Mailing Systems Technology January/February 2024 by MadMen3

5 SOFTWARE AND SERVICES TO IMPROVE YOUR MAIL… TODAY! PAGE 19 JANUARY - FEBRUARY 2024 MailingSystemsTechnology.com

HOW DID THE JANUARY 21, 2024

USPS RATE INCREASE IMPACT YOU? PAGE 28

FIND VOTE-BY-MAIL SOLUTIONS INSIDE page 21

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TABLE OF CONTENTS

JANUARY-FEBRUARY 2024 | VOLUME 37 ISSUE 1

DEPARTMENTS

05 Editor's Note

2024, Here We Come By Amanda Armendariz

06 Real-Life Management

Credibility – Our Passport to Respect and Achievement! By Wes Friesen

08 Software Byte

Data Is Key… Especially in An Election Year!

By Hank Martin

12 The Trenches

The Impact of Tangible Communications in B2B Relationships

By Mike Porter

14 Postal Insights

Is the Plan Veering Off Course? By Leo Raymond

16 Inkjet Info

FEATURES

The Evolution of Inkjet By Karen Kimerer

22 Direct Mail in a Hybrid World – These Boots Are Made for Shopping

26 The Case for Customer Collaboration By Ryan Semanchik

By Dave Lewis

24 Unlocking Savings: A Deep Dive into USPS Growth Incentives for Mailers By Bob Rosser

28 The January 21, 2024 USPS Rate Change – What You Need to Know By Adam Lewenberg

18 Intro to International Mail Postal Customs and the Transit of Goods

By Merry Law

20 To Sum Up

SPONSORED CONTENT 19 5 SOFTWARE AND SERVICES TO IMPROVE YOUR MAIL TODAY 21 NEED VOTE-BY-MAIL SOLUTIONS?

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EDITOR’S NOTE

VOLUME 37, ISSUE 1 MAGAZINE STAFF President Chad Griepentrog Publisher Ken Waddell Editor Amanda Armendariz amanda.c@rbpub.com Contributing Writers Wes Friesen, Karen Kimerer, Merry Law, Adam Lewenberg, Dave Lewis, Hank Martin, Mike Porter, Leo Raymond, Bob Rosser, Ryan Semanchik Audience Development Manager Rachel Chapman rachel@rbpub.com Advertising Ken Waddell 608.235.2212 ken.w@rbpub.com Design Kelli Cooke

MadMen3 PO Box 259098 Madison WI 53725-9098 Tel: 608.241.8777 Fax: 608.241.8666 Email: customerservice@rbpub.com SUBSCIRBE Subscribe online at MailingSystemsTechnology.com.

2024, HERE WE COME BY AMANDA ARMENDARIZ

Subscriptions are free to qualified recipients: $20 per year to all others in the United States. Subscription rate for Canada or Mexico is $40 per year, and for elsewhere outside of the United States is $45. Back issue rate is $5. SEND SUBSCRIPTIONS TO: Mailing Systems Technology, PO Box 259098, Madison WI 53725-9098 Call 608.241.8777 Fax 608.241.8666 E-mail rachel@rbpub.com Online at MailingSystemsTechnology.com. REPRINT SALES ReprintPro 949.702.5390 www.ReprintPros.com All material in this magazine is copyrighted ©2024 by MadMen3 All rights reserved. Nothing may be reproduced in whole or in part without written permission from the publisher. Any correspondence sent to Mailing Systems Technology, MadMen3 or its staff becomes property of MadMen3. The articles in this magazine represent the views of the authors and not those of MadMen3 or Mailing Systems Technology. MadMen3 and/or Mailing Systems Technology expressly disclaim any liability for the products or services sold or otherwise endorsed by advertisers or authors included in this magazine. MAILING SYSTEMS TECHNOLOGY (ISSN 1088-2677) [Volume 37 Issue 1] is published six times per year (January/February, March/April, May/June, July/August, September/October, November/December) by MadMen3, PO Box 259098 Madison WI 53725-9098, 608-241-8777. Periodical postage paid at Madison WI and additional offices. POSTMASTER Send address changes to: Mailing Systems Technology PO Box 259098 Madison WI 53725-9098

appy new year, mailers! It’s hard to believe we’re already a couple of months into 2024. Of course, as has been the case the past couple of years, we’re ringing in the new year with a fairly substantial rate increase from the USPS. This isn’t exactly good news for mailers, but unfortunately, the Postal Service has made it pretty clear that multiple yearly rate increases will be the new normal. Luckily, there are ways to mitigate the impacts of this increase, and Adam Lewenberg’s article on page 28 does a great job of laying out the steps mailers can take to keep their postage costs as low as possible. Be sure to check it out and see what ideas you can implement in your specific mail operation. Of course, it’s not all doom and gloom. There are some great growth incentives this year that are attempting to get more mail pieces into the mail stream… and offering substantial savings in the pro-

cess. As Bob Rosser notes in his article on page 24, “these incentives can be a game-changer for organizations aiming to maximize their marketing budgets and mail smarter.” We know that direct mail gets noticed, which means that it works. If you’re considering growing your mail volume and want to save money in the process, these growth incentives are a no-brainer. The new year has just begun, but don’t let time pass you by. Take whatever steps you need to take now to both cut costs and grow your volume. At the end of the year, you’ll be glad you did. As always, thanks for reading Mailing Systems Technology.

MailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

REAL-LIFE MANAGEMENT

CREDIBILITY – OUR PASSPORT TO RESPECT AND ACHIEVEMENT! BY WES FRIESEN

ecognized leadership experts James Kouzes and Barry Posner assert, “Credibility is the foundation of leadership” in their bestselling book The Leadership Challenge. Respected religious leader Rick Warren wrote, “The most essential quality for leadership is not perfection but credibility. People must be able to trust you.” Webster’s dictionary defines credibility as “the quality or power of inspiring belief.” Developing our credibility is a necessary ingredient to earn respect and pave the way for greater achievement for ourselves and our teams. Greater credibility leads to greater influence and management effectiveness and aids our efforts to justify resources and find support for our initiatives. Credibility is built upon two twin pillars: character and competence. Both character and competence are important — and go together like peanut butter and jelly, or Laurel and Hardy (imagine one of those without the other!). The following are 12 building blocks that will help develop our character and competence — and build credibility in the process. Twelve Building Blocks for Developing Credibility 1. Walk the Talk. Multiple surveys have shown that people are looking for leaders with integrity and trustworthiness — those that live out strong personal values and ethics and always strive to do the right things. Senator Alan Simpson said, “If you have integrity, nothing else matters. If you don’t have integrity, nothing else matters!” How true! 6

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2. Be a Straight Shooter. The Bible speaks of “speaking the truth in love.” Being candid AND dignifying leads to people trusting what we say. Always telling the truth is important — one lie can sink us. Author Wes Fessler says, “Credibility is like glass. It is strong until it is broken, and then it is almost impossible to repair.” 3. Beat the Grapevine. It is better to over-communicate than to under-communicate. When we fail to communicate thoroughly, a vacuum is created — and that hole gets filled with the grapevine (rumor mill), which is invariably negative and often wrong. Surveys have shown that people prefer to hear news that affects them from their immediate manager. There is a tendency to avoid sharing negative news, but people respect hearing what is really going on (keeping in mind the Napolean quote that the best leaders are “dealers in hope”). 4. Mess Up? Fess Up! We are all human and make mistakes. Credible people don’t lie or hide from their blunders but own up to it immediately and do what we can to correct it. Author Brian Koslow says it well: “The more you are willing to accept responsibility for your actions, the more credibility you will have.” 5. Show Respect to All. Credible leaders are respectful of others. We don’t tear others down or talk behind their backs, and we treat others positively like we would like to be treated positively. And I suggest that the most credible leaders are not status conscious but treat all people with respect. Ann Landers’ quote

speaks to this: “The true measure of a man is how he treats someone who can do him absolutely no good.” One of my favorite quotes is from the respected author and speaker Maya Angelou, who said, “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.” 6. Be Consistent. People around us will respond well when we are consistent in our behavior. Unpredictability can be disturbing. In an uncertain world, people understandably like things that they can count on — can they count on us to be consistent and stay calm even in stressful situations? If yes, we earn credibility. We also earn credibility when we consistently keep our word and meet the deadlines we have agreed to if possible. 7. No Excuses — Make It Happen. Michael Jordan once said, “Some people want it to happen, some wish it would happen, others make it happen.” Credible people are those that make it happen. Earn the reputation as a doer, not a talker. Follow the principle of “under promising and over delivering.” Look for creative and innovative ways to get the right things done and develop positive relationships with those than can help you get results. 8. Get Certified. As a long-time university professor, it’s probably not surprising for me to suggest completing that bachelor’s or master’s degree you may have intended to earn. Apart from a college degree, earning professional certifications is one of the most valuable means to develop greater competence AND earn credibility with others. Most industries have one or more professional certifications that we can earn to help us learn and enhance our professional credibility. Within the mail industry, both the Mail Systems Management Association (MSMA) and the United States Postal Service (USPS) have multiple certifications to consider pursuing (go to msmanational.org and usps.com for details). 9. Become a SME (Subject Matter Expert). Developing our personal expertise and willingly sharing it with others will earn us credibility. We can further develop our expertise by earning professional certifications, being active in trade associations (like MSMA and our local Postal Customer Council), thoroughly reading trade publications like this one,

SUBSCRIBE FOR FREE! attending conferences (like National Postal Forum and MAILCOM), and developing our own personal network of peers and industry leaders. 10. Deliver Results. For those of us in management roles, we are ultimately judged on our ability to deliver results. The quote from author Richie Norton applies: “Credibility comes from results. Everything else is just marketing.” Our results are primarily based on the results of the teams we serve and help lead. I, and many others, have shared ways to help build high-performance teams. One extensive research project boils down developing high-performance teams into three keys: Develop a sense of fairness and equity; develop a sense of achievement; and develop a sense of camaraderie within the team. 11. Be a Fred. Author and motivational speaker Mark Sanborn wrote about the exceptional customer service provided by Fred the postal carrier in The Fred Factor. Going the extra mile and providing exceptional customer service will earn us and our team’s lasting credibility

and success. Napoleon Hill was right when he said, “One of the most important principles of success is developing the habit of going the extra mile.” And Sam Walton addressed the importance of customer service when he said, “There is only one boss — the customer. If we don’t take care of our customers, someone else will.” 12. Promote Our Team’s Accomplishments. We want to be known as servant leaders that focus the spotlight on our team’s achievements, not self-serving leaders known to look out for number one. Kouzes explains: “Leaders strengthen credibility by demonstrating that they are not in it for themselves, instead they have the interests of the institution, department, or team and its constituents at heart. Being a servant may not be what many leaders had in mind when they chose to take responsibility for the vision and direction of their organization or team — but serving others is the most glorious and rewarding of all leadership tasks.” When leaders sincerely lift up our teams in the eyes of others, we ourselves are elevated in the minds of our teams and

outsiders. We can promote our team’s accomplishments through internal company communication channels (e.g. intra-net; company newsletter articles); open houses and tours; promotional team brochures, blogs, and websites; and through our local PCC and MSMA chapters. Leadership guru John Maxwell says, “Credibility is the leader’s currency. With it, he or she is solvent; without it, he or she is bankrupt.” Let’s intentionally work at building our credibility. For being a person of credibility is very rewarding — for us and our teams. Good luck to you on your credibility journey!  Wes Friesen (MBA, EMCM, CMDSM, MCOM, MDC, OSPC, CCE, CBF, CBA, ICP, CMA, CFM, CM, APP, PHR, CTP) is a proven leader and developer of high-performing teams and has extensive experience in both the corporate and non-profit worlds. His book, Your Team Can Soar!, has 42 valuable lessons that will inspire you and give you practical pointers to help you — and your team — soar to new heights of performance. Wes can be contacted at wesmfriesen@gmail.com or at 971.806.0812.

MailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

SOFTWARE BYTE

DATA IS KEY… ESPECIALLY IN AN ELECTION YEAR! BY HANK MARTIN

of this publishing, after 44 years in the print and mail industry, with the last 15 at BCC Software, I will have retired. Consider this article as my swan song! Since 1979, I’ve had the great pleasure of working with — and learning from — great companies in the subscription fulfillment, data processing, printing, software, and hardware business of the print and mail market. They’ve afforded me opportunities and exposure to highly valued working relationships, which have enabled me to learn and grow. My passion has always been around data and how it drives the processes well beyond just print and mail. Data is key! The more accurate it is, the better companies can manage and grow their businesses. Whether it’s identifying the characteristics of your best customers or using the data to identify your optimal prospects or markets, how companies consume and utilize data to drive their businesses varies dramatically. Today, companies utilize business rules inside AI tools to aid in the standardization of how data is collected and stored. These same principles apply in marketing campaigns in the design, development, and channels used to target the best prospects or customers. This same practice applies to elections. As reported in the 2020 edition of BCC

JANUARY-FEBRUARY 2024 | MailingSystemsTechnology.com

Software’s eBook “Guide to Election Mail,” summarizing the 2018 election as a guide to the 2020 election, companies in the mailing industry experienced tremendous growth in election mail spending. The research and studies show we can expect the same for the 2024 election. Therefore, delivering the message to correctly targeted voters residing in the state, district, precinct, city, or village for each of the candidates running is key.

When asked to rank the three most credible political outreach techniques, 68% of those surveyed responded with mail sent to their home. The 2024 election year is expected to be highly contested in many parts of the country. In their article, “Politics and Digital Marketing in the 2024 Elections," The Goodway Group recently posted: “The 2024 political landscape is already

shaping up to be just as contentious — if not more so — than that of 2020.” And they also report: “The 2024 presidential election will likely be one of the most expensive races in American politics. Political ad spending is expected to reach $11 billion in 2024, according to a Vivvix analysis, making it one of the fastest-growing advertising sectors. Political campaigns will likely continue investing heavily in data analytics and machine learning to refine their targeting strategies. They will seek to deliver highly personalized messages to individual voters based on their demographics, interests, and online behavior.” Additionally, The Goodway Group also reports that local elections will be the biggest contributors to political ad spending. A PEW Research Center article, “Evaluations of members of Congress and the biggest problem with elected officials today," published on September 19, 2023, says: “Americans are more evenly split over whether campaigns have been interesting or dull, although they are still more negative than positive. About half (52%) say recent presidential campaigns have been dull, while 44% say they have been interesting.” And “Among U.S. adults overall, 85% say elected officials do not care what people like them think. Just 14% say they do care.” Therefore, the right message to the right constituents will be a key factor for voters in the 2024 election year. Name and address data is a primary driver in developing political campaigns. While understanding the nuances of the data does drive the message, sending the appropriate candidate message to a person registered in the other party may miss the mark and end up in the trash — wasting all the efforts, effectiveness, and overall cost of the campaign. Another factor is the voter registration data itself. While registrars do a fantastic job managing the accuracy and completeness of their voter databases, voters do move. Looking for the change of address is important to not only keep voter rolls up to date, but also to know if they still reside in the location being targeted by the campaign. Voter data, like subscriber or consumer data in other markets, can become stale, often unknown to a registrar. Accurate

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data that adheres to the 3C Approach to Address Quality (Complete, Correct, and Current address information) ensures the right message hits the targeted voters with a timely, predictable, and ultimate delivery of a mail piece. As BCC Software’s eBook “Guide to Election Mail,” reported, 86% of registered voters collect their mail at least five times per week. Of those, 56% will immediately read their mail pieces. With many pieces likely arriving in the mail, it is critical that the mail moment experience convey the right message to the targeted voter. Additionally, as showcased by a multitude of studies conducted by the USPS, as well as the Pew Research Center in their report “The presidency and presidential politics," direct mail works for all constituents. When asked to rank the three most credible political outreach techniques, 68% of those surveyed

responded with mail sent to their home. Digging deeper into this statistic, the percentage of voting demographics that found mail among the most credible methods were suburban voters at 69%, female voters at 66%, non-white voters at 57%, and millennial voters at 56%. Direct mail continues to play a trusted and influential role during every phase of a campaign, from introduction to persuasion to voting decision for all kinds of voters. Heading into 2024, the demand for election print and mail will grow further with more and more candidates utilizing mail to deliver their message, beginning in the primaries, and extending on through the November general election. Preparing for this growth is a good time for companies handling election mail to look at their software automation. Driving repetitive data processes using automation is an impactful time saver to accelerate the onboarding of new work.

As the research studies report, political ad spending will be one of the fastest growing advertising sectors in 2024. This will drive growth in mailing volumes, which correlates to more data processing, and ultimately more print for print and mail companies. Successful companies who invest in automation and AI technologies will enable faster new client onboarding while maintaining effective, reliable, and repeatable processes that feed the core of their print and mail business.  Hank Martin has gone fishing. Prior to doing so, he accumulated 44 years of experience in the print and mail industry, the last 15 of which he shared his wisdom, acumen, and wit with BCC Software and their customer base. His reference to the BCC Software’s eBook “Guide to Election Mail,” is limited to the 2020 edition. It is presently being updated for 2024 and should be available by the end of January. Interested parties can request a copy by emailing marketing@bccsoftware.com.

THE TRENCHES

THE IMPACT OF TANGIBLE COMMUNICATIONS IN B2B RELATIONSHIPS BY MIKE PORTER

here’s no doubt that digital interactions and instant messaging characterize today’s business world. Anyone who has been working for more than a few years can easily see how much faster businesses move today because of the pace of B2B communication. I can recall when the definition of speed was embodied by the Federal Express slogan: “When it absolutely, positively has to be there overnight.” That has all changed. Those working with postal mail realize that B2B communications don’t depend on the mail (or FedEx) like they used to. They may even believe that mailed items don’t have a place anymore when businesses communicate among themselves. Businesses have converted those critical overnight packages containing contracts or other important business documents to electronic alternatives. And expectations changed from “Have it on my desk by 10 AM” to “Send a link to me now!” But in some ways, the prominence of digital B2B communications presents a new opportunity for items that arrive in the mail. Printed materials, be they letters, catalogs, postcards, or brochures, bring an element of value, personalization, and sincerity that digital communication often lacks. Revitalized B2B Relationships Through Print Printed materials delivered by mail rely on an intricate balance of art, psychology, and communication tactics that businesses refined over centuries. When a

JANUARY-FEBRUARY 2024 | MailingSystemsTechnology.com

B2B business sends customers physical mail, they are not sending it to a business, they are sending it to a person working at a business. The senders want businesspeople who receive printed pieces to be influenced by the documents they crafted to make an impression. In today’s business environment, receiving a tangible piece of mail is an uncommon experience. This rarity adds an immediate value to your communications. It tells your business associate or customer you allocated the time, effort, and resources to communicate on a personal level, in a format that is both enduring and tactile. And it gets noticed! As I am writing this article, today’s mail arrived. One of the B2B pieces addressed to me at my business came from my bank. It’s a notice about how they are changing terms on my business credit card — not exactly thrilling content, but I opened the mail and read it. Compare that to the 50 emails that came into my business inbox so far today. I’ve only opened six of them. Like lots of businesspeople, I look at a screen all day. The postal mail is a welcome break. I automatically place a higher value on the messages I get through the mail, so long as they are relevant and targeted to me. Personalized B2B Mail One significant advantage printed communications offer is personalization. Sure, emails can include names and some custom data, but the depth of personalization business mailers can achieve with print is truly incredible. Senders of intelligently personalized B2B mail should

experience even higher open rates than they achieve with generic versions. From customized typography and unique graphics that represent shared experiences or values, to designing layout and color schemes that evoke your customer’s brand and messages, creative personalization can make a lasting impact. It leaves a memorable impression, reflecting a deeper understanding and respect for your B2B customer’s unique identity. When you combine personalization with triggered mail that you generate at the perfect time, the recipient of the mail piece is likely to take notice. Even if they do not respond directly, they will appreciate and remember the one-to-one communication. Perfectly timed mail shows the recipients you care about them as unique individuals, even if the triggers are based solely on the business relationship. Print Drives Emotion and Engagement The tactile nature of print fuels emotional engagement. When someone physically handles a brochure, pamphlet, or letter, it activates multiple senses. They feel the texture of the paper, hear the crinkle, and even smell the ink. These “real-world” experiences drive a deeper emotional connection than digital communication can provide. Consider a well-crafted letter; the feeling of the sealed envelope, the artful layout of the letter — it all culminates in an experience that bears a personal touch and care. This is something digital communications can never replace. Scientific studies show that printed materials activate different areas of the brain than images viewed on screens. Physical materials are more memorable and connect at deeper levels. Printed materials can even trigger nostalgia. In today’s digital age, receiving a physical letter or catalog can be a novel experience that reminds people of simpler times. This can evoke positive emotions and create a unique emotional connection between the businesses. Printed materials are also shareable. Items like catalogs come with implied endorsements when shared among colleagues at work. Forwarded emails don’t carry the same weight. When multiple people within a business share and discuss mailed materials, you increase the reach and impact of the communication. Strengthening B2B Relationships with Tangible Reminders Mailed materials can act as a constant reminder of your relationship with B2B

entities. Print materials can sit on a desk or be attached to an office wall. They offer daily reminders of your organization and its relationship with customers and others with whom you correspond. A physical object helps facilitate a more robust recall and fosters a stronger link with your brand. The physical interaction leaves a concrete impression, grounding your brand in the recipient’s tactile world. It’s like a firm handshake in an introductory meeting — making your brand more real, more personable, and a more relatable entity. B2B Mail Examples Even organizations firmly entrenched in the digital realm can benefit from B2B mailing projects developed and executed on their behalf by print/mail service providers. Consider the case of a software company that sends personalized letters to its clients. The letters might include updates on the company’s latest products and services, as well as thankyou notes for continued support from their business accounts. This not only keeps clients informed but also makes them feel valued and appreciated, strengthening the relationship between the two businesses. In the retail industry, a wholesale clothing company could send catalogs to its B2B customers, showcasing their new collection. The high-quality images and detailed descriptions in the catalog give the customers a clear idea of the products and fashion trends, leading to increased orders. The catalog might include a personalized note or analyst reports, which adds a personal touch, enhances an industry leadership reputation, and helps build a stronger connection with customers. B2B mail doesn’t need to be marketing-oriented to make an impression. Suppose a manufacturing company sends annual reports to its B2B partners — tangible representations of the company’s performance. Physical mail keeps important investors informed about the company’s progress and demonstrates transparency and reliability — key factors in maintaining strong B2B relationships. Comparing B2B Digital to Postal Mail When we think of mail as augmenting the effectiveness of digital communication channels, we often focus on B2C relationships. The same postal mail advantages we hear about all the time for B2C companies exist for B2B organizations. They just haven’t been publicized as often. Digital communications have their own advantages in the B2B environment. They can be faster, more convenient, and more cost-effective than tangible communications. They also allow for real-time interaction and feedback, which can be crucial in certain business situations. A balanced approach that combines the strengths of both tangible and digital communications can be the most effective strategy in strengthening B2B relationships. While tangible and digital communications each have their own unique impacts in the B2B environment, they are not mutually exclusive. Rather, they complement each other with a holistic communication strategy. By understanding and leveraging the unique strengths of each, businesses can create more effective and impactful communications that strengthen their B2B relationships.  Mike Porter works with companies in the printing and mailing industries to help them raise awareness for their companies, improve their rankings on search results, inform potential customers about the value of their products and services, and keep prospects interested as they proceed through the buying process. Learn more about his services at www.pmccontentservices.com. Follow @PMCmike on Twitter, or send him a connection request on LinkedIn. MailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

POSTAL INSIGHTS

IS THE PLAN VEERING OFF COURSE? BY LEO RAYMOND

ollowing the November 13-14 meeting of the Postal Service’s Board of Governors, the agency released its Form 10-K, containing the financial results for Fiscal Year 2023 (October 1, 2022, through September 30, 2023). As was widely anticipated, given the trend of the preceding months, the USPS ended the year with a loss of $6.478 billion. Though the PMG argues otherwise, the annual figures for revenue and volume by class are widely believed to reflect the impact of two price increases totaling over 9.5% that followed price increases in FY 2022 of more than 13.3%. Actual revenue, again, did not grow in line with the increases. Revenue from First-Class Mail and from Shipping and Package Services increased, but only by 2.1% and one percent, respectively, while revenue from Marketing Mail and Periodicals decreased by 5.8% and 3.9%, respectively. Mail volume was sharply lower, falling by 8.87% from the previous year. None of the classes had higher volume than in FY 2022, with First-Class Mail, Marketing Mail, and Periodicals shrinking by 6.1%, 11.4%, and 12%, respectively. Shipping and Package Services — a key part of the PMG’s revenue strategy — was as anemic as other classes of mail. The above-mentioned one percent higher revenue — as elsewhere, derived from price increases — was not reflected in volume, which actually shrank by 2.4%. The only growth areas were complement — up 0.7%, including 1.6% more career personnel — and related costs. (FY 2006 had revenue of $72.817 billion — $104.53 billion when adjusted for inflation — and the all-time-high volume of 213.139 billion pieces. After 17 years, revenue is about 25% lower, and more

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than 45.5% of mail volume has been lost; however, complement is only 19.6% smaller, suggesting “efficiency” and cost reductions remain elusive.) When Postmaster General Louis DeJoy issued his 10-Year Plan in March 2021, he forecast fiscal years 2021, 2022, 2023, and 2024 to show successive improvements in financial performance: a loss of $9.4 billion, a loss of $2.2 billion, break-even, and a $1.7 billion surplus, respectively. What’s actually happened has been much different. The loss in FY 2021 was smaller — only $4.93 billion — and the impact of the April 2022 Postal Service Reform Act, which voided nearly $57 billion in prefunding obligations, obscured FY 2022’s “operating loss” of $950 million. These two years may have given the PMG hope for break-even in FY 2023. Not only did FY 2023 not break even, the “official” result would have been significantly worse had two external factors not benefitted the agency’s bottom line: the worker’s compensation liability — tied to interest rates that are influenced by inflation — was about $2.5 billion less than in FY 2022, and the USPS earned over $900 million in “interest and investment income.” Looking ahead, some in the mailing industry are reporting the Postal Service will forecast a larger loss — about $6.8 billion — in its FY 2024 Integrated Financial Plan. The PMG’s prepared remarks offered a variety of reasons for why his Plan isn’t attaining advertised results but should not be accepted unquestioningly: “... When looking back to our DFA projections published in March of 2021, we forecasted that we would break even this year. Our efforts to grow revenue and reduce labor and transportation costs

were simply not enough to overcome our costs to stabilize our organization, the historical inflationary environment we encountered, and our inability to obtain the CSRS reform we sought, none of which were accounted for in our forecasts.” [Does this mean The Plan made assumptions that were too optimistic? Or that control cost wasn’t as robust as needed?] “To reconcile this year’s results to our plan, the financial forecasts of the Postal Service at the time we developed the plan projected that we would lose approximately $15 billion in FY 2023 if we did not accomplish the cost reduction and revenue producing actions identified in our DFA initiatives. While timing and execution are factors, a close look at our DFA breakeven forecast identifies specifically that the allocation methodology for our CSRS liability would be re-evaluated and we would be relieved of the cost of our unfair CSRS obligation which totaled $3 billion in this year’s financials.” [DeJoy excuses that his Plan incorrectly assumed that the CSRS liability would be adjusted favorably.] “In addition, this year’s loss includes $2.6 billion in inflation above what we projected and what we were able to recover, as our pricing adjustments are not proportional to our costs and are garnered after we have already been impacted by the inflation. Therefore, if not for these two specific factors, breakeven results for 2023 were within reach...” [DeJoy does not mention that CPIbased rate authority is designed to offset inflation or, moreover, that labor contracts to which he has agreed include semi-annual cost-of-living adjustments, meaning that inflation-fueled increases in compensation are a self-inflicted wound.] DeJoy then delivered a litany of steps he’s taken: “Many of you know of our ongoing efforts to redesign our network from 430 randomly deployed, inadequately equipped, and poorly maintained facilities to a logical and efficient network of 210 facilities suited for their intended purposes that are safe and habitable for postal employees.” [DeJoy seems to believe that the USPS previously threw darts at a map as a means of siting facilities — another dubious and needless assertion that everyone before him didn’t know what they were doing.] “Many of you have heard of our initiatives to stabilize our workforce by

SUBSCRIBE FOR FREE! converting over 150,000 people to full time positions.” [In an environment of plunging mail volume, many would say a flexible, lowcost workforce would be preferable to a larger complement of fixed-schedule, high-cost employees, protected by contractual no-layoff clauses.] “I estimate that our requirement to deliver market dominant mail products to the required 165 million addresses six and sometimes seven days a week far exceeds any market dominant revenue we can ever achieve, even with our price increases.” [It was long argued that delivery of mail should be trimmed to five days a week, but DeJoy agreed to make six-day delivery, not previously a legal mandate, a statutory requirement under the April 2022 PSRA; another self-inflicted wound for which he’s deflecting responsibility.] “Using any costing methodology, over 50% of our retail centers and ZIP Codes do not make money, including the package revenue we have today, which if not for the competitive strategies being deployed under the Delivering America Plan, was in jeopardy of being ceded to

our formidable competition as our market share was declining prior to our Plan...” [DeJoy conflates the existence of money-losing post offices — part of the Universal Service Obligation — with his efforts to win package business, as if unprofitable POs would be turned around by a surge in parcels.] “As a final note, this endeavor also requires dramatic change from our regulator who has a demonstrated tendency to resist change or to move only incrementally as it concerns our efforts to acquire new business and save this institution. Their strategies, rooted in the legacy and bureaucratic thinking of a mail monopoly of the 1990s, impedes our efforts to timely and adequately respond to the requirements for success in the competitive marketplace... “I ask that the PRC bring their thinking forward to understand what it entails to compete. Innovation, speed to market, cost, price, customer contracts, and disruption of long-standing practices that have proven not to work are requirements for this Postal Service to succeed...”

[While it’s true that the PRC — likely guided by its lawyers — tends to be cautious and risk-averse, DeJoy still seems to think they should overlook their statutory roles and simply let him do what he wants. As for having an “integrated mail and package system,” it was DeJoy who agreed to inserting the language in the PSRA; another self-inflicted wound.] DeJoy’s Plan is long on confident declarations but short on measurable process, and relies on events — like Congressional action on CSRS reform and union cooperation on cost cuts — that are overly optimistic. He persuaded Congress to pass the PSRA but ladened it with the requirements for six-day delivery and an “integrated network” that impose their own cost consequences, and he’s investing heavily in network changes that may not be needed if his pricing strategy continues to drive away ratepayers and their mail.  Leo Raymond is Owner and Managing Director at Mailers Hub LLC. He can be reached at lraymond@mailershub.com.

MAI is a full-service systems integrator serving all fifty states’ Vote-By-Mail needs.

MailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

INKJET INFO

THE EVOLUTION OF INKJET BY KAREN KIMERER

oday’s production inkjet technology excels in every way when it comes to the world of print and mail. The newest available devices deliver stunning print quality at breakneck speeds, while features like in-line finishing and real-time personalization push the boundaries of what's possible. Still, this hasn’t always been the case. Inkjet presses had humble beginnings and were once effective for only a handful of applications. While digital technology offered a more efficient alternative to traditional offset, lower print quality and fewer substrate options meant that the inkjet production presses of yesteryear were often purchased for a single purpose or document type. Thanks to rapid advancements in inkjet technology over the past few years, things have changed. Unfortunately, some print buyers might still be overlooking inkjet based on outdated perceptions, thereby missing out on the advantages it can offer — especially when it comes to direct mail. It’s up to us to reshape outdated impressions that include images of sprayed-on text or muted graphics. This article explores the evolution of production inkjet presses and considers how this remarkable technology can mean better business results for direct mailers. Early Beginnings Inkjet technology has been around for decades; in fact, it was developed during 16

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the 1950s. Even so, it wasn’t until the late 1970s that inkjet technology was able to be used for printing business documents. Whereas Chester Carlson is credited for the invention of the photocopier, there is no single inventor of inkjet technology. Credit is partly given to a man named John Vaught, who worked for HewlettPackard in Silicon Valley. His original inspiration came from a coffee pot.

Production inkjet has evolved into a direct mail powerhouse, delivering stunning images and razorsharp text at previously unheard-of speeds. Recognizing how hot water expands coffee grounds, he wondered if a similar process could heat ink enough to spread it evenly over a sheet of paper. During that same time, a Canon engineer named Ichiro Endo observed the effects when a syringe full of ink accidentally met a soldering iron; the heat caused the ink to increase in volume, which caused it to bubble out in tiny drops.

This accident was the driving technology behind Canon’s proprietary Bubble Jet inkjet printers. Though its efforts were impressive, Canon was not acting alone in the development of inkjet. Instead of using heat to expand the ink into droplets, Epson began to power inkjet with electric currents. This technique, known as micro piezo technology, was used to create and place drops of ink on paper. Meanwhile, companies like Kodak and IBM saw the opportunity for highspeed inkjet printers in the billing market and continued to advance the technology behind inkjet printing. Although inkjet’s promise was increasing, applications were limited to text-heavy documents like statements, manuals, reports, and instructions that contained simple graphics and diagrams with only basic color requirements. Needless to say, the early days of production inkjet were, well, rough. The 1970s and 80s saw clunky behemoth devices with sluggish speeds and inconsistent print quality. Think smeary address blocks and color gradients that resembled abstract art more than marketing materials. Inkjet Takes Flight Production inkjet has expanded by leaps and bounds since its early days, thanks to several key technological advancements. Its evolution is a story worth sharing with buyers of direct mail. One of the most notable changes is the advancements in printhead technology that allow for precise droplet placement and control. The results include sharper print quality and higher resolutions. Most inkjet printheads are now designed with more nozzles, which means droplets of ink can be placed with greater accuracy. Another remarkable difference is how many printheads on the market today can adjust the droplet size on the fly. This capability translates to photorealistic images and crisp text that is guaranteed to grab attention and drive engagement. Innovations in the ink itself are also worth talking about. Today, manufacturers of inkjet presses have learned that the relationship between the ink and the printheads they use can often lead to a competitive advantage. Regardless of whether a press uses solvent-based or water-based ink (which includes both dye and pigment variations), the chemistry of the ink continues to advance, offering

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a wider color gamut and more vibrant colors. The ink also determines image adhesion and substrate flexibility. Improved ink-drying methods enable faster print speeds without compromising the print quality. From Data to Drops With today’s advanced technologies, matching ink usage to specific paper or substrate types is no longer a manual task. Much like smartphones, the brains of a production inkjet device have access to more data than ever before. A great example is how the press automatically adjusts its ink usage to suit different materials, resulting in better print quality and less trial and error. Included in the production inkjet value proposition is the ability to meet short print and delivery times without compromising print quality. One of the key influences in that statement is how the press can access data in real-time to improve equipment performance and reduce downtime. Now, with higher speeds and color accuracy, print buyers can print variable data and personalize documents at scale. These capabilities empower businesses to create personalized marketing materials and customized communications that are engaging, efficient, and cost-effective. Data acts as the invisible conductor, orchestrating every step of the

printing process to deliver continuous improvement. Machine learning means a steady rhythm of press performance and efficiency. This dynamic optimization squeezes out the most value from each print run, maximizing productivity and reducing costs. An Inkjet Renaissance It was only effective for a limited number of uses in the past, but inkjet technology has since made significant advancements in a remarkably short amount of time. Improved ink chemistry, printhead architecture, and ink drying performance have made inkjet a viable option for a much broader range of applications, including those preferred by luxury brands. Page volumes produced on inkjet continue to rise as work is transferred from offset to inkjet. Additional page growth is found with applications that won’t fit well on a traditional press yet still require highquality images. Such work was previously designated to electrophotographic (EP) or toner-based production presses. By building on previous technologies, inkjet continues to see incredible productivity, flexibility, and quality improvements. Data from Keypoint Intelligence supports a promising future, with color inkjet outpacing EP page volume by leaps and bounds over the next several years (see Figure 1).

The evolution of this amazing technology opens the door to new growth with applications like catalogs, magazines, and photo products. The Bottom Line Production inkjet has evolved into a direct mail powerhouse, delivering stunning images and razor-sharp text at previously unheard-of speeds. As research and development continues, we can expect even more innovations that push the boundaries of what we can print and how we print it. Evolving from its slow, splotchy beginnings to a versatile, high-flying force, production inkjet has transformed the print and mail industry. Its journey is a testament to human ingenuity and a glimpse into a future where every printed piece is a masterpiece of personalization and possibility. 

Karen Kimerer of Keypoint Intelligence has experienced the many challenges of expanding current market opportunities and securing new business. She has developed a systematic approach to these opportunities, addressing the unique requirements of becoming a leader in our changing industry. She is wellversed in 1:1 marketing, web-to-print, direct mail, book publishing, supply chain management, data segmentation, channel integration, and photo products. MailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

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INTRO TO INTERNATIONAL MAIL

POSTAL CUSTOMS AND THE TRANSIT OF GOODS BY MERRY LAW

controversy between the member countries of the Universal Postal Union (UPU) and the 27 EU countries plus Norway and Switzerland raises questions about whether a country can impose controls on what passes through its national borders or whether international treaty agreements can impose restrictions on national controls. It has implications for enforcement of national restrictions, including those in the US — and the disagreement cannot be easily resolved. A majority of the UPU member countries rejected proposals to modify the UPU Constitution to allow the enforcement laid out in ICS2 Release 2 at the UPU’s Extraordinary Congress last October and again during their quarterly Postal Operators Council (POC) plenary in November. The UPU Constitution is an agreement among its 192 member countries. ICS2 is the customs requirements enacted into law in the 27 EU countries plus Norway and Switzerland. The two legal requirements are in direct conflict over provision of Advanced Electronic Data (AED, also known as EAD) for postal goods transiting or being transshipped through the 29 countries that have implemented ICS2 R2. While more than 100 countries require AED according to the UPU, detailed AED for items in transit has created conflict 18

JANUARY-FEBRUARY 2024 | MailingSystemsTechnology.com

among the UPU member countries. ISC2 R2 was to come into full enforcement on October 2, 2023; it has been delayed until April 1, 2024 because of this disagreement. The EU contends that ISC2 R2 is needed to protect the transit supply chain and the security and safety of the European Union. Their position is that these controls are essential to their border controls. The controls will apply equally to postal, express, and cargo goods and carriers. Some in the EU have suggested that other countries and regions are likely to move in this direction. The UPU members have found the concept of allowing reciprocal treatment of postal material from other member countries and transport of items in transit to other member countries sufficiently important that they are enumerated in Article I of the UPU Constitution. Those countries opposing the amendment of the UPU agreements believe the position of the EU is at odds with those agreements on postal goods in transit or transshipment. The UPU has restrictions on dangerous and illegal goods and other standards on security that member countries are required to follow. Any security measures for international postal items, according to the UPU agreements, must be proportionate with the risks or threats they are designed to address,

applied without hindering international mail flows, and implemented in a coordinated and balanced manner. Those countries opposing the ISC2 R2 at the UPU maintain that the measures being instituted by the 29 countries do not meet these requirements. This brings us to an impasse between the 29 ISC2 countries and those countries that oppose the requirements for AED applied to postal goods in transit or transshipped through the ISC2 countries. A majority of the UPU member countries opposed the proposals to amend the UPU agreements to systematize them with ISC2 in October, 2023, at the UPU Extraordinary Congress; a majority of the UPU POC members opposed this in November, 2023. The POC referred this matter to the Council of Administration (CA), which will consider this at a country-policy matter, rather than a matter between postal operators. Meanwhile, non-postal private carriers (express transporters, airlines, and others) carrying goods through the 29 ISC2 countries are being required to comply with the new requirements. There have been unconfirmed reports that some air carriers are avoiding the contracts to carry goods transiting the ISC2 countries. This should raise concern about the global transport of goods. Both sides are firm in their positions. Those opposing the additional AED requirements contend that there is a fundamental difference between goods in transit and imported goods. The ISC2 countries contend these AED requirements are necessary for security. No simple resolution is apparent. Beyond this disagreement, practical concerns about the provision of AED for goods in transit and transshipment remain. Considerations about security and privacy have been raised with detailed data about individuals and business sending and receiving packages disclosed to more parties in multiple countries.  Merry Law is President of WorldVu LLC and the editor of Guide to Worldwide Postal-Code and Address Formats. She is a member of the UPU’s Addressing Work Group and of the U.S. International Postal and Delivery Services Federal Advisory Committee.

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With evolving data and technology, vote-by-mail is far more transparent, reliable, and accessible to the nation than ever before. ReliaVote Ballot Manager software from BlueCrest is the only integrated, secure, end-to-end vote-by-mail solution for processing outbound and inbound mail ballots. It’s an ideal solution for large to medium counties or municipalities to cost-effectively and securely automate election ballot processing, while complying with state voting regulations and USPS® postal regulations. With BCC Software’s Track N Trace® mail piece tracking service now embedded in Relia-Vote, states, counties, and municipalities automate and modernize their vote-by-mail and absentee process, saving time, labor costs, postage costs and have full insight into the entire process including bccsoftware.com | sales@bccsoftware.com | 800.337.0442 tracking mail ballot packets to and from voters. Trust Cenveo® for all your Vote by Mail Envelope needs. As the industry leader, we provide reliable and secure solutions. Our envelopes are built to withstand the journey from USPS carrier to your home, and they are designed to last in archival storage. With 11 manufacturing facilities strategically located across the country, we guarantee on-time delivery and quality you can rely on. Choose from the largest selection of stock options. Our complete made in USA package includes outer envelopes, reply envelopes, and security sleeves. Plus, we have the ability to print the Union Bug. Experience why people prefer to #senditwithcenveo! www.cenveo.com | cenveo.communications@cenveo.com | 203.595.3000

Mail Automation, Inc. is a full-service Systems Integrator within the commercial mailing industry. Our focus is to provide customized solutions for applications within the mailing industry. We are excited to share two new products that are featured in the Mailing Systems Technology Vote By Mail publication — the Secure TrayTruker and Secure Tray Rack. Due to COVID-19 and the massive expansion of Vote by Mail, we developed systems that keep not only ballots, but credit cards and other confidential information secure.

https://mailautomationinc.com | 844.808.5454 Since the pandemic, Vote by Mail has continued to increase in popularity, offering convenience and better accessibility for voters. Ensuring address accuracy by identifying voters who have moved contributes to a well-managed election process — helping to reduce the cost of waste and UAA mail, strengthen voter trust, and maintain election integrity. As a USPS® NCOALink® Full-Service Provider Licensee, Melissa matches existing voter lists against the last 48 months of permanent change-of-address records filed with the USPS, and offers proprietary change-of-address processing using reliable, multi-sourced data to identify those who don’t file a notice. Be sure to take advantage of our limited time offer — free list processing for states Melissa.com | info@melissa.com | 800.MELISSA and counties — call for details! Managing a safe, secure vote by mail program requires extra attention to data hygiene. Peachtree Data has been helping mailers reach their intended targets for almost three decades. Offering a range of tools designed to validate and update addresses, screen for deceased individuals, flag duplicates, and identify vacant addresses, Peachtree Data can help election administrators achieve maximum deliverability, while simultaneously reducing potential fraud associated with mailing to an incorrect address or a deceased voter. Allow us to provide no-cost testing to help establish a baseline for data quality, and to help map a strategy for effective vote by mail data hygiene. peachtreedata.com | sales@peachtreedata.com | 678.987.4600 Tritek specializes in providing custom-designed vote by mail ballot envelope processing solutions for elections. Our fieldproven, patented vote by mail technology has been successfully implemented in cities and counties across the country. The Correct Elect scans ballot envelopes and provides accurate signature verification to reduce labor costs and improve regulatory and security compliance. The Correct Elect ballot sorting systems for elections are highly customizable and sort ballots based on any criteria, such as precinct, name, batch size, drop box location, polling place, ZIP Code, or any other desired sort.

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By Dave Lewis

DIRECT MAIL IN A HYBRID WORLD – THESE BOOTS ARE MADE FOR SHOPPING

o, how was I going to explain the ostrich skin boots to my wife? I was just waiting for a check… the boots just kind of happened. Well, they really didn’t just “happen.” Those boots ended up here today based on a sophisticated marketing campaign aimed just at me. It was pretty much out of my hands. But man, these boots look sharp. It all started a few weeks ago when we sold our house. I knew that the mortgage company still owed me money from escrows and all that real estate stuff. I wasn’t sure how much it was, but I knew it was a lot — thousands. I just wasn’t sure how many thousands. “Worry not,” the bank told me. “We’ll mail you the check as soon as possible.” And so, I waited. But in today’s world, waiting has become an active process. There are more ways than ever to anticipate. Like 60 million other US citizens, I began to check my Informed Delivery more closely — was there a check in there? Nah, didn’t look like it, but there was a boot catalog that was headed my way. Huh. I’m not generally much of a boot guy, but there was a pair of kind of cool boots on the cover. Impression delivered. I got the mail that afternoon — no check, which I really already knew, but I’m always hopeful. But I did see that boot catalog, and those boots did look good. I spent a couple of minutes flipping through the catalog — there were a number of boots I liked, and, hey, maybe it was time I tried some cowboy boots. But then 22

JANUARY-FEBRUARY 2024 | MailingSystemsTechnology.com

my wife walked up and asked if the mail had come yet. I handed her the mail — boot catalog included — and went back to work. Another impression was delivered. My wife, by the way, was less impressed with the boot catalog and threw it away with the other mail she wasn’t interested in. She was too late — the impression had been made. By the evening, the boots were pretty much out of my mind. But then an email appeared from the boot company, which was odd because I didn’t remember getting emails from them in the past. There was a “Shop Now” button in the email, but I don’t like to click on those, so I went to their website and browsed around a bit. There were those ostrich skin boots… and they had them in my size. I went so far as to put them in my shopping cart, but didn’t quite pull the trigger — I mean, I hadn’t even gotten the check yet. The next day, I was back on Informed Delivery. No check, again, and no boot catalog today either. But there on my computer screen, in my email app, there were those boots again — in my size! In fact, pretty much everywhere I went on the web that day featured those boots. My resolve was weakening. Next day, I’m back on Informed Delivery — still no check! But there was another mail piece — a postcard with those same doggone boots. In my size! There was a button under the image of the postcard — “Shop Now.” I shopped now. I bought the boots. I just have to explain them to my wife. And we still haven’t gotten the check.

SUBSCRIBE FOR FREE! Really, what chance did I have? At the heart of this campaign is a direct mail catalog. None of the other elements work or even exist without it. But a catalog by itself is not as effective without supporting channels. Informed Delivery Remember, I was already looking at those boots before I even got the catalog. I’d seen an image in my Informed Delivery digest. I might have even clicked on the ride-along ad under the image and gone shopping from there — but I didn’t. More often than not, Informed Delivery has more value as an extra impression — my first taste of the brand… and those boots. Oh, and a four percent postage discount almost half the year. The Catalog Of course, the catalog was at the heart of the campaign. I was expecting it and got it. I even flipped through it. I was interested, but my wife threw it away. I’m certain she recycled it. The Coordinated Email Fear not about my abandoned catalog. The email I got that evening was timed to arrive by tracking the mail, so I got it when it was still on my mind. A week later (or earlier), and the email might not have mattered, but in this case, because those boots were on my mind already, I went to the site and found them — in my size! But, whew, $379?! Those ostriches must be hard to catch. I need to think about this. A Cookie for My Thoughts My interest in those boots did not go unnoticed. A cookie was placed in my browser, so that most sites I visited after that had ads for those specific boots in my specific size. I spent the next day immersed in my boots (yes, I began to think of them as “my” boots… a danger sign). This is retargeting — identifying interested consumers who have not converted and giving them another opportunity to buy. I was weakening.

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Another Kind of Retargeting — Now My Boots Are in My Mailbox — Sort Of Website owners can do more than send ads on your computer. A new form or retargeting allows them to identify the mail address of web visitors and send them a personalized postcard almost immediately. Digital printing allows them to send another opportunity to buy to their most likely consumers. They gave me 20% off. I bought the boots. Now I need to explain to my wife how a sophisticated marketer like me was sold a pair of boots that I didn’t know existed a few days earlier. It was a direct mail campaign to be sure, and direct mail was the biggest cost, but that investment was buttressed by Informed Delivery, coordinated email, retargeting — and more than one kind. I’m not sure any of those things on their own would have sold me these boots. Channels in combination magnify one another. This same kind of coordinated campaign can work for fundraising and, really, anything that traditionally sells through the web. Before you send out that next big mailing, be sure to give it every opportunity by coordinating a few helpers. Mail service providers need to be prepared to help their customers tie together all of their marketing channels. Now, honey… about these boots…  Dave Lewis is President, SnailWorks. He can be reached at dlewis@snailworks.com. MailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

Uncovering the Unseen: Why Mailers May Overlook These Incentives Mailers might not realize the availability of these promotions, which is likely due to several dynamics. First is that the growth incentive is a departure from traditional promotions and marks the first of its kind since 2010. The focus is on rewarding real and sustainable growth, making it particularly attractive for smaller mailers or those new to the media channel. Second is that the target audience for these incentives is the small- to medium-sized mailers who may not necessarily be deeply engaged with trade associations or current activities in the industry. This segment often includes individuals or organizations that are not in regular communication with the USPS, making it imperative to raise awareness about these opportunities.

UNLOCKING SAVINGS: A DEEP DIVE INTO USPS GROWTH INCENTIVES FOR MAILERS By Bob Rosser

he recently unveiled 2024 growth incentives from the United States Postal Service (USPS) present an opportunity for marketers to reevaluate and optimize their 2024 mailing plans. With the potential to boost First-Class and Marketing Mail volumes, these incentives can be a game-changer for organizations aiming to maximize their marketing budgets and mail smarter. This article provides an in-depth overview of the USPS growth incentive programs, dissecting their intricacies and demonstrating how savvy marketers can leverage these initiatives to optimize their expenditure while elevating their campaign outcomes.

JANUARY-FEBRUARY 2024 | MailingSystemsTechnology.com

Unraveling USPS Growth Incentive Programs The USPS growth incentives consist of two identical programs — one for First-Class mail volumes and another for Marketing Mail volumes. To access these incentives, customers need to register during the registration period, which is open until June 30, 2024. To qualify for the incentives, mailers must agree to a baseline volume they mailed during the USPS 2023 Fiscal year (October 1, 2022 to September 30, 2023). If a mailer exceeds this baseline volume during the growth incentive program period (January 1, 2024 through December 31, 2024), they become eligible to receive a 30% postage savings credit on their incremental volume, over the baseline. This presents an excellent opportunity for mailers to test and implement direct mail strategies from a marketing perspective with that incremental growth. Mailers can register for these incentives through the USPS Mailing Promotions Portal, which is accessed via the Business Customer Gateway (BCG), with registration having opened in November 2023 and closing at the end of June 2024. The earned postage credits can be utilized not only in 2024 but also through December 31, 2025, depending on a mail owner’s growth plans. Complementary Aspects of Growth Incentive for 2024 Postal Savings  The growth incentives are not promotions but rate incentives: This means that it can be applied over and above the promotions a mail owner may already be planning for as part of their postal optimization strategy.  Emerging and Advanced Technology Promotion: In 2024, the USPS is introducing a unique aspect to the emerging technology promotion. Unlike fixed promotion periods, mail owners can now customize their six-month period, aligning it with what works best for their company or specific lines of business within their organization. This Pick Six feature enables use of the promotion and postage savings during six consecutive months throughout 2024. This flexibility enhances the potential impact of the promotion for more seasonal oriented mailers.  Containerization Discount: Marketing mailers can leverage a containerization discount for SCF level containerization, as it saves on USPS handlings from cross-docking, even if it's entered locally. This provides a dual benefit of improved service and potential postage savings.  Network Remodeling Efforts: The USPS is undergoing a fullscale remodeling of its network, which promises to deliver significant changes. I encourage mailers to stay involved, be open to opportunities, and become active in local groups like your Postal Customer Council (PCC) to stay informed on changes and opportunities.

SUBSCRIBE FOR FREE!  Mitigating Postal Price Increases: In addition to leveraging commingling and postal promotions to mitigate the impact of biannual postal price increases, don’t forget improving the quality of address files. Reducing Undeliverable as Addressed (UAA) volume is crucial for ensuring deliverability and optimizing marketing dollars. Eliminating one to three percent UAA volume can have a big impact on your marketing budget and ROI with the mail channel.  Volume Considerations: The growth incentive doesn’t have volume caps, enabling even smaller mail owners or those new to the mail channel to participate. A mail owner must exceed their USPS-agreed to baseline volume or one million pieces in 2024 to have volume that is eligible for the growth incentive. Postage credit for volume growth exceeding the baseline is calculated at an enticing 30% of the net postage paid, factoring in any eligible promotion discounts in 2024. Strategic Steps for Maximizing Savings Now, the next pressing question for marketers is likely, “How can I optimize my planned postage spend using these programs?” Below are several key steps to guide marketers through the process: Know Your Baseline Numbers Embark on a journey to gather all volume information by meticulously tracking class and company-owned Customer Registration IDs (CRIDs) from both internal and external mail service providers. This foundational step lays the groundwork for understanding the potential impact of the growth incentive on your bottom line. Dedicate Time for Data Collection Data collection may vary in complexity. Some organizations may find it straightforward, while others might face intricacies in understanding applicable CRIDs and mailing methods. While time-consuming, this process is pivotal in identifying units with the potential for volume growth and, consequently, incentive advantage. Familiarize Yourself with Modeled Numbers Project your postal spend numbers forward, factoring in rate increases scheduled for January 2024 and another expected in July 2024. A 30% postage credit offers marketers a significant opportunity to mitigate the impact of these increases, potentially reducing the direct mail channel's Cost per Lead (CPL) and Cost of Acquisition (COA) by six to 20% or more. Explore Mail's Channel Mix Opportunities Consider the unique advantages that mail brings to your channel mix. With its measurable results, omni-channel compatibility, and hyper-personalized possibilities, mail stands out as a highly effective medium for reaching target audiences. Enhanced return on investment from qualifying growth incentive volumes could be the boost your 2024 marketing plans need. With some planning, a marketer can leverage these opportunities to:  Test new creative strategies  Integrate mail components into digital-only efforts  Expand cross-sell and upsell endeavors  Explore new emerging markets  Address customer churn  Build upon successful elements within your mail channel

Closing Thoughts: Investing for Big Results Navigating the potential of these growth incentive programs prompts me to ask: Isn't it better to invest a little more than initially planned to drive substantial results in your mail channel efforts for 2024? For marketers who agree, you will find that the USPS and your mail service providers are ready and enthusiastic about assisting in evaluating this new opportunity and helping redefine what's possible through mail in the year ahead. Unlocking savings through the USPS growth incentives demands strategic planning, data-driven insights, and a forward-thinking approach. By aligning your baseline numbers, understanding the nuances of the programs, and envisioning the impact on your marketing mix, you can turn these incentives into a catalyst for transformative results in 2024.  Bob Rosser is Director, Postal Affairs, Products and Services for IWCO. Bob has been with IWCO for the last 19 years. He leads the postal optimization strategies for IWCO clients that achieve in-home targets at the best possible postage rates. Bob’s in-depth automation, data, and postal operations experience also helps ensure that mail packages meet specifications. He subscribes to the innovation philosophy that the best way to predict the future is to help create it. He currently serves as the Mailers Technical Advisory Committee’s (MTAC) Industry Immediate Past Chair and sits on the Board of PostCom and DTAC, and is actively involved with the National Association of Presort Mailers (NAPM). For more details Bob can be reached at bob.rosser@iwco.com MailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

THE CASE FOR CUSTOMER COLLABORATION By Ryan Semanchik

ith the rise in omnichannel capabilities, coupled with the pressure every business is experiencing to significantly reduce costs, the complexities of managing documents as a third-party service provider have multiplied. Print service providers (PSPs) are challenged with addressing these market changes by providing new services to keep pace with increased demands for faster turnaround, lower costs, and value-added services. One avenue is finding a solution that provides the opportunity to work collaboratively with clients when it comes to managing their content. PSPs serve many industries where small changes in documents need to be made frequently. However, even simple client alterations can derail production schedules. The time required to update changes and get approvals pushes production timelines to the brink and causes billing nightmares. Providers get in an endless cycle of changes and updates that would have taken seconds if there was a way for the client to do them and approve them at the same time. The bottom line is that the traditional model of submitting changes, updating the documents, and sending back proofs is time-consuming and no longer fits today’s time-to-market requirements. Putting Clients in the Driver’s Seat The past decade has seen the emergence and continued growth of online customer portal solutions that provide customers with the ability to make changes to text, images, and messaging. Initially, these systems only allowed for small changes with very limited control on the part of the client. Today, collaborative online solutions have evolved to meet compliance standards

JANUARY-FEBRUARY 2024 | MailingSystemsTechnology.com

and create reliable expedited workflows. As technology has evolved, so has users’ comfort levels with making changes utilizing online portal tools. Working in a world that has come to expect same-day service, online portals provide the speed to make and approve updates without complicating the process, reducing the number of required proofs and giving users ownership in the process. Not only does the implementation of portals save time, it also provides an opportunity to improve the relationship between provider and client. Providers can focus their time on serving up new solutions and expanding business relationships when the tedious tasks of changes and approvals are removed. Empowering an organization’s content authors is particularly valuable for industries that send out a variety of time-sensitive communications that require regular modifications, such as healthcare, insurance, and financial services. Because these business users are the most knowledgeable source of information about their organizations’ communication strategies, key messaging, and current offerings, having control of what updates they want to make provides a measurable advantage in managing and delivering effective relevant messaging. Then, there is speed. Having the ability to change messaging or information on the fly reduces time to market, which is critical today. Additionally, when customers have real-time control over their customer communications, they feel more assured they are providing an exceptional customer experience. On the flip side, PSP staff that manage the production of these communications will spend less time making those time-consuming (and costly) minor edits and adjustments that often come up

SUBSCRIBE FOR FREE! in the production process. Liability is also decreased when customers are involved in the approval process and in control of their changes. Additionally, online collaboration tools engage users in the process of creating and working within the provider’s ecosystem, making it less attractive to change suppliers. In addition to empowering users and providers to work more closely together, online portals have the potential to address issues surrounding billing. With users in control of their own changes, service providers have the power to reduce change alteration (CA) charges and replace them with online portal subscriptions. Clients are accustomed to paying for subscription services, and charging monthly for access to online tools gives clients a predictable monthly cost while also simplifying the process of billing. With the simplification of billing, providers can again focus more readily on the business of expanding their portfolio of solutions and cultivating client relationships. What to Consider When Evaluating a Collaborative Online Tool Conventional campaign management tools often limit customer control, putting an outsourced provider in the position of being responsible for accumulating, managing, verifying, and controlling most elements of a customer’s campaign. In contrast, it is important that the solution used ensures business users are able to control virtually all elements of the process, including approvals, tracking, and even which updates they want to see. Having a tool with a web-based wizard makes it possible for users to change communications on the fly with relevant messaging, such as educational details, product information, and promotional campaigns on their outbound communications — all without leaving their desks. This independence dictates that the platform must be userfriendly, with simplicity of access and navigation. It must include a user permission structure that has secure roles for various types of users. Clients may want to designate users as editors, approvers, or super users with varying degrees of access when it comes to uploading new templates and designating permissions. A well-developed platform will have the flexibility to set up user permissions based on client capabilities and the provider’s preferred process. In addition to ease of use, the platform should include a dashboard where both parties can see projects in process, approved projects, and projects waiting for approval. A well laid out dashboard also reduces calls about status of work and provides a historical record of changes and approvals. The past 10 years have brought significant changes in terms of how customers interact with technology. Online collaboration tools have become essential in a business environment where frequent changes are made. They streamline processes, improve client-provider relationships, simplify billing, and enhance communication and transparency. These solutions are expected to continue growing in popularity as they meet the demands of today's expedited business models and client expectations for real-time updates and approvals.  Ryan Semanchik is an equity partner and President of Transformations, Inc., developer of Uluro, a comprehensive Customer Communications Management (CCM) software. A CPA, Semanchik’s expertise in operational excellence is gained from 20 years of hands-on production and document management experience laser focused on measurable results. He can be reached at ryans@transfrm.com. Visit www.linkedin.com/company/uluro or www.uluro.com for more information. MailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

BY ADAM LEWENBERG

THE JANUARY 21, 2024 USPS RATE CHANGE – WHAT YOU NEED TO KNOW

SPS is raising rates on January 21, 2024, for the fifth time in 29 months with some of the largest increases in history and at significantly higher increases than inflation. We can expect these rate spikes to continue as the USPS has stated that two increases per year will be the new norm.

We have been creating comparison charts for our clients that go over the changes in rates to show how these changes will affect budgets, providing a true comparison versus the overall average percentage increase that the Postal Service talks about. Based on the type of mail you send, the increase could be higher or

lower. Also, when you look at the new rate charts provided by the USPS, they typically will not show the level of detail needed (such as previous and new rates, side by side) to see these differences. Hopefully, this comparison will help you budget by seeing the impact of the most common services that you use today. Here

First-Class Mail Single Piece – 1% – 4% Increase

Figure 1

First-Class Mail Commercial – 1% - 21% Increase

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Automation letters are going up two percent and Flats by one to two percent. Figure 2

SUBSCRIBE FOR FREE! Figure 3

Figure 4

is a link (https://postaladvocate.com/ratechange-tools/) to a simple chart of all the rates in this article as well as an Excel tool where you can plug in your mail volumes to see the impact to your organization. The retail rate of a one-ounce letter goes up by $0.02 to $0.68, but the metered letter rate is only increasing $0.01 to $0.64 (see Figure 1). This means there is a $.04 savings by having a meter or online postage platform vs. buying stamps at the USPS. A single piece flat is increasing from $1.35 to $1.39, but the additional ounce rate is staying the same at $.24. Postcards are seeing the largest increase at $.02, or a four percent change. Automation letters are going up two percent and Flats by one to two percent (see Figure 2). With any increase, it becomes more important to look for ways to reduce costs. Figure 3 shows the options available:  Use meters or online postage to save $.04 on letters.  Consider presort services if you run over 500 pieces per day or have one-time mailings over 1,000 pieces.  Automate your mailings in-house or through third-party mail services to have drastic postage savings.  Presort and automation levels go up to 3.5 ounces for the same base rate.  Flats and postcards can have the same automation rates as letters.  Consider moving generic content mail from First-Class to Marketing Mail. Marketing Mail Letter rates are increasing at approximately one percent while Flats are going up at two to five percent (Figure 5).

Marketing Mail (Formerly called Standard Mail) – 1-5% Increase

The best way to save money is to move mail closer to its final location utilizing destination entry level discounts. The savings increased by 17% back in July and you can subtract $.027-.035 per letter and $.07-.09 per flat. USPS Competitive Services UPS and FedEx just announced a 5.9% increase for 2024, and USPS increases are right in line with this as you can see in Figure 4. The best way to reduce costs in this area is to convert your items from Retail to Commercial Base rates. You must process your items through an online postage solution that can generate a 4” x 6” shipping

Figure 5

label with the address, barcode, and return address embedded. USPS.com only allows for Retail rates so you will need to look at third-party solutions that start at about $15 per month. These average savings for items less than 10 pounds (the most common for the USPS) is the following:  Priority Mail – 30% Savings  Priority Mail Express – 14% Savings  Ground Advantage – 26% Savings Conclusion Increases of 23-56% in 29 months are unheard of and are impacting every organization. Mailers are going to need to look for savings strategies to help offset these changes. Our recommendation is to creMailingSystemsTechnology.com | JANUARY-FEBRUARY 2024

SUBSCRIBE FOR FREE! Additional Rate Change Items

Our recommendation is to create visibility to all mailings and look for automation methods where applicable to reduce the cost and streamline production.

ate visibility to all mailings and look for automation methods where applicable to reduce the cost and streamline production. To budget for this increase, you need to look at the type of items you are sending, and the weight and zones that are most common, to truly estimate the impact. Most of the most popular USPS classes 30

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are going up, but luckily there are ways to help mitigate this through automation and technology.  Adam Lewenberg, CMDSS, MDC, President/CEO of Postal Advocate Inc., runs the largest Mail Audit and Recovery firm in the United States and Canada. They manage the biggest shipping & mail equipment fleet

in the world and their mission is to help organizations with multi-locations reduce mail and parcel related expenses, recover lost postage funds, and simplify visibility and oversight. Since 2011, they have helped their clients save an average of 56% and over $88 million on equipment, presort, avoidable fees, and lost postage. He can be reached at 617.372.6853 or adam.lewenberg@postaladvocate.com.