USPS Crisis and Direct Mail Campaigns

By Soo Dawson

piece of mailAh, the annoyance. After the 7th time in 14 days of receiving a large envelope stuffed with an unsolicited credit card application (from “x” institution), I decided to fight back. I took out the business reply envelope (metered for use within the U.S.) and stuffed all the material they sent me back into it (blank, of course). I licked the envelope and promptly dropped it in the metered mail box. Now, “x” institution needs to pay USPS a quarter (sucks that they don’t pay standard first class postage), and I get a brief sense of satisfaction about having taken action. This man on YouTube articulates the need to stand up against these unethical folks well– but my recent incident got me thinking about the USPS crisis and what happens with direct mail marketing.

First of all, 95% of the population who use first class mail (everyday people like you and me, but also businesses) are cutting back on it – which means the income stream that brings in more than half of USPS’s revenue is severely threatened. However, USPS has grown increasingly smart to combat its income loss:

  • USPS has cut its work force by 12% since 1999 and achieved savings of $8.8 billion.
  • The organization uses IT efficiently to save money; consumers are able to purchase services, print and sign forms, and track mail via, as well as arrange front-door pickup. Internet sales are strong and the demand is especially strong among small-business owners.
  • They apply sophisticated sorting techniques at sorting centers. Their sorting system can now check envelopes against a database of forward requests, and it also applies labels redirecting letters to their new destinations.
  • USPS has focused on advertising mail to combat loss of income from first class mail. These include advertisements, catalogs, circulars and of course, unsolicited credit card offers like the ones I receive regularly. However, on average, each piece of standard mail earns the post office about half as much as a similar piece of first-class mail. Still, USPS has the volume of these types of mailings to keep it afloat.

So what does this mean for business and direct mail as a form of marketing? Bottom line: USPS is facing a bit of a crisis since it is losing a big percentage of its first class mail income. However, they have found ways to adapt. Have you, though, in your marketing efforts?

  • Is your mailer relevant and does it have good content? More importantly, is it solicited?
  • How frequently are you sending mailers out?
  • What does your mailer look like? Is it something people would want to even open or does it make them turn away in disgust?

Finally, ask yourself this question: if they did respond to you, is it going to be worth your quarter? Think back to my example above. Few people are going to react in annoyance and frustration like I did – some responses may actually be valuable to you. It’s up to you to gauge whether or not direct mailing is a form of marketing you want to pursue, but I want to throw out a word of caution: no one likes unsolicited material and you can be assured that “x” institution and I will not be doing business together.