Mailing Systems Technology Mar/Apr 2017 by MadMen3

ADDRESS QUALITY • INK • PRINTERS • SOFTWARE • MORE MARCH - APRIL 2017

www.MailingSystemsTechnology.com

DON’T OVERLOOK THE IMPORTANCE OF THE ENVELOPE. PAGE 12

THE KEY FACTORS THAT IMPACT ADDRESS QUALITY. PAGE 16

CONNECTING

YOUR METER TO THE NETWORK? WHAT YOU NEED TO KNOW. PAGE 18

UNDERSTANDING

THE MAILBOX MONOPOLY. PAGE 20

ENSURING YOUR MAIL’S SUCCESS: A TRUE BALANCING ACT

TABLE OF CONTENTS

MARCH - APRIL 2017 | VOLUME 30 ISSUE 2

FEATURES

DEPARTMENTS/COLUMNS 05

Editor's Note

A Balancing Act By Amanda Armendariz

Real Life Management

The Three Rs Approach to Building Great Relationships By Wes Friesen

Mail & Technology Merge

They Must Do Things Today for Our Industry By Vincent DeAngelis

Factors That Impact Address Quality

You know that the goal is to reduce UAA mail, so what factors should you focus on? By Gary A. Seitz

Connecting Point

Accountability throughout the Mailing Process By Chris Lien

Software Byte

The Key to Postal Facility Identification By Jeff Peoples

Direct Mail Evolution

Physical & Digital Work Together By Joy Gendusa

18 Connecting Your Postage Meter to The Network? What You Need to Know

The Mailbox Monopoly Conundrum Kathleen J. Siviter

Improving Color Quality through Color Management

By Lou Prestia

Postal Affairs

Postal Reform Legislation Quickly Returns to New Congress By Bob Schimek

By Adam Lewenberg

The Trenches

Letâ&#x20AC;&#x2122;s Talk About Envelopes By Mike Porter

Say What?

SPOTLIGHTS

24 Acing the RFP Process By Mark M. Fallon

MARCH-APRIL 2017 | MailingSystemsTechnology.com

Upping the Game with Your Transactional Customer Communications By Harry Stephens

Better Mailings Need Better Solutions

EDITOR'S NOTE

VOLUME 30, ISSUE 2 MAGAZINE STAFF Publisher Ken Waddell

A BALANCING ACT

Editor Amanda Armendariz amanda.c@rbpub.com Editorial Director Allison Lloyd allison.l@rbpub.com Contributing Writers Vincent DeAngelis, Wes Friesen, Joy Gendusa, Adam Lewenberg, Chris Lien, Mark M. Fallon, Jeff Peoples, Mike Porter, Lou Prestia, Bob Schimek, Gary A. Seitz, Kathleen J. Siviter, Harry Stephens Audience Development Manager Rachel Chapman rachel@rbpub.com Advertising Ken Waddell (o) 608.442.5064 (m) 608.235.2212 ken.w@rbpub.com Design Kelli Cooke

RB Publishing Inc. PO Box 259098 Madison WI 53725-9098 Tel: 608.241.8777 Fax: 608.241.8666 Email: rbpub@rbpub.com SUBSCIRBE Subscribe online at www.MailingSystemsTechnology.com. 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 www.MailingSystemsTechnology.com. REPRINT SALES ReprintPro 949.702.5390 www.ReprintPros.com All material in this magazine is copyrighted ©2017 by RB Publishing Inc. 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, RB Publishing Inc. or its staff becomes property of RB Publishing Inc.

WITH AMANDA ARMENDARIZ Our cover image of a tightrope walker might initially bring to mind the talents of a circus performer, but after thinking about it for just a moment, it’s clear that this image pretty accurately depicts our lives as mailers (minus the inherent danger, of course). It seems as if running a mail operation is a constant balancing act: juggling the new rules, regulations, and rates; staying abreast of legislative issues affecting the postal sector; not to mention the fight to stay relevant in the face of competition with digital avenues. It can be difficult to pick an area to focus on, especially since they all require our attention if we are going to be successful in the mail industry! That’s where we come in — and have, for the past 30 years. Our goal is to be the number-one resource that mailers like you turn to as you strive to make your mailing operation the best it can possibly be. Within the following pages, we’ll cover some of the most pressing issues facing mailers in 2017. And like we always stress, hardcopy mail and digital avenues can complement each other wonderfully, so don’t just utilize Mailing Systems Technology’s print issues as a resource — our website is a wonderful, 24/7 option for you to reference at any time, with exclusive content we simply couldn’t fit in the printed magazine. So check it out, if you haven’t already. And I hope to see many of you at NPF; it will be a wonderful place to discuss the many changes happening in the postal industry (the 10-year rate review being at the top of the list!) So please drop by booth #304 for a chat. As always, thanks for staying connected with Mailing Systems Technology.

The articles in this magazine represent the views of the authors and not those of RB Publishing Inc. or Mailing Systems Technology. RB Publishing Inc. 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 30 Issue 2] is published six times per year, (January/February, Annual Industry Buyer’s Guide, March/April, May/June, September/October, November/December) by RB Publishing Inc.,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

MailingSystemsTechnology.com | MARCH-APRIL 2017

REAL LIFE MANAGEMENT View on Website

By Wes Friesen

THE THREE Rs APPROACH TO BUILDING GREAT RELATIONSHIPS

ant to be a more effective manager? An important key to our leadership success is to develop great relationships with our team members and develop an environment where they are motivated to excel. The three Rs approach, if consistently applied, will help us develop relationships and create a motivating work environment. The three Rs consist of: Recognition: Recognizing people for who they are and recognizing the value of the work they do. Rewards: Proving tangible and intangible rewards to individuals and teams, thereby showing our appreciation for their accomplishments and results. Respect: Showing respect for each person and their innate value as a fellow human being. Let’s drill down and look at some key concepts related to these three Rs. Recognition and Rewards I agree with Dale Carnegie when he said, "People work for money but go the extra mile for recognition, praise, and rewards." Research over the years has led to the development of what some have called the “Greatest Management Principle in the World” — you get what you reward. Sincere, regular, and positive recognition and rewarding of desired behaviors is common sense — but not common practice. A Gallup poll of thousands of employees found that 65% claimed to have received no praise or recognition the past year! Everyone likes to be recognized and shown appreciation. William James was one of the most respected psychologists who ever lived. After a lifetime of research and practice, he concluded that most people’s greatest need is the need for appreciation. Ongoing recognition and praise makes a person feel appreciated, important, and stimulates the intrinsic motivation to excel. Gallup research 6

MARCH-APRIL 2017 | MailingSystemsTechnology.com

Research over the years has led to the development of what some have called the “Greatest Management Principle in the World” — you get what you reward. found that individuals that receive regular recognition and praise: Increase their individual productivity Increase engagement among their colleagues Are more likely to stay with their organization Receive higher loyalty and satisfaction scores from customers Have better safety records and fewer accidents on the job On the other hand, a survey by Robert Half Associates showed that the number one reason for leaving a company was “limited recognition and praise.” There are specific actions we can take to improve our recognition practices. Following are the top 10 ways to motivate employees (adopted from recognition expert Bob Nelson’s book, entitled Motivating Today’s Employees): 1. Provide personal thanks. Mark Twain said he could "live for two months on just one compliment.” JR Tolkien was quoted as saying, “Kind words cost little, but are worth much.” A landmark research study showed the number one thing that employees wanted was “full appreciation for work done.” 2. Make time for employees. What kind of message do we send when we meet

with and listen to employees? We are sending the message that we care. John Maxwell captures the importance when he says, “People don’t care how much we know, until they know how much we care.” 3. Provide specific feedback. Employees want to know how they are personally doing and how the department and organization are doing. Also, catch people doing things right and thank them! 4. Create an open (and fun) environment. Having an open, fun, and trusting environment helps build a sense of camaraderie and encourages new ideas and innovation. 5. Provide information. Carla O'Dell was on the mark when she observed, "If you don't give people information, they'll make up something to fill the void." The reality is, if we don’t provide information, a vacuum is created, which is filled by the “rumor mill” — which is invariably negative. The heralded former CEO of Portland General, Peggy Fowler, emphasized the importance of communication when she suggested the three keys to being a great

manager are “communication, communication, and.... communication.”

and helping them recognizes their contributions and potential.

6. Involve employees in decisions. Involving employees in decisions that impact them results in buy-in as well as better quality decisions.

10. Celebrate successes. Taking the time to celebrate the successes of individuals, the team, and the organization builds morale and the motivation to strive for future successes.

7. Reward high performers. Promoting and rewarding people based on their performance (not politics) sends the right signals. Also, dealing with poor performers so they improve or leave strengthens the team and really helps morale. 8. Develop a sense of ownership. Provide employees a sense of ownership in their work and in their work environment. 9. Give chances to grow and learn. Most employees desire to grow and learn —

Many of us have good intentions to show more recognition — but often fall short. Here are a few ideas to help build recognition into our regular routines: Use a “to-do” list or daily planner. At the beginning of the week, write down the names of your team members and others you intend to recognize during the week ahead. Catch someone doing something right, recognize them, and then mark your list. On your planner, you can record birthdays, anniversary dates with the company, etc.

Use email and/or voicemail. Send positive, personal messages to let someone know you appreciate their work. At the end of the day, leave a positive voicemail thanking them for their excellent work that day, and express appreciation for them being on your team. I guarantee when they come to work the next morning and that’s the first thing they hear, they will have a great day! Use thank-you notes. Have a stack of notes readily available so you can send handwritten notes on a regular basis. One manager told me she has a standing appointment for one hour on Friday afternoons that she uses to write notes and do other forms of recognition. Let me close with a quote from Saint Paul: “Give everyone what you owe him… if respect, then respect; if honor, then honor.” (Romans 13:7). Good luck to you as recognize, reward, and respect your employees and let them know how much you appreciate them! ¾

Wes Friesen is a proven leader and developer of high performing teams. He has extensive experience in leadership and management roles, in both the business and non-profit worlds. He is also an accomplished university instructor and conference speaker. His latest book, Your Team Can Soar! Powerful Lessons to Help You Lead and Develop High Performing Teams, can be ordered from www.Xulonpress.com/bookstore or www.wesfriesen.com (under “Book”) or an online retailer like Amazon or Barnes & Noble. Wes can be contacted at wesmfriesen@gmail.com.

MailingSystemsTechnology.com | MARCH-APRIL 2017

MAIL & TECHNOLOGY MERGE View on Website

By Vincent DeAngelis

THEY MUST DO THINGS TODAY FOR OUR INDUSTRY

ack in the late 1990s, I was promoted into a new role that required me to manage people who were domiciled around the country. One of the first things I thought about was how I could stay connected to these people in a way that inspired them and also let them know that I was thinking about them. Motivational and Provocative A few days into pondering some different options, I came across a book as I was unpacking my new office. The book, The Best of Success: A Treasury of Success Ideas, is 300-plus pages of quotes meant to motivate and provoke thought. It occurred to me at that moment that sending out a daily “thought for the day” to my team would be a great way to let them know that, in some small way, I was thinking of them. For two years I would spend five or so minutes gleaning my book or searching the internet for a quote that I “felt” that day. Sometimes I would pick one with a particular person on my recipient list in mind, sometimes it was to send a message, and sometimes it would be a thought that I needed that particular day. Frequently, I would get a response back from someone — or some ones – letting me know that they needed an uplifting or relevant observation that day, or that it made them think about something in a different way or they just liked the thought. Some days those responses would come from the people I intended to reach. Just as often, I received responses from someone else on the list.

The Thought of the Day Returns Through the years, as I changed jobs and even companies, people would email me and ask if I would keep them on the quote-for-the-day email distribution. I found this fascinating because, in today’s age of technology, we have those sources of quotes tethered to ourselves via our mobile devices. Well, after delivering thoughts for the better part of a decade, I abruptly stopped about a year and a half ago. But just recently, my company administered its employee engagement survey. Upon receiving individual departmental scores, company leaders were challenged with devising and executing an action plan to increase our scores. While I was brainstorming some possible items we could implement, one of my employees suggested bringing back the thought of the day. And so I did. And one of the first ones I sent was this: “You must be willing to do the things today others don’t do in order to have the things tomorrow others won’t have.” – Ohio-based motivational speaker Les Brown (not the swing-era bandleader) Germane and Topical As I reflected on Mr. Brown’s quote, it occurred to me how germane it is to our industry. We need our leaders in government, new and re-elected, to enact legislation for an industry that, according to the EMA Mailing Industry Job Study, 2015, is worth $1.4 trillion and employs more than 7.5 million people. They Must Act Our political leaders need to address the issues that will allow mailing and shipping

“You must be willing to do the things today others don’t do in order to have the things tomorrow others won’t have.” costs to stay affordable. They need to allow the USPS to use the revenue garnered from the American public and the mailing and shipping community to enhance the infrastructure that produced the delivery of more than 750 million packages this past holiday season. This updated infrastructure would also include replacing decades-old vehicles for the hardworking women and men of the Postal Service, who drove more than 200 million miles during that same peak holiday season. They need to connect the dots that the industry issues they keep kicking further down the road will affect future elections as the US mail plays a critical part in the American election process. Or, to slightly modify the quote above, “They must be willing to do things today others haven’t in order to ensure what we have today is there tomorrow.” ¾

Vincent DeAngelis is Vice President, Postal Relations, and Shipping Product Management, Neopost USA. Neopost USA provides hardware and software to mailers and shippers of all sizes. Neopost-brand solutions enable businesses to send and receive physical mail, digital documents, and traceable packages. More importantly, Neopost solutions help our customers connect with their customers by establishing individualized, one-to-one business relationships. Visit www.neopostusa.com for more information.

MARCH-APRIL 2017 | MailingSystemsTechnology.com

CONNECTING POINT View on Website

By Chris Lien

ACCOUNTABILITY THROUGHOUT THE MAILING PROCESS

ailing service providers (MSPs) work tirelessly to provide strategic mail induction opportunities to their customers. Proving delivery has been challenging in the past. In the era of the Intelligent Mail barcode, MSPs can leverage a depth of data that opens the door for multi-channel marketing. The United States Postal Service (USPS) has scan data from the largest delivery network in the world. In July 2014, 79% of eligible commercial mail was mailed at Full-Service rates, according to the USPS. As of January 2017, the amount has grown to 87%. Can providers benefit from the burden of seemingly endless documentation to solve delivery accountability woes? The Intelligent Mail barcode system that exists today provides an infrastructure of visibility, predictability, and accountability. However, in its current state, it doesn’t quite fulfill the demands of modern-day marketers. Tracking through only the Intelligent Mail barcode leaves providers with little insights or control. USPS changes due to network rationalization and other unforeseen reasons can impact providers’ ability to deliver on promises to clients. Several companies offer robust tracking solutions so providers are no longer making assumptions about timely delivery. Users of these products are able to receive refunds and hold the USPS answerable. These measurement tools ensure that accountability is a two-way street — if you have done your job correctly as the MSP, you are guaranteed delivery of your product.

We’re often asked, “What is the ROI potential?” for these services (beyond basic mail tracking, of course). The ROI question brings me to the focal point of this bimonthly column — connecting the points of contact in a strategic plan drives sales. In an interview with Great Britain’s Marketing Week about 2016 holiday sales, Sir Charles Mayfield, chairman of the John Lewis Partnership, said, “The most valuable shoppers are the ones who shop across multiple channels, as they tend to spend a lot of money with us. So while digital is a big focus, I wouldn’t say we’re a digital-first business; it’s more just waking up to the fact consumers now need multiple efficient options to access our brand.” Tracking solutions allow clients to achieve multi-channel campaigns, integrating digital and physical marketing messages. If your client uses Google Analytics or another marketing dashboard for measuring the effectiveness of digital advertising, intelligent tracking solutions give the same measurement capabilities for direct mail communications. Tracking also returns ROI by helping to ensure that every piece of mail gets to its intended audience. Today, every piece of mail is scanned. Every piece, therefore, can be accounted for. That’s a powerful tool that many digital platforms cannot claim. Search engine marketing agencies cannot guarantee that a search engine ad will get onto the desktop of its intended viewer. To take advantage of workshare discounts, mailing service providers are held to a complex standard of mail induction. I was recently delighted to hear a customer

In July 2014, 79% of eligible commercial mail was mailed at Full-Service rates, according to the USPS. As of January 2017, the amount has grown to 87%. success story using mail tracking to validate a reimbursement by the USPS. Not that I revel in the Postal Service’s mea culpa, but rather, I’m proud of another provider holding the accountability mirror back at the USPS. Mail tracking is the provider’s tool for holding the Postal Service accountable for its end of the deal. In instances like these, the term “big data” becomes more than a buzzword. Mail tracking solutions utilizing big data make direct mail communications a stronger channel. It connects the dots for an organized multi-channel marketing message and equips providers with the means to prove delivery. ¾

Chris Lien is the president of BCC Software and has been active in the mailing industry for over 20 years. During that time, he authored several software solutions utilizing Mail.dat for electronic auditing, distribution and logistics planning, palletization, and electronic postage payment. He has been heavily involved in industry associations such as the Association for Postal Commerce, EPICOMM, Alliance of Nonprofit Mailers, and Idealliance.

MailingSystemsTechnology.com | MARCH-APRIL 2017

SOFTWARE BYTE

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By Jeff Peoples

THE KEY TO POSTAL FACILITY IDENTIFICATION

he United States Postal Service (USPS) has thousands of postal facilities across the country: Network Distribution Centers (NDCs), Sectional Center Facilities (SCFs), Area Distribution Centers (ADCs), Destination Delivery Units (DDUs), and, recently, Service Hubs. These facilities often have names that are not reflective of their actual locations, which can be confusing. To aid in the proper identification of postal facilities, particularly in eDoc, the USPS has assigned unique identification codes, called locale keys, to each postal processing and delivery facility. This allows for very precise identification of the postal facilities that mailers are using for their origin entry and for any additional entry points at which mail is entered. If you are submitting electronic documentation (eDoc) to PostalOne!, one of the critical pieces of information required to identify postal facilities are these locale keys. There are a number of fields in the Mail.dat file where these locale keys may be populated for communication of this information to the USPS and other entities in the mailing process. Origin Locale Keys The PostalOne! and the Mail.dat specifications for population of the Origin Locale Key is one of the areas where the two specifications are not in sync. The Mail.dat specification calls for this field (CSM-1167) to be populated with “ORIGIN” for the origin entry point of the mail. The PostalOne! specification, on the other hand, calls for this field to be populated with “LOC,” followed by the six-digit locale key for all entry

facility types, including Origin. Because of this disparity in the specifications, this field is often not populated correctly in Mail.dat files, which can lead to validation errors when uploading to PostalOne! Editing Locale Keys in Mail.dat Files If you are presorting your mailing jobs to include additional entry points, it is important that your presort software follow the PostalOne! specifications for population of the locale key data in the Mail.dat file. Even if these locale keys are not populated correctly, or are not populated at all, you may also use post-presort software to add or edit these locale keys. Looking Up Locale Keys So, where does one find the correct locale key for a postal facility? The USPS offers extensive information about postal facilities via the Facility Access and Shipment Tracking system (FAST; visit https://fast.usps.com/ fast/main.action for more information). Mailers who drop ship mail to additional entry points are likely familiar with this website, but it is also quite valuable for any mailer. The site allows users to look up very detailed information about virtually any postal processing and/or delivery facility, including the locale key information. This can be a very helpful resource for mailers to research anything from office hours, holidays, types of mail processed, phone numbers, directions to the facility, and information regarding mail being directed to alternate facilities. Facility Profiles Each postal facility has its own “profile” on the site, which includes virtually every

detail about the postal facility that mailers would need to know. The list below shows the level of detail available in these profiles: Physical and operating characteristics of facilities Hours of Operation Facility Contact Information Mail Discounts Information Facility Constraints (ex. slots and volume for Standard and Package Services mail) Facility Address Facility Dock Information Holidays Additional Information Default Facility Information Non-Default Facility Information Critical Entry Times The USPS provides a user guide (https:// fast.usps.com/jobaid/FacilityProfileInformation.pdf) to assist users in navigating through the facility profiles portion of the FAST website. If you use mailing software, however, you don’t need to do individual look-ups to access these locale keys. Rather, your software will look these up for you, using the Destination Data files published by the USPS. It is very critical, however, that mailers make sure their mailing software is accessing the most up-to-date Destination Data files, to ensure that the correct postal facility data, including the locale keys, is being populated in your eDoc. These Destination Data files should be updated at a minimum of once a month. However, if you routinely drop ship mail to additional entry points, you should be updating these files weekly, or even daily. ¾

Jeff Peoples is President, Founder, and CEO of Window Book, Inc. With 20+ years of innovative solutions that make using the Postal Service easier and more profitable for mailers and shippers, he has done presentations at industry events, GraphExpo, MAILCOM, the National Postal Forum, Postal Customer Council meetings, Harvard Business Expert Forum, and other industry and direct marketing events.

MARCH-APRIL 2017 | MailingSystemsTechnology.com

DIRECT MAIL EVOLUTION View on Website

By Joy Gendusa

PHYSICAL & DIGITAL WORK TOGETHER

ith so many digital marketing options available today — and all the bells and whistles that come with them — direct mail is losing the battle for marketers’ dollars. But does it have to be a battle? No — and it shouldn’t be! We know that direct mail is the workhorse of the marketing world. It generates seven times the responses of all digital channels combined. SEVEN TIMES! Yet business owners can’t resist the allure of digital advertising. It’s shiny and new, and it often costs less. Digital methods also offer real-time analytics that allow marketers to SEE how their campaigns are performing. So the reality is: In today’s world, businesses need to do both. Even the United States Postal Service (and I can’t think of anyone who has a greater stake in the success of direct mail) sees the value of digital platforms. In fact, the USPS is incentivizing direct mailers to integrate their campaigns. I’ve got two exciting words for you: POSTAGE. DISCOUNTS. I know I touched on this in my last column, but now that the promotions’ start dates are (or almost are) upon us, I thought I would take the opportunity to remind you again — this is not an opportunity you want to miss out on! This year, the Postal Service is offering up to five percent off postage for companies that incorporate online technology into their direct mail marketing. To recap, here’s why the USPS wants you to integrate your direct mail: Marketers who combine on- and offline marketing achieve significantly better results — as much as an 81% increase in new customers! And when

But many small business owners lack the resources to mail with the frequency that is needed to create the results they want. campaigns perform better, clients reorder more often. Everybody wins: businesses, marketers, mail houses, and the USPS! But let me back up. What do I mean when I say that on- and offline-integrated campaigns perform better? “Online marketing” encompasses a lot of different formats — email, pay per click, banner ads, etc. I’m talking a very specific, VERY effective kind of online marketing called retargeting. You know when you’re shopping online but, for whatever reason, you don’t buy? For example, say you find a pair of shoes you like and you check out all the details on them, but don’t pull the trigger — you leave the page without making the purchase — and then you start seeing ads for those exact shoes all over the internet? That’s retargeting! (It’s also known as remarketing or Google follow-up advertising.) Why is it so effective? Research shows that 80% of sales take place on the fifth contact or later. This means that follow-up is essential to any successful marketing endeavor. But many small business owners lack the resources to mail with the frequency that is needed to create the results they want. With a remarketing campaign, visitors to your client’s website are “cookied” with

an unobtrusive piece of coding that tells Google to start showing that person your client’s follow-up ads. That prospect then sees the ad all over the internet, again and again, reminding them of their initial interest until they become customers! And it works:  Leads who are shown Google follow-up ads are 70% more likely to convert  Retargeting can boost response up to 400% Now, about those postage discounts; how do they work with online advertising? It’s simple. The USPS is offering two separate discounts for direct mailers who add this technology to their campaigns: 1. The Emerging and Advanced Technology promotion offers two percent off postage for First-Class mail with no quantity restrictions and runs from March 1 through August 31, 2017. 2. The Direct Mail Starter program gives five percent off postage (up to 10,000 pieces) to businesses and nonprofits who are not currently using direct mail. It is effective from May 1 through July 31, 2017. If you haven’t already, now is the time to take the leap and implement these incentives in your mail operations! ¾

Joy Gendusa is the Founder and CEO of DirectMail2.0, a fully integrated marketing solution for the clients of printers/mailers that combines the proven success of direct mail with in-demand features like online advertising and automated campaign tracking. Visit www.directmail2point0.com or call 800.956.4129 today!

MailingSystemsTechnology.com | MARCH-APRIL 2017

THE TRENCHES

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By Mike Porter

LET’S TALK ABOUT ENVELOPES

n today's hyper-personalized communications environment, the lowly envelope's status is improving. Thanks to technological developments, mailers are no longer locked into a narrow range of choices. They can now create envelopes that contribute to the effectiveness of the mail pieces they encase, offer greater returns for their customers, and generate a new source of revenue for themselves. Dynamic Envelope Printing Most mailers continue with traditional preprinted single window envelopes. For some, the double-window variety allows them to use the same material across many applications. A few, however, have discovered that advances in inkjet technologies and document integrity controls make it possible to offer their customers something different. High-quality envelope printing solutions are available from many hardware vendors. With varying levels of speed, intelligence, and functionality, envelope printing solutions can allow mailers to reduce their inventories of custom envelopes or even abandon window envelopes entirely. Customer Interest in Envelope Printing Full-color inkjet envelope printing makes it possible to create mail that is more valuable to customers. Any organization that helps clients achieve their objectives instead of just providing an easily sourced service creates opportunity. By showing customers how to connect envelope messaging to their marketing goals, service providers can expand business relationships with their clientele. Customers regard traditional mailing products as commodities. When a service provider generates the same mail delivered in the same envelopes offered by the competition, it drives down the provider’s profits and makes customer loyalty difficult to maintain. With many companies looking to digital delivery as their first choice, mail service providers 12

MARCH-APRIL 2017 | MailingSystemsTechnology.com

Possibilities for adding prompt, targeted, and personalized elements to a highly visible but generally ignored area of a mail piece are limited only by imagination and data availability. must sell their customers on the concept that mail offers value worthy of the cost. Variable envelope printing is one way for service providers to make that argument while separating themselves from competitors. Dynamic envelope print devices image each envelope with messages and graphics connected to recipient-specific offers described in the mail piece, communicate urgency, or raise curiosity. Unlike special orders for pre-printed envelopes, messages printed at production time can be very timely. Is there an extended polar cold front on the way? Heating oil companies may want to recommend customers top off their tanks. Did a local emergency create an urgent need for blood donors of a particular blood type? Print the plea in red, right on the envelope where recipients will see it at once, along with a map to the nearest donation site. Possibilities for adding prompt, targeted, and personalized elements to a highly visible but generally ignored area of a mail piece are limited only by imagination and data availability. Studies have shown that relevance, personalization, and color affect response rates and order sizes. Customers will appreciate the value these elements add to their campaigns.

Is Envelope Printing Right for You? The justification for adding full-color envelope printing to a mail production workflow may be different for each company. It depends on the size of the operation, the mix of production jobs, printing platforms, and the competitive environment. Here are some benefits a print/mail service provider or their customers may enjoy from dynamic envelope printing:  Less money tied up in custom envelope inventory  No waste due to obsolescence or expired shelf life Increased open and response rates  Occupy fewer square feet of warehouse space Reduced time and resources dedicated to staging and stock movement  Larger envelope orders, enabling attractive services such as just-in-time delivery and better pricing  No rush charges when unexpected shortages occur  Ability to merge small inserting jobs into larger, more efficiently processing units of work  Avoid material staging errors

Segmented messaging without degraded postal presort density  Personalization to alert recipients to important envelope contents, deadlines, or opportunities Windows Pluses and Minuses Window envelopes are both a convenience and a pain point for mail producers. I worked in the service provider industry for 20 years and experienced both the advantages and challenges of window envelopes. ADVANTAGES  No worries about matching address-bearing envelopes to contents  Easy quality control, either by camera or humans, to see that an address appears in every window  Inventory simplicity – use double-window envelopes for multiple applications or multiple customers CHALLENGES  Adjusting fold plates for different jobs to align addresses with windows  Programmatically repositioning document address blocks in customer-supplied print-image files  Address-creep caused by variable page counts and nested folds  Long address lines or too many lines to fit in the window  Little or no available messaging space  Privacy concerns when confidential data becomes visible  Undeliverable or rejected mail caused by shifting envelope contents  Mass production appearance is unsuitable for some applications With adequate systems to control document integrity, some organizations may decide switching to closed-face envelopes is another way to distinguish themselves from the competition. If so, they may enjoy additional benefits:  Reclaim areas of the document reserved for the address block, postal barcode, and clear zone  Improved privacy for mail recipients  Eliminate window-alignment and address shift problems

 More professional appearance Inkjet Printing Can Drive Need for Dynamic Envelopes Dynamic envelope printing may be especially interesting to companies migrating to high-volume inkjet document environments. Manufacturers build their roll-fed inkjet printers to process large print files that keep the devices running for long time periods. One way to generate larger print jobs is to build them by combining documents from several smaller jobs. Inserting machines allow operators to load only one type of outbound envelope at a time. If inserting jobs feature co-mingled documents from many applications, printing customized text and graphics on the outbound envelopes on the fly is the only alternative to producing a generic mailing product. What About Envelope Makers? Inline envelope-making machines and wrappers are another solution for some print/mail operations. They can allow a company to gain all the advantages of dynamically printed envelopes with the bonus of not maintaining envelope inventories at all — not even blank envelopes! Service providers with enough volume and appropriate types of applications can print the main documents and inserts, make an envelope featuring variable elements, and produce a finished mail piece with a single piece of equipment. Many mailers are uncomfortable with having all the production steps so tightly connected, though. They need more flexibility, or their customers don’t like the look of wrapped documents. For them, dynamically printing on blank envelopes with high-quality inkjet heads mounted on the inserting equipment is probably the best approach. If I were building a service center from the ground up today, dynamic envelope printing would probably be in the plan. The technology has been available for a long time, but the quality, speed, and integrity built into today’s solutions make them an attractive choice and a way to distinguish a print/mail service provider from competitors. ¾

Mike Porter writes extensively on topics of interest to companies and individuals working in the customer communications business. Visit www.printmailconsultants.com to learn more about his writing and consulting services or follow him on Twitter @PMCmike.

MailingSystemsTechnology.com | MARCH-APRIL 2017

POSTAL AFFAIRS

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By Bob Schimek

POSTAL REFORM LEGISLATION QUICKLY RETURNS TO NEW CONGRESS

he House Oversight and Government Reform Committee wasted little time to introduce postal reform legislation into the new Congress. On January 31, 2017, H.R. 756 — The Postal Service Reform Act of 2017 — was entered as a new bill. A push was made at the end of 2016 during the lame duck session of Congress to get a postal reform bill passed (H.R. 5719). However, delayed scoring by the Congressional Budget Office (CBO) left little time to generate the support needed to bring the bill to a vote. Generally, when a session of Congress completes, any unfinished bills are lost and any effort in the new Congress begins anew. This was not the case for postal reform, as H.R. 756 is very similar to the bill that successfully passed out of subcommittee in the previous session of Congress. The bill, as introduced, seeks to create a balance between cost relief, accountability, and service performance. The subcommittee quickly held an official hearing on H.R. 756, which occurred on February 7, 2017. The hearing included participation from Postmaster General (PMG) Megan Brennan, Postal Regulatory Commission (PRC) Chair Robert Taub, Government Accountability Office (GAO) Director of Physical Infrastructure Lori Rectanus, National Association of Letter Carriers (NALC) President Fredric Rolando, and Coalition for a 21st Century Postal Service (C21) Manager Art Sackler. The testimony reflected broad support from the various stakeholders participating in the hearing. Given the excessive

amount of USPS unfunded liabilities, few can argue the need for postal reform legislation to ensure the viability of the Postal Service and the larger mailing industry. Important Changes H.R. 756 continues to include several core changes:  Modifications to USPS retirees’ health care benefits, including using Medicare and the use of Postal Service-specific demographics to greatly reduce the USPS current unfunded liabilities. While there is still no active board of governors since December 2016, the bill would reduce the number of presidentially appointed governors from nine down to five. Items to Watch The hearing covered several topics that the mailing industry will need to watch carefully: The bill permanently brings back half of the expired temporary exigent surcharge. If the bill is passed as introduced, it will allow the Postal Service to do a one-time increase of 2.15%. It is likely this would be implemented as quickly as the USPS could get the price change officially approved by the PRC. In theory, this could occur as quickly as 90 days after the bill is passed into law. PMG Megan Brennan made it clear that the USPS is looking for more than just the proposed postal reform legislation in H.R. 756.  The PMG noted that ideally, the USPS would like to see the full 4.3% exi-

gent surcharge permanently brought back but did acknowledge a lack of support from the mailing industry. The PMG also noted the need for a favorable outcome to the 10-year rate review that the PRC is currently conducting. When asked what would define “favorable,” it was defined as removal of the current Consumer Price Index (CPI) cap on market dominant products. The one-time 2.15% price increase combined with the removal of the CPI cap on market dominant products sends a pretty clear signal that the Postal Service wants the ability to raise postage prices more than CPI. This is concerning because any increase that exceeds CPI creates unpredictability in postage prices. That could potentially have a significant impact on mail volumes by increasing the push to electronic diversion and further impacting the mailing industry, which is still struggling to recover from the volume losses of the last recession. While the industry has shown the willingness to swallow a one-time 2.15% price increase, the CPI cap has provided the mailing industry stable and predictable postage prices. This value needs to be proactively communicated to the PRC in the 10-year rate review to prevent a cap-based system from being eliminated. Now is the time to leverage the industry association membership(s) you belong to and ensure the USPS objectives are balanced with the needs of the mailing industry to create a win/win environment for everyone. ¾

Bob Schimek, Senior Director of Postal Affairs for Satori Software, serves as primary liaison with the USPS on technical matters affecting the mailing industry. His 27 years of industry knowledge and leadership provide product management and strategic direction for Satori Software’s mailing solutions. Schimek currently serves as Chairman of the Board for PostCom, Chair of Idealliance’s Mail.dat Work Group, and as an Idealliance representative for MTAC.

MARCH-APRIL 2017 | MailingSystemsTechnology.com

SAY WHAT?

Think About It

A common saying is that “We need to learn from our mistakes.” That’s true; however, we should also learn from our successes. When something works well, we should try to replicate that accomplishment. Our most successful RFPs have had three elements in common: a solid RFP team, a culture of promoting diverse points of view, and keeping costs analytics separate.

— GARY A. SEITZ.

— MARK M. FALLON

the impact for not complying?

When looking at the mailbox monopoly, there are different issues for mail vs. parcels. After all, how much USPS parcel volume today is delivered into the mailbox? And parcels are, for the most part, not subject to the USPS’ other monopoly, meaning it is a competitive marketplace with many carriers.

— ADAM LEWENBERG

— KATHLEEN J. SIVITER

The mailing equipment providers are now requiring new postage meters to be connected to the network instead of using typical analog phone lines. Overall, this is a good change as it will reduce the costs associated with analog lines, and it will provide faster transmissions that allow meters to do more things. The issue is, however,

The one-time 2.15% price increase combined with the removal of the CPI cap on market dominant products sends a pretty clear signal that the Postal Service wants the ability to raise postage prices more than CPI. — BOB SCHIMEK

Direct Marketing Association’s Statistical Fact Book indicates that nearly 75% of businesses believe inaccurate data prevents them from finding new customers, increasing sales, and providing good customer service. It also leads to a poor decision-making process and costs millions in wasted marketing expenses.

how you get this done, and what is

Delivering a positive customer experience requires careful attention to every aspect of the customer journey, including the transactional documents that customers receive from your organization. Every bill or statement you send to customers is an important touchpoint and an opportunity to do much more than just present the basics. — HARRY STEPHENS MailingSystemsTechnology.com | MARCH-APRIL 2017

By: Gary A Seitz

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FACTORS THAT IMPACT ADDRESS QUALITY You know that the goal is to reduce UAA mail, so what factors should you focus on? By Gary A. Seitz

ast September, we published an article with an in-depth look at Undeliverable-as-Addressed (UAA) mail, where it comes from, and how to fix it. After the article had been published, we received an interesting follow-up question: What factors impact address quality? There are two answers to this question: factors in the collection of address data at the front end, and factors that affect the addresses at the time of your mailing (at the back end). We’ll take a brief look at both. COLLECTION OF ADDRESSES THAT IMPACT QUALITY Each year, the Direct Marketing Association (DMA) collects, compiles, and publishes its Statistical Fact Book. It’s a definitive source of benchmarks for datadriven marketing.

MARCH-APRIL 2017 | MailingSystemsTechnology.com

The report indicates that nearly 75% of businesses believe inaccurate data prevents them from finding new customers, increasing sales, and providing good customer service. It also leads to a poor decision-making process and costs millions in wasted marketing expenses. On average, US organizations believe 25% to 33% of their data is inaccurate. Despite advances in automation, data is still manually typed into computers, user interfaces, and web applications every day. Sometimes it’s entered internally by sales or customer service, and other times it comes directly from your customer. Whatever the case, these inaccuracies are from people who simply make a mistake — they mistype or misspell. When on the phone, these errors may even come from a misunderstanding of key words (do they live on

Arbor or Harbor; N. Field Rd. or Northfield Rd.). Other times, transposed characters and digits (especially in a house number or ZIP Code) can be entered incorrectly — something is left out, like a number or address component, or they enter the right value, but just in the wrong space. Some data entry may not always be a mistake. How often do people give incomplete or inaccurate information to safeguard their privacy, or simply to get something free (like your latest whitepaper)? You’d be surprised how often that theme park character from Orlando appears in web-based requests and forms. If a field is missing, the data is forgotten or skipped (like an apartment number), or an alternate field is used — an extra name in the address field, a phone number in the company field, and so on. Whether

Causes of Inaccurate Address Data 50% 40% 30% 20% 10% 0% Incomplete/Missing Data

Inaccurate data

Outdated Information

Data in Incorrect fields

Typos

Spelling errors

Duplicates

Source: Direct Marketing Association (DMA)

it’s additional delivery information from a customer or a salesperson’s notes on an account, these all lead to further quality issues down the road. Organizationally, a lack of standard systems leads to data failure. Each department may have their own system and undefined rules for data — from accounting (with billing rather than contact info) or a marketing CRM database to individual account service and sales reps who may maintain data in Excel or some other proprietary desktop software. There are no standards, no rules, and no control over the format of the data. WHAT CAN YOU DO? Most companies that have enjoyed an increase in sales and profits manage their data quality strategy centrally, by a single director. We call them a “data steward.” These data stewards are empowered to oversee the systems and standards for data collection — from providing input on the layout and design of the entry forms to the format of the captured data. They play an integral role in the selection and use of software tools, such as website real-time validation software and additional hygiene tools. They also take the lead in the development and governance of rules and standards and provide training to all internal teams (we endorse the use of USPS Pub. 28 for address collection and input standards). Finally, they work with outside experts such as mail service providers (MSPs) who support your address data quality with software and solutions tailored to your application.

IMPACTING QUALITY PRIOR TO MAILING There are a multitude of sources to assist your data quality efforts after collection as well as prior to using it to market your products and services to customers and prospects. It can come from software you can acquire as well as assistance from industry experts like MSPs. The process starts with properly mapping and converting data to a standard format. Whether you provide a single source file or multiple files from various departments (accounting, CRM, sales, rented lists, etc.), it’s critical that it be consolidated into a common format that contains ALL of the contact data necessary for your marketing campaign: company name, contact name, title, multiple address lines (with primary and secondary addresses), ZIP Code, email address, and phone. The USPS Coding Accuracy Support System (CASS) and Delivery Point Validation (DPV) tools are used to validate each address down to the house number when assigning a ZIP+4 while also standardizing all of your address elements to USPS standards (e.g., correcting street name formats and spelling). If a Zip+4 Code can’t be assigned, then something is wrong with your address, and it probably shouldn’t be mailed. Our last article discussed ways to handle these types of records. Editor’s Note: You can read this previous article by visiting MailingSystemsTechnology.com/FixingUAAMail SuiteLink and Apartment Append are database tools that enhance your addresses to correct or append key secondary information to your addresses. These ensure improved

delivery and better matching during NCOA and merge/purge processing. NCOA is a file of individuals, families, and businesses that have recently moved. The USPS requires that you use a Move Update tool within 95 days of your mailing, the most common of which is NCOA. While this can be a quarterly process for database hygiene, we recommend it prior to every mail marketing campaign. More importantly, ask your MSP for a file of match movers, and be sure to apply these as an update to your database. Many businesses fail to complete this critical process. Proprietary COA databases also enhance databases. These are change-of-address files compiled from catalogers, magazines, and financial institutions that increase the level of COA match by two to five percent beyond NCOA. Merge/purge is a process to identify duplicates within your database, either by individual name or by family last name, depending on the type of mailing. Advanced matching logic identifies nicknames (William and Bill) and names with dual addresses (a P.O. Box and a conventional address), which prevents wasted expense and tarnishing your image. Be a compassionate mailer — we also recommend periodic use of deceased coding to remove these records from your marketing database. CONCLUSION There will still be remaining data quality issues — people move and don’t tell the USPS, they change jobs, and you never truly can fix the fact that people will still continue to make mistakes entering data. A data quality initiative takes time and diligence. Start with a data steward, look for outside expertise from your MSP when prudent, and get going. While these tools aren’t the end-all, be-all to impacting your data quality, they’ll add much more value to your business intelligence. ¾

GARY A. SEITZ is Vice President of C.TRAC Direct in Cleveland, OH and has been a frequent presenter on UAA mail at the NPF and PCCs around the country for more than 30 years. Gary can be reached at GSeitz@ctracdirect.com or by calling 216.251.2500 x 4985. Follow Midwest Direct on Twitter (@MW_Direct) and LinkedIn for other industry updates and helpful articles. MailingSystemsTechnology.com | MARCH-APRIL 2017

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By Adam Lewenberg

CONNECTING YOUR POSTAGE METER TO THE NETWORK? WHAT YOU NEED TO KNOW

he mailing equipment providers are now requiring new postage meters to be connected to the network instead of using typical analog phone lines. Overall, this is a good change, as it will reduce the costs associated with analog lines, and it will provide faster transmissions that allow meters to do more things. The issue is, however, how you get this done, and what is the impact for not complying? There are over 1.1 million postage meters in the US today, and the majority are connected through analog connections that will need to be switched. Issues with Analog Connections Let’s start with the hard truth: It is going to be harder and harder to get analog phone

MARCH-APRIL 2017 | MailingSystemsTechnology.com

lines in the future. Many of the large phone companies are pushing the FCC to allow them to stop providing analog services and, in turn, raise prices. Keep in mind: Analog lines cost $300-600 per year and may only be used for the postage meter. Meter vendors are charging $100-400 for analog adapters to retrofit existing systems. Mailing equipment renewals and replacements will need to be updated to network connections. Benefits of Network Enabled Mailing Systems The good news for customers is that network-enabled mailing systems can do many more functions that will make meters easier to use and provide additional

value for your organization. Increased quantities of data can be transmitted at faster speeds, which is the future direction for this industry. Automatic Rate Updates – Network-enabled devices may be able to push the correct rates to your system instead of needing to wait for the next time you update your meter. Web Accounting – One of the biggest developments with mailing systems is being able to enter department accounting information on the meter and access it on the web through the vendor’s website. You used to need expensive accounting systems or have printers connected that required retyping information into your business system. Now you can access this data from the web

and then export it into a spreadsheet to use internally. Mail Class Detail – You can now see the details of the mail classes used at each meter. This information can be used to find savings strategies for the future. Shipping Savings – If your meter comes with a way to submit USPS Priority Mail transactions to the USPS (this requires typing the address and generating a shipping label vs. using meter tape), you can save an average of 15%! What You Need to Know to Get Your Meter Connected The biggest challenge our clients encounter when switching mailing systems from analog to network-enabled is firewall issues. The systems are basically designed to work when you plug them into the network jack, but many companies have security standards that require IT to get involved. This can delay the installation and require multiple departments to be brought in to rectify what used to be a simple process. This issue gets multiplied when you have meters scattered throughout your locations, and a plan may need to be put in place to get this change completed. Steps to Get Your Postage Meter Connected on the Network: We will define the process to get your meter connected as well as explore common definitions that will help those who may not be familiar with these technical terms. 1. Is there a network connection close to where you’re putting the mail machine? If not, there are many options available, ranging from wireless adapters to connecting to the back of IP phones that have an extra port. 2. Do you use a proxy server? (A proxy server is a dedicated computer or a software system running on a computer that acts as the intermediary to access the mailing vendor’s servers through your internet connection.) 3. You will need to know if your company has a Dynamic Host Configuration Protocol (DHCP) Server. DHCP is a network protocol that enables a server to automatically assign an IP address to a computer from a defined range of

numbers (i.e., a scope) configured for a given network. A DHCP server is designed to eliminate the need to provide a static IP address, subnet mask, and default gateway, which are required to connect to a LAN connection. If you do not have a DHCP Server, the information below needs to be entered into your mailing system. If it is a self-installable meter, this can be done by internal staff, or you can have this information ready for the service technician if the mailing vendor installs the machine. a. IP Address - Internet Protocol (IP) Address is a unique string of numbers separated by periods that identifies each device to communicate over a network. b. Subnet Mask - A subnet mask is a screen of numbers used for routing traffic within a subnet. c. Default Gateway - The access point that a device uses to send information to a computer in another network over the internet. 4. Do you use a static IP address or dynamic IP address? If you do not have a DHCP server (which can automatically recognize these addresses) and have dynamic IP addresses, these numbers will need to be entered into the meter if they change. a. Static IP Address - A set of numbers assigned to a computer by an internet service provider (ISP) to be its permanent address on the Internet. b. Dynamic IP Address - A temporary set of numbers assigned to a computer when it’s connected to a network. 5. Plug the machine into the network port. 6. Try downloading postage or doing a balance inquiry. If that works, you are connected! What Happens If It Does Not Work? The main reason we typically see this not working is the firewall is blocking the connections to these ports or IP address ranges. The only way we have found to solve this is to bring in the IT departments along with documentation provided by the meter vendors. At times, it requires someone technical from your organization connecting directly with the meter vendor support

staff (either over the phone or in person) to diagnose the issue. The meter vendors’ support websites are good resources you can go to get help if needed. They all have good documentation on the sites with the steps required for your mailing system. It was made clear at a recent product launch by Pitney Bowes that the future of the mailing system will be web-enabled functions that can be added to the system to increase its value to the customer. It is adding cloud-based applications that will allow the appliance to do more than just printing postage. We have seen the same thing from Neopost, where they are creating value by having a computer tied to the mailing system to be able to automate shipping and accounting. We see this trend increasing as the vendors try to offset declining mail volumes with the increase in USPS shipping. We strongly recommend that as clients migrate to new mailing systems, they connect them to the network instead of holding on to antiquated analog phone lines with expensive adapters. There will be savings across the board, along with increased capabilities and information available. ¾

ADAM LEWENBERG, CMDSS, MDC, President of Postal Advocate Inc., runs the largest Mail Audit and Recovery firm in the United States and Canada. They manage the biggest mail equipment fleet in the world and their mission is to help organizations with multiple locations reduce mail related expenses, recover lost postage funds, and simplify visibility and oversight. Since 2013, they have helped their clients save an average of 60% and over $26 million on equipment, avoidable fees, and lost postage. He can be reached at 617.372.6853 or adam. lewenberg@postaladvocate.com.

RESOURCES Neopost and Hasler www.neopostusa.com/resources/support Pitney Bowes www.pitneybowes.com/us/support.html FP www.fp-usa.com/support

MailingSystemsTechnology.com | MARCH-APRIL 2017

THE MAILBOX MONOPOLY CONUNDRUM

The USPS mailbox monopoly is a unique setup, and as the Postal Service struggles to remain relevant, many are wondering how to best proceed.

By Kathleen J. Siviter

MARCH-APRIL 2017 | MailingSystemsTechnology.com

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recently had the interesting experience of helping to organize a oneday event sponsored by PostalVision 2020, which brought together members of our postal ecosystem to talk about the USPS’ mailbox monopoly. The event was a parallel effort to an ongoing study by the Government Accountability Office (GAO), requested by Congress to look at the USPS’ monopolies in today’s competitive marketplace. For those who don’t know the history — and this is an extremely abbreviated version of what many have written entire books about — the USPS mailbox monopoly law was passed in 1934 after years of tumultuous US history and the growing use of private messengers/carriers delivering statements, circulars, bills, and other pieces into the mailbox. In passing the law, Congress noted that these behaviors were depriving the thennamed Post Office Department of needed revenue and also resulting in the “stuffing of letter boxes with extraneous matter.” The US Supreme Court upheld the constitutionality of the mailbox restriction in 1981.

There is much confusion about the USPS’ monopolies — that’s right, there are two separate USPS monopolies. The mailbox monopoly, mentioned above, means that only the USPS can deposit anything in the “US mail” box. The other monopoly, often called the “letter mail monopoly,” or the Private Express Statutes, was first enacted in its earliest form in 1792 and restricts private delivery services of certain matter (see https://about.usps.com/ publications/pub542/welcome.htm). Although there are two separate monopolies, it is often hard to discuss them separately because they both were enacted to support the key goals of providing the USPS with a revenue stream to support the cost of universal service. If only the USPS can deliver letters but the mailbox monopoly were eliminated, only items not subject to the letter mail monopoly (like parcels and some other pieces) could be put in the mailbox. And if anyone could deliver all mail but only the USPS could deliver into the mailbox, where would the others deliver mail?

Plus, it is hard to separate the revenue associated purely with the mailbox monopoly from that associated purely with the letter mail monopoly. Unique to the United States The mailbox monopoly in the US is a somewhat unique animal. Few, if any, foreign posts ever had a monopoly over the mailbox, and most posts over the past decade have been moving to new liberalization or privatization models. The EU, for example, began a transformation of its member country posts in the late 1990s, with most monopolies around carriage of mail ended by 2010. Although never an apples-to-apples comparison with the mail delivery environment in the US — which is the world’s largest post in terms of volume and delivery territory — it is an interesting study to look at how foreign posts have transitioned out of their monopolies. One panelist at the PostalVision mailbox monopoly event noted that many of the “fears” people had about opening the postal monopoly (which are similar to concerns expressed in the US)

MailingSystemsTechnology.com | MARCH-APRIL 2017

never came to fruition. Of course, there are some significant differences between the delivery environment in the US compared to other countries. For instance, some countries largely have mail slots in residence doors that prevent mail theft issues and make it easy for multiple carriers to deliver to the same address without some type of “smart” mail receptacle. If the Monopoly Fell in a Parcel Forest… Would Anyone Hear it? When looking at the mailbox monopoly, there are different issues for mail vs. parcels. After all, how much USPS parcel volume today is delivered into the mailbox? And parcels are, for the most part, not subject to the USPS’ other monopoly, meaning it is a competitive marketplace with many carriers. For our house, nearly all parcels are left on our front porch, like at many other residences. Except for delivery addresses where parcels go into some kind of USPS box (e.g., cluster delivery to parcel lockers, etc.) the mailbox monopoly may be a largely moot discussion when it comes to parcels. There is no law today preventing deployment of receptacles for parcels from multiple carriers as a way to combat security and theft issues. Several countries already have “smart” carrier-agnostic parcel receptacles for residences, and there is no law against it being done in the US. Of course, the USPS would not deliver its parcels into such receptacles, but all other carriers delivering parcels could use the parcel receptacle with codes to provide access, ensure security, and track who is accessing the box when. Most carriers seem to be pursuing a more economical and centralized approach, however, such as banks of Amazon, UPS, FedEx, or other parcel lockers (and even the USPS is testing this concept). And the challenges to delivering parcels are only going to continue as the volume grows. The USPS reported that the volume of packages delivered to households has grown 91% since 2012, but according to statistics reported by eMarketer, e-commerce in 2016 was still only eight percent of all retail sales. Can you imagine the parcel volume when the US e-commerce reaches even just 13% (which eMarketer projects by 2020)? The challenges being seen today with parcel delivery and receipt may just be the tip of the iceberg if e-commerce trends continue in a positive direction.

MARCH-APRIL 2017 | MailingSystemsTechnology.com

A Great Debate One thing is for sure; when you put together a room full of people and ask them about the USPS’ mailbox monopoly, you get a diverse set of opinions! Some passionately argue for eliminating the monopoly, while others are adamantly opposed to any change. But many others weigh in on the side of modifying the monopoly in some way. And there seems to be no shortage of ideas on that front! Arguments for retaining the monopoly include privacy and security of delivery (USPS trusted brand, federal law enforcement, etc.), simplicity in the USPS being the sole carrier with access to the mailbox, economies of scale and greater efficiency, preventing “cream-skimming” of high-density delivery areas by USPS competitors (leaving the USPS with the more costly rural delivery addresses), preventing excessive “clutter” in mailboxes from outside the USPS, ensuring universal service is provided, and more.

When looking at the mailbox monopoly, there are different issues for mail vs. parcels. After all, how much USPS parcel volume today is delivered into the mailbox? On the side of eliminating the monopoly and opening access up to others, proponents argue that doing so could promote efficiency through competition, avoid the current waste and environmental impacts of multiple parcel delivery companies sending separate trucks and personnel to deliver packages on the same route in a given day, ensure fairness in government and respect the rights of households to choose who has access to their mailbox, facilitate modernization of the USPS and avoid worse problems in the future as package volumes increase. Many argue that the USPS’ mailbox monopoly is not

necessary to support universal service, protect mail security, allow use of the mailbox for outbound mail, or any of the other popular arguments for retaining the monopoly. The most interesting discussions take place on the side of modifying the monopoly, partly because there are seemingly endless ways it could be modified. For example, the mailbox could be open to competitors for parcels only and not mail, or it could be opened only to businesses licensed/approved/certified in some way with licensees perhaps paying a fee to support universal service to other areas where they may not want to deliver. Or the monopoly could be modified in the opposite direction, such as restricting last mile delivery to only the USPS, with the USPS perhaps having to give up its parcel business to avoid conflicts of interest in that model. Or a “neighborhood logistics manager” model could be created with one last mile carrier for all things being delivered to the same neighborhood (dry cleaning, pizza, groceries, etc.). This event showed me that the more people you put in a room, the more ideas the group can come up with around ways the mailbox monopoly could be modified! The Conversation Will Continue… Obviously, a topic as complex and with as potentially far-reaching consequences as this one deserves serious consideration. No one is looking to make any sudden moves to change the laws governing the USPS’ monopoly over the mailbox (or its letter mail monopoly). But conversations and study are underfoot, with more to come. The GAO likely will issue a report to Congress around the USPS’ monopolies later this year, and it remains to be seen what next steps on The Hill may occur. ¾ KATHLEEN J. SIVITER is president of Postal Consulting Services Inc. (PCSi) and has over 30 years of experience in the postal industry, having worked for the US Postal Service, Association for Postal Commerce (PostCom), and a diverse set of clients with interest in the postal industry. She also serves as the Director, Community & Brand Development, for PostalVision 2020 (www.postalvision2020.com), an initiative designed to engage stakeholders in discussions about the future of the American postal system.

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ACING THE RFP PROCESS Despite common practice, the RFP process is not about getting the lowest price, but rather the best solution for your company. By Mark M. Fallon

ecently, I participated in an online discussion about the Request for Proposal (RFP) process. It was similar to the conversations I have with clients when we recommend using an RFP to select a new vendor for equipment, software, or services. In both cases, the argument revolves around whether the results justify the hard work and time required. To be clear, a well-executed RFP requires substantial effort. At a high level, the process includes the following steps: 1. Conduct research 2. Hold meetings inside and outside your company 3. Assemble an RFP team 4. Draft and publish the RFP 5. Conduct vendor reviews 6. Call references 7. Compare the bids 8. Award the bid 9. Receive and accept the equipment or service 24

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For many projects, it may take between three and six months just to get through the first eight steps. The schedule can be impacted by competing priorities, the need for site visits, and addressing concerns raised by senior management. Considering contracts generally average about five years, the investment upfront pays dividends. The Arguments Against — And Responses to Each The number one argument against RFPs is that they’re just a mechanism to get to the lowest possible price. From this point of view, the questions, scoring, and presentations are merely smokescreens. The process is being followed because it’s mandated, but at the end of the day, the lowest price wins. If the company’s goal is just to “race to the bottom” with pricing, then I agree, don’t waste your time with an RFP. Use a reverse-auction instead. This commoditizes whatever you’re buying, and removes the need for any in-depth analysis. Beware, however — you get what you pay for.

The goal of the RFP is not to get the lowest possible price, but the best possible price for the best solution for your company. Through the process, you’ll discover which vendors are able to meet the technical, service, and support requirements for your project. Sometimes, the lowest-priced vendor will be able to provide the right solution, but not every time. Which leads to the second most common objection — the buyer has already selected the vendor and is only going through the motions. Vendors may complain that the RFP was written in such a way that only one company can meet the requirements. In other words, “the fix is in.” This complaint often has some merit. During the research phase, a buyer may have received a lot of good information from one supplier. They may even have been given a list of requirements to include in the RFP. Unless they include additional prerequisites, then the document is probably skewed in favor of the “helpful” supplier. This underscores the importance of

At times, the RFP process may seem long and tedious. But by creating an RFP team and following the process, you’ll increase your chances of success when purchasing equipment, software, and services.

questions to find out solutions, not limit responses. Which leads to the second method — include a section for alternative solutions. The language is very simple: “Based on the intent of this RFP, please recommend any other (products, software, service, etc.) that will help (the company) meet our objective.” Smart vendors will seize upon this opportunity.

getting information from more than one source — other people in your own company, peers in the industry, consultants, and multiple vendors. Read articles and case studies in publications like Mailing Systems Technology. Taking the time to perform research will result in a better RFP — for the vendors and your company. The last dispute to overcome: an RFP restricts the opportunity for vendors to promote the best solution to your problem. The strict requirements might limit the responses to a specific product or service. In some cases, the buyer may have asked the questions in such a way that the seller is forced to quote a hammer. However, the customer could be better served with the purchase of a screwdriver. There are two ways to avoid this problem. The first is to eliminate overly precise requirements for the solution. Clearly spell out minimum standards for information technology, security, and response times. But don’t include machine speeds, process rules, or similar specifications. Ask

Lessons from Success A common saying is that “We need to learn from our mistakes.” That’s true; however, we should also learn from our successes. When something works well, we should try to replicate that accomplishment. Our most successful RFPs have had three elements in common: a solid RFP team, a culture of promoting diverse points of view, and keeping costs analytics separate. The importance of having a good team of people working on the RFP can’t be understated. Depending on the policies of your company, procurement may take the lead role on the project. If equipment or computers are involved, get people from facilities management and information technology on the team. You should also invite the key internal customers impacted by this project, including customer service, sales, marketing, and the business units. The team members need to know that their opinions are valued. Feedback and scoring systems need to collect the information so everyone can provide input. During team meetings, the facilitator must ensure that all members have the opportunity to express their point of view. When scoring an RFP, the grading and the financial comparisons should be done separately. Before sending the responses out to the team, remove the pricing data. This safeguards against people’s opinions being impacted by a lower bid.

Mini Case Study We recently worked with an insurance company on an outsourcing RFP. The project manager brought together a team that included purchasing, information technology, claims, customer service, document management, and sales. Not only did we meet as a group, but the team members were interviewed one-on-one to gather their requirements. The entire team reviewed the RFP before it was published, drafted the scoring chart, and participated in the vendor conference. When the responses were received, the pricing section was removed before sending out for the team to grade. After people had the opportunity to grade individually, the team came together for a two-hour meeting to discuss grading and select the finalists. There were 12 team members in attendance at the meeting. More importantly, all 12 people actively participated. Every person expressed their opinion about how key aspects of the proposals impacted their unit. The other members actively listened, asking follow-up questions to clarify concerns. Only after the team selected the finalists was the pricing disclosed. The lowest bidder for one service was not selected, but the vendor with the best solution was chosen instead. At times, the RFP process may seem long and tedious. But by creating an RFP team and following the process, you’ll increase your chances of success when purchasing equipment, software, and services. When done correctly — it works! ¾

MARK M. FALLON is President & CEO, The Berkshire Company. You can read his blogs at www.berkshire-company.com/the-berkshire-company-blog and www.markfallon.com/blog. Contact Mark at 508.485.9090 or mmf@berkshire-company.com. MailingSystemsTechnology.com | MARCH-APRIL 2017

IMPROVING COLOR QUALITY THROUGH COLOR MANAGEMENT Today’s technology allows you to make the most of color printing without breaking the bank.

By Lou Prestia

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or print operations considering switching to high-speed inkjet printing, expanding an existing fleet, or moving from black-andwhite to color, digital color management provides the tools to satisfy customers with accurate and consistent color on various media across different presses. With the wide range of quality options color management offers, shops can print to the specific quality needs and budget of an individual customer. Even when printing under a tight budget for a particular customer, print operations can still use tools to make the most of the color and appearance for higher customer satisfaction.

Increase Quality with Advanced Color Management When a print operation migrates from offset to high-speed inkjet, many factors that affect output quality are different. For inkjet production, there is no longer the need 26

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for plates, ink mixing, or operator skills to manually adjust color on the press. Highspeed inkjet presses with an integrated color management system provide: Exceptional color quality out-of-the-box Easy-to-use tools that allow press operators to perform color management Expanded press color gamut providing the ability to match brand colors without specialty inks The ability to match colors across presses and substrates The flexibility to optimize print color to meet a wide range of quality and customer cost constraints The ability to reduce rework by printing one copy to verify color accuracy before printing the entire job

More Accurate, Consistent Color Inkjet inks aren’t the same as those used in a conventional press. Print operations need to deliver consistent color quality

in a hybrid (offset/digital) print environment. Print buyers expect consistent color appearance when a job is reprinted. This is often achieved by adopting a shop appearance-matching reference. The ability to match an offset standard such as the General Requirements for Applications in Commercial offset Lithography (GRACoL) or Specification for Web Offset Publications (SWOP) will make a hybrid environment work. In some cases, custom shop references can be established based on production equipment capabilities and customer expectations. And an international color consortium (ICC) profile makes the solid and saturated colors look right every time. Color-managed digital workflows can also consistently match spot and brand colors — in many cases without requiring custom ink mixing. Some print service providers invest in multiple presses for load-balancing of jobs. One of the functions of the color manage-

Richer, More Saturated Colors with Less Ink Another benefit of using color management on high-speed inkjet and other digital presses is the ability to control the color separations in order to save ink. This is achieved by creating a press profile that replaces colored inks with black ink in neutrals, a separation technique called gray component replacement (GCR). Creating profiles with high levels of GCR provides more stable neutrals on press and, in some cases, more saturated, chromatic colors. The printed output looks richer and is more eye-catching, often perceived as higher quality by print buyers. Color management technology for inkjet presses also includes ink-limiting tools for optimizing print appearance while minimizing ink consumption. By setting the correct ink limits when calibrating the inkjet press from the digital front end (DFE), high-quality printed products that don’t use more ink than required can be produced. Optimizing ink coverage not only saves money, it also ensures the pieces dry properly and don’t affect finishing equipment.

Less Rework and Fewer Finishing Failures

ment system is to create ICC profiles that are used to match color for each substrate and each press used. These profiles are used to ensure common color appearance across substrates, even in a multi-press production environment. One tool required to implement color management is a spectrophotometer. In addition to enabling color matching with ICC profiles, this device also enables color quality control to ensure that printed results meet expected color precision. Color quality assurance is conducted by measuring a control bar with the spectrophotometer then comparing it to the shop reference.

More Production Flexibility High-speed inkjet presses allow a wide range of controls over ink laydown. For this reason, choosing a digital front end optimized for the inkjet production press is essential to provide more control over the way the ink is applied.

Using a raster-viewing tool, an operator can proof and inspect a post-RIP raster image on a calibrated and profiled monitor to check a job’s color accuracy before print production. It is easier to create a proof because there’s no need to change out plates or inks. Operators can easily generate a proof on the same output device that will be used for the production run or a color-correct soft proof for remote color approval workflows. Finally, digital systems allow one-pass personalization, so there’s no need to put pieces back on press — avoiding potential registration problems and eliminating the need to produce and store preprinted shells.

Today’s Color Management Systems Users of legacy color management systems are often surprised by the simplicity and ease-of-use offered by modern color management solutions such as wizard-based calibration, profile creation, and profile editing. Now press operators can easily create profiles and calibrations instead of requiring the expertise from an expert color consultant, saving time and money. In addition, desktop spectrophotometers are more precise, more automated, and less expensive. This makes it easier than ever to measure color quickly and successfully. Integration of these devices with modern color workflows means color management works as intended.

When evaluating systems, make sure to choose one with these critical functions to get the full benefit of advanced color management: Calibration to enable ink-limiting settings Custom profile creation for individual presses and substrates Tools to match and optimize spot or brand colors Workflows for press-to-press matching to enable load-balancing Verification of color consistency over time Tight integration with the press DFE

Another benefit of using color management on high-speed inkjet and other digital presses is the ability to control the color separations in order to save ink. Invest in Quality with Color Management In the report, The Evolving Shape of the Production Inkjet Market, I.T. Strategies notes that respondents say software (primarily for managing workflow) was key to the efficiency gains. They continue, “For many print providers, a major allure of inkjet presses is speed. The workflow and color management software that help minimize make-ready and prepress costs may increase productivity.” For this reason, before investing in highspeed inkjet presses, select a DFE and press system with these advanced color management and workflow tools for the highest quality and productivity. ¾

LOU PRESTIA is a senior product line manager for EFI Fiery products, specializing in color system architecture, hybrid color workflow integration, and other color-management topics. For more information about EFI Fiery digital production printing technologies, visit www.efi. com or call 800.875.7117. MailingSystemsTechnology.com | MARCH-APRIL 2017

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UPPING THE GAME WITH YOUR TRANSACTIONAL CUSTOMER COMMUNICATIONS By Harry Stephens

here is a great deal written today about the importance of every communication you send to customers. These communications are now considered to be at the heart of your company’s image and have a direct impact on your customers’ experience. That means that effective and efficient print and mail functions are more important now than ever, making it critical to evaluate what resources and expertise are now needed to produce every customer 28

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communication in the most cost-effective, sophisticated, and efficient way. What is exciting to see is that today’s technologies continue to make it possible to move well beyond simply putting ink on paper. Companies now have the opportunity to customize business communications based on collected customer data, personalizing the content to market specifically to an individual for cross-selling and up-selling new and additional services. Along with advanced technology, the United States

Postal Service (USPS) offers a number of advantageous mail stream options that can enhance results and reduce costs for all types of mailings. Then, of course, is the need for omnichannel capabilities. When it comes to your ongoing transactional communications, to up the game you need to consider all three factors — and then some. Start the Journey With Leveraging Effective Document Design Delivering a positive customer experience

requires careful attention to every aspect of the customer journey, including the transactional documents that customers receive from your organization. Every bill or statement you send to customers is an important touchpoint and an opportunity to do much more than just present the basics. Improving the design of your transactional documents can achieve a number of goals, including: Creating a more engaging document using cost-effective color Including educational details, product information, and personalized promotional messages on the statement Adding larger and more noticeable inserts and on-serts (promotions printed on the bill or statement)

Including informative newsletters with your statements In fact, we have seen that companies that have included color and promotional and educational messages on their transactional statements have saved on mailing costs, increased response rates, and enjoy a positive impact on the experience their customers have with the company. Optimize Your Mailing Strategy Companies routinely mailing customer communications should also take advantage of the most effective and cost-efficient mailing techniques. Here are a few that should be a part of your strategy:

Third Ounce Free Companies mailing First-Class automation presort letters can significantly reduce mailing costs by taking advantage of the USPS 3rd Ounce Free program, which started January 22. There will be just one price for pieces weighing up to 3.5 ounces (i.e., you’re able to send another ounce and half “free”). The program enables those mailing transactional bills and statements to include additional ounces of material for operational or marketing purposes at no additional cost. This gives organizations the option of using higher quality paper stock or larger envelopes to create a greater impact or adding more inserts or on-serts. Intelligent Mail Barcode (IMb) The USPS next generation barcode is used to sort and track letters and flats and reap the greatest automation postal discounts available. IMb Tracing For outgoing mail, Destination IMb Tracing provides advanced notice about when mail pieces will reach their destination. For incoming mail, Origin IMb Tracing provides information about when checks, replies, or orders are on their way back to your company. Editor’s Note: You can read more about IMb tracing and its capabilities by visiting www.MailingSystemsTechnology.com/ IMbTracing. Move Update This service enables your organization to maintain the highest quality of address accuracy and avoid wasted costs due to undeliverable-as-addressed mailings. IntelliAddress A service that utilizes the latest USPS software to update mailing addresses prior to mailing using realtime change of address information. ACS Service Another cost-effective means to obtain accurate change of address information, reducing the risk of undeliverable-as-addressed mail and labor-intensive and expensive steps involved in address change operations. Offering Electronic Bill Presentment and Payment (EBPP) In addition to optimizing the design and mailing of paper-based customer communications, it is also important to consider the growing requirement for paperless delivery. Using the internet to send, receive, and pay bills offers many advantages to your business as well as your customers. In addition to overall convenience, the popularity of

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mobile technologies and rising postal rates are some of the reasons why electronic billing solutions have become an important part of business operations for organizations in nearly every industry. For any company that routinely sends transactional statements, the benefits of EBPP are obvious — they reduce costs compared to paper bill processes while improving customer satisfaction and retention. E-bill presentment can reach customers through their preferred delivery method, whether that is via email, fax, or web presentment and can accelerate payment. Sharing the Risks and Responsibilities When performed in-house by business organizations, transactional print and mail operations can be costly and difficult to manage functions. They are labor-intensive and involve significant capital outlays for purchased or leased print and mailing equipment. Often, it is difficult (if not impossible) for most organizations to fully account for the costs of these functions or keep abreast of the rapidly changing technologies and logistical strategies to reduce electronic and print document production and mail costs while enhancing results. Outsourcing transactional customer communications to a qualified service provider can overcome the difficulties and

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expense a company incurs by performing these functions in-house, leveraging the experience and expertise of the service provider to optimize print production and distribution and stay competitive by gaining access to the latest capabilities and technologies. A qualified outsource service provider should have the technology and expertise to help you evaluate your company’s approach to ensure you are taking full advantage of the communication opportunities and value that print and electronic transactional documents and mail processes can deliver for your organization. Plus, utilizing the advanced document processing and delivery capabilities of a third-party service partner can enable your company to create data-driven, highly targeted communications that engage customers, deliver print and electronic documents through the channel of choice, all while optimizing those postal costs. Two More Necessary Considerations In addition to the considerations mentioned above, there are two more important questions to ask when evaluating whether to engage a service provider for your transactional print and mail operation: Are adequate security measures in place? One thing you can’t compromise

on is security. Two independent certifications are particularly important in ensuring operational excellence and security: The American Institute of Certified Public Accountants (AICPA) SSAE 16 Type II certification and Payment Card Industry Data Security Standard (PCI DSS) version 3.1. Additionally, is the company trained in SOX regulations to ensure that its clients are compliant with all corporate accounting controls required by US federal law? Secondly, will we have the benefit of USPS Full-Service certification? When choosing a third-party provider, look for an organization that has successfully completed the USPS Full-Service Certification (FSC) program. The FSC program recognizes those mailers who are able to implement the full-service mailing process and consistently meet all of the USPS Full-Service Certification standards, offering a variety of solutions to prepare and present full-service presort mailings. The certification recognizes the fact that the company has consistently provided a comprehensive spectrum of fully automated mailing services for its customers, ensuring them timely, accurate mail delivery at the most beneficial postal rates. Either In or Out In today’s competitive marketplace, organizations need to continually evaluate whether they are communicating with their customers in the most effective ways possible and whether they are devoting their resources in a way that will reduce costs and drive revenue. Whether an internal or outsourcing approach is right for your organization, enhancing your transactional customer communication processes has the potential to significantly deliver the kind of customer experience that will increase the bond with your customers. Don’t miss the opportunity. ¾

HARRY STEPHENS is President/CEO and founder of DATAMATX, one of the nation’s largest privately held, full-service providers of printed and electronic billing solutions. As an advocate for business mailers across the country, Stephens is actively involved in several postal trade associations. For more information, visit www.datamatx.com.