The Catablog
Archive for the ‘How to Mail Efficiently’ Category
USPS’s Exigency Rate Case Appears to be Dead
Yesterday, the Postal Regulatory Commission issued an order requiring the US Postal Service to complete the submission of its entire case to the PRC. Per the PRC order, this includes “all information, materials, and testimony on which the Postal Service would rely to demonstrate that its Exigent Request satisfies the causal nexus of ‘due to,’ as interpreted by the Commission” – “due to” referring to the impact of the 2008 recession.
According to the PRC order, the Commission stated that it would “apply its interpretation of the causal nexus of ‘due to’ to evaluate the remanded Exigent Request if the Postal Service wished to pursue it. The Postal Service, however, “has not provided all of the information necessary for the Commission to evaluate the Exigent Request.” What’s more, Postmaster General Patrick Donahoe yesterday said that the USPS won’t be be providing the requested information.
End of Exigency Once and For All?
So is the exigency case once and for all stone-cold dead? Not quite. It’s still on the table because the PRC has not dismissed it. But it can’t proceed in its current state. So it remains essentially in limbo. And with no intent of filing the required information, the USPS is standing behind its promise to take no further action on the case. As we’ve stated in the past about the case, we must take PMG Donahoe’s word on this, and he continues to say he has no intent to follow through with an exigency increase, but at the same time, doesn’t want the case thrown out altogether, pending what comes out of Congress in legislation to save the USPS.
In its original exigency filing last year, the USPS sought $2.3 billion in additional revenue and an approximately 5%, on average, rate hike.
If you have any questions contact:
Don Landis
VP of Postal and Government Affairs
Arandell Corporation
Measuring the impact of mailing a household multiple times during the same season
When you are up against the need to maximize both sales and profitability in Q4, you should be sure to have some tests and metrics in place to measure the impact of mailing the same name multiple times.
The key way to preserve your profitability is to know how many prospects are being mailed multiple times and the catalog cost of those second and third mailings compared to the incremental revenue being generated. Profits get pretty skinny when you are mailing two or three or four catalogs to get incremental prospecting revenue.
The coops have good optimization models that you can use to only mail the “best-of-the-best” prospecting names and to score older multibuyers and these optimization models should be part of cataloger’s circulation plans. If you are taking a large portion of your circulation from a single coop, use another coop’s optimization model to score your prospecting file.
What to do in the face of increased postal costs
So postage is going to go up for catalogers again this Spring. This is not the first time and in all likelihood it won’t be the last.
Every time the USPS has increased rates in the past, catalogers have mailed fewer books. Marginal circulation has been eliminated. It is a downward spiral. It is a pretty simply formula, i.e., increase the cost and reduce expense by mailing less and revenue remains about the same (or decreases).
So if you are planning on mailing less this year plan on making less revenue. If you don’t want to make the same or less revenue let me suggest a radical strategy. This is the time to increase your circulation! Why? You need more customers to cover increase costs. How do you get more customers? You mail more catalogs to prospects. Another positive is that most WILL decrease circulation, what will that create? Less catalogs in the mailbox = less compteition.
USPS Delays Closings until May
The U.S. Postal Service will delay the closing or consolidation of additional Post Offices or mail processing facilities until May 15, 2012. The USPS said on Tuesday that it made the decision in response to a request made by multiple U.S. Senators.
The U.S. Postal Service is studying 3,700 of its nearly 32,000 retail offices for possible closure as it faces an ongoing financial crisis, and is planning to close about half (250) of its processing facilities. Postmaster General Patrick Donahoe said it was considering the retail closures because customer’s habits “have made it clear that they no longer require a physical post office to conduct most of their postal business.”
Tuesday’s announcement came a week after the Postal Service announced it would move ahead with plans to lower its service standards for First-Class mail. The move, which it said would generate annual savings of $2.1 billion, would mean in effect the end of overnight delivery for First-Class mail.
In its announcement yesterday, the Postal Service said it would continue all necessary steps required for the review of the facilities during the interim period, including public input meetings.
“The Postal Service hopes this period will help facilitate the enactment of comprehensive postal legislation. Given the Postal Service’s financial situation and the loss of mail volume, the Postal Service must continue to take all steps necessary to reduce costs and increase revenue.”
9 Reasons to Mail More in 2010
“The economy is weak.”
“My budgets are frozen.”
“We are barely surviving as is.”
“I don’t have enough staff or time to even think about prospecting.”
“I have plenty of non-active buyers on my file who I can turn to.”
And the best one…..”business is not good right now.”
If you answered, “yes” to any of these, you are a great candidate to ramp up your prospecting in 2010, or for most of you, to actually begin prospecting again after a year or two of not doing it. Why? Because the cost and timing to acquire a new customer could not be better.
First let’s look at the cost side of the equation.�
1. The USPS has frozen rates for 2010 and is considering offering incentives to mail more. Even without the incentives, rates are locked for 2010 and for budgeting purposes you have a stable fixed cost.
2. List brokers are willing to deal like never before. Co-ops are also loosening their rules and barriers to entry. Discounts and incentives that were once for only the large mailers (are there any of those left?) are now being offered to virtually all mailers.
3. Arandell Corporation is also in a great position to provide you with the most innovative solutions to reduce your costs and deliver your message as efficiently as possible. Technology in the industry has never been better.
4. Your other suppliers have also been driven to invest in the tools, technologies and personnel to keep you going (as well as themselves) and will do whatever they can to earn your business (and to stay alive themselves).
The other side of the equation is timing and as they say…”timing is everything.”
1. Despite the fact that the economy is shaky, there are people out there still wanting and needing goods and services. If you have been to a mall lately, they are still very crowded. Yes, some stores are doing better than others, but isn’t that always the case and isn’t that what marketing is all about?….finding and talking to people who fit your target? There will always be winners and losers.
2. Because there are fewer competitors of all kinds out there, there are fewer catalogs and direct mail pieces being delivered. If you have a good product, demonstrate value, provide a great experience and deliver memorable customer service, you will be noticed and successful. Again, as bad as it may be out there, people are buying, people are going to stores and people are looking to feel good. What an opportunity.
3. You also have the opportunity to capture customers, maybe for a long time. Keep the messages and your brand going. Once you stop, your “loyal” customers will likely forget about you and stop as well. The people that never heard from you have fewer messages to decipher and that is a good thing for you, so again, now is the time.
4. The amount of available data used to find the “best” prospects is also at an all-time high. Today, you can slice and dice using an infinite amount of data if you feel so inclined.
5. The methods to reach new customers are greater than ever. Every channel has potential for you in today’s environment. Do not assume that your potential customer is not using all of them in their daily lives today.
So, while it won’t be easy, the path to growing your business is a little smoother than it once was and may ever be. You don’t have to jump in with both feet but now is the time to test the water….. at least with your toes.
Full Service IMB options, is it right for you?
Arandell Corporation has printed and mailed many retail and mail-order catalogs. Both have their own unique requirements based on their marketing objectives. For instance, retail catalogs have particular in-home dates to meet and are planned in meticulous detail with in-store promotions. Our standard mail-order catalogs often have personalized order forms and inserts that need matchback information to correlate in-home dates and Internet traffic.
With the upcoming changes to the USPS method of tracking mail, specifically transitioning to the Intelligent Mail barcode (IMB) system, the needs of our retail and mail-order clients will be adjusted. Click here to learn more about IMB. We have been surveying our customers to determine how they, or if they, plan to use the Full Service IMB option. As of today, only our retail customers have expressed a desire for Full Service IMB to be used for tracking purposes. Additionally, some retailers are toying with the idea of using the Full Service IMB in lieu of printing Point-of-Sale personalized customer barcodes on their direct mail pieces.
I am writing to learn the opinion and perspective of our standard mail-order catalogers. We have already heard several possibilities on how they might use the IMB services, but at this time have not heard of any immediate plans for mail-order catalogers. Our understanding is most catalogers are just looking at “What if?” scenarios.
Some of the things we have heard being pondered:
- Using IMB in lieu of matchbacks
- Using IMB data for segmentations
- Of course, retail and standard mail-order catalogers are taking in cost considerations with the different IMB options.
It seems the possibilities center around being able to use the IMB for smaller segmentation of files. I would love to learn what you are planning! Do you believe that Full Service IMB will have a large ROI? What information are you most interested in collecting? If you are NOT considering the Full Service, why? Do you fully understand the file requirements to implement your desired IMB service? What possibilities are there for using the IMB in a standard mail-order world other than tracking?
Look forward to hearing from you!
Do You Pass the Droop Test?
First of all, I should clarify WHAT the droop test is. I can only imagine what you all thought of when you read the title of this post….
The droop test measures the flexibility of catalogs. If mail pieces are too flexible they will topple over as they travel through the USPS sorters and scanners. Implementing deflections standards, or droop standards, will greatly reduce the amount of direct mail pieces that fall off the machines. Recently, the USPS extended the deadline for the deflections standard implementation from September 8, 2009 to January 4, 2010.
How to test your catalog
Click here to see a brief three minute instructional video. Otherwise, read on! (more…)
How Move Update Requirements will Affect YOU the Cataloger
The USPS’s recent announcement to assess charges for mailings that do not comply with the Move Update requirements starting in January should be a non-issue for mailers. The sad truth however is that it still causes many of you confusion, anxiety, and worry.
Very simply put – In today’s environment, there is no reason not to run NCOA on each and every mailing you do regardless of how small they are. To do anything else even though it complies with the USPS’s requirements really defeats the overall purpose and does not provide an efficient / effective mailing campaign. All of the other options approved by the USPS are either done during or after the actual mailing. So why waste dollars when you have the ability to make the changes before the mailing goes out?
To recap – Here is what NCOA provides you with:
- Change of Address
- Address Standardization
- Carrier Route Coding
- Zip Code Correction
- Zip+4 Coding
- DPV Coding
- CASS Certification
- Identification of non-deliverables
What other product can deliver all of this at an extremely low price with almost immediate turnarounds? AND before the mailing goes out?
For additional information on the increase for non-compliant mail piece click here.
I am always available as well via email at GASierzchulski@Arandell.com at 414-248-9151.
How FSS will Take Away our Co-mail Savings
I have attended several postal meetings recently where postal officials updated the industry on the status of the FSS. Click here to see the FSS in action. It seems the program is back on track after some start-up delays. I would suspect that in the near future the postal service is going to start asking or requiring U.S. mailers to prepare flats for the FSS.
Why are they implementing FSS?
The FSS sorts flats in Carrier Walk Sequence. (Carrier Walk Sequence is just a fancy term for putting mail in the order that it is delivered). The more the USPS can automate the daily tasks of the carrier, the less expensive it will be for the USPS to deliver the mail. Because the USPS is swimming in hot water, you can imagine it will continue to jump at any opportunity to make money.
How will this affect me?
First, we will start to see the disappearance of the carrier route flat discount. The FSS machines will start to do what mass mailers are doing right now, putting flats in Carrier Walk Sequence. The USPS estimates the FSS will sort about 80% of the flat volume when installation is complete. That will still leave 20% of the flats eligible for the carrier route discount, and therefore only 20% which is eligible for co-mail savings.
How to get the savings back
To compensate for the loss of co-mail savings the USPS has stated they are going to give catalogers a discount if they organize their shipping pallets to fit the FSS machine requirements. This process is called co-palletization.
Now, to be frank, I am not sure if the co-palletization savings is ever really going to happen. We have been told and promised by the USPS that we would have savings before, but nothing ever follows through.
If we lose co-mail savings most catalogers would see a 5-10% increase in postage! Postage continues to increase and savings is decreasing. Can we really afford to pay more for mail?
If you are sick of paying more, and more and MORE for postage email the American Catalogers Mailers Association. Catalogs need to have a voice before our postage savings are taken away.
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