The U.S. Postal Service Needs Financial Protection

Even in crisis, exacerbated by COVID-19, there’s not likely to be new postal reform bill any time soon. So here we are now: the U.S. Postal Service needs financial protection.

COVID-19 may have frozen ad budgets, including direct mail, but the financial woes of the U.S. Postal Service have pre-dated the current crisis. Calls for postal reform to facilitate all types of fiscal fixes have gone unanswered, despite bipartisan support to get the job done. Huge Congressional mandates from 2006 to pre-fund healthcare costs for future retirees – which do not exist to any such extent in the private sector – are just one example of how politicking gets in the way of running USPS more efficiently.

On paper, the U.S. Postal Service should be holding its own. And it had been through the end of last year.

A Formidable Job of Management Couldn’t Predict a Crash

Mix and match, but it’s been managed. In 2010, First-Class Mail volume was 77.6 billion pieces. In 2019, it was 54.7 billion – a nearly 30% decline. Marketing Mail also declined, but less precipitously – from 81.8 billion pieces to 75.7 billion. Meanwhile, as direct-to-consumer (DTC) shopping has taken hold, parcel volume has doubled from 3.1 billion to 6.2 billion package deliveries, making the USPS truly the Greatest Carpool on Earth. (Happy Earth Day.)

And though there is mail volume decline, the “mail moment” remains vital, and delivery points have increased from 150.9 million in 2010 to 160 million in 2019. Against this expanse, the USPS has shed 93,000 jobs in 10 years, maintaining 497,000 positions in 2019.

Throughout all this, USPS operating revenue has increased to more than $71 billion, from $67 billion in 2010. Rate hikes have been predictable and better managed. So why the carnage?

Yes, it’s COVID-19. Mail volumes reportedly have dropped by 30% since the crisis began. Add to this the hands-tied effects of the Congressional mandates – and it’s no wonder the USPS Postmaster General is seeking a “we need cash” bailout. This time, will Congress – and The White House – answer the call? According to The Washington Post, as of Friday, April 24, President Trump stated he would not approve of emergency aid for the Postal Service if it didn’t raise prices for package delivery immediately.

We Can Debate the Amount – But Let’s Recognize These Heroes at Work

The U.S. Postal Service is a quasi-governmental operation that answers by U.S. Constitution to the American people – but is called upon to run as a business. And it indeed tries. Yet it can’t just set rates on its own, as everyone gets a voice in rate-making and operations, even competitors.

Even in crisis, exacerbated by COVID-19, there’s not likely to be new postal reform bill any time soon. So here we are now: the U.S. Postal Service needs financial protection.

It’s hard to blame the USPS, but that doesn’t stop President Trump from calling out sweetheart deals that don’t exist. Add to the cacophony those who wish to privatize – answer to shareholders instead of the public – and sparks fly. Postal labor interests, for one, are powerful – and so are marketing mail and parcel customers. No one wants to upend the letter carrier.

But a virus might just do that.

So as I put on my mask and gloves, and go to the mailbox as part of my daily heightened ritual, I retrieve my personally addressed parcels, flats and letters. I spray them with Lysol. I open and read each piece, and I recycle each piece when I’m done (Happy Earth Day again). And I wish Godspeed, and a few billion tax dollars, to all these postal heroes who are keeping American commerce every day in movement. We need you. America needs you. Thank you.

What You Need to Know About USPS Informed Delivery

You probably don’t like spoilers for movies, but what about your direct mail?

The U.S. Postal Service has rolled out a new tracking feature called Informed Delivery in the last few months. And it has implications for how the customer, the mail service vendor, and marketing agencies operate in the mailstream.

You probably don’t like spoilers for movies, but how about for your direct mail?

The reason I’m asking is because the U.S. Postal Service has rolled out a new tracking feature called Informed Delivery in the last few months. And it has implications for how the customer, the mail service vendor, and marketers operate in the mailstream.

USPS LogoThe first time I heard of it was in September 2015, when I spoke at the National PCC Day event in New York.

In his remarks, USPS Chief Marketing Officer Jim Cochrane mentioned a service undergoing trials that would let people see their mail before it gets delivered.

I was intrigued, and still am, as Informed Delivery is being implemented this year.

I agree with Tom Glassman, Director of Data Services and Postal Affairs at Wilen Direct. He calls it “a great integration of digital and physical mail.”

So last week, I signed up for the program and waited to see what happened.

How It Works

Consumers can enroll online for a free, password-protected account that creates a digital mailbox for the direct mail they receive at their house. Before it’s even physically delivered, they can log in and see a grayscale image of the front of a common-sized mail piece, like a #10 envelope or folded self-mailer.

It’s not available yet for P.O. Box customers. And jumbo mailers, catalogs, and packages aren’t included in the mix at this time.

What Marketers Should Think About

So if you’re a marketer, you’re probably asking, “What’s in it for me?” What’s the ‘why’?” There are complex answers to these questions.

If this service were only about giving consumers a sneak preview of their mail, one more impression of an offer, well that’s not too bad.

But Informed Delivery is more than that.

Marketers can build campaigns using the Intelligent Mail barcode (IMb) to reach target audiences in the digital and physical worlds simultaneously. Under the program, marketers can enhance a physical mail piece when it’s scanned into the mailstream with a representative full color image, interactive content, and a click-through URL, with individual URLs coming this fall.

I’m not going to get into all of the technical details about campaign management and how to set up Informed Delivery. That discussion needs a much deeper dive, so it can wait for another time and place.

And I fully expect USPS to change features based on feedback from industry users and the public.

But I do have some recommendations.

First, consider how your direct mail – or at least some of it – can stand out in a grayscale image. This means paying special attention to your images, teaser copy, etc., and testing all of them

Second, think about all how your mail or your client’s mail can be enhanced with an Informed Delivery campaign. So off the top of my head, I can see uses for retailers, transpromo, insurance, utilities, and financial services.

Finally, there are some great resources to consult for more information about why and how to implement Informed Delivery.

One other thing. Remember the words of the late Mal Decker: “Rule No. 1, test everything; Rule No. 2, see Rule No. 1.”

Postal Promotions: Reduce Postage Costs and Improve Response Rates

For several years, the U.S. Postal Service (USPS) has offered promotions to encourage marketers to integrate mail with new technologies and help increase customer engagement — enabling incentives to see how direct mail can best be deployed in an increasingly mobile and digital nation. The six USPS promotions for 2017 and their promotion periods are:

This week, I’m away on vacation, but blog readers have a special treat — an expert opinion from GrayHair Advisors’ Jody Berenblatt on postal savings in the offing for 2017 calendar year, courtesy of the U.S. Postal Service and its plans for postage promotions. Plan and save! — Chet Dalzell

USPS postal promotions 2017For several years, the U.S. Postal Service (USPS) has offered promotions to encourage marketers to integrate mail with new technologies and help increase customer engagement — enabling incentives to see how direct mail can best be deployed in an increasingly mobile and digital nation.

The six USPS promotions for 2017 and their promotion periods are:

1. Earned Value Reply Mail Promotion: January – June 2017

The Earned Value Reply Mail Promotion enables the USPS to automate the reply mail accounting process. At $0.05 credit per mail piece, this promotion is the easiest postage credit to earn. To qualify, you must use an Intelligent Mail barcode on the reply device for postage paid by the customer (courtesy reply mail) or postage paid by the business (aka business reply mail).

2. Tactile, Sensory and Interactive Mail Piece Engagement Promotion: February – July 2017

What could make mail irresistible? The tactile, sensory and interactive mail piece engagement program encourages marketers to invest in the experiential aspect of mail (textures, scents) to earn a 2 percent postage credit on future Standard mailings. The USPS recently won a ‘Webby’ Award for its own “irresistible” catalog.

3. Emerging and Advanced Technology Promotion: March – August 2017

To connect mail with mobile, the emerging and advanced technology promotion creates an opportunity for marketers to experiment with augmented reality, virtual reality, near-field communications, beacon technology and earn a 2 percent postage credit on both First-Class and Standard Mail.

4. Direct Mail Starter Promotion: May – July 2017

The Direct Mail Starter Promotion is aimed at digital marketers and newbies to advertising mail; earn a 5 percent postage credit on Standard mailings of 10,000 or less.

5. Personalized Color Transpromo Promotion: July – December 2017

The Personalized Color Transpromo Promotion encourages businesses to transform statements with colorful, personalized, targeted marketing to earn a 2 percent credit on First-Class Mail.

6. Mobile Shopping Promotion: August – December 2017

To earn this 2 percent credit for Standard mailings, marketers must create a call to action that allows the mail recipient to take action with his or her mobile phone. Easy.

For the balance of 2016, marketers also can enroll in both the Personalized Color Transpromo and the Mobile Shopping promotion. Simply register before the mailing enters the mail stream in order to qualify for either promotion.   For more information about the promotions and, importantly, program requirements, click here.

These savings are significant — so they are very much worth planning for and participating.