerce where we shared -- showed last year as well that was specifically fashion which was having the strongest elements. Also, if we compare the growth of those B2B e-commerce accounts versus the, let's say, non-B2B e-commerce accounts, we also could see that the growth of those customers is significantly higher than those not in B2B e-commerce. And that is both based on what we're seeing on that data as well as what we're hearing from our customers. Because we're meeting with a lot of customers. And again, they have -- some may have already a B2B e-commerce channel in conjunction or together with their traditional sales model. But also there, the feedback of the customer is that, yes, our B2B e-commerce channel is growing hard and it's also something that we're seeing in our data. So again, the interesting is the different in verticals or different sectors that we're seeing versus B2B -- B2C e-commerce and the fact that it is growing harder than the traditional B2B.

And I think another way of saying it, thanks, Leendert -- another way of saying it is, when I first presented to some of those who are on the call now, B2C was around -- it was on the slide, but I'm going back even earlier than that, some 26%, 28% of our volume, and it's now touching 50%. I think we know that whilst it's a little bit more difficult to measure, from a customer point of view, from an industrial point of view, they say it doesn't matter how I sell, it matters that I sell. And moving my revenue lines, we know that this will go in the same direction, really, is that shift in traditional B2C e-commerce, which has moved from sort of 25% to 50% over the period of about 4 years.

Okay. Maybe shifting on to the current B2B practice, a question coming from Alexia at Barclays, maybe to you, Leendert. That MisterWorker site that you just showed as an example, is that something that was developed with the help of you guys?

Yes. We're very close to them. We're close to the CEO of that company. So yes, so that was developed together with us. It was not from the -- so they started it. But after that, we had multiple sessions with them to share our insight, to share our advice which we can do, to share our website health check. And their, also, reaction was, yes, this is very good and it did indeed put multiple things in place. MisterWorker is one example. We have multiple of those examples. So we always see that whatever the companies are doing, there's always something we can bring to the table, whether it is when it comes to currency conversion, whether it is when it comes to payment options, whether it's when it comes to how they position shipping and delivery on the website. And the feedback from the customers is also always, yes, this is very valuable; and yes, we are working on it; or yes, actually, we should start working on it.

A good example that is worth commenting is a little bit -- it's a separate billing point. When Brexit happened and January 1 came about, there was certainly a number of merchants in the U.K. or in Europe, and I had a shopping -- or my wife did, a shopping experience herself where the company in Spain was no longer servicing the U.K. So to Leendert's point, there's something we can offer. It is about encouraging these merchants in Europe or in the U.K. that have suspended sales temporarily and saying, we'll help you set up your back calculator or do this or that. It's about -- this is what I call the consultancy. It's the E in consultancy. It's helping these companies get back online with very simple remedies to their existing website offering that allows them to tell their customers what the TAT will be or whatever it was post January 1 change. And it's the same in this world. It's not necessarily Brexit-related what we've been talking about today, or it is in fact Brexit-related, but it's about helping the merchants. We know that we help the consumer receive the quality that they want, but the other end of the spectrum, by helping the merchant become successful and spanning both ends of that bridge is extremely important to our overall commercial plan.

Maybe also good to mention that one of our biggest eye-opening experiences when we launched the B2C e-commerce was that we thought like, okay, so these merchants, they know everything. They know absolutely everything. And we were just so surprised to see that with such simple tools like website health check or web analysis tool, that customers, they were really so pleased to get this knowledge they didn't know and we could really help them to grow their business. And we feel that especially for B2B e-commerce, this will be exactly the same. So we can really have a clear contribution to their growth.

We're hearing a lot about European examples so far. Is there a regional difference? Is Europe more advanced than, say, the U.S. or Asia? What's your view there in a few lines?

Now we have done also a lot of research on B2B marketplaces. And from that research, you could see that it seems that Asia and the U.S. were a little bit more advanced than Europe. But basically, we see the B2B e-commerce examples all over the place, all over the globe. But my guess would be that Asia and the U.S. are a little bit more advanced than Europe.

Marketplace environment, certainly, yes.

Yes. Okay. So now narrowing in on the real big question in there. First, on the economics of this, is there any difference in the way you're pricing your shipments compared to B2C? Or is it the same yield logic being applied?

It would be interesting to watch that one over time over the next couple of years or so. But fundamentally, our pricing to the customer remains the same. If volume -- if volumes change dramatically, then so may our pricing approach to that specific customer. But our pricing structure and our pricing construct is very stable and very consistent over the years, and we don't see that changing. I think what is interesting in relation to the -- in one aspect of the green and yellow and sort of red arrows we had on one of Michiel's slides is that typically these shipments will be a little bit heavier, but -- which is good for our network, 2 kilos, 4 kilos, 8 kilos, 12 kilos, so to speak, but they'll continue to move very nicely around our automated sorting systems and be packaged extremely well. So I think B2B has some -- has that arrow chart explained. B2B has, actually, some advantages, B2B online over indeed B2C.

Okay. Thank you, John. And now ultimately to the question, how big is this going to be for Express or for Deutsche Post DHL Group in a whole? So it's obviously replacing more traditional ways of trade. So this is a real extra, not cannibalizing into any of your existing volumes.

Yes. Michiel can touch on that, that's an interesting question.

Yes. So yes, indeed, a very interesting question. Obviously, there would be a little bit of cannibalization, because whether you have a traditional channel or an e-commerce channel, ultimately, it needs to go to the customer. But I think for Express, it offers more opportunities. As I tried to explain, you have a lot more, in our view, cross-border shipments of smaller orders, more volume. So that, in itself, is obviously great for Express very clearly.

Okay. And so -- many people are asking, so, okay, well, we are somewhere in the mid-single-digit percentage so far. Do you expect this to grow? Any sort of a target share of volume going forward for [ this ] being vertical?

At the minute we're just responding to -- we're so busy responding to sort of customer demand in the sense of supporting them, not with their own website development, but with their own sort of helping hints that I think we're keeping our sort powder dry on that. We know that this is an enduring trend. I think we had the e-commerce question answered during the course of last year that, that is here to stay, that is how many people now sell on Instagram and Shopify and the whole -- there's been a sort of seismic shift and an inflection point in how things are doing. And inevitably, a trade fair and an overseas sales representative to China was never going to keep up with the ability to sell online to the world overnight from your garage. It's as simple as that. It's fanciful to imagine that, that could never keep up with all the customer demand if someone has a good product. So we know that the growth -- we know that this will be enduring. We know that it's the next horizon on the chart, so to speak. But our focus is on really spending time with the customers, we're already [ augmenting out ] the growth. And then we continue to need to grow and plan with our investment offers, our investments in aviation and ops and gateways specifically.

Okay. So if I understand correctly, it's going to grow into the current network volume, but we will remain very disciplined and focused when it comes to future investments on this, right?

Yes.

An interesting question coming from a couple of people. So with this whole consultancy approach, do you also take this one step further in helping your customers in getting omni-channel-ready, i.e., are we going to see the colleagues from supply chain going to be involved in helping the customers really getting ready for this?

Yes, sure. I think the group, there is not one e-commerce strategy in DPDHL. I think we're all happy to agree with each other. There are 4 e-commerce strategies in the divisions that build up to the overall approach of DPDHL to the e-commerce opportunity. But already, supply chain is a good example with their European fulfillment network, EFN, where we're partnering on customers and assisting supply chain, actually, in the setup of that fulfillment network, which seeks to deliver last mile and emergency -- emergency shipments and fulfillment from the site, [ then ] to Spain, for example. If anyone wants to know more about that, Michiel is quite involved in that. But yes, I think this is a -- collaboration is, for some time, has been no longer been a -- no longer a dirty word. And the collaborative opportunities on e-commerce, quite frankly, are as many as there are collaborative opportunities on capacity management last year during the pandemic with our aviation assets. And as you can imagine, Ken Allen establishing the e-commerce solutions division coming from Express, you would foresee and predict and expect, there's a lot of opportunity there across business unit collaboration and synergies and efficiency.

Okay. So I thank everyone out there, for the multitude of questions which I tried to group thematically. I don't think that we missed out on any specific question here. John, Michiel, Leendert, thank you very much for introducing our community to the world of e-commerce in B2B, definitely an appetizer. So we are going to look forward to you continuing growing this, and we will make sure, from an IR point of view, of course, that we are then going to be able to track the progress that Express, and eventually, the other divisions are making out of this real big global trend of B2B trade flows going e-commerce as well. With that...

Thank you, everyone. Thank you for your interest.

Thanks, everybody.

Thank you very much.

Thank you very much. Looking forward to talking to each of you in over the next weeks and months. And with that, have a good rest of the day. Thank you, everybody.