Coming soon! To a mailbox near you! The next Great American Make-Over! Starring: The United States Post Office!

Not unlike the popular TV show in which a busload of contractors arrive at a home of a deserving-but-beleaguered "every family," intent on re-inventing the dilapidated structure (while sending the gob-struck family to Disney World for a week), the USPS is starting a dramatic make-over of its own. But without the diversionary trip to Disney.

Not unlike the TV show, the heroes in the rock-star bus do not show up until the last second, when the inhabitants are at its collective wits' end.

Not unlike the TV show, no one really knows what the outcome will be until later. And no one truly knows if folks will like what they get.

While not beset with awful diseases like these TV families, the USPS is seriously ailing and needs help fast.

Acknowledging that its current business model is unsustainable, USPS management cites huge declines in mail volume (thank you, internet and email)...as well as expensive-to-maintain, but probably-no-longer-necessary facilities...the folks who work (or don't have enough work to keep busy) in those underutilized facilities...and the dreaded Congressionally-mandated retirement pre-funding.

The cumulative effect is that the USPS has been saying if things are not resolved, they will be insolvent by September 30th.

Cue the bus. It's time for triage.
The USPS has manfully tried to forestall the current situation. Since 2006 it has closed 186 facilities, deep-sixed 1,500+ pieces of equipment, and decreased staff by more than 110,000. Result: $12 billion saved.

Good start, but not enough.

Realizing that it needs to save $3 billion (that's billion with a "B"!) a year, the USPS is considering closing or merging 250 more processing facilities, reducing equipment by another 50%, decreasing the transportation network, and eliminating up to 35,000 more jobs.

Ouch!

So what does this mean to those of us who mail to promote our businesses or non-profits, and hope to see mail in our mailboxes when we get home every night?

#1. Time delays. Fewer people and less equipment could mean delivery delays. The USPS Standards of Performance tell the tale:

Standards of Performance
	Today	Proposed
Priority	1-3 days	1-3 days
First Class	1-3 days	2-3 days
Periodicals	1-9 days	2-9 days
Standard Mail	3-10 days	3-10 days

OK, that's not too bad, all things considered. But what about...

#2. Postage increases. Count on it. Stay tuned.

#3. Closure of local post offices. Absolutely. Non-profitable locations—mostly in small towns—are already packing up.

#4. Procedural changes for mailhouses. No doubt. But exactly what and when is still TBD. Among the items on the table are:

• Reduced points of entry for dropshipped mail
• Rate changes in zone-based mail
• Schedule shuffling to meet required "in home" dates

So when will this take effect? September 30th is, after all, just days away.

Protocol requires that the USPS (1) put its proposal out for public comment. That happened on Thursday, Sept 15th. Then the USPS (2) asks the Postal Regulatory Commission (PRC) for approval. The PRC (3) considers, then proposes. A "reasonable amount of time must pass" before the USPS implements any nationwide service change (4).

Using the debt-ceiling debaters as a role model for bureaucratic efficiency, the USPS hopes to have its proposal presented to the PRC (step 2, above) by the end of October—one month into its insolvency.

The PRC is expected to respond by—well, we really don't know. But the USPS says it hopes to begin its consolidation and constriction efforts (step 4) by February or March of 2012. Only six months after its September 30th deadline for insolvency.

Adding more stress: The economy is showing few signs of recovery. The Super Committee (Debt Ceiling Part 2) isn't making headway yet. And the American public is understandably antsy.

Cue the bus! Disney World is looking better by the minute.

What does 44 cents buy these days?

Within my memory, 44 cents has gone from buying 4 candy bars and 4 packs of gum to an itty bitty piece of paper that you lick and stick on an envelope.

While those 4 candy bars and 4 packs of gum could give a kid a day-long sugar high—and keep a dentist busily occupied cleaning up the after-effects for months!—that little stamp can send a letter across the country, in first class accommodations.

44 cents to write your Mom whether she lives across the street—or across the country. What a deal! (And while I'm thinking about it—write her! She'd love to hear from you.)

But did you ever wonder how the Post Office arrived at that cost? Here's an educated guess, proffered by George Washington University MBA student Andrew Schneider after delving into USPS and Postal Regulatory Commission Reports. The big surprise is that less than half the cost is the mailing process itself (sorting and delivery). The remainder covers USPS general overhead. Almost.

Sorting/labor	10 cents
Delivery labor	7 cents
Facility & vehicle maintenance	2 cents
Fuel & transportation	1 cent
Buildings, equipment, vehicles	2 cents
Retiree pension & health costs	2 cents
Misc. Expenses/first class mail	8 cents
Corporate overhead	16 cents
Cost to the USPS	48 cents
Cost to Consumer	44 cents!

That means every letter you mail to your Mom costs the USPS 4 cents. Now multiply your 4 cents by the billions of first class letters the USPS mailed last year. No wonder the USPS has the low down dirty fiscal blues!

The USPS is subsidizing your mail. And what do you do? You whine about paying 44 cents! In most countries around the world 44 cents would look like the bargain of the century. Even better for you ingrates, the USPS isn't raising the cost of the hard-working First Class stamp in the pending postal increase.

So write your Mom more often.

Remember: It's only 44 cents. It's a sweet deal.

And it won't rot your teeth.

The Deadliest Quote!

Determining postage is not for the faint of heart

I work in a very dangerous job. No, I’m not snagging crabs out of a frigid arctic ocean, or felling 3-ton trees in a rainforest. I don’t work in a coalmine or build bridges. It may not be one of the most death-defying jobs, but I promise you, my job is even riskier!

You see, I work with the US Post Office.

It starts out innocently enough: You’re on the phone with me. You’re a new client, with a new direct mail project—your first! The boss is pushing you to get answers. But you don’t know if you want to mail a postcard, a flyer, a brochure, a newsletter or a letter. And you don’t know your own data.

We select an option and work through all the necessary specs. Size of piece. Number of colors. Paper stock. Bleeds. Number of pieces. Class of mail. Stamp, meter or indicia. I am feeling better about this process. We’re working toward a manageable end goal in tandem.
And then the wheels fall off the wagon.

“What’s my postage going to be?” you ask me innocently.

Oh no! It’s the dreaded unanswerable question!

I stall. I sweat. I try to change the subject. My mind races. I’m stepping into a bottomless pit and I know it. Any answer I give you will be wrong.

What kind of a person are you? Will you accept when I say this is ESTIMATED postage? Will you hold it against me 2 weeks later when we discover I was one tenth of a cent off? Will you question my expertise when I tell you I can’t give you a simple two-digit answer—NOW? Will you understand that to be perfectly accurate we have to have your data and determine its distribution while factoring the size, weight and thickness of the piece you’ve decided to mail?

Will you wait patiently while I try to explain how I can’t answer that question with absolute accuracy? Will your mind wander as I present my truncated explanation of 5-digit sorts…3-digit sorts…AADC…Automation…letters…flats…dropshipping…co-mingling…SFC or BMC rates?

Will you cut me short so my carefully crafted, oft-rehearsed explanation makes no sense? Will you graciously allow me to finish and then ask again, perhaps a bit impatiently, “OK, so what’s the postage?”

My mind is awhirl with the possibilities.

All the possibilities are jumbled up in my head as I’m calculating what would work best for you. There is a lot to consider, and my circuits are overloading.

But curious minds want to know. You repeat a little more insistently since I obviously didn’t hear you earlier: “What’s my postage going to be?”

Deep breath. Clear the mind. Calm the raging mental storm. A sip of tea. Another deep breath. OK, here we go, plunging in without a life jacket:

Dearest Client, let me help you. Please tell me about your data. Is it local? Regional? National?

If you can’t tell me that basic fact, I can’t give you anything remotely accurate. I can give you ranges, but your boss is looking for a nice, neat, simple answer. Something he can put in a spreadsheet. A range of numbers won’t hack it.

If you don’t know your data distribution, how am I to know how it will split out over the 27 different rate categories that this one piece of mail could qualify for?

If you’re unsure about the size of the postcard you’re mailing, there could be 54 possible rate categories—just in Standard mail. Add CRRT and you’ve added another 9 possible rate categories. Add First Class Presort as a consideration and you’ve just added another 6 categories.

Complicating the situation even further, in many mailing projects there can be 5 or more postal rate categories, depending on the distribution of your mailing list.

The USPS’s rules are so complex they fill a volume the size of the Manhattan phone book. Even their experts in mailing requirements disagree as to the interpretation of various rules and sub-rules. It is a daunting question you put before me. And you want your answer NOW!

I know my chance of calculating your postage rate exactly right is comparable to my chances of winning the Lottery: nil.

If I under-calculate your cost, I’m a goat if when we presort your job. “Ellen promised me the postage would be xx-cents each! We won’t pay a penny more!”

If I over-calculate, we lose the job. Some guy in Florida has promised he’ll print and mail your 20,000 postcards for $100 over the postage cost I’ve just quoted you.

I know that $100 won’t buy the paper to print your job on, much less print and mail it. I know you’ve given me one set of specs and him another, but you insist you’ve given both of us exactly the same thing.

Pfffft. Just like that your job is gone.

Trying to explain to you, Dear Client, the byzantine postal regulations and relating them to your job is a guaranteed anxiety attack.

Trying to explain to your boss why you lost a simple postcard job to some guy in Florida who is clearly not playing by the same rulebook is another.

Like I said, mine is a business fraught with risk. Thank you, USPS.





Working in a coalmine is looking better all the time.




43670 Trade Center Place,
Suite 150,
Dulles, VA 20166
Phone: 703.996.0800
Fax: 703.996.0888
1.866.365.2858
www.paulandpartners.net
sales@paulandpartners

Why do I like direct mail?

As a marketer, I like direct mail because it is a proven marketing technique that’s been around for years. Yes, it’s a bit old fashioned. But that’s not always a bad thing. You can get hurt on a cutting edge. It’s all perspective.

I like the preparation and planning that goes into a mailing. The thousand and one decisions that can make or break the campaign. The copy. The graphics. List segmentation. Proofs and press checks. Deadlines and re-dos. The stress and the pressure. The teamwork. And the feeling when it’s all over that “We got it right.”

If, as my wise Grandmother used to say, “Anticipation is half the fun of getting there” then that time waiting for the mail to hit is indeed a delicious pins-and-needles pleasure. But much like Alaskans who wager on the day and hour when the frozen river will break up in spring, we wait anxiously for the day when the mail hits.

Watching early returns come in is like a game of expanding geography. First the areas closest to our mailing point come in, then spreading farther afield, moving from East Coast to West Coast in a predictable pattern validating our pre-launch planning.

As a user of direct mail, I know it works. I see responses come in, building housefiles, making sales and providing information we can use to make our next campaign even better. Every response is validates the planning process and ultimate execution. Our team rocks!

I value how targetable direct marketing is. I know that by pinpointing our message to each audience in our universe, we can make our approach more personal and generate more response. Manipulative? Maybe a little. Marketing magic? Absolutely!

I appreciate how statistically quantifiable direct mail marketing is. No other media allows us to know exactly how many people received our message, how many opted to respond, and at what level of commitment. It proffers verifiable, concrete proof of performance.

On the other hand, as a recipient, I like direct mail because it lets me choose who/what to let into my home, my head, my wallet. It’s polite and gracious, allowing me to respond as I deem appropriate.
I like direct mail for its “keeper” value. I can act on it immediately, or I can store it away for action later. I go back to it when or if I want to, on my time, at my convenience. I keep catalogs so I can see fashion trends on the horizon—and confirm just how truly hopeless I am.

I like direct mail because it has tactile value. I can hold it in my hand. It has physical heft and reality.

I like direct mail because it has a wonderful freshly printed smell that is faintly reminiscent of my Father’s beloved workshop.

My bottom line: I like direct mail because it works. On so many levels.

Need help with your direct mail marketing? Consult a professional like Paul&Partners. We’ll help you navigate the postal regulations to ensure you get the best postage rate available to you. We’ll help you design a package that is the right one for you and your budget.

Check us out at www.PaulandPartners.net. Let us know how we can help make your next marketing program more successful.

43670 Trade Center Place, Suite 150, Dulles, VA 20166

Phone: 703.996.0800 Fax: 703.996.0888 1.866.365.2858

www.paulandpartners.net sales@paulandpartners