In the past year, the U.S. Postal Service has launched several initiatives to bolster its customer base, revenues and profits. Two of these advances, Confirm and Mailing Online, can benefit direct mail service providers.
One of the USPS’ most impressive advancements is its Confirm program, which is designed to identify the location of mail in the USPS system and define its date of delivery. The tracking mechanism has been in limited use for some months and is expected to be fully deployed by next fiscal year. This service gives mail service companies the chance to provide timely financial and marketing information to their remittance and advertising mailers.
Enterprising direct mail service providers, large and small, have been “working the system” and creating reports for test clients. Providing value-added service, of course, is an excellent way to keep partnerships strong and to capture new business.
To better appreciate the Mailing Online program, an understanding of two related actions is needed. First, deputy postmaster general John Nolan has set a goal of $3 billion in new business revenue to be captured from the mid-market business segment, that is, businesses with 20 to 100 employees. The objective is to develop direct mail business from 1 million companies not currently using the medium. At the recent spring postal forum, Nolan announced the creation of a direct marketing industry task force to guide and monitor developments. He also has charged the panel to present near-term results at the October postal forum.
The second background item that affects Mailing Online is the postal service’s Business Service Network, which has been charged with building broader use of direct mail by businesses. A principal tactic the BSN uses is to make the medium easily accessible, particularly to businesses unfamiliar with developing direct mail promotions. For example, the mid-market category contains many entrepreneurial-type companies that are young and growing yet have little understanding of direct mail other than knowing it is an effective way to prospect for new business and maintain contact with customers.
The BSN staff guides such users onto the USPS online mailing services site, which epitomizes the concept of one-stop shopping. The inexperienced business is directed through the process relatively quickly and simply. Behind the scenes, the postal service contracts processes ranging from copy and design to printing and lettershop services.
John Ward, vice president of core business marketing for the USPS, thinks Confirm and Mailing Online are examples of the right tools to achieve their growth and profitability objectives.
Now it is incumbent upon advertising/direct marketing agencies, lettershops, printers and service bureaus to join forces and actively promote the one-stop shopping concept. The old Marine Corps KISS principle (keep it simple, stupid) is a precept that industry must employ to encourage greater use of direct mail. Establishing local alliances will ensure that direct mail services are procured locally, because there’s no guarantee that the USPS online service will channel outsourced services at the point of origin. Helping create local alliances may be an area where Nolan’s task force can provide leadership.
Finally, it’s time the postal service required all business mailers to use name/address and address-only hygiene services regularly to qualify for continued postal discounts.
The economics of postage and material savings over the cost of the postal service’s file-cleansing services have been proved time and again. Yet the USPS still processes 5 billion to 6 billion pieces of undeliverable mail annually. This intolerable $1.5 billion problem persists while business mailers receive postal discounts for portions of their mail that continue to be undeliverable.
This wasteful cycle will end only when company accountants understand how much more costly undelivered mail (discounted or not) is compared with regular use of USPS pre-mail cleansing services.