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Discussion Starter · #1 ·
Hey everyone!

As you may or may not be aware, the USPS will be increasing Postage Rates on May, 14 2007.

http://www.usps.com/ratecase/welcome.htm

If you currently use direct mail as part of your overall marketing/advertising campaign, this increase may affect you slightly or significantly...depending on volume/quantities mailed; but it will affect you (see examples below). Even if you're just considering using direct mail, then this Postage increase will affect you too.

Example #1 - weekly Jobsite Proximity Mailers (JPM's) + Regular monthly prospecting postcards

Say you send out 100 postcard JPM's per week mailed at First-Class postcard rates and approx. 5000 oversized postcards every month to a list of prospects mailed at Standard (or "bulk mail") rates. Currently, you spend .24 in Postage for the JPM card and, depending on list concentrations, around .20 in Postage for the oversized prospect card. NEW POSTAGE RATES = .26 for the JPM card and .218 for the larger card. Do this for 10 months a year and your Postage costs just increased by $980.00 per year. Big deal? I don't know, you tell me.

Example #2 - Quarterly (seasonal) oversized prospecting postcard

Say you send out 20,000 oversized postcards (again, mailed at Standard, or "bulk" rates) with some sort of seasonal theme, split up into manageable quantities, to a list of prospects every quarter. Again, depending on list concentrations, let's say you currently spend around .20 in Postage per card. NEW POSTAGE RATES = around .218 per card. Your Postage costs just increased by $1440.00 per year. Big deal? Again, I don't know, you tell me.

Since Postage makes up the single largest cost component of nearly every direct mail campaign, what, if anything, are you doing to prepare for/reduce this increase? Will this change the way you use direct mail as a marketing/advertising tool? Or do you feel this just a normal cost of doing business?
 

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Thanks for delivering that important information mailman

I suspect, like fuel price increases, most will suck it up and deal
I can see some who rely greatly on direct mail trying to make more informed decisions on when and where to mail, but I can't see them dropping it
 

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Since Postage makes up the single largest cost component of nearly every direct mail campaign, what, if anything, are you doing to prepare for/reduce this increase? Will this change the way you use direct mail as a marketing/advertising tool? Or do you feel this just a normal cost of doing business?

OK, Patrick, I'll bite. It almost seems as if your saying there is something we can do to reduce it. Is there?

I was fully preparred to just sit back and take it, like everything else the post office, government and American energy cartels throw at me.:laughing:
 

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Rock On
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I was fully preparred to just sit back and take it, like everything else the post office, government and American energy cartels throw at me.
You get to sit back?
Lucky you
Seems like I always have to bend over
 

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Discussion Starter · #7 ·
There is a lot that you can do. Because the increase itself is unavoidable, the key is in reducing the amount of the increase and making everything more efficient...starting with the Postage. The way to make Postage more efficient starts with the list. If the list is concentrated enough, Postage can be reduced to it's lowest possible level.

Or, of course, you could just sit back and take it.
 

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Discussion Starter · #8 ·
Postage discounts/mailing list concentrations

I was re-reading my last post and thought I should clarify some things about both Postage discounts and mailing list concentrations:

  1. The whole reason that the USPS gives Postage discounts in the first place is to help the mail flow through the postal system more efficiently. They have acknowledged that other companies may be able to do parts of this better than they can. They encourage this by offering discounts for doing parts of their job for them. The more of their job you do for them, the larger the discount. In general, this process is called presorting and anyone who's ever done a relatively large in-house mailing knows how much fun this can be.:censored:
  2. The second way to take advantage of Postage discounts is to make sure your mailings are automation-compatible. This has to do with the sortation equipment they use and the way that the mailpiece is physically designed, printed and addressed. Ever wonder what that barcode is either directly above or directly below the delivery address? That barcode, if done properly, corresponds directly with the delivery address. This way, the sortation equipment can scan the barcode, rather than "read" the address and still know where the mailpiece is going to. If they can't scan the barcode, or if there isn't one, they'll put one on for you, (even if you don't want them to) and you'll pay for it with a higher Postage rate. That's what that faint orange barcode is that you see on the bottom/backside of a piece of mail. Sometimes, they'll even slap a big white sticker with the orange barcode on it across the front of the mail piece. These stickers have been known to cover up printed phone #'s, website addresses, or other important info. Why is all this important? Because most commonly used address labels have a tendency to disqualify you from automation Postage discounts.
  3. Lastly, and perhaps most importantly, your level of Postage discount has to do with what type of mailing list you use. Typically there are two kinds: a Consumer List (effective for targeting based on income, home value, squ.ft. etc.) and a Resident/Occupant List (effective for targeting based on ZIP or other geography). If you choose a Consumer List , be aware that your records, while targeted, will be more spread out. Because they are less-concentrated, all the presorting and automation in the world will only be able to sort them down so far. If you choose a Resident/Occupant List, be aware that (for argument's sake) you will be mailing to every mailbox within your pre-defined geography. This list, however, is "super-concentrated" and therefore you're able to achieve the maximum postage discounts.
What list you should use depends entirely on your individual needs, goals and budget.
 
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